December 16, 2013
By:
The Mogambo Guru
Snug and safe inside the silent and comforting Mogambo Big Boy Bunker
(MBBB), I have a lot of spare time each day to work myself into a state of
paranoid hysteria by thinking about the economic mess we are in.
Being a cynic of the first order (everything is corrupt and nothing can be
done) and sensing imminent doom (We’re Freaking Doomed (WFD)!), it is not
surprising to me that the evil Federal Reserve owns more than $3.5
trillion in Treasury debt, which is about 21 percent of ALL the nation’s
$17 trillion debt.
As totally bizarre and horrifying as this “monetizing the debt” crap is,
the damage has already been done.
Namely, the damage caused by all the newly created currency and credit,
used to buy all the Treasury debt in the first place, has already long
since flooded into the economy via government borrowing and spending the
new money, inflating the money supply and causing horrifying inflation in
prices.
Ergo, the national craze to increase the minimum wage.
Nevertheless, one cannot help but notice the way my handsomely rugged face
is suddenly contorted into a fit of rage, or the way my manly biceps and
bulging forearms flex in anger, or the way the blood vessels are popping
in my brawny, muscular neck, or the way I am shamelessly lying through my
teeth about all three of these things, to know that this is something
important.
And it is! The sheer
existence of the debt on the books of the Federal Reserve is just the
crucial “paper trail” of the treasonous crime of “monetizing the debt,” a
sorry scheme which has -- all the way through history! -- shown to be not
only ultimately catastrophic, but also, given the fact that this fact is
well known, in fact, to everybody for more than a century, Completely
Freaking Stupid (CFS). CFS!
So this evidence will come in real handy as glaring Exhibit A when the
whole enchilada of the corrupt American government-centric economy,
financed by a ridiculous Federal Reserve rapidly expanding a fiat
currency, using outrageous degrees of fractional banking, falls completely
apart in a blizzard of price increases impacting the things you need to
live, like food, water and energy, but also terrifying price decreases in
things you don’t, like stocks, bonds, vacation houses, retirement plans
and labor.
Whereupon I, the brave and heroic Mogambo The Outraged (MTO), will be
thrilled to be called to the witness stand, frantically elbowing my way
through the frenzied, maddened crowds thirsting for blood and seeking
revenge on the people who caused their misery, to happily and loudly
testify against the monstrous Ben Bernanke, on trial for his treachery for
this monetizing the debt thing, and verily will I thunder at him!
But I will thunder mostly at the horrid, satanic butthead Alan Greenspan,
who is solely responsible for our economic mess, and I will thunder long
and loud at him as The Great Monetary Satan (TGMS), over the repeated
objections of the defense attorney, the judge, and even Randy, the
avuncular bailiff, who will be struggling to drag me, kicking and
screaming, off of the witness stand to stop me from bellowing ever-louder
about the demonic Alan Greenspan (“Off with his head! Off with his
head!”), the judge repeatedly banging his gavel, bang, bang, bang, and
sternly saying “Order! Order in the court!” Bang, bang, bang! Wow! What a
scene!
But, as you are probably aware, that is then. This is now.
Fortunately, the People Of The World (POTW) can already find this
kind of evidentiary loudmouthed firebrand condemnation of the horrid Alan
Greenspan and Ben Bernanke in that fine and fabulous book of Cosmically
Timeless Mogambo Monetary And Investment Wisdom (CTMMAIW), the Economica
Mogambo, available at Amazon.com, which makes a fine Christmas present to
anyone who has ever wondered aloud about a general unease, a feeling of
being freaking doomed, and who might want to know that he or she was
right: We ARE freaking doomed!
And it is a wonderful book to find out who is responsible, but who cannot
wait for the trials of Greenspan and Bernanke to officially find out:
The wonderful book, Economica Mogambo, tells them who, how and why,
and (best of all!) what to do about this catastrophe to capitalize on it.
To wit: The lesson of the last few thousands of years of government and
money is to buy gold and silver when the government is acting suicidal and
stupid, such as the current fad of allowing massive deficit-spending of
newly-created fiat currency and credit.
The problem is debt. Chris Martensen, writing at Mises.org, notes that
Total Credit Market Debt is now about $57 trillion. And what is the Total
Credit Market Debt? He graciously defines it as “Total Credit Market Debt
(TCMD) is a measure of all the various forms of debt in the U.S. That
includes corporate, state, federal, and household borrowing. So student
loans are in there, as are auto loans, mortgages, and municipal and
federal debt. It’s pretty much everything debt-related. What it does
not include, though, are any unfunded obligations, entitlements, or
other types of liabilities. So the Social Security shortfalls are not in
there, nor are the underfunded pensions at the state or corporate levels.
TCMD is just debt, plain and simple.”
What he does NOT say is that total GDP is about $15 trillion, which means
that collectively we owe almost four times as much as we make, in A Whole
Freaking Year (WFY), as a whole freaking country! Unbelievable!
The problem is demonstrated by example. If you make $100 a year and you
owe $100 at 5 percent interest, your interest payment is 5 percent of your
income. Simple.
But if you make $100 and owe $400 at 5 percent, your interest payment is
$20, or 20 percent (a fifth!), of your income!
And since preposterously-low interest rates are being held down by the
manipulations of the evil Federal Reserve, when interest rates double, as
they surely will, your interest payments will consume 40 percent of your
income. And when they double again, as they surely will, they will consume
80 percent of your income! Just the interest payments!
Now, if your income (GDP) is $15 trillion and you owe $57 trillion at 5
percent interest, your interest payments alone consume almost 20 percent
of your income. And what will happen when interest rates zoom because of
all the inflation in prices caused by all of this creation of new currency
and credit by the evil Federal Reserve?
Yikes!
This, in case you are following my drift here, is Beyond Freaking Insane
(BFI).
Luckily, we know what to do: 2,500 years of Earth history has shown that
buying gold and silver bullion at a time like this is the only -- only! --
winning move. All others are
losers. All!
And that is why I say, without fear of contradiction except from those
stupid Earthling people who have not read their own economic history, and
those who, as yet, refuse to recognize my Cosmic Mogambo Genius (CMG),
even though Economica Mogambo is right there for sale at Amazon, and who
still scoff (“Screw you, ya moron!”) at my helpful suggestion that they
call me “Master” and grovel at my feet in whimpering supplication, “Whee!
This investing stuff is easy!”