Inflation is running at a reported 5.1% in China, a figure most believe is on the low side. Nonetheless, China has been loath to hike rates out of fear of more "hot money" flowing in. Something had to give, and it did. The markets forced China's hand.
Please consider China Increases Rates to Counter Highest Inflation in Two Years
China raised interest rates for the second time since mid-October to counter the fastest inflation in more than two years and more moves may follow.China Overheating
The benchmark one-year lending rate will rise by 25 basis points to 5.81 percent and the one-year deposit rate will climb by the same amount to 2.75 percent, effective today, the People’s Bank of China said in a one-sentence statement on its website late yesterday.
Premier Wen Jiabao is seeking to slow gains in property values and consumer prices that are making it harder for families to buy homes and pay for food. Bank lending and a wider-than-forecast November trade surplus have pumped more cash into an economy already awash with money.
China is tightening after a record expansion of credit to counter the effects of the world financial crisis. The broadest measure of money supply, M2, has surged by 55 percent over the past two years and outstanding yuan-denominated loans have climbed 60 percent to 47.4 trillion.
Residence-related costs, including charges for water, electricity and rent, jumped 5.8 percent last month from a year earlier, the most in more than two years, and consumer goods prices rose 5.9 percent, the biggest gain since August 2008, according to statistics bureau data.
Policy makers are concerned that raising interest rates could “encourage hot money inflows,” Paul Cavey, a Hong Kong- based economist at Macquarie Securities Ltd. said. “Raising interest rates has far more implications” than ordering lenders to set aside more of their deposits as reserves, as it may affect the ability of local governments and companies to pay their debts.
State Council researcher Ba Shusong told state television yesterday that the government will step up regulation of capital inflows, without specifying measures that will be taken.
The Ministry of Commerce is stepping up supervision of foreign investment in real estate to crack down on speculation after a 48 percent jump in overseas fund inflows to the industry in the first 11 months of the year, spokesman Yao Jian said on Dec. 15. Policy makers may also allow faster gains in the yuan to help curb inflation from higher prices of imported commodities, according to analysts’ forecasts.
China was number 5 on my list of Ten Economic and Investment Themes for 2011
5. China Overheats, Multiple Rate Hikes ComingCapital Controls Coming
China, everyone's favorite promised land, has a hard landing. China will grow at perhaps 5-6% but that is nowhere near as much as China wants, or the world expects. Tightening in China will crack its property bubble and more importantly pressure commodities. The longer China holds off in tightening, the harder the landing.
Initially, rate hikes will encourage more "hot money" inflows into China. In hopes of preventing those inflows, China has announced more capital controls. It will be interesting to see precisely what those controls will look like.
Currency Sterilization Needed
One thing China should do is sterilize speculative hot money and balance of trade inflows via domestic government bond issuance, hoping to curb money supply growth.
However, it is not as simple as that, because in a fractional-reserve credit system, a net increase in lending itself increases money supply.
Clearly the Chinese central bank is behind the curve. Will China simply restrict lending? Would it even work?
I do not know about the former, but the latter would eventually force a hard landing if China gets serious enough. Actually, there are so many problems that I think a hard landing is coming regardless, and the longer China dallies, the harder it will be.
In the meantime, these paltry rate hikes by China of .25 points each pale in comparison to increases in reported consumer price increases.
Enormous Property Bubbles Including Vacant Cities
It is not "consumer price inflation" that is the big problem. Asset inflation, especially property speculation is rampant.
In case you missed it please consider The ghost towns of China: Amazing satellite images show cities meant to be home to millions lying deserted
Speculation will continue until China gets serious or until the pool of greater fools buying property at absurd prices dries up.
China’s Army of Graduates Struggles for Jobs
Exacerbating China's myriad of problems, an Army of Graduates Struggles for Jobs
In 1998, when Jiang Zemin, then the president, announced plans to bolster higher education, Chinese universities and colleges produced 830,000 graduates a year. Last May, that number was more than six million and rising.Odds for social unrest will mount if China's growth slows. Yet, because of short-term overheating concerns on top of long-term peak oil issues there is no way China can keep growing at the current pace.
It is a remarkable achievement, yet for a government fixated on stability such figures are also a cause for concern. The economy, despite its robust growth, does not generate enough good professional jobs to absorb the influx of highly educated young adults. And many of them bear the inflated expectations of their parents, who emptied their bank accounts to buy them the good life that a higher education is presumed to guarantee.
“College essentially provided them with nothing,” said Zhang Ming, a political scientist and vocal critic of China’s education system. “For many young graduates, it’s all about survival. If there was ever an economic crisis, they could be a source of instability.”
In a kind of cruel reversal, China’s old migrant class — uneducated villagers who flocked to factory towns to make goods for export — are now in high demand, with spot labor shortages and tighter government oversight driving up blue-collar wages.
But the supply of those trained in accounting, finance and computer programming now seems limitless, and their value has plunged. Between 2003 and 2009, the average starting salary for migrant laborers grew by nearly 80 percent; during the same period, starting pay for college graduates stayed the same, although their wages actually decreased if inflation is taken into account.
Chinese sociologists have come up with a new term for educated young people who move in search of work like Ms. Liu: the ant tribe. It is a reference to their immense numbers — at least 100,000 in Beijing alone — and to the fact that they often settle into crowded neighborhoods, toiling for wages that would give even low-paid factory workers pause.
“Like ants, they gather in colonies, sometimes underground in basements, and work long and hard,” said Zhou Xiaozheng, a sociology professor at Renmin University in Beijing.
Eight Problems Facing China
- Hot money inflows
- Huge property bubble
- Massive increases in money supply, much of it property speculation and building of unneeded capacity
- Currency manipulation charges from the US and potential trade wars
- Unsterilized trade imbalances fuel inflation
- Slowing Europe
- Dearth of Jobs for new graduates
- Potential social unrest
Case For Hard Landing
Risks are enormously skewed to the downside, so much so that the odds China avoids a hard landing are not good. China is far more exposed to a slowdown in Europe than the US and the popping of China's property bubble will extract a huge toll.
Those plowing into commodities, foreign currencies, and equities (especially foreign equities), fail to consider those risks.
Moreover, given that much of China's growth is overheating and malinvestment, it is not even clear the Renminbi is undervalued.
For a look at India, please consider Food, Fuel Inflation Hits India; Primary Price Index Up 15%, Credit Expansion Up 23%
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Submitted by David Galland from Casey Report
Profiting from Policy
These days, it’s hard to draw any conclusion other than that the train is gaining speed on wobbly tracks perched over a rickety bridge.
Most notably, unemployment has again risen – to 9.8% from 9.6% – very much not the direction things should be headed given the amount of money the government has pumped into the economy. The latest data shows that this nation of 310 million souls managed to add just 39,000 jobs in November. That, unfortunately, falls short of even keeping up with a population growth of about 1% – doing just that requires generating a net of about 250,000 jobs a month. As for eating away at the millions of unemployed and the many millions more who are underemployed… oh, well.
Of course, the mainstream financial media wastes no time in pointing to this latest dismalia as proof positive that the Fed’s recent decision to energetically restoke the money machine with upwards of $100 billion a month was the right decision. This despite the clear evidence that adding debt to debt is having no real effect, except begetting more debt.
This is a lesson that, so far, appears to be making no headway in the cognitions of Washington’s policy makers, even with the latest election results delivering a sharp rap across the knuckles to the power elite.
Evidence of that truth came to me during a recent drive to do sundry errands. After flipping through the stations, I ended up listening to a program on National Public Radio with a moderator quizzing a couple of congresspersons – one still in power and the other dismissed by voters in the midterm elections.
In conversing with the latter, the reporter asked if the Democrat congressman’s loss wasn’t a clear sign of voter frustration. To which the ex-official blathered on about the number of filibusters threatened by the Republicans over the last couple of years as a reason why the Obama Congress was unable to get its business done.
But, interjected the reporter, the Democrat-controlled Congress passed all manner of legislation – healthcare, financial reform, environmental bills, etc., etc – so isn’t it more a case of voters being upset about the quality and scale of the legislation passed, and not the dearth of it?
Whereupon the ex-Con began to illustrate his point by spouting off about some wastewater bill that was turned back by the Republicans, even though it would have unleashed another $15 billion in federal spending “so important to putting Americans back to work.”
But wait, again interjected the reporter, wouldn’t many people listening to this program say to themselves, this guy just doesn’t get it? That we don’t want the federal government to keep spending billions of taxpayer money on these make-work projects?
Without missing a beat, the ex-Con flipped like a freshly landed mackerel and argued against his position of just seconds before, saying, “This isn’t about the money! It’s about clean water for all Americans!”
At which point the reporter cleared his throat and ended the interview.
Next up was an angry Democrat of some influence. The congresswoman’s anger was directed first at the findings of the Deficit Reduction Commission that the spending cuts must be widespread if they are to be sufficient, and then at the administration for even thinking about extending the Bush tax cuts for people earning over $250K.
Oh, how I wish I was able to do proper justice to her diatribe here – I can’t, but I will do my best.
In her world view, the poor huddled masses of America – being defined as anyone with an income of under $250,000 a year – had nothing to do with the financial crisis, and so why should they be held even a little bit responsible for helping to foot the bill? No, no – it was the greedy fat cats that brought this fresh hell upon us, and so it is they, and they alone, who should be made to pay… and pay.
Of course, nowhere in the discussion was there mention of the role that the many-tentacled government played in all of this… of the loose money, the looser spending, the wars, the unbridled enthusiasm for a steady diet of pork, and… and...
If there were some mega-computer capable of fairly allocating the financial pain based on the contribution each of us has made to this mess, and then assess taxes accordingly, I suspect the end result would leave past and present members of the Fed living in cardboard boxes, and 97% of past and present members of Congress shuffling in gutters looking for cigarette stubs… at least when they weren’t fighting over discarded clothes with executives of the big financial institutions, NGOs, and the Treasury Department.
Having wiped all of those individuals out to the bone, the burden could then shift to the military-industrial complex that has so effectively pursued its symbiotic and very, very costly “Don’t Ask (where the money went), Don’t Tell (the truth)” policy for decades now.
It could then lay the hooks into anyone who ever took a government-backed loan – big or small – without first taking the time to do a serious calculation as to their ability to repay it, or the unscrupulous lenders who knew that the loans they were originating were going to end up in default with the tab ultimately being dropped on the government.
In fact, were such a mega-computer able to do the calculation, I strongly suggest it would only be after many further layers that the pain, fairly allocated, would reach the rank and file business community, the sole real engine of growth in this economy.
I refer, of course, to the very same individuals so steadily derided by the vote-seeking politicos, despite the fact that it is these long-suffering entrepreneurs who wake up every new day to risk everything in their efforts to create new jobs, despite the heavy glop of bureaucracy on their backs every step of the way.
Yet it is the few that succeed, against all odds and a constant battering of taxes and regulations, that this particular congressperson sees as the villains. In other words, she has pretty much reversed the proper order of accountability – as one would expect in a system where all that matters is vote gaining.
When the talk turned to the administration’s apparent willingness to accept an across-the-board extension of the Bush tax reductions as part of a compromise to also extend unemployment benefits (at 42%, the situation of the long-term unemployed is becoming a serious problem), the congresswoman was almost apoplectic. In addition to the views just exposed, about the wealthy needing to pay for their many sins, she was astounded that anyone could hold up the unemployment extension, given the poor shape of the economy.
How can anyone argue against the direct benefits to our struggling economy of putting money in the pockets of people who most need it, she asked with dismay in her voice. Adding in support of her view that it should be obvious to all that the recipients of the money will turn right around and spend it on the necessities and that will give the economy just the boost it needs.
Hmm, I thought as I drove down the road. All we need to improve the economy is to give people money.
Why, it’s simplicity itself! And now that I get it, I think people should just quit their whining about fiscal probity and all of that, and just let ‘er rip. Don’t stop with small change, encourage the Treasury to start cranking out checks in princely sums to everyone!
Thousands, millions, even! In no time at all, America’s salad days will be back.
Of course I’m being cynical. But the point I’m trying to make is important, because while I am exaggerating, the economic concept so ardently championed by the congresswoman is accepted at face value by most of the government and all of the administration’s favorite economists.
More than that, because it is accepted, it is policy.
In this construct money is, at best, an abstraction: it has reached the point that the government, and most people, actually believe the stuff falls from the proverbial tree. Money is no longer a medium for saving or transacting with the fruits of one’s labor, but instead is a commodity – albeit unique in that it has unlimited supply.
It does not, however, enjoy unlimited demand. For now, the demand is certainly there. But as the supply increases, individuals and institutions are correctly wary of the effects of dilution… debasement… inflation, pick your term.
The alternative forms of money – the sound kind – are getting a lot of attention because more and more people actually “get it.” They are beginning to recognize the fictions that the politicians and bureaucrats believe in and are taking measures to protect themselves and to profit.
Before moving on, I would mention that I know someone who works as a manager in the Department of Motor Vehicles. A few days ago she told me that, other than a relatively brief flurry during the Cash for Clunkers program, the pace of car registrations has been slow ever since the crisis began and has shown absolutely no improvement since that program ended.
In fact, the only increase in the DMV’s workload has come from the processing of suspended driver’s licenses.
As the latest unemployment figures show and my friend’s first-hand observations confirm, this economy is not recovering. And, per the rise in license suspensions, the government is becoming increasingly aggressive in fine-generating enforcement actions.
In relationship to the second of those data points, if you’re going to imbibe this holiday season, don’t drive.
Finally, please don’t misunderstand my comments above as being insensitive to the plight of the unemployed. I personally know far too many people in that situation whose prospects of ever regaining their prior lifestyles is now almost non-existent to be cavalier about the topic.
The only realistic way I can help – because I can’t and won’t put my own family’s future at risk by trying to help everyone – is doing my part to build and maintain a business that, by offering a tangible value to clients, is able to keep a lot of people productively employed.
Therefore, it angers me to no end to listen as the morons maintained in power by the equally moronic masses make rude noises about the entrepreneurial class and otherwise meddle in matters about which they have no actual understanding and, as a consequence, continue doing great damage to the economy.
Something has got to change… and will, before this is over.
robert shumake
500 More Red-Winged Blackbirds Found Dead in Louisiana - AOL <b>News</b>
Days after 100000 fish and approximately 4000 red-winged blackbirds were found dead in Arkansas, 500 deceased blackbirds and starlings were discovered on a Louisiana highway.
Moore: EA not backing away from Tiger <b>News</b> - Page 1 | Eurogamer.net
Read our news of Moore: EA not backing away from Tiger.
John Roberts Leaves CNN for Fox <b>News</b> - NYTimes.com
Executives at CNN confirmed Monday that John Roberts, who served as the morning anchor for the network since April 2007, would be joining Fox News as a national correspondent.
robert shumake
500 More Red-Winged Blackbirds Found Dead in Louisiana - AOL <b>News</b>
Days after 100000 fish and approximately 4000 red-winged blackbirds were found dead in Arkansas, 500 deceased blackbirds and starlings were discovered on a Louisiana highway.
Moore: EA not backing away from Tiger <b>News</b> - Page 1 | Eurogamer.net
Read our news of Moore: EA not backing away from Tiger.
John Roberts Leaves CNN for Fox <b>News</b> - NYTimes.com
Executives at CNN confirmed Monday that John Roberts, who served as the morning anchor for the network since April 2007, would be joining Fox News as a national correspondent.
robert shumake detroit
Inflation is running at a reported 5.1% in China, a figure most believe is on the low side. Nonetheless, China has been loath to hike rates out of fear of more "hot money" flowing in. Something had to give, and it did. The markets forced China's hand.
Please consider China Increases Rates to Counter Highest Inflation in Two Years
China raised interest rates for the second time since mid-October to counter the fastest inflation in more than two years and more moves may follow.China Overheating
The benchmark one-year lending rate will rise by 25 basis points to 5.81 percent and the one-year deposit rate will climb by the same amount to 2.75 percent, effective today, the People’s Bank of China said in a one-sentence statement on its website late yesterday.
Premier Wen Jiabao is seeking to slow gains in property values and consumer prices that are making it harder for families to buy homes and pay for food. Bank lending and a wider-than-forecast November trade surplus have pumped more cash into an economy already awash with money.
China is tightening after a record expansion of credit to counter the effects of the world financial crisis. The broadest measure of money supply, M2, has surged by 55 percent over the past two years and outstanding yuan-denominated loans have climbed 60 percent to 47.4 trillion.
Residence-related costs, including charges for water, electricity and rent, jumped 5.8 percent last month from a year earlier, the most in more than two years, and consumer goods prices rose 5.9 percent, the biggest gain since August 2008, according to statistics bureau data.
Policy makers are concerned that raising interest rates could “encourage hot money inflows,” Paul Cavey, a Hong Kong- based economist at Macquarie Securities Ltd. said. “Raising interest rates has far more implications” than ordering lenders to set aside more of their deposits as reserves, as it may affect the ability of local governments and companies to pay their debts.
State Council researcher Ba Shusong told state television yesterday that the government will step up regulation of capital inflows, without specifying measures that will be taken.
The Ministry of Commerce is stepping up supervision of foreign investment in real estate to crack down on speculation after a 48 percent jump in overseas fund inflows to the industry in the first 11 months of the year, spokesman Yao Jian said on Dec. 15. Policy makers may also allow faster gains in the yuan to help curb inflation from higher prices of imported commodities, according to analysts’ forecasts.
China was number 5 on my list of Ten Economic and Investment Themes for 2011
5. China Overheats, Multiple Rate Hikes ComingCapital Controls Coming
China, everyone's favorite promised land, has a hard landing. China will grow at perhaps 5-6% but that is nowhere near as much as China wants, or the world expects. Tightening in China will crack its property bubble and more importantly pressure commodities. The longer China holds off in tightening, the harder the landing.
Initially, rate hikes will encourage more "hot money" inflows into China. In hopes of preventing those inflows, China has announced more capital controls. It will be interesting to see precisely what those controls will look like.
Currency Sterilization Needed
One thing China should do is sterilize speculative hot money and balance of trade inflows via domestic government bond issuance, hoping to curb money supply growth.
However, it is not as simple as that, because in a fractional-reserve credit system, a net increase in lending itself increases money supply.
Clearly the Chinese central bank is behind the curve. Will China simply restrict lending? Would it even work?
I do not know about the former, but the latter would eventually force a hard landing if China gets serious enough. Actually, there are so many problems that I think a hard landing is coming regardless, and the longer China dallies, the harder it will be.
In the meantime, these paltry rate hikes by China of .25 points each pale in comparison to increases in reported consumer price increases.
Enormous Property Bubbles Including Vacant Cities
It is not "consumer price inflation" that is the big problem. Asset inflation, especially property speculation is rampant.
In case you missed it please consider The ghost towns of China: Amazing satellite images show cities meant to be home to millions lying deserted
Speculation will continue until China gets serious or until the pool of greater fools buying property at absurd prices dries up.
China’s Army of Graduates Struggles for Jobs
Exacerbating China's myriad of problems, an Army of Graduates Struggles for Jobs
In 1998, when Jiang Zemin, then the president, announced plans to bolster higher education, Chinese universities and colleges produced 830,000 graduates a year. Last May, that number was more than six million and rising.Odds for social unrest will mount if China's growth slows. Yet, because of short-term overheating concerns on top of long-term peak oil issues there is no way China can keep growing at the current pace.
It is a remarkable achievement, yet for a government fixated on stability such figures are also a cause for concern. The economy, despite its robust growth, does not generate enough good professional jobs to absorb the influx of highly educated young adults. And many of them bear the inflated expectations of their parents, who emptied their bank accounts to buy them the good life that a higher education is presumed to guarantee.
“College essentially provided them with nothing,” said Zhang Ming, a political scientist and vocal critic of China’s education system. “For many young graduates, it’s all about survival. If there was ever an economic crisis, they could be a source of instability.”
In a kind of cruel reversal, China’s old migrant class — uneducated villagers who flocked to factory towns to make goods for export — are now in high demand, with spot labor shortages and tighter government oversight driving up blue-collar wages.
But the supply of those trained in accounting, finance and computer programming now seems limitless, and their value has plunged. Between 2003 and 2009, the average starting salary for migrant laborers grew by nearly 80 percent; during the same period, starting pay for college graduates stayed the same, although their wages actually decreased if inflation is taken into account.
Chinese sociologists have come up with a new term for educated young people who move in search of work like Ms. Liu: the ant tribe. It is a reference to their immense numbers — at least 100,000 in Beijing alone — and to the fact that they often settle into crowded neighborhoods, toiling for wages that would give even low-paid factory workers pause.
“Like ants, they gather in colonies, sometimes underground in basements, and work long and hard,” said Zhou Xiaozheng, a sociology professor at Renmin University in Beijing.
Eight Problems Facing China
- Hot money inflows
- Huge property bubble
- Massive increases in money supply, much of it property speculation and building of unneeded capacity
- Currency manipulation charges from the US and potential trade wars
- Unsterilized trade imbalances fuel inflation
- Slowing Europe
- Dearth of Jobs for new graduates
- Potential social unrest
Case For Hard Landing
Risks are enormously skewed to the downside, so much so that the odds China avoids a hard landing are not good. China is far more exposed to a slowdown in Europe than the US and the popping of China's property bubble will extract a huge toll.
Those plowing into commodities, foreign currencies, and equities (especially foreign equities), fail to consider those risks.
Moreover, given that much of China's growth is overheating and malinvestment, it is not even clear the Renminbi is undervalued.
For a look at India, please consider Food, Fuel Inflation Hits India; Primary Price Index Up 15%, Credit Expansion Up 23%
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Submitted by David Galland from Casey Report
Profiting from Policy
These days, it’s hard to draw any conclusion other than that the train is gaining speed on wobbly tracks perched over a rickety bridge.
Most notably, unemployment has again risen – to 9.8% from 9.6% – very much not the direction things should be headed given the amount of money the government has pumped into the economy. The latest data shows that this nation of 310 million souls managed to add just 39,000 jobs in November. That, unfortunately, falls short of even keeping up with a population growth of about 1% – doing just that requires generating a net of about 250,000 jobs a month. As for eating away at the millions of unemployed and the many millions more who are underemployed… oh, well.
Of course, the mainstream financial media wastes no time in pointing to this latest dismalia as proof positive that the Fed’s recent decision to energetically restoke the money machine with upwards of $100 billion a month was the right decision. This despite the clear evidence that adding debt to debt is having no real effect, except begetting more debt.
This is a lesson that, so far, appears to be making no headway in the cognitions of Washington’s policy makers, even with the latest election results delivering a sharp rap across the knuckles to the power elite.
Evidence of that truth came to me during a recent drive to do sundry errands. After flipping through the stations, I ended up listening to a program on National Public Radio with a moderator quizzing a couple of congresspersons – one still in power and the other dismissed by voters in the midterm elections.
In conversing with the latter, the reporter asked if the Democrat congressman’s loss wasn’t a clear sign of voter frustration. To which the ex-official blathered on about the number of filibusters threatened by the Republicans over the last couple of years as a reason why the Obama Congress was unable to get its business done.
But, interjected the reporter, the Democrat-controlled Congress passed all manner of legislation – healthcare, financial reform, environmental bills, etc., etc – so isn’t it more a case of voters being upset about the quality and scale of the legislation passed, and not the dearth of it?
Whereupon the ex-Con began to illustrate his point by spouting off about some wastewater bill that was turned back by the Republicans, even though it would have unleashed another $15 billion in federal spending “so important to putting Americans back to work.”
But wait, again interjected the reporter, wouldn’t many people listening to this program say to themselves, this guy just doesn’t get it? That we don’t want the federal government to keep spending billions of taxpayer money on these make-work projects?
Without missing a beat, the ex-Con flipped like a freshly landed mackerel and argued against his position of just seconds before, saying, “This isn’t about the money! It’s about clean water for all Americans!”
At which point the reporter cleared his throat and ended the interview.
Next up was an angry Democrat of some influence. The congresswoman’s anger was directed first at the findings of the Deficit Reduction Commission that the spending cuts must be widespread if they are to be sufficient, and then at the administration for even thinking about extending the Bush tax cuts for people earning over $250K.
Oh, how I wish I was able to do proper justice to her diatribe here – I can’t, but I will do my best.
In her world view, the poor huddled masses of America – being defined as anyone with an income of under $250,000 a year – had nothing to do with the financial crisis, and so why should they be held even a little bit responsible for helping to foot the bill? No, no – it was the greedy fat cats that brought this fresh hell upon us, and so it is they, and they alone, who should be made to pay… and pay.
Of course, nowhere in the discussion was there mention of the role that the many-tentacled government played in all of this… of the loose money, the looser spending, the wars, the unbridled enthusiasm for a steady diet of pork, and… and...
If there were some mega-computer capable of fairly allocating the financial pain based on the contribution each of us has made to this mess, and then assess taxes accordingly, I suspect the end result would leave past and present members of the Fed living in cardboard boxes, and 97% of past and present members of Congress shuffling in gutters looking for cigarette stubs… at least when they weren’t fighting over discarded clothes with executives of the big financial institutions, NGOs, and the Treasury Department.
Having wiped all of those individuals out to the bone, the burden could then shift to the military-industrial complex that has so effectively pursued its symbiotic and very, very costly “Don’t Ask (where the money went), Don’t Tell (the truth)” policy for decades now.
It could then lay the hooks into anyone who ever took a government-backed loan – big or small – without first taking the time to do a serious calculation as to their ability to repay it, or the unscrupulous lenders who knew that the loans they were originating were going to end up in default with the tab ultimately being dropped on the government.
In fact, were such a mega-computer able to do the calculation, I strongly suggest it would only be after many further layers that the pain, fairly allocated, would reach the rank and file business community, the sole real engine of growth in this economy.
I refer, of course, to the very same individuals so steadily derided by the vote-seeking politicos, despite the fact that it is these long-suffering entrepreneurs who wake up every new day to risk everything in their efforts to create new jobs, despite the heavy glop of bureaucracy on their backs every step of the way.
Yet it is the few that succeed, against all odds and a constant battering of taxes and regulations, that this particular congressperson sees as the villains. In other words, she has pretty much reversed the proper order of accountability – as one would expect in a system where all that matters is vote gaining.
When the talk turned to the administration’s apparent willingness to accept an across-the-board extension of the Bush tax reductions as part of a compromise to also extend unemployment benefits (at 42%, the situation of the long-term unemployed is becoming a serious problem), the congresswoman was almost apoplectic. In addition to the views just exposed, about the wealthy needing to pay for their many sins, she was astounded that anyone could hold up the unemployment extension, given the poor shape of the economy.
How can anyone argue against the direct benefits to our struggling economy of putting money in the pockets of people who most need it, she asked with dismay in her voice. Adding in support of her view that it should be obvious to all that the recipients of the money will turn right around and spend it on the necessities and that will give the economy just the boost it needs.
Hmm, I thought as I drove down the road. All we need to improve the economy is to give people money.
Why, it’s simplicity itself! And now that I get it, I think people should just quit their whining about fiscal probity and all of that, and just let ‘er rip. Don’t stop with small change, encourage the Treasury to start cranking out checks in princely sums to everyone!
Thousands, millions, even! In no time at all, America’s salad days will be back.
Of course I’m being cynical. But the point I’m trying to make is important, because while I am exaggerating, the economic concept so ardently championed by the congresswoman is accepted at face value by most of the government and all of the administration’s favorite economists.
More than that, because it is accepted, it is policy.
In this construct money is, at best, an abstraction: it has reached the point that the government, and most people, actually believe the stuff falls from the proverbial tree. Money is no longer a medium for saving or transacting with the fruits of one’s labor, but instead is a commodity – albeit unique in that it has unlimited supply.
It does not, however, enjoy unlimited demand. For now, the demand is certainly there. But as the supply increases, individuals and institutions are correctly wary of the effects of dilution… debasement… inflation, pick your term.
The alternative forms of money – the sound kind – are getting a lot of attention because more and more people actually “get it.” They are beginning to recognize the fictions that the politicians and bureaucrats believe in and are taking measures to protect themselves and to profit.
Before moving on, I would mention that I know someone who works as a manager in the Department of Motor Vehicles. A few days ago she told me that, other than a relatively brief flurry during the Cash for Clunkers program, the pace of car registrations has been slow ever since the crisis began and has shown absolutely no improvement since that program ended.
In fact, the only increase in the DMV’s workload has come from the processing of suspended driver’s licenses.
As the latest unemployment figures show and my friend’s first-hand observations confirm, this economy is not recovering. And, per the rise in license suspensions, the government is becoming increasingly aggressive in fine-generating enforcement actions.
In relationship to the second of those data points, if you’re going to imbibe this holiday season, don’t drive.
Finally, please don’t misunderstand my comments above as being insensitive to the plight of the unemployed. I personally know far too many people in that situation whose prospects of ever regaining their prior lifestyles is now almost non-existent to be cavalier about the topic.
The only realistic way I can help – because I can’t and won’t put my own family’s future at risk by trying to help everyone – is doing my part to build and maintain a business that, by offering a tangible value to clients, is able to keep a lot of people productively employed.
Therefore, it angers me to no end to listen as the morons maintained in power by the equally moronic masses make rude noises about the entrepreneurial class and otherwise meddle in matters about which they have no actual understanding and, as a consequence, continue doing great damage to the economy.
Something has got to change… and will, before this is over.
robert shumake detroit
robert shumake
500 More Red-Winged Blackbirds Found Dead in Louisiana - AOL <b>News</b>
Days after 100000 fish and approximately 4000 red-winged blackbirds were found dead in Arkansas, 500 deceased blackbirds and starlings were discovered on a Louisiana highway.
Moore: EA not backing away from Tiger <b>News</b> - Page 1 | Eurogamer.net
Read our news of Moore: EA not backing away from Tiger.
John Roberts Leaves CNN for Fox <b>News</b> - NYTimes.com
Executives at CNN confirmed Monday that John Roberts, who served as the morning anchor for the network since April 2007, would be joining Fox News as a national correspondent.
robert shumake
500 More Red-Winged Blackbirds Found Dead in Louisiana - AOL <b>News</b>
Days after 100000 fish and approximately 4000 red-winged blackbirds were found dead in Arkansas, 500 deceased blackbirds and starlings were discovered on a Louisiana highway.
Moore: EA not backing away from Tiger <b>News</b> - Page 1 | Eurogamer.net
Read our news of Moore: EA not backing away from Tiger.
John Roberts Leaves CNN for Fox <b>News</b> - NYTimes.com
Executives at CNN confirmed Monday that John Roberts, who served as the morning anchor for the network since April 2007, would be joining Fox News as a national correspondent.
robert shumake
One of the lesser known money-makers uses an idea called Pay-Per-Click Websites (or, more simply, PPC sites). A PPC site is a search engine, much like Google or Yahoo!, which rank websites based on the search terms you enter. Using a membership subscription process, you can be paid for using them. The idea behind these websites is to promote their search engine to potential advertisers, so that they can make money. Because of the prevalence of Google, Yahoo!, and ask.com, the lesser known sites have to offer incentives to people who use their service so that they can compete. Their method is to pay users, often at about one-thousandth of a cent per click, to browse on their site, eventually paying the customer when their balance reaches between $5 and $50, depending on the site. As I'm sure you can imagine, this takes a long time to build up, but once you automate your clicking, you can eventually work up a large sum of money and get a pretty big check. It can take awhile, but can be worth it if you spend a lot of time on the net already. The site you want to sign up with is PPC Appraisal (you can find all the necessary links at the bottom of this article)..
Simply sign up for a new account. When the site asks for your company, simply put your full name. For your tax ID, put 'n/a' and for your website, put 'www.ppcappraisal.com'. Sign up for any account name you please.
The next step is to download and install an automatic clicker. The only approved choice by PPC appraisal is the Ougo browser (), and fortunately, it happens to be one of the better ones out there. .
Now you need to do some initial setup. You only need to do this next part once. After you log in to PPC Appraisal's website, you need to click on the requests tab. Check the following boxes: Baltimore, Braintopia, Campaign, Cialto Art, Cockta, Cymicon, Joymars, Kazati.com portal, kili gaga, Medical health and fitness, NetVivid Portal and PPC Search engine. Do not select any others, or else it will take you years to get a check. Click the request bottom at the bottom of this page to continue.
Once you've made your requests, go to the "Menu" tab and find "Your link to rotation script for portals." Highlight the link inside this box, and press CTRL+C to copy.
Now it's time to set up the browser. Install the Ougo Browser you downloaded earlier and go to the "Surf" Menu, then click on Setup. Under Set1, paste (CTRL+V) the link into the panel on the right. That's all for setup.
To start the process, you need to start up the Ougo Browser whenever you go online. To start auto-surfing, and of course, making money, you simply go to "Surf" then "Start Surf" then "OK" when a pop up starts. You'll quickly see two windows pop up.
This is fine, but to maximize your options, go to "Tools -> Developers ->Analyst -> Six" to open six windows, and triple your browsing powers. Now let the money roll in, albeit slowly.
To get paid, you need to simply wait until you have enough credits with these websites. To check your current status, go to the PPC Appraisal website and sign in. One option you probably want to turn on in Ougo is to send the browser to the tray when you click the minimize button. To do this, click Tools -> Ougo Browser -> Options -> Tray Options -> Enable Tray Icon ->Minimize to Tray. Now when you click the minimize button, it will not appear next to the other programs you're using, but rather disappear down by the clock on the right-hand side of the screen. It will continue running, but you just won't be able to see it.
Now, this alone will NOT make you any money whatsoever. It could take you months to earn enough for a single check, but you'd be losing money on electricity the whole time. You need to take you clicking business to the next step, or don't bother. The way you do this is simple. You get referrals. You'll need a lot of them to make it work, but if you get one or two really intrepid adventurers, you can get up to $4 a day with minimal effort. You earn 5% of what each of your referrals makes by clicking, and 5% of their referrals down to the fourth level (i.e. you -> your referral -> their referral -> their referral). It can add up nicely if you do it right. Currently, I'm making about $3 a day with four referral levels. Write up a set of instructions similar to this one (sorry, you can't copy this document outright), and post it in your blog, or on message boards, changing out my referral addresses with yours, and there's some money to be made here. Keep clicking yourself so that you receive checks, otherwise that referral money will simply sit in your account. If you have an alternate address, like a P.O. Box or an office address, you can use those too. Refer yourself to yourself! Not a bad idea if you ask me. Refer everyone else from your second level account, and you instantly get twice the bonus on any future referrals.
You can also sell this document on eBay or other Auction sites, as people are always looking to get some more income streams. It's hard work to do this, but once you get yourself established, all you need to do is request money once a week from each of your PPC sites.
Are there any dangers to doing this? No. It's completely legal, spyware free, and does very, very little to slow down your PC while it is running.
You should also know that a document has been going around the internet for a while now, very similar to this one, advertising the same site, though promising a lot larger gains in money than are possible, and giving out bad advice on how to get started. You'll find a lot of information online about how this is a scam, etc. It is not. I've been paid, multiple times already, and am on the verge of getting paid again. The trick is to use the method I describe, that is, not clicking on all the possible membership requests. As I stated in that section, this is a sure way to make no money whatsoever, as different sites pay different rates. The sites I've chosen for you to participate in have the best payrates, and thus, you're not wasting any time waiting for the slow sites to give you some money. Only the fast paying ones will be clicked through. Also make sure that you use Ougo Browser rather than Test33.
For example, I started off finding out about this method through that bad document, and clicked on request all. By doing this, I earned five cents from the highest pay-rate site in a week's time. I knew something was wrong. So I singled out that site for the next week, and low and behold, I got $2.92 in a week instead. As you can see, this is not the biggest money earner ever. However, I kept my PC auto-clicking for a while longer, and eventually got a $50 check in the mail for my troubles. Most of the time, I was using my computer for other purposes while it was clicking away, so I wasn't losing out on anything while it was running.
The reason you're doing all of this for credits is simple: a credit is a unit created by the search engines you're participating in by clicking on them. The way you make money is to make a batch request for your credits, and then to sell them on a site like De Quba . To sell your credits, use PPC Appraisal's Transfer option to transfer your banked credits away from PPC to your DeQuba Account.
To sell your DeQuba credits, you must become a platinum member - which means it's $36 for a year-long membership, and you won't make any sales in the first 60 days. I suggest banking your credits on PPC Appraisal, then after you've requested some, sign up for the Platinum Membership. You'll get a bunch of free credits immediately, just leave these as they are. After your 60 day "fraud protection" time is over, you transfer all of your credits from PPC Appraisal, and sell them in the DeQuba Forum (go to "sell your credits"). Find either a one-time sale (recommended), or a monthly sale (only do these if you are positive you can create a high enough balance). You will be paid by these people. Although this option now becomes a paid program, you make roughly $1 per credit, and since the minimum balance for cashing in credits requires you to have 50 or 60, you make your money back, and more, with your first transaction.
After publicizing the proper methods to everyone I could, I got plenty of referrals, and made some nice money. I opened up my requirements to all the sites listed above, and now get a bevy of checks every six months or so. Referrals help immensely, of course, but the money is still earnable, and it's not a scam.
Good luck!
robert shumake
500 More Red-Winged Blackbirds Found Dead in Louisiana - AOL <b>News</b>
Days after 100000 fish and approximately 4000 red-winged blackbirds were found dead in Arkansas, 500 deceased blackbirds and starlings were discovered on a Louisiana highway.
Moore: EA not backing away from Tiger <b>News</b> - Page 1 | Eurogamer.net
Read our news of Moore: EA not backing away from Tiger.
John Roberts Leaves CNN for Fox <b>News</b> - NYTimes.com
Executives at CNN confirmed Monday that John Roberts, who served as the morning anchor for the network since April 2007, would be joining Fox News as a national correspondent.
robert shumake
robert shumake detroit
Inflation is running at a reported 5.1% in China, a figure most believe is on the low side. Nonetheless, China has been loath to hike rates out of fear of more "hot money" flowing in. Something had to give, and it did. The markets forced China's hand.
Please consider China Increases Rates to Counter Highest Inflation in Two Years
China raised interest rates for the second time since mid-October to counter the fastest inflation in more than two years and more moves may follow.China Overheating
The benchmark one-year lending rate will rise by 25 basis points to 5.81 percent and the one-year deposit rate will climb by the same amount to 2.75 percent, effective today, the People’s Bank of China said in a one-sentence statement on its website late yesterday.
Premier Wen Jiabao is seeking to slow gains in property values and consumer prices that are making it harder for families to buy homes and pay for food. Bank lending and a wider-than-forecast November trade surplus have pumped more cash into an economy already awash with money.
China is tightening after a record expansion of credit to counter the effects of the world financial crisis. The broadest measure of money supply, M2, has surged by 55 percent over the past two years and outstanding yuan-denominated loans have climbed 60 percent to 47.4 trillion.
Residence-related costs, including charges for water, electricity and rent, jumped 5.8 percent last month from a year earlier, the most in more than two years, and consumer goods prices rose 5.9 percent, the biggest gain since August 2008, according to statistics bureau data.
Policy makers are concerned that raising interest rates could “encourage hot money inflows,” Paul Cavey, a Hong Kong- based economist at Macquarie Securities Ltd. said. “Raising interest rates has far more implications” than ordering lenders to set aside more of their deposits as reserves, as it may affect the ability of local governments and companies to pay their debts.
State Council researcher Ba Shusong told state television yesterday that the government will step up regulation of capital inflows, without specifying measures that will be taken.
The Ministry of Commerce is stepping up supervision of foreign investment in real estate to crack down on speculation after a 48 percent jump in overseas fund inflows to the industry in the first 11 months of the year, spokesman Yao Jian said on Dec. 15. Policy makers may also allow faster gains in the yuan to help curb inflation from higher prices of imported commodities, according to analysts’ forecasts.
China was number 5 on my list of Ten Economic and Investment Themes for 2011
5. China Overheats, Multiple Rate Hikes ComingCapital Controls Coming
China, everyone's favorite promised land, has a hard landing. China will grow at perhaps 5-6% but that is nowhere near as much as China wants, or the world expects. Tightening in China will crack its property bubble and more importantly pressure commodities. The longer China holds off in tightening, the harder the landing.
Initially, rate hikes will encourage more "hot money" inflows into China. In hopes of preventing those inflows, China has announced more capital controls. It will be interesting to see precisely what those controls will look like.
Currency Sterilization Needed
One thing China should do is sterilize speculative hot money and balance of trade inflows via domestic government bond issuance, hoping to curb money supply growth.
However, it is not as simple as that, because in a fractional-reserve credit system, a net increase in lending itself increases money supply.
Clearly the Chinese central bank is behind the curve. Will China simply restrict lending? Would it even work?
I do not know about the former, but the latter would eventually force a hard landing if China gets serious enough. Actually, there are so many problems that I think a hard landing is coming regardless, and the longer China dallies, the harder it will be.
In the meantime, these paltry rate hikes by China of .25 points each pale in comparison to increases in reported consumer price increases.
Enormous Property Bubbles Including Vacant Cities
It is not "consumer price inflation" that is the big problem. Asset inflation, especially property speculation is rampant.
In case you missed it please consider The ghost towns of China: Amazing satellite images show cities meant to be home to millions lying deserted
Speculation will continue until China gets serious or until the pool of greater fools buying property at absurd prices dries up.
China’s Army of Graduates Struggles for Jobs
Exacerbating China's myriad of problems, an Army of Graduates Struggles for Jobs
In 1998, when Jiang Zemin, then the president, announced plans to bolster higher education, Chinese universities and colleges produced 830,000 graduates a year. Last May, that number was more than six million and rising.Odds for social unrest will mount if China's growth slows. Yet, because of short-term overheating concerns on top of long-term peak oil issues there is no way China can keep growing at the current pace.
It is a remarkable achievement, yet for a government fixated on stability such figures are also a cause for concern. The economy, despite its robust growth, does not generate enough good professional jobs to absorb the influx of highly educated young adults. And many of them bear the inflated expectations of their parents, who emptied their bank accounts to buy them the good life that a higher education is presumed to guarantee.
“College essentially provided them with nothing,” said Zhang Ming, a political scientist and vocal critic of China’s education system. “For many young graduates, it’s all about survival. If there was ever an economic crisis, they could be a source of instability.”
In a kind of cruel reversal, China’s old migrant class — uneducated villagers who flocked to factory towns to make goods for export — are now in high demand, with spot labor shortages and tighter government oversight driving up blue-collar wages.
But the supply of those trained in accounting, finance and computer programming now seems limitless, and their value has plunged. Between 2003 and 2009, the average starting salary for migrant laborers grew by nearly 80 percent; during the same period, starting pay for college graduates stayed the same, although their wages actually decreased if inflation is taken into account.
Chinese sociologists have come up with a new term for educated young people who move in search of work like Ms. Liu: the ant tribe. It is a reference to their immense numbers — at least 100,000 in Beijing alone — and to the fact that they often settle into crowded neighborhoods, toiling for wages that would give even low-paid factory workers pause.
“Like ants, they gather in colonies, sometimes underground in basements, and work long and hard,” said Zhou Xiaozheng, a sociology professor at Renmin University in Beijing.
Eight Problems Facing China
- Hot money inflows
- Huge property bubble
- Massive increases in money supply, much of it property speculation and building of unneeded capacity
- Currency manipulation charges from the US and potential trade wars
- Unsterilized trade imbalances fuel inflation
- Slowing Europe
- Dearth of Jobs for new graduates
- Potential social unrest
Case For Hard Landing
Risks are enormously skewed to the downside, so much so that the odds China avoids a hard landing are not good. China is far more exposed to a slowdown in Europe than the US and the popping of China's property bubble will extract a huge toll.
Those plowing into commodities, foreign currencies, and equities (especially foreign equities), fail to consider those risks.
Moreover, given that much of China's growth is overheating and malinvestment, it is not even clear the Renminbi is undervalued.
For a look at India, please consider Food, Fuel Inflation Hits India; Primary Price Index Up 15%, Credit Expansion Up 23%
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Submitted by David Galland from Casey Report
Profiting from Policy
These days, it’s hard to draw any conclusion other than that the train is gaining speed on wobbly tracks perched over a rickety bridge.
Most notably, unemployment has again risen – to 9.8% from 9.6% – very much not the direction things should be headed given the amount of money the government has pumped into the economy. The latest data shows that this nation of 310 million souls managed to add just 39,000 jobs in November. That, unfortunately, falls short of even keeping up with a population growth of about 1% – doing just that requires generating a net of about 250,000 jobs a month. As for eating away at the millions of unemployed and the many millions more who are underemployed… oh, well.
Of course, the mainstream financial media wastes no time in pointing to this latest dismalia as proof positive that the Fed’s recent decision to energetically restoke the money machine with upwards of $100 billion a month was the right decision. This despite the clear evidence that adding debt to debt is having no real effect, except begetting more debt.
This is a lesson that, so far, appears to be making no headway in the cognitions of Washington’s policy makers, even with the latest election results delivering a sharp rap across the knuckles to the power elite.
Evidence of that truth came to me during a recent drive to do sundry errands. After flipping through the stations, I ended up listening to a program on National Public Radio with a moderator quizzing a couple of congresspersons – one still in power and the other dismissed by voters in the midterm elections.
In conversing with the latter, the reporter asked if the Democrat congressman’s loss wasn’t a clear sign of voter frustration. To which the ex-official blathered on about the number of filibusters threatened by the Republicans over the last couple of years as a reason why the Obama Congress was unable to get its business done.
But, interjected the reporter, the Democrat-controlled Congress passed all manner of legislation – healthcare, financial reform, environmental bills, etc., etc – so isn’t it more a case of voters being upset about the quality and scale of the legislation passed, and not the dearth of it?
Whereupon the ex-Con began to illustrate his point by spouting off about some wastewater bill that was turned back by the Republicans, even though it would have unleashed another $15 billion in federal spending “so important to putting Americans back to work.”
But wait, again interjected the reporter, wouldn’t many people listening to this program say to themselves, this guy just doesn’t get it? That we don’t want the federal government to keep spending billions of taxpayer money on these make-work projects?
Without missing a beat, the ex-Con flipped like a freshly landed mackerel and argued against his position of just seconds before, saying, “This isn’t about the money! It’s about clean water for all Americans!”
At which point the reporter cleared his throat and ended the interview.
Next up was an angry Democrat of some influence. The congresswoman’s anger was directed first at the findings of the Deficit Reduction Commission that the spending cuts must be widespread if they are to be sufficient, and then at the administration for even thinking about extending the Bush tax cuts for people earning over $250K.
Oh, how I wish I was able to do proper justice to her diatribe here – I can’t, but I will do my best.
In her world view, the poor huddled masses of America – being defined as anyone with an income of under $250,000 a year – had nothing to do with the financial crisis, and so why should they be held even a little bit responsible for helping to foot the bill? No, no – it was the greedy fat cats that brought this fresh hell upon us, and so it is they, and they alone, who should be made to pay… and pay.
Of course, nowhere in the discussion was there mention of the role that the many-tentacled government played in all of this… of the loose money, the looser spending, the wars, the unbridled enthusiasm for a steady diet of pork, and… and...
If there were some mega-computer capable of fairly allocating the financial pain based on the contribution each of us has made to this mess, and then assess taxes accordingly, I suspect the end result would leave past and present members of the Fed living in cardboard boxes, and 97% of past and present members of Congress shuffling in gutters looking for cigarette stubs… at least when they weren’t fighting over discarded clothes with executives of the big financial institutions, NGOs, and the Treasury Department.
Having wiped all of those individuals out to the bone, the burden could then shift to the military-industrial complex that has so effectively pursued its symbiotic and very, very costly “Don’t Ask (where the money went), Don’t Tell (the truth)” policy for decades now.
It could then lay the hooks into anyone who ever took a government-backed loan – big or small – without first taking the time to do a serious calculation as to their ability to repay it, or the unscrupulous lenders who knew that the loans they were originating were going to end up in default with the tab ultimately being dropped on the government.
In fact, were such a mega-computer able to do the calculation, I strongly suggest it would only be after many further layers that the pain, fairly allocated, would reach the rank and file business community, the sole real engine of growth in this economy.
I refer, of course, to the very same individuals so steadily derided by the vote-seeking politicos, despite the fact that it is these long-suffering entrepreneurs who wake up every new day to risk everything in their efforts to create new jobs, despite the heavy glop of bureaucracy on their backs every step of the way.
Yet it is the few that succeed, against all odds and a constant battering of taxes and regulations, that this particular congressperson sees as the villains. In other words, she has pretty much reversed the proper order of accountability – as one would expect in a system where all that matters is vote gaining.
When the talk turned to the administration’s apparent willingness to accept an across-the-board extension of the Bush tax reductions as part of a compromise to also extend unemployment benefits (at 42%, the situation of the long-term unemployed is becoming a serious problem), the congresswoman was almost apoplectic. In addition to the views just exposed, about the wealthy needing to pay for their many sins, she was astounded that anyone could hold up the unemployment extension, given the poor shape of the economy.
How can anyone argue against the direct benefits to our struggling economy of putting money in the pockets of people who most need it, she asked with dismay in her voice. Adding in support of her view that it should be obvious to all that the recipients of the money will turn right around and spend it on the necessities and that will give the economy just the boost it needs.
Hmm, I thought as I drove down the road. All we need to improve the economy is to give people money.
Why, it’s simplicity itself! And now that I get it, I think people should just quit their whining about fiscal probity and all of that, and just let ‘er rip. Don’t stop with small change, encourage the Treasury to start cranking out checks in princely sums to everyone!
Thousands, millions, even! In no time at all, America’s salad days will be back.
Of course I’m being cynical. But the point I’m trying to make is important, because while I am exaggerating, the economic concept so ardently championed by the congresswoman is accepted at face value by most of the government and all of the administration’s favorite economists.
More than that, because it is accepted, it is policy.
In this construct money is, at best, an abstraction: it has reached the point that the government, and most people, actually believe the stuff falls from the proverbial tree. Money is no longer a medium for saving or transacting with the fruits of one’s labor, but instead is a commodity – albeit unique in that it has unlimited supply.
It does not, however, enjoy unlimited demand. For now, the demand is certainly there. But as the supply increases, individuals and institutions are correctly wary of the effects of dilution… debasement… inflation, pick your term.
The alternative forms of money – the sound kind – are getting a lot of attention because more and more people actually “get it.” They are beginning to recognize the fictions that the politicians and bureaucrats believe in and are taking measures to protect themselves and to profit.
Before moving on, I would mention that I know someone who works as a manager in the Department of Motor Vehicles. A few days ago she told me that, other than a relatively brief flurry during the Cash for Clunkers program, the pace of car registrations has been slow ever since the crisis began and has shown absolutely no improvement since that program ended.
In fact, the only increase in the DMV’s workload has come from the processing of suspended driver’s licenses.
As the latest unemployment figures show and my friend’s first-hand observations confirm, this economy is not recovering. And, per the rise in license suspensions, the government is becoming increasingly aggressive in fine-generating enforcement actions.
In relationship to the second of those data points, if you’re going to imbibe this holiday season, don’t drive.
Finally, please don’t misunderstand my comments above as being insensitive to the plight of the unemployed. I personally know far too many people in that situation whose prospects of ever regaining their prior lifestyles is now almost non-existent to be cavalier about the topic.
The only realistic way I can help – because I can’t and won’t put my own family’s future at risk by trying to help everyone – is doing my part to build and maintain a business that, by offering a tangible value to clients, is able to keep a lot of people productively employed.
Therefore, it angers me to no end to listen as the morons maintained in power by the equally moronic masses make rude noises about the entrepreneurial class and otherwise meddle in matters about which they have no actual understanding and, as a consequence, continue doing great damage to the economy.
Something has got to change… and will, before this is over.
robert shumake
500 More Red-Winged Blackbirds Found Dead in Louisiana - AOL <b>News</b>
Days after 100000 fish and approximately 4000 red-winged blackbirds were found dead in Arkansas, 500 deceased blackbirds and starlings were discovered on a Louisiana highway.
Moore: EA not backing away from Tiger <b>News</b> - Page 1 | Eurogamer.net
Read our news of Moore: EA not backing away from Tiger.
John Roberts Leaves CNN for Fox <b>News</b> - NYTimes.com
Executives at CNN confirmed Monday that John Roberts, who served as the morning anchor for the network since April 2007, would be joining Fox News as a national correspondent.
robert shumake
robert shumake
No comments:
Post a Comment