Monday, June 1, 2009

Some thoughts

Just some thoughts I had this morning...

If we ever enact a balanced budget amendment, take yourself and your family and move to Canada or China.

Obama believes the U.S. has "run out of money." Scary. Our president doesn't understand our own monetary system. Even George Bush understood this.

Any country that spends in its own currency, where that currency is not backed by gold or bound by some fixed exchange can NEVER run out of money!

We are ceding our position as the world's largest economy to China because of stupid policies that are based on myth and fallacy.

The demise of GM was not due to putting workers' interests over the company and shareholders. It was precisely the opposite!

The easiest way to lower "debt" (if that's what you want to do) is to sustain full output and employment.

If the private sector can't sustain full output and employment for whatever reason, then gov't should!

Here in America we mock the Europeans as being, "socialist." Did anyone notice that Europe's economy is larger than ours and adding size?

By definition, those Socialist Europeans are richer than us! And they have free health care, education, 6-weeks paid vacations, new cars, movies, theater, culture and all the consumer items that we have. Not bad for a bunch of commies!

Our leadership is destroying America's real terms of trade because of irrational sensitivity to perceived "imbalances."

We care more about the Chinese standard of living than our own, apparently!

For every debit there is a credit. For every liability there is an asset. For every borrower there is a saver. This is all definitional. It's double entry accounting! Did anyone in Obama's administration take an accounting course? Has any Republican taken one? Has any Democrat taken one?

1 comment:

googleheim said...

I would point out that this is a secondary reaction to a weakening dollar. As the dollar weakens people will think we need to balance the budget.

The perception is due to a misperception of the kinds of debt. People associated government debt with the real economy's debt - they think that we need to balance both when they are entirely different.

The government can create and negate debt very easily.

However, the real economy, mainly the public debt, is not so easy to get rid of.

investment = spending

If we demand the government to reduce spending, "printing", and crediting , then we shall not have the ability in the real economy to address the public's own debts.

They are not the same, but there is linkage.

This also brings up the point about China whose currency is pegged and fixed to be undervalued.

Argentina artificially pegged it's currency to that of the U$D - 1 for 1. Argentina deregulated as per Menem / Bush / Reagan / Nixon in the 1990s and the result was catastrophe.

The Republican't ideology is directly for blame for that bank failure in 2001.

What does this have to do with China ?

China has done the opposite - it is artificially undervalued to the U$D, and they created a global savings glut ( which we allowed ), and as such they are overwelmingly to blame for the current problem.

Enron did this as a company to itself, Argentina did this as a country unto itself, and China has done this to the USA but in an inverted manner compared to the Enron or Argentina crisis.