Economic Armageddon

Do you feel the need to be depressed today?  You do?  Good, because I’ve got just the thing for you (h/t Ricochet):

Bottom line:  it’s the end of the world as we know it, and no matter who we elect (Obama or someone else), it’s not going to matter.

Now please explain to me why the video is wrong.  Otherwise I’ll be up all night contemplating this economic existential nightmare.

For now, I’m going to distract myself by seeing if I have any visitors from Liechtenstein.

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Comments

  1. Mike Devx says

    In what way is the video wrong?  Well, it is very simplistic.  It treats every bank, country, and institution as a faceless entity in which they are all the same, and all in exactly the same boat.  And that’s not true.

    As an example, Canada took major steps to reform its affairs in the late 90’s and early aughts, and it weathered the crises of the last four years rather well as a result.  While Europe and the US slide madly down the slope to disaster, Canada is doing well as a result of its early-onset fiscal reforms.  (Now, if only they’d do something about their health care and their PC speech laws…)

    Canada would not be immune to the “global economic collapse”, but not all countries and institutions will be affected the same way.  And while the window of opportunity *is* closing fast, the US can still save itself from fiscal Armageddon, though I am pessimistic it will do so.

     

  2. says

    Not a single statement in this video is correct.  I don’t have the time to comment on the dozen mistakes and nonsense.  Three examples: $4 trillion of debt is to ourselves in trust accounts.  We will reduce this by changing So.Sec. this fall. The interest costs are a bill we pay out of government taxes, always have and its not large or serious. We have had general deflation, not inflation.  The only rising costs are the three domestic industries with no international competition: home building, academia and healthcare.  Lunch if you want it. 

     

  3. says

    Bless you my friends. I knew it couldn’t be correct — it was too Mayan end-od-the-world, but I lacked the sechel to know how it was wrong.

    And yes, Phillips1938, lunch would be lovely. Let’s email and see what we can put together.

  4. Mike Devx says

    I’m interested in more of your take, phillips1938!  I personally think you’re being too optimistic!  We may institute some kind of Soc. Security reform soon, but will it be significant enough to make any difference.  And while paying the interest on the debt isn’t serious yet, it becomes serious.  It won’t take long, for example, before our interest payments to China cover the current Chinese military budget – that’s serious money in my book.
     

  5. SADIE says

    We have had general deflation, not inflation.
     
    Have you shopped for groceries lately.  I had an urge for pita and humus. I paid more than $10.00 for two items yesterday.

  6. JKB says

    Yes, Sadie, but have you see how much more you get for the same price as earlier iPhones and iPads?  I kid, but that is the economist view.  That the price of food, health care, energy might be rising but you get lots more bells and whistles from your gadgets for the same price.  But with the contraction in borrowing, technically, the money supply is getting smaller and we have deflation even as we have price inflation on staples.  

    More likely we will have a global economic disruption as who has the money and power is shifted around.  Just today I saw some who argue we’re broke also arguing for more money for space.  Well, guess what, space has nothing productive to add to the economy as it is now managed.  It is a luxury item, not an essential, other than the government funded jobs it provides.  They’d put it all on the backs of the poor but there is that whole burn down the urban cores threat.  Which in itself isn’t such a horrible thing as the urban cores of the cities are in general not conducive to productive output.  What little production we have having moved to the suburbs as old line enterprises moved offshore for cheaper labor and better business environments.

    Of course, most of this could be avoided, sorry we’ll have to cut back so that we are actually retiring debt, if/when we throw off the anti-production regulations and re-embrace work that transforms resources into valuable output.  The kind of work that produces wealth that pays taxes.  America has lots of resources but the enviros work very hard to keep them from being exploited.  Things become desperate enough, the enviros will be shot if they interfere.  People aren’t going to passively starve to save the Delta Smelt or freeze in honor of the global warming god.  The Soviet block survived as long as it did by unrestrained exploitation of natural resources and the good graces of the American farmer.  

  7. says

    It’s not just hyper inflation. It’s hyper inflation plus hyper deflation.

    The prices for certain economic goods go way down, this makes the government think printing more money and monetizing the debt by printing more money to pay it with, is a good idea. This then reduces the wealth of each individual and increases prices. This then causes a deflation in supply and bankrupting businesses, lowering the price for the businesses that relied on selling to those other bankrupt businesses. As their income decreases, and as their material and food expenditures increase, you have an interesting cycle of inflation, followed by deflation, followed by even more massive inflation.
     

    That, if the Left had such motivations, would more than be sufficient for destroying a Western nation. If Islam follows up the weakened nation with an expansion from outside and inside.

  8. SADIE says

    JKB
     
    Thanks. I’ll check my supermarket aisles for iPita and iHumus ;)
     
    If I understand the economics of it or just a little. Anything we import is less money, because we have outsourced production using US Dollars to do it. Anything, we actually raise within the USA (crops, cows, chickens) is more expensive, because we have to pay one another in real dollar value. In other words, the Chinese now can buy whatever they want using our currency and we’re buying more or less what the Yen does in China – not much.
      Case in point:
    LA Dodgers owner Frank McCourt is reported by the LA Times to have been offered $1.2 billion for the Dodgers. The all-cash bid comes from Bill Burke, founder of the L.A. Marathon, plus a group of Chinese investors.
    http://www.missionvalleynews.com/article/Just_In/Just_In/Dodgers_sold_to_China/23012

  9. says

     We could fix every income problem the Federal Government has fairly easily. The United States owns a tremendous amount of land, mainly in the western half of the country. This land has a lot of valuable resources in and on it. Lumber, grazing and mineral rights could be released in a very short time. So, there’s oil. Every barrel coming from our reserves means a barrel’s worth of money we aren’t paying Saudi Arabia, Canada or Mexico. Every American getting that oil is employed and paying taxes instead of taking government bennies. Every barrel has a royalty paid to the government and every gallon of gas out of that barrel has a gas tax.
     
     And that’s just oil. There’s a heckuva lot of lumber. Copper, zinc, lead, gold, silver, iron. There’re millions of acres of grass for cattle, sheep and goats. Hell, it’s raining soup and our politicians are standing around with knives. A combination of tax reform, entitlement reform and intelligent resource management would put poor ol’ Uncle Sam back in business. Trouble is we’ve got the inmates running the asylum.

  10. JKB says

    James Joyner has a post up that explains the man-made food crisis that has been created by the enviros  Biofuel vs. Food  But it isn’t just biofuel, it is also the GM terror of the EU, which keeps poor African countries from even planting any crop that might feed them for fear of wiping out exports to the EU.  And the organic fetish, which could be better described as low-yield farming.

    Sadie, “Let them eat iPads,” might very well turn out to be the phrase that takes them to the guillotine.  A FED member basically said that, when he explained the lack of inflation due to the increase in iPad utility, to which came the reply, “I cannot eat an iPad.”  Ah, but you can book reservations at many a fancy restaurant in San Francisco from what I understand.

  11. SADIE says

    “Trouble is we’ve got the inmates running the asylum”


    Peter, you’re right and they are not nameless either.

    Effective execution of Agenda 21 will require a profound reorientation of all human society, unlike anything the world has ever experienced a major shift in the priorities of both governments and individuals and an unprecedented redeployment of human and financial resources. This shift will demand that a concern for the environmental consequences of every human action be integrated into individual and collective decision-making at every level.- excerpt, UN Agenda 21
     
    President Obama signed his 86th executive order (13575) on June 9, which established the White House Rural Council (WHRC).
    Sadie here: The EO above was signed while our attention was diverted with Anthony Weiner antics.
     
    As the Executive Order references “sustainable rural communities,” it raises a few eyebrows, since that is one of the key phrases found in the UN plan for sustainable development known as Agenda 21. The order admits that it intends to seize greater power over “food, fiber, and energy,” items that are key to human sustenance.
     
    More here…
    http://www.thenewamerican.com/usnews/politics/7958-obama-signs-agenda-21-related-executive-order

  12. JKB says

    Well, at Reagan said, they don’t have to seize the land when they can control any and every thing you can do with it.  That is the goal via the environmentalism, endangered species and “rural development” programs.  And if the farmer’s question to Obama which was followed up by a reporter who dove into USDA bureaucratic hell is an indication, they offer nothing but capricious control.

    Of course, the premise is that once things get desperate they will be able to maintain control even in the hinterlands.   

    Over at Coyote Blog, there is a list of other, existing regulations California can impose on home employers not that they’ve rolled babysitters into the mix.
    Coyote Blog » Blog Archive » This is an AWESOME Idea. I Want to Propose California Do Much More of This 

  13. Mike Devx says

    JKB 13:
    > Well, at Reagan said, they don’t have to seize the land when they can control any and every thing you can do with it.  That is the goal via the environmentalism, endangered species and “rural development” programs.  

    Don’t forget “sustainability”.  That’s the one I think will be the next big effort to control us and expand power, once the “man made global warming” effort is finally thoroughly discredited.  

    Sustainability!  Sustainability! Sustainability!   

    Get used to it.  It’s coming.  
    Every strategy used today by the left in the global warming battle is usable in the sustainability battle.  They’ll just have to pivot to hit slightly different targets, is all.   Gird your loins!  Even as we wrap up the first battle (against false and pseudo-faux-scientific “Global Warming” claims), the next battle approacheth (against false and pseudo-faux-scientific “Sustainability”claims).  It’s all anti-human, anti-progress, anti-Western-industrialization hate.

     

Trackbacks

  1. [...] Hattip to Bookworm Room.  We are heading to debt repudiation both nationally and internationally, although I am sure that some euphemism will be used.  What this does to the global economy is anyone’s guess, but I think at best we are looking at a prolonged recessiondepression lasting at least a decade.  Long range however, I share the fundamental optimism expressed by Milton Friedman in the video below, if we are capable of understanding how we got into this mess and make the necessary changes to radically alter our course. [...]

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