Hong choi hin gong?
And maybe it will! A book by John Perkins entitled "Confessions of an Economic Hit Man" explains how it is done. "My real job was deal-making," he explains. "It was giving loans to other countries, huge loans, much bigger than they could possibly repay. One of the conditions of the loan let's say a $1 billion to a country like Indonesia or Ecuador and this country would then have to give ninety percent of that loan back to a U.S. company, or U.S. companies, to build the infrastructure. A country today like Ecuador owes over fifty percent of its national budget just to pay down its debt. And it really can't do it. So, we literally have them over a barrel. So we make this big loan, most of it comes back to the United States, the country is left with the debt plus lots of interest, and they basically become our servants, our slaves. It's an empire."
And there is no reason to think that it is not working here either. I can almost hear The Voices On The Other End Of The Phone (TVOTOEOTP) explaining how it works to Wall Street money managers. "Borrow money from the banks and buy stocks and bonds with it, or we'll sic Eliot Spitzer on you, or the SEC, or any of thousands of government agents, to hound you until you die or you end up like The Mogambo, babbling to yourself and wiping spittle off of your chin. And nobody wants that." Ergo, debt gets bigger, the stock market goes up, and everybody is happy. Or are they?
- The Federal Reserve, as is their wont, stepped back into the business of providing unholy amounts of liquidity last week, and increased Total Fed Credit (the ultimate in money-from-thin-air, because it gets multiplied by the banks themselves, via the fractional-reserve method) by another $2.6 billion, which was, presumably, to offset the draw-down in Foreign Custody Holdings at the Fed, which dropped by $7.5 billion.
Speaking of banks, the difference between liabilities and assets dropped to a new low, which shows that savings are increasing faster than loans are being made.
Of course, we can always rely on the Treasury to act irresponsibly, and they increased total public debt to, as of Tuesday morning, $7.617 trillion, prompting Barb at 321gold.com to post the notice of "Breakout alert," by which I assume she means to beware that I may have broken out of my restraints and am probably running amok somewhere, armed to the teeth, spoiling for a fight and predictably upset at the monetary stupidity. But I was not, thanks to them using heavier leather straps to tie me down, and something new in my IV that makes me drowsy all the time. Anyway, this means that, for everybody who has a job in the USA that is not a government job, they are on the hook for roughly another $135 in debt, in just this one week.
And where did all that money go? Everywhere, but apparently it finally ended up in the hands of somebody who put it into corporate debt and Treasury debt, all of which continue to go surprisingly up in price and down in yield, as all that sheer tonnage of money has to find a home somewhere. For the week, 2-year Treasury yields dropped to 3.15%, and the 5-year yield declined to 3.64%. Oddly enough, the yield on the 5-year T-note is roughly the exact same as the inflation rate! Which says something unseemly about a money manager that would lock your money up for five years at a rate that merely equals the rate of inflation, especially when inflation is rising.
The 10-Treasury, for its part, also went up in price, and the yield sank to 4.14%! Even the long-bond yield fell to 4.65%! What are these people thinking? The Fed is on record as warning that interest rates are going up, inflation is heading up to the point where even the clueless Federal Reserve is starting to take notice, and yet they are bidding long-term debt UP so as to lock-in low yields for a long, long time? Yow! What morons!
In a similar vein, Robert B. sent me a letter written by Jess George Murray, writing to his nephew Charlie in 1990. Jesse George Murray was an 80-year old retired newspaperman, author, diplomat, Type-A overachiever and intellectual. He writes, "The Constitution of the United States, every single word of it, is directed to one end -- and one end, only: to protect the ordinary citizen from the Government. That's all it is, nothing more. Any time one is tempted to put his faith in the Government of the United States, let him go back and read -- one by one -- the treaties signed by our Government with the American Indians." Hahahaha! Touché! He goes on to say, and you might want to take this as your own personal credo, "I never, never, never trust a Government. Any Government. My own Government or any other Government."
His example is excellent, and is the whole point. "In 1940," he writes, "our Government urged us all to 'buy war bonds.' The Series E, typical of the rest, cost $18.75. In 1940, an excellent pair of good leather Thom McAn shoes cost $3.30." I know that you, like me, are thinking to yourself "Oh, God! This sounds like one of those math problems on the SAT test, and there is going to be a train leaving Chicago heading west at 30 miles per hour!" and your stomach started hurting. But relax! He does the math FOR you! Anyway, he goes on, "So it took 6 1/2 pairs of shoes to buy a bond. Ten years later, that same pair of shoes cost $25. So to 'buy a bond' cost 6 1/2 pairs of shoes. And at redemption time the buyer got back just one pair of shoes. Is this difficult to understand? I don't know how it could be made clearer or simpler."
You invested 6 1/2 pairs of shoes and you got back one pair? Hahahaha! Nice investment there, dude!
So I rush to the fortune-teller to have a séance with the Spirits From Beyond The Veil (SFBTV), hoping to get a message to this Murray fella, because I know how to make it clearer! He left out the part about WHY the shoes cost $25! Because the damn government both raised taxes and fees to pay off the bonds, which raised costs, so everyone had to raise prices, and the government likewise created excess credit and money to pay their debts, which debased the money and reduced its buying power. Ergo, and I love saying "ergo," inflation soared. The result? Well, you KNOW that just THINKING about this crap makes me go crazy, so I will force myself to turn back to Mr. Murray, who lucidly goes on to announce, "In ten years our Government cheated its trusting citizens -- those who bought bonds -- out of 5 1/2 pairs of shoes. Inflation, let us never forget, is not an impersonal force such as an earthquake, a volcano, a tornado, a tidal wave. Inflation is a policy consciously adopted -- or rejected -- by politicians in Government."
The solution? Oddly enough, it is the same as your have been getting from The Mogambo all this time. He suggests, "If the Government is in favor of each of us buying gold, get suspicious at once. If the Government tells us not to buy gold, go out and acquire all you can. That's Rule No. 1."
- The market breadth line, which is the cumulative difference between how much stock was bought versus how much was sold, is looking like it is rolling over. This may have something to do with the Dow falling below the level of last year, handing those who are so stupid that they are buying stocks at these high prices a nice loss, as a lesson in the value of education and common sense, although you would think that they would not need the additional education, since the SP500 is still below where it was five long years ago.
- The Leading Economic Indicator went up by 0.2, to 115.4, mainly on the basis of the Fed creating a gigantic load of money and idiots using a lot of that money to buy stocks that are already overpriced. Of course, the dimwits who infest the media are all giggly and beside themselves with joy. Even so, the leading indicator went up by only (0.2/115.2=) 0.0017%.
Nobody seemed to notice that the lagging indicator, which is an indicator of inflation, rose by 0.6, to 98.9, according to Barron's. In percentage terms, it rose (0.6 /98.3=) 0.0061%, which is more than three times as much as the leading indicator went up! Fabulous. Just freaking fabulous.
- Hans Sennholz's new essay is entitled "A New Economic Elite" and it takes a look at one of the cancerous distortions in the American economy, the mal-distribution of earnings. He writes "The average annual compensation of the top 100 chief executives amounts to an astonishing $37.5 million, which is 1000 times the pay of an average worker."
- Thursday, January 27, is Mozart's birthday. I bring this newsy tidbit to you as my way of providing a Mogambo education in music (MEIM), totally free of charge, as my gift to you, because the erroneous opinions of music "experts" is as abysmal as the opinions of today's mainstream economists, and I know that you trust an opinion only when it is certified with the Mogambo Guarantee of Excellence (MGOE), which is unique among guarantees, in that it is less than worthless. Mostly it means that you are always guaranteed to lose your shirt if you are so stupid that you would trust the opinion of a guy who calls himself The Mogambo and is such a lunatic-recluse-gold-bug-gun-nut-moron that he is only rarely seen in public, mostly when being taken away in the back of police squad cars, hands cuffed behind my back, and screaming, screaming, screaming that the Federal Reserve is killing us with their damned creation of excess money and credit, and their damned fractional banking setup, and their damned fiat currency, and I'm trying to kick out the windows of that damn police car, and I have this spittle of anger and outrage all over my face, and it is pretty sad and disgusting, all in all.
But I am sure that there is will be no disagreement when I say that Mozart, of all the composers that ever lived, stands alone and supreme, towering over all others. And I say this with all the snotty arrogance of 1) a guy who has been playing music, composing music and butchering music (as only a no-talent bum from another planet can butcher music) for a long, long time, and 2) as a guy who knows that everybody knows that to dare to disagree with me about anything, no matter how trivial, especially about things musical, or economic, or whether something is fattening or not, or whether my cardiologist would approve of me eating or drinking some particular thing, usually something tasty, will always result in their being put on the Official Mogambo Enemies List (OMEL), which contains, after all these years, almost everybody, which proves that everybody is out to get me.
As a tip, if you want to get some Mozart music, and I suggest that you do, there are a bunch of CD's that contain only the up-tempo stuff, marketed such fanciful names as "Mozart in the Morning" and "Mozart for the Morning Commute," "Mozart for Your Morning Workout," "Mozart for Morning Coffee" etc. which are all good. And, of course, anything with "concerto" in the title, particularly piano, since he was such a hot shot piano player. And if your taste runs to violin, my personal favorites are the Violin Concerto #3 and the Violin Concerto #5, which contain such an overabundance of melodies, all overlapping and combining and weaving around, that it recalls the complaints from audiences of the time that the music was TOO beautiful, and that there were too many melodies, and that as soon as one has delighted in hearing one of incomparable beauty, along comes another one, on and on, again and again, until one is completely overwhelmed and amazed, and left breathless and exhausted.
And in celebration, I also suggest that you do as we do here in the Mogambo household; go out for German food and order a schnitzel dinner with all the trimmings.
- So do you every wonder what the Chinese are going to do with all those dollars they are accumulating? Did you ever wonder if maybe they wake up in the morning and think to themselves, "Hong choi hin gong?" which, of course, means, "I wonder how much value those damn American dollars lost last night?" Well, wonder no more! They have decided to buy things with them before they turn into just worthless paper, which will probably be a lot sooner than anyone thinks. If you don't believe me (and if you DO believe me then there is something very wrong with you, so you deserve whatever bad happens to you) let's just see what some other fine folks have to say (and for the record, these are people who think as YOU do, namely that the Mogambo is a loudmouth jerk, so at least you have something in common!) For instance, over at the Christian Science Monitor, there is an article entitled "China's Risky Scramble for Oil" by David R. Francis, that starts off noting that, "The average American consumes 25 barrels of oil a year. In China, the average is about 1.3 barrels per year; in India, less than one."
We're gluttons. I know that you think it looks bad to criticize us Americans as gluttons when I have just stuffed an entire donut, dripping with delicious icing, into my mouth at once, and now my cheeks are puffed out and I look like some kind of deranged squirrel, and when I talk, I sound like "Mmfph gmgg thmmnqnn!" But there is a reason for that; by eating the donuts as an integral, audio-visual aid and, as such, is a necessary part of the class lecture, they are a tax deduction! And the fact that I originally borrowed the money to buy the donuts means that, net net net, I am MAKING money by eating donuts! Man! Why didn't I think of this earlier? This is the best plan I ever had!
But, sadly, my brilliant Mogambo tax windfall bonanza (BMTWB) is not going to have much of an impact on my lifestyle, because I consume a lot fewer donuts than I do barrels of oil. And it is going to get worse, too, as Mr. Francis goes on to say, "So as the 2.4 billion Chinese and Indians move to improve their living standards, they're going to want more oil - likely more than can be produced. That perceived shortage is setting off an intensifying scramble to tie up oil reserves around the world. So far, China has been the most aggressive player. But the competition is just getting going."
How strong is the competition? Well, I know that everybody in the whole world is out to get me, personally, and so I assume that the selfsame whole world would all like to take oil and donuts right out of my mouth, the greedy bastards. Not much help, I admit, but it gives you a certain "perspective" on things. So, in desperation we turn to Mr. Francis again, and in reply he writes, "The challenge is huge. For China and India to reach just one-quarter of the level of US oil consumption, world output would have to rise by 44 percent. To get to half the US level, world production would need to nearly double."
I love this kind of thing! I grab you by the front of your shirt with my grubby little fist, and haul you in close to my face so that I can look deep, deep, deep into your eyes, and I say, "World oil output is maxed out, and refining capacity is maxed out, too, and so just where in the hell is all of this additional output going to come from? Hahahaha!" Just as suddenly, I release you, and you collapse in a heap at my Mighty Mogambo Feet (MF), and two thoughts instantly cross your mind. 1) Why did that stupid bastard grab me like that, and 2) what in the hell is that SMELL? Pew-yew!" Ignoring you and your two impertinent questions, I say that if there is one thing that I am pretty sure is true, and it is that when demand exceeds supply, the only way to equilibrate the two forces is for the price to go up. And although I have never actually shown a profit in my life, (or even been near one, as far as I can tell), mostly because I am an incompetent loser whose entire inventory of managerial skills ranges from "bad" to "nonexistent," I have HEARD and READ about profits, and as I understand it, you would make a profit if prices go up.
I just happen to have a copy of The Mogambo Unabridged Dictionary (TMUD) nearby, so it is child's play to look up "competition." There are, of course, many alternate definitions. But we are interested in the one definition categorized under "Competition, resource, international, long-term, price action, phases of. Page 4744." So we go to page 4744 and we read that, in this case, it is defined as "A period of time when prices start heading up, leading to a time when prices are still heading up, which leads to a time period where prices have seemingly always headed up, culminating in a period when prices continued to go up but that, suddenly, stop going up. Over the long-term, even at relatively low levels of inflation, prices will rise enough to make your freaking eyes pop out of your head."
As a result, "The growing demand for oil is leading to a growing global conflict," warns Amos Nur, who is a geophysicist at Stanford University. And if you don't think so, too, then ask the people of Iraq if they have noticed any conflict with foreigners.
But it is not only oil! Oh, no! As Jim Willie reports, that the Chinese are making bids to, for starters, acquire Noranda Copper, gobble up vast tracts of undeveloped land in Alberta's energy fields, buy up Australia and Brazil to secure large supplies of minerals, and buy the American energy firm Unocal. Mr. Willie says, "The captured booty will be mineral and energy properties, which will elevate the tone of the commodity bull market and eventually trigger a bidding war on mining and energy stocks in the coming years. Political fallout is certain. Tensions will heighten."
But it isn't just the Chinese, either! Man, it just keeps getting worse and worse! He goes on, like driving a stake into my heart, to report about how "A newly coalesced group has formed. Greater Asia has banded together to form the Shanghai Cooperative Group in order to create what could become a more powerful commodity supply organization than OPEC itself. China, India, Russia, and the former Soviet Moslem Republics form the nucleus."
So what does this all mean? I have my own ideas, most of which revolve around me eating an entire pepperoni and sausage pizza, but perhaps Mr. Willie can come up with something better. And sure enough, he does! "My conclusion," he says, "calls for an amplification of current trends in a declining US Dollar and rising commodity prices, with the added risk of the USA locked out of markets." You mean that China and India and Russia and the former Soviet Moslem Republics that he talks about might want to hurt us? Why? Didn't we spend most of the last century kicking all their nasty little butts and humiliating them? Wasn't that enough already? They want ANOTHER little taste of American competition?
This is very alarming to me, mostly because I am the easily-excitable type, but also because we Americans are living waaaAAAAaaayyyy beyond our means, and have been for a long, long time. And that means that OUR standards of living are going to have to come down. And they are! When the prices we pay for things go up faster than our incomes (with which we pay for those things), our standard of living is falling! So, welcome to the future, chumps! There ain't a damn thing anybody can do about it, because believe me when I tell you that every dirtbag government that ever lived, and every economist that ever lived, have ALL sought the Holy Grail of somehow magically managing things to produce a Utopian "prosperity without earning" and "getting rich by amassing un-payable debts." And I blush to admit that even I, The Mogambo, have spent a great deal of MY time, too, searching for a way to turn my natural stupidity, ignorance and sloth into a prosperous career so that I could make lots and lots of easy money, and then I could go back to a high school reunion and prove to them that they were WRONG to have used my locker as a urinal for all those angst-filled, teenage years.
So far, and wait a moment as I tally up the final score, we have all failed miserably in our quests for A Free Lunch On Easy Street (FLOES). Not one of us even came close. The lesson seems to be (and you might want to write this down, since it is a concept that is apparently difficult to grasp, given how little attention is given to it), that a country and everyone in it cannot continually borrow and spend their way to prosperity, no matter how much we want to, or how cool that would be, or how many Congressional buttheads say that they can. But you can borrow and spend yourself into bankruptcy and ruination. And you WILL, too, if you ever try that stupidity. And if you want to know why I am cowering under the coffee table, clutching a submachine gun to my chest and whimpering, it is because America will be bankrupt and ruined, because we have been trying that silly crap for the last 40 years!
And the other lesson is that even trying that silly crap always results in heartbreak, which is how I will feel when I see you pounding on the door of the Mogambo Fortress And Fortified Bunker Complex (MFAFBC) begging me to give you something, anything, for your lousy handful of worthless paper US dollars. And as I squeeze off a few bursts of machinegun fire to chase you away, I will think to myself "The Mighty Heart Of The Mogambo (TMHOTM) is breaking for their plight! But, then again, how about me? Who is going to replace all this very expensive ammunition that I am firing here? Me, that's who! (Insert video footage of money sprouting wings and flying away). And yet, how many of them care about MY problem here? None of them! None! The selfish bastards! Take that!" The soundtrack erupts in a cacophony of gunfire, and the scene fades to black.
The end-result of inflation is always heartbreaking like that. And that is why all intelligent people have strenuously tried to avoid inflation, until the suicidal idiocy known as the Greenspan Fed took over in 1987.
- Lawrence Lindsey, former Fed Governor, says that he figures that long-term rates are being held down by a global glut of savings. No kidding! It's due to glut of something, all right, as all that money, plus the deluge of money pouring out of the world's central banks, has to go somewhere.
Gary Stern, the president of the Federal Reserve Bank of Minneapolis, says he believes the Fed can "keep hiking rates at a measured pace because he does not foresee 'deterioration' in inflation prospects." I enclosed that in quotes because I think I cut-and-pasted that from somewhere, but I forget where, and if you think that The Mogambo is going to take the time to actually do a little research to clear up the mystery, then you are a bigger idiot than he is, and that is really saying something. But I like that part that goes, "does not foresee 'deterioration' in inflation prospects." Hahahaha! That must be an example of Fed NewSpeak. Is he saying that inflation pressures aren't tame enough to stop hiking rates, meaning that there IS inflation, but they are low enough for the Fed to keep raising rates slowly, up from "insanely low" to only "stupidly low"?
The damned Fed has watched as all that money that they created, ton upon ton of it, year after year, went into raw, grubby consumption financed by going into unbelievable debt, and buying overpriced government debt, and buying overpriced stocks, and overpriced bonds, and overpriced houses, and overpriced anything you can name, which is close to what Warren Buffett said the other day, and if you want to buck both The Mogambo AND Warren Buffett (which I call The New Dynamic Duo!), then go ahead. Chump.
Taking a look at what other Federal Reserve morons have to say, we should express our thanks to Peter Spina and GoldSeek.com for posting "FACTBOX-U.S. Fed policymakers' recent comments" which is a real hoot, if you like that kind of thing. But if you go to the site and read the whole thing, you will be struck by the sudden realization that these Federal Reserve people are all robots, although none of them can shoot laser beams out of their eyes, so they are just CHEAP robots at that!
Don't believe me? Well, Reuters quotes Fed Governor Ben Bernanke saying, on January 19, "Inflation is likely to remain under control." The camera switches to The Mogambo, who is grinding his teeth together in rage. 3.5% inflation, even using the laughably low official figure of inflation, is not "under control"!
He goes on to say "I don't think it's the job of monetary policy to address (investor behavior)." Again, we switch to the Mogambo, whose face is a study in surprise (SIS) as he asks "Does this bozo think that pumping liquidity by the gallon into the economy, and thus driving interest rates into the basement, is NOT going to influence investor behavior? Cheap money is NOT going to influence investor behavior? Especially those investors who are more rightfully speculators, out to make a quick buck? And who then beat it out of town before somebody from a law enforcement agency comes around and starts asking a lot of questions, and pretty soon all the neighbors are spilling their guts to the police and the newspapers and the television reporters about how NONE of them ever thought that I seemed normal in the first damned place, and how none of them is surprised in the least, and they always had a feeling that something like this would happen someday.
Then they quote Fed Governor Susan Bies saying, on January 18, "I believe that with underlying inflation expected to moderate, the Federal Reserve can continue to remove its policy accommodation at a measured pace, consistent with its commitment to maintain price stability as a necessary condition for maximum sustainable economic growth." I can hardly sit in my chair! Straining at the harness I am ordered to wear as part of my plea bargain, I am screaming. "First she says that there IS inflation, but that she expects it to moderate, while, at the very same freaking time, she is calling this inflation 'price stability'? Arrgghhh! I hate her! I hate her!"
Then, without ever having actually been in business or even in the private sector, she thinks she knows all about what it is like out here in the real world, and she says "In my view, even with a rise in interest rates and some moderation in profit growth, the business sector should remain financially strong and continue to expand." Gaaahhhh! I think I swallowed my tongue in my hostility!
Let me get this straight: Things are not so hot right now, but business is going to "remain financially strong and continue to expand"? And in the future, while we are making less profit, businesses will completely ignore rising interest rates? Are you SURE? I mean, I don't want to sound like I am a know-it-all, but it seems that I read somewhere that disappearing profits and rising interest rates were always BAD for stocks and the economy! And in fact raising interest rates, to choke off economic activity, is how the Federal Reserve cools an economy down!
Of course, things would not be complete without Minneapolis Fed President Gary Stern, who said, also on January. 18, "I personally don't have the sense that there is excessive risk-taking in U.S. financial markets." That's why we pay this guy the big money, I suppose; he doesn't need any facts! He has his definition of "excessive" and that is all he needs! Most bonds are yielding less than the rate of inflation, the SP500 is selling at a P/E of over 20 (and at the end of a long, long boom), houses have mortgages as big as four times annual income, and yet there is no excessive risk-taking? My God! I would LOVE to hear what he DOES consider "risk taking"!
He also reminds us that the wonderful people in "the Federal Reserve are committed to maintaining low inflation," which is such a laughable, blatant lie that I am screaming at the top of my voice in my outrage, but I stop as soon as one of my attendants catches my eye, and he is signaling to me that he is going to have to give me a shot if I don't shut up, so I do.
- In the rush to save Social Security, nobody asks why it needs saving. And the answer is that the buttheads in Congress, especially the foul Democrats, but more and more the foul Republicans too, spent their considerable time, year after year after year, passing new regulations and laws that gave more and more whining people more and more money out of the fund. Suddenly, with so many people drawing money, there is a growing shortfall, even with the continual hikes in the FICA taxes levied on all income.
And the worst part is not the money! The worst part is that it distorted the economy, and now we have lots and lots people whose job it is to dispense and administer this money, and account for the money, and lobby for more money, and let's not forget the legions people who GET the money, who spend it on consumption! You can't stop, because then these people would have no money, which was their big problem in the first place!
And you can bet your sweet butt that when they increase the Social Security tax (and they will) and the Medicare surtax (and they will), that the butthead commie-Congress bastards will immediately start handing out all of that new money, too, causing the next Social Security crisis when all this new spending catches up with the increase in tax revenue, which will "force" Congress to increase the taxes again, which will give them the wherewithal to increase benefits, again, and enroll a whole new bunch of people in the list of recipients, again and again, on and on and on, around and around.
- At the Mineweb.com site, a guy named Elliot Guy, who is the "editor of Wall Streets Winners and associate editor of Personal Finance," says that "periods where we tend to see financial instability and the weakening U.S. dollar is when gold performs the very best." In particular, he points to the rising U.S. consumer debt load, which he says is "the number-one cause for concern in the U.S. economy." And here is a statistic that I haven't seen much of; but he said the average consumer is spending 13.5% of disposal income simply to service debt! One-seventh of after-tax income goes to debt service? Yow! And all of that is merely interest? Double yow! Which would be written, of course, as "yow yow!"
And this is at a time when interest rates are currently the lowest rates in, literally, four freaking decades! Mr. Guy, in his bid for Biggest Understatement of the Year, says "We are in the midst of a credit bubble."
In a related note, for all of us gold bugs out here, he also thinks that the ratio between gold and the Dow Jones Industrial Average will change from its current 25 ounces of gold to 2 to 5 ounces of gold. So, the Big Question Of The Day (BQOTD) is, "Will the DJIA go down, or will the price of gold go up?" Probably both. -
- Safehaven.com posted an interesting essay by Jas Jain entitled "Markets & Data Suggest That US Econ Recovery Is Artificial." They write, "We show that the behavior of the stock market suggests the current recovery to be the worst in 134 years, maybe worst on record. Also, keeping in mind that the past four years have seen one of the largest stimuli, from Federal govt. and the Federal Reserve combined, and yet we have the worst Employment growth since 1932 and no Income growth."
Now, this is bad enough, but then they go on to write (and notice that they are using all capital letters here, which is either some desperate, pathetic cry for attention or a literary device to indicate importance or emphasis), "2001-4 IS THE FIRST TIME IN HISTORY FOR WHICH WE HAVE DATA DURING WHICH JOBS WERE LOST DESPITE ONE OF THE LARGEST STIMULI IN HISTORY.
- Michael Boskin, the little twit who was (with his infamous Boskin Commission) instrumental in setting up the blatant fraud known as "hedonic adjustments," whereby the actual horrors of inflation are handily removed using only the magic of making mathematical adjustments to actual prices to "account" for the benefits of quality and convenience, is back on the scene with an essay in Monday's Wall Street Journal entitled "The Economist's President." To save you a lot of time, he starts out by indicating that he is still not in touch with reality as decent people know it, and that he will still say and do anything because he is such a shameless whore, and he starts off with the incredible sentence, "President Bush deserves very high marks on economic policy in his first term." Hahaha! I laugh in contempt! Compared to what? He borrowed more money than any other President, both nominally and percentage-wise. He is presiding over the largest budget deficits in history. We have the largest trade deficits in history. Foreigners own about a third of all our marketable debt and assets. He got us into an expensive, deadly quagmire of a war. He pressed for the most expensive and hugely grandiose expansion of Medicare in history. And this Boskin character thinks Bush deserves "high marks" for that?
Before you go ballistic, remember who he is, and what he did. Then you will realize something profound about university economics professors, and maybe something equally profound about Stanford University, who hired him.
***** The Mogambo Sez: It turns out that many people like
a long Mogambo Guru.