Sunday, September 21, 2008

And I Thought 85 Billion Was A Lot

Guess what. AIG was, surprise surprise, just the start. Now the Fed is recommending that we bail out *everyone* who is stuck with a bad loan. The starting number is $700 billion, that's $700,000,000,000, btw. And doesn't include the folks we've already bailed out, at another $100 billion. And when analysts are suggesting that perhaps the number will instead be $1 trillion ($1,000,000,000,000, that is indeed 12 zeros), which is about 1/10th of the existing national debt, you know that we are in very deep doo doo indeed. 

The biggest threat? Inflation. It may be time to start stocking up on every staple I can conceive of before the prices start doubling and tripling in the next six months. 

At this point, I almost wish that McCain/Palin *did* get elected to office (or steal it, that seems to have worked the last two times out), because there is no way that the next president will be able to repair much of the damage in this country with the financial crisis as bad as it is. And it is. We have a *Republican* administration wanting to effectively socialize the entire investment industry as a preferable choice to it's complete collapse. In an election year. 

Me, I'm hoping that both parties are completely wiped out by this mess so that we can start over from scratch. I like the Constitution just fine (except the electoral college), but the parties no longer either represent the people, nor are they willing to let any other parties in. 

Of course, that means you get some really crazy parties with really crazy ideas (think the National Socialists in 30's Germany). Imagine a party whose main plank was the teaching of Creationism and Aristotilian physics, with the sun at the center of the universe. If some people can think, against every shred of physical evidence we have, that dinosaurs were once used by people as draft animals *solely* because a Bishop in England a few hundred years ago decided that each day of creation was equivalent to one thousand years of history (with the seventh day supposedly starting in 2000/2001), there will be some very frightening groups out there indeed. 

For now, however, we are going to have to find out what our parents and grandparents went through in the Great Depression, because our economy is built on an astonishingly flimsy set of premises. That bad house loans could lead to a complete collapse only proves my point. 

I may go learn how to shoot a firearm. It just may get that bad. 

$1,000,000,000,000. I think that number is going to be pretty low. Of course, in not too long a time, if history repeats itself, we'll be in an inflationary period where a million dollar bill may not buy coffee, certainly not at Starbucks (because no one will have discretionary income to buy coffee at Starbucks, so there won't be a Starbucks). At least you can pay off your home loan fast. 

One more thing: on your way out, don't forget to blame Clinton. It's clearly his fault. :-/


Matthew said...
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Matthew said...

A extended stagnant period of deflation is another possibility; it's really hard to say at this point.

Stocking up on staples is a good idea regardless. I've been doing it gradually for almost a year - nothing overboard, just sensible preparation.

Good luck to us all who'll get to pay for more than our share of human hubris.