All Together Now! We're Freaking Doomed (WFD)!!! Doomed!
October 14, 2015
By:
The Mogambo Guru
Lately, the world is understandably all nervously atwitter about many
things, mostly whether things economic (i.e. the overvalued stock market,
the overvalued bond market, the overvalued housing market, overextended
banks, overextended governments, overextended government promises,
overextended businesses, and overextended citizens all adding up to
incomprehensibly enormous and ludicrously large debt loads, etc.) will
come crashing down in a stinking, staggering, stupefyingly monstrous,
huge, honking heap of utter, utter ruination.
Perhaps, pausing for breath, due to something (shall we
soothingly-yet-ominously say) untoward happening.
“Untoward happening.” It’s a
nice, vaguely sinister phrase, and so handy when the kids whine something
like “And what if we DON’T stop acting like greedy little snot-nosed,
mental-defective brats who want new cellphones and nicer cars, like all
our friends whose fathers are not stingy, paranoid, whack-job weirdos like
you, and that’s why we hate you, in case you were wondering?”
Now, being a good father who lovingly tries to educate his children by
screaming at them (supplying that all-important emphasis), you knew that
when they were young, their attention spans were limited and they were
still thinking too concretely to understand abstract concepts.
Understanding this, you, as the considerate and loving parent,
could calm them down and conveniently end the conversation by explaining
“Shut up.”
Now that they are older, you have to explain everything, all subsumed
under the heading “You’re morons!” Now, as the thoughtful and dedicated
parent, you patiently explain to them “For some mental-defective reason,
you morons refuse to comprehend absolute necessity of buying gold and
silver when faced with the suicidal enormity of the Federal Reserve
creating so much cash and credit that everything, including the Entire
Freaking Economy (EFE) and half the population, directly depend on the
gargantuan, gluttonous government continuing to deficit-spend more and
more money, inflating the money supply above the already-enormous inflated
level which allowed all assets to inflate into these dangerous, deadly
bubbles!”
Of course, you could, trying to do the best job of parenting that you can,
also explain that the government NOT continuing to increase the
deficit-spending means that the fabled Keynesian multiplier (which
actually does exist and equates to around five, as do most multipliers)
will go into reverse, and five dollars of spending will disappear with
every dollar not created and deficit-spent.
But getting back to the basics of Explaining Things To Stupid Kids
(ETTSK), now would be a good time to throw a little guilt in there, too.
You can add “How can you embarrass me, over and over, for not knowing that
silly Deficit-Spending Crap (DSC) always ends badly with an inflationary
hell for things you need to live, and with a deflationary hell for paper
assets?”
Finally, as a coup de gras, appeal to their greed. This is where you can
casually throw in “And then gold and silver will again reign supreme, as
they always do, and then you can -- glory of glories! -- have all the
money you want! Piles and piles of money! All for you!”
Nowadays, alas, they are old enough to have learned at least a smattering
of the Austrian school of economics, and thus they know that those piles
and piles of money that I tantalizingly refer to won’t buy squat because
of the lack of buying power of each dollar, thanks to the monstrous
over-issuance of cash and credit by the evil Federal Reserve.
As a case in point, take a look at the pitiful case of Zimbabwe, as Junior
Mogambo Ranger (JMR) Phil S. and I suggest everyone do: They printed so
much cash in a single decade that their old Zimbabwe dollar is literally
worthless, and their economy (once a shining star of all of Africa) has
collapsed to the point where they again need foreign aid, just to keep
their citizens from starving.
So you can understand my irritation that my loving family ignores all
that, and greedily prefers nutritious food, decent clothing, washing
machines that don’t leak, dental care and all the rest of the luxuries
that I cannot afford, even if I WASN’T furiously using every available
dime to buy gold and silver because (all together now!) We’re Freaking
Doomed (WFD)!!! Doomed!
Okay, now that I have you all worked up, you can relax. Yes, it’s WFD one
day, but maybe -- just maybe -- not yet!
The soothing-yet-terrifying truth is that with ethically corrupt
governments and a fiat currency, there are a lot of things that can be
done. A lot!
They can, as an extreme example, literally create enough fiat money to buy
Every Freaking Thing (EFT) that exists.
Every stock. Every bond. Every house. Every debt. Every everything.
All they need is a willing seller.
More realistically, the government can deposit fiat money into your bank
account (“free money”). They can send you a check (“advance tax rebate”)
through the mail, or let you claim it on your next tax return.
They can let you deduct actual debt from your tax return (thus lowering
your debt), while simultaneously letting your creditors claim a 100% tax
credit to offset their loss! Everybody wins!
In short, there is nothing that they can’t do. And there is nothing to
stop them, now that the government has passed laws that allow them to do
illegal acts in the name of protecting national security and/or the
integrity of markets.
So whither the markets? Well, with monetary and fiscal powers like that,
it would be child’s play to let the markets sink awhile, flushing out the
weaker and less well-connected hands, reducing the prices of assets from
“bubble la-la land” to “buy territory,” consolidating repossessed assets
in the banks, and inflicting real pain on people and their retirement
plans.
Then it’s just a matter of sitting back and waiting until the frantic call
goes out through the land: “Somebody do something!
Make the government do something!” which is the green light to
goose markets up via Keynesian deficit-spending, building the bubbles
back, and thus giving the banking and financial-services industries
another chance to set up another flimflam, by which they will profit and
we will lose.
So, not buying gold and silver against the certainty of calamity that has
occurred thousands and thousands of time throughout history, on scales
both large and small, despite desperate, frantic actions by all the
thousands and thousands of affected governments and millions and millions
of affected people?
Hahahaha! One choice has never succeeded and one has never failed, and you
ask me which one to choose?
Hahahaha! Obviously, I have to
explain it to you as if you were a child: Shut up! Hahahaha!