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Given the insanity on the Potomac last week, I cannot imagine a time when a clear vision of the future would be more crucial.
At 1600 Pennsylvania Avenue, President Obama signed a new fiscal package, which …
- is virtually designed to add $858 billion to the federal deficit …
- is likely to cost much MORE if events do not pan out as planned, and worst of all …
- is not tied with any plan for long-term fiscal restraint.
Simply put, our leaders figure they can deal with the deficit “later.”
Sound familiar? It should. Because it’s the same exact rationale we heard after passage of the $800-billion TARP bill to save the banks in 2008 … and still again after passage of another $820-billion law to stimulate the economy in 2009.
In both cases, they said it was the LAST major government action to save the day. It wasn’t.
In both cases they said they’d deal with the resulting deficit later. They did nothing of the kind.
So what do you call it when otherwise intelligent people repeat the same action while expecting a different result?
Insanity!
But that’s not all. Just a few days earlier, at 20th and Constitution, the Federal Reserve’s Open Market Committee met with the apparent goal of matching the lunacy.
Despite screams of outrage from governments and investors worldwide, the Fed absolutely committed to creating hundreds of billions — and perhaps trillions — of paper dollars out of thin air.
The 3-Way Collusion Is Obvious …
Congress passes a groundbreaking bill to gut the budget.
The president promptly signs it into law.
And the Fed prints the paper money to finance the folly.
But there’s a problem: America’s creditors aren’t buying it. In fact, ever since the Fed first announced its intent to print up another $600 billion (QE2), supposedly with the goal of LOWERING long-term interests rates, those same rates have been rising.
Just a couple months ago — in early October — the yield on the benchmark 10-year Treasury note rested at 2.41%. Last week, it blew through the 3% level and looked for all the world as if it could reach 4%!
It’s clearly not working.
The Fed’s solution? Do more; hope for different results.
More insanity!
All over Europe, governments are cutting spending like there’s no tomorrow. They know that voters will take to the streets in outrage. But they know they have no choice. If they don’t lower their deficits, bond investors will abandon them. Their governments could collapse like a house of cards.
Meanwhile, here in the U.S., despite deficits rivaling those of many of the worst in Europe, our leaders have just added hundreds of billions MORE dollars!
Moody’s has a number to measure this insanity. It warns that the new law will raise the government’s debt-to-GDP ratio to a staggering 73%! Along with Fitch it has warned — again — that it may have to lower the U.S. government’s credit rating.
What do you call it when our leaders ignore the warnings of rating agencies that are known for being overly optimistic about future financial challenges?
Still more insanity!
Needless to say, all of these events will have a profound impact on every dollar you have saved, invested and socked away for retirement in 2011.
So be sure to stick with the strategies we have set forth here. Despite any twists and turns in the economy, they remain fully on track.
Good luck and God bless!
Martin
{ 18 comments }
As we all know, scum always rises to the top. (http://wenchwisdom.blogspot.com/2009/04/why-scum-always-seems-to-rise-to-top.html) What kills me is that this was generated for the sole purpose of handing control over to the U.N. for forming a one-world government. Again, scum rises to the top…and guess who gets to vote on it? Not you, not me, but whoever votes for U.N. leaders now–this takes the “humanity” (read: peasant voters) out of politics. All the countries in favor of one-world power are purposely collapsing their economies in hopes of spreading the contagion, and gaining more followers.
Why stop at mere president or king for power, title, and money, when there could be a whole world at your feet?
Another guy who’s parroting a conspiracy theory. Give it a rest! The Banksters already control the governments in the world.
the bankers will have a much easier time enslaving the world with one currency. manipulation will be much easier on a global scale. They may be rich and powerful, but their fat and lazy. they will kill anyone who stands in their way and that is a problem for all people on this planet, and I see no way out of the mess we are in.
Right on Raygun! And if you know that you know a lot more.
I would to do stock optins with Gerg Roy. How do I get started?
“Insanity” – When (WE THE PEOPLE) continue to vote the same action while expecting different results.
“A fool and his money are soon parted”
There is an old saying, “Look for the Sin in sincere and the Con in confident.”
There is not a government, dynasty or kingdom of man that lasts forever. One world government is the cherry on the sunday…….and everyone knows how fast ice cream melts. If the people allow it, then its going to happen. Americans are asleep, hoping for the best and scared to do the necessary thing. Throw the bums out, march and demand a return to what made America a great nation. Will they do it?
I doubt it……
The U.S. Government’s debt to GDP ratio of 73 %–so called public debt–does not include the intragovernmental debt of $4.5 Trillion (includes (i) $2.2 Trillion that is in the Social Security (OAS) Trust Fund, (ii) $780 Billion that is in the Federal Civilian’s “Civil Service Retirement and Disability Trust Fund and (iii) about $1.5 Trillion of other Trust Fund accounts). If the INTRAgovernmental debt is included–the U.S. Government’s debt to GDP ratio would be around 90 %. This 90 % debt to GDP ration is very alarming!! What is Fitch’s opinion of this? Tom McKinney– Dunwoody, Georgia
Insanity? What insanity? The people at the top are intelligent enough to know what they are doing, and they are doing exactly what they are supposed to be doing. Clinton, Bush, Obama and those before them were put there to run the bankers’ agenda. Just because they are playing fools when addressing the public, doesn’t mean they are. Insanity? I find that view naif.
The stupid does not afraid of a knife , you can lying to him as much as you want and than do with him what you want. System w/o planning is good only for criminal.
I call it, they are not intelligent people!
Anyone who remembers the financial situation in Europe after the II World War, knows that printing money leads to inflation. The only solution is to switch to a new currency. Now America cannot do it- because there will be no Marshal Plan – better face the hard fact and:
1, Raise taxes. Graduated tax raise, higher the income higher the rate! No loopholes, and no
fake exceptions.
2, Cut spending. Simplify the health care! Cat the medicare and medicaid, Cut out the cheating (boy if someone looked in existing situation,half of people on disabilty would be excluded.) Food stamps should not be privatye business. Soc. Sec. should have an upper limit. Soc. Sec is not an income to live on, but a supplement to the reduced income of the retired people.
3, Every military activcity outside the USA border should be terminated after 6 months. July 1, 2011.
4, A simplified tax code should be written and applied. Bonuses, special draws, golden parachutes,
offshore income, etc. should be taxed 95%
5, Foreign aid should be replaced by foreign trade.
USA would have a balanced budget within 5-7 years!
Steven Jalso
retired almost 20 years, (who knows what it means carry a monthly salary in a full backpak!)
The Federal Reserve CORPORATION owns our money and exacts a percentage of every dollar it prints. Congress gave the FED control of the nation’s currency in 1913 and it has been CONTROLLING our economy ever since. Every congressman, every president since that time has aided and abetted the theft of a nation by the world’s Megaqbankers who envision a One World economy they control.
I believe too that there’s a method to their madness. These are Alinskyites seeking to destroy American (and it’s Constitution) to pursue their dream of a one world government. Hitler had that fantasy too…”Today the fatherland, tomorrow the world.”
And that is precisely why it shouldn’t happen.
But it IS happening – have a look at RISE OF THE FOURTH REICH by Jim Marrs. The Germans lost the war, but the NAZIs? That’s a different story.
WayneO. You’re right but what is frightening is that government is out of control and the people have no means to correct it between election opportunities.
A very wise ex-president of the United States once said” never put off until tomorrow what you SHOULD and CAN do TODAY. The problem today is, we have politicians that are self serving, no term limits for Congress, far too many Americans that are as frogs in the kettle on the economic stove with the water getting hotter each day. I continue to be amassed by the lack of understanding by the majority of Americans, as to what is reall going on financially in this country. I hear people say, “bring back the jobs to this country”, however these very same people will nver pay the price for products made here in the United States because the price is cheaper at Wal-Mart. We can’t have our cake and eat it too!!! Whenever there is a wide disparity in workers wages in the world, businesses will ship their manufacturing off shore. That means that the United States MUST produce jobs in other higher paying professions that will satisfy a full employment. The problem? We don’t have this on the horizon so we will remain in a tailspin.