The Game Ends When Obama Can't Spend
August 20, 2009
– Comments (19)
Right now, most of our economy is government spending. Government spending on health care, welfare, defense, food stamps, unemployment etc.....government spending directly over $6.5 trillion dollars and indirectly probably resonsible for a few trillion more. The Government is the primary driver of spending in America right now.......a role which has been reversed in recent years as the bankers have cut off the private economy from funds.
THE PROBLEM: Tax receipts to government are evaporating at a historically unprecedented rate in absolute dollars. The private economy is coming to a screeching halt. Commercial Building sales in Manhatten in the first half of the year were down OVER 90% from last year. Architecture firms are closing down across the nation as there is very little actual work from this point forward.
Our government is spending trillions that does not exist nor will ever likely to matierialize under current Zombulation policies. No nation in the history of the world has ever been allowed to simply print money to support is population. By simply printing, you are effectively counterfeiting your currency and destroying the underlying value....something very different than borrowing.
As Buffett alluded to in his recent op ed piece, this will lead to a disaster much worse than the one we perceive we recently avoided.
At this point, if Obama doesn't spend....Wal Mart is dead....so are many health care facilities......and drug stores.....and drug companies.....and defense companies.......and schools......and hospitals..........and local governments dependent on stimulous money........
Now the only problem is where is the money going to come from to support all of the above......without making us all broke?
Right now, our money center banks (that we are loaning money to) are the primary ones buying our debt (loaning us money)....in other words, they are loaning us money with our own money at a much higher interest rate......what do you think they are going to demand when they want to be paid back?
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