In my preceding post I suggested that 'over here' the loonies have taken over the asylum. Perhaps a better analogy would have been to say that the children were running the nursery. Either way, it can only mean bad news. However, 'over there' the forces at work are infinitely more malevolent and the situation is best described as the maximum security prisoners have now taken over the jail! The outcome is likely to be catastrophic.
As Peter Ferrara explains in The American Spectator, the spiral of decline in America is growing in size and strength. The means are simple and disasterous, and I used Donald Boudreaux's succinct explanation of them in a previous post. In essence, the American government is spending far and away above its income and is printing money to lend to itself as a means of paying for it. This is a version of a Ponzi scheme on a gigantic scale and the resulting crash will reverberate round the globe and into the history books. Read this and cringe:
Last month, President Obama's own budget admitted that he will more than double the national debt in just one term of office, with an admitted budget deficit this year of $1.645 trillion, the highest anywhere in world history by several times over. Friday's CBO report concluded that federal deficits over the next 10 years under President Obama's budget would soar by nearly a third more than he estimated, totaling nearly $10 trillion over those 10 years, which would nearly double the national debt again to $21 trillion by 2021.
This headlong plunge into debt is set to continue but begs a huge question:
QE2 [the second tranche of money printing] is scheduled to continue through June, at which time most commentators expect the Fed to end this reckless policy. But if the Fed suddenly stops this "quantitative easing," who is going to step in to buy the bonds to finance the 70% of the remaining federal deficit [my emphasis]of $1.645 trillion for this fiscal year, and the $1.4 trillion deficit the CBO projects for the next fiscal year? Finding real buyers for those bonds is going to require paying soaring interest rates on them, which will only further increase the deficit. And that will cause soaring interest rates across the credit markets as well.
The rocketing-up of interest rates will bring about a massive recession to follow in the next year - and guess who is up for re-election in 2012? So, as Ferrara shrewdly says, in effect, 'it ain't gonna happen, folks'!
Which is why QE2 will be followed by QE3, QE4, and quite possibly QE5, just to make sure no recession or ominous economic clouds darken President Obama's door during his glorious 2012 re-coronation tour [...]
Thus, the perfect shit storm grows and grows and, without exaggeration, I really do believe the end result will be apocalyptic.
Now, at the risk of wandering into Glenn Beck-land, one is entitled, I think, to ask what it is that lies at the heart of Barack Obama? Personally, I like to think that if someone pokes me in the eye with a sharp stick I would be gracious enough to allow that it might be an accident. (Actually, there is absolutely no chance of that but I offer it up as a theoretical possibility.) However, if he then goes for my other eye then I would seek about for an even larger stick to insert up his nether regions- sideways! During Obama's first term he has inflicted not one but two grievous injuries on the American people. First, he used every trick in the book to ram through a health bill which is so eye-wateringly expensive and useless that States, cities, trade unions and big companies are queing up to gain exemption from it. That is one sharp stick, the other I have described above, and I think it is reasonable to ask why this man is inflicting these damaging blows on the American republic? There can only be two answers; either he is stupid beyond belief, or, he is motivated by hatred of his own country. As far as I am concerned, the jury is out!
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