Earlier Posts: I. More education bubble stuff
Just after Barack Hussein Obama was elected in November, 2008, I was at an academic conference in Boston. There was a Festschrift celebration for one my profs, at which I met a childhood friend of his–my prof grew up in the Boston area. Once this elderly “gentleman” learned that I grew up in the state of Alaska, he became red-faced and angry, “What’s wrong with you people in Alaska? Has the cold weather frozen your brains?” Well, one could have asked the same thing of Boston residents that year–it was a distinctly cold November. He continued, “That Sarah Palin is such an idiot!” Well, I wonder whether Miss Manners would think it proper to talk in this manner with a new acquaintance. I mean Sarah Palin enjoyed a very high approval rating in the State of Alaska and if I shared the view of the majority, then this East Coast snob was insulting me as stupid along with my fellow Alaskans. Most of the people in that room held PhDs–so the gratuitous insults were uncalled for. Well, I couldn’t really think of anything to say, but by this time I was pretty hot under the collar: “Sir,” I said, “The our problem in Alaska is that when we are hungry and need to eat, we have to go outside and kill something.”
Then my new East Coast friend started to talk about Barack Hussein Obama: “He’s so smart. He talks so well. I just know he’s going to be a better president than that idiot Bush.”
Then one morning in Grand Cayman at Christmas there was a “lady” sitting with me under the veranda at the pool of the hotel. We began to discuss where she was from: Washington D.C. I told her about growing up in Alaska but that I now live in Canada. “I am going to move to Canada,” she said, “If Sarah Palin ever becomes president.” Wow. Miss Manners where are you? But this brilliant woman doesn’t understand the first thing about Canada Immigration or moving to another country. It sometimes takes years to get your paperwork. I know people married to Canadians who have taken over two years to get landed status, and this lady thinks she can just walk up here and live in Canada. I hate to tell you this, but this is not the Viet Nam War era, and Pierre Trudeau is not the president of Canada anymore.
Well, to all you brilliant people on the East Coast who think you are smarter than us Alaskans who kill animals to put food on the table, I dedicate this post. I love what your President and your Federal Reserve Chair have done to the value of my gold portfolio. In the words of Mogambo Guru, “Whee! This investing stuff is easy!”
In an earlier post I listed the East Coast schools of some the people responsible for $1300 gold. I repeat that list here (Harvard, by the way, is in Boston):
Barack Obama, Columbia, Harvard
Ben Bernanke, Harvard, MIT
Alan Greenspan, Columbia, NYU
Hank Paulson, Harvard (MBA)
Paul Krugman, Yale, MIT
Tim Geitner, Dartmouth, John Hopkins
Larry Summer, MIT, Harvard
But some of us people who don’t enjoy PhDs from these schools where the genius go, don’t believe it is advanced economic theory that is going to help the economy, but common sense. Yesterday, in a seminal article, Monty Pelerin summarized our main problems under five points:
- An Incompetent President - The President is inexperienced and incompetent. He is likely a fraud, as evidenced by his guarded and unknown past. He is incapable of leadership, honesty or management. Virtually every one of his policy initiatives has been harmful to the economy and country. His intentions are clear, the degree to which he will be able to drive us further down the Road to Serfdom is not.
- An Incompetent Political Class – The political class attained power via Santa Claus economics, providing gifts to constituents in return for votes. Both parties are guilty. Politicians have conditioned themselves and their constituents to “free-lunch” governance. Few know how to govern in any other fashion. Most are indistinguishable from prostitutes — vote for me and I will do “that” for you. Both parties want to preserve the welfare-warfare State, disagreeing merely on the means of doing so.
- An Incorrect Paradigm – The Keynesian model of spend and spend has been good for politicians but disastrous for the economy. Over time, it has encouraged loose credit, overspending and living beyond our means. The failures are obvious to all but Statists and so-called Keynesian economists. The political class cannot stop “free lunches” without suffering severe political consequences. Hence, the abuses will continue until resources are exhausted. Like Rome of old, we will soon run out of bread and circuses.
- An Unhappy Ending – Current economic problems cannot be mitigated or solved without incurring another Great Depression. Whether it is preceded by a deflationary collapse or a hyperinflationary blow-off is moot. The ending is inevitable and as more people understand this ending, they take more extreme steps to protect themselves — spending ratchets back, savings increases and businesses refuse to engage in new investment or hiring.
- A Dangerous Prelude to the Ending – Government is insolvent. It would be bankrupt without Federal Reserve Quantitative Easing. As a cornered, wounded animal will do anything to survive, so will Government. Does that mean confiscatory tax rates, capital controls, IRA investments forced into Treasury Bonds, “excess profits” taxes, a national sales tax, etc. etc.? It could mean any or all of these and more. Government will not roll over. It will do whatever it can to continue, regardless of how illegal, immoral, unethical or harmful it may be for the country.