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alstry (35.42)

ARE ECONOMISTS TERRORISTS?

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July 01, 2010 – Comments (6)

Something strange happened to Economics....

Somehow it came into mainstream thinking that Americans could continue to consume massively even though they didn't produce very much......

We could borrow, cheat and steal.....it didn't matter.....as long as we consumed, Economists believed everything would be OK with little regard to production.

Now, as a nation, we are consuming massively with relatively little production.  The bankers assured us of this by cutting off credit to an economy that they made credit dependent.

Our government and the tens of millions of employees are consuming much more than they are producing.  Our Welfare, Retired, and Unemployed are consuming much more than they are producing.  Our select few bankers are consuming much more than they are producing.

Simply the above constitutes a massive amount of production backed by relatively little production.

How are we consuming?...by handing others currency and taking production in return.  HOWEVER, currency only has value if it is backed by production/assets.  And as we keep printing more currency backed by less and less production....soon our currency will have little value and fewer and fewer will accept it for their production.

When our money is worthless, or near worthless.....you will know what it is like to take your "FREEDOM" away.  Just ask the poor in Africa, India, or much of the rest of the world.  The German's after World War 1 have a profound understanding of this concept.

This is the path we are heading down....and when few will accept our currency for their production....we will be left with two choices.....STOP CONSUMING OR FORCE/FIGHT OTHERS TO ACCEPT OUR CURRENCY.

It will be interesting to see which choice we select.

6 Comments – Post Your Own

#1) On July 01, 2010 at 10:20 AM, alstry (35.42) wrote:

YOU SIMPLY CAN'T PRINT MONEY AND PRODUCE LITTLE AND EXPECT ANYTHING BUT A TERRIBLE OUTCOME

May Pending Home Sales Tumble to Record Low

The only reason the retired people in America can retire is their money can be exchanged for production.....what happens when there is a lot of retired relative to production of few will accept money for production?

DID YOUR FINANCIAL PLANNER EVERY DISCUSS THIS WITH YOU?

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#2) On July 01, 2010 at 1:04 PM, 1315623493 wrote:

We produce little? Making stuff up again?

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#3) On July 01, 2010 at 1:08 PM, alstry (35.42) wrote:

We produce little RELATIVE to our consumption.....

Where do you think that little $2 trillion dollar collective government deficit come from?

That is the equal to giving 40,000,000 American families of four $50,000 per year to consume.....which then drives production....

At some point.....few will be willing to accept our currency as bankers continue to cut off the private sector from credit and production evaporates as few will be around consuming with worthless money.

Ask a German for some perspective on this issue.

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#4) On July 01, 2010 at 3:22 PM, NDimensionalDino (98.43) wrote:

1.2 million people were cut off from unemployment at the end of May.  1.3 million more will be cut from unemployment as of Monday.  200,000 more per week after that.  The earliest Congress can pass a renewal for the federal extension is the July 12th.

 What do you think this will do to consumer confidence?  To consumer spending?

 I don't care who is at fault.  Let me repeat that for the stupid because I know some people just HAVE to point fingers.  I don't care who is at fault.  This is what happened, and this will be the consequence.  People will lose homes, cars, and everything else.  Some of them will even pull their money out of the markets.  This will only further reduce demand, further depress the economy and further erode community tax bases.

 

Of course, the real problem is supply.  Not the lack of it, but from where it comes.  As goods enter, money leaves.  We've been bleeding billions per month for 30 years now.  One can only bleed the patient for so long before all you have is a dried out husk.  So even if we create jobs.  Even if we stimulate demand - it will only make things worse because that just sends more money out of the country.

The only way is to slowly close our borders to imports while simultaneously rebuilding our own manufacturing base.  Yes, things will cost more.  But the cost of high unemployment and continued trade deficits are far greater than a few years of inflation.  Too many of us are so fearful of inflation that they would rather millions sat under a bridge starving to death.  They're irrational.

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#5) On July 01, 2010 at 5:10 PM, 1315623493 wrote:

ALSTRY,

We produce little RELATIVE to our consumption..... 

Ah, that I won't argue against. First, the consumer had to buckle down. Now it's governments.  

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#6) On July 01, 2010 at 5:34 PM, alstry (35.42) wrote:

AHHHH.  Now you are thinking.....

But at a spending rate of OVER $7 trillion dollars per year.....

GOVERNMENT IS THE ECONOMY!!!!

Without government spending...we have NO ECONOMY!

Unemployment benefits are creating jobs faster than practically any other program, House Speaker Nancy Pelosi said Thursday. 

Talking to reporters, the House speaker was defending a jobless benefits extension against those who say it gives recipients little incentive to work. By her reasoning, those checks are helping give somebody a job. 

"It injects demand into the economy," Pelosi said, arguing that when families have money to spend it keeps the economy churning. "It creates jobs faster than almost any other initiative you can name." 

Pelosi said the aid has the "double benefit" of helping those who lost their jobs and acting as a "job creator" on the side. 

Approaching 20 million people receive unemployment checks every month...some approaching $3000.

Where do you think our economy would be without just those checks being handed out?

What about the 40,000,000 in Food Stamps?

And we havn't even dented the deficit yet.

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