If you haven't had an "Oh Shit" moment, you're not paying attention

Posted by: Barthélemy Barbancourt

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On Thursday, in honor of Barack Obama's 50th birthday, the Dow dropped 10 points for every year he has walked among us. It was the ninth-largest drop in history. We should be relieved he wasn't turning 80.

The markets are apparently concerned that the entire global economy may be "stalling."

You don't say? Observant fellows, these market chappies.

And yet, in a certain sense, these are still the good times. At the end of the week, U.S. Treasury yields plunged to Eisenhower-era rates. America, explained Ethan Harris of Bank of America Merrill Lynch, "still gets the safe-haven money." That's to say, as crazy as Washington is, Europe is perceived to be crazier. In confirmation of the point, over in Italy, which is (believe it or not) a G7 economy, police raided Moody's and Standard & Poor's over allegations that all the meanie things that the rating agencies have been saying about the Italian economy were having an impact on Italian stock prices. Apparently that's a crime in Italy. They're not yet shooting the messenger. But they are dragging him through the streets in chains
pour encourager les autres. Good luck with that.

America will be cutting federal spending by $900 billion over 10 years. "Cutting federal spending by $900 billion over 10 years" is Washington-speak for increasing federal spending by $7 trillion over 10 years. And, as they'd originally planned to increase it by $8 trillion, that counts as a cut. If they'd planned to increase it by $20 trillion and then settled for merely $15 trillion, they could have saved five trillion. See how easy this is?

Like America's political class, I have also been thinking about America circa 2020. Indeed, I've written a book on the subject. My prognosis is not as rosy as the Boehner-Obama deal, as attentive readers might just be able to deduce from the subtle clues in the title: "After America: Get Ready For Armageddon". Oh, don't worry, I'm not one of these "declinists". I'm way beyond that, and in the express lane to total societal collapse. The fecklessness of Washington is an existential threat not only to the solvency of the republic but to the entire global order. If Ireland goes under, it's lights out on Galway Bay. When America goes under, it drags the rest of the developed world down with it.

by 2020 just the interest payments on the debt will be larger than the U.S. military budget.

When interest payments consume about 20 percent of federal revenue, that means a fifth of your taxes are entirely wasted. Pious celebrities often simper that they'd be willing to pay more in taxes for better government services. But a fifth of what you pay won't be going to government services at all, unless by "government services" you mean the People's Liberation Army of China, which will be entirely funded by U.S. taxpayers by about 2015.

But time is running short. If you think we've got until 2050 or 2025, you're part of the problem.

I have always known that liberalism would eventually kill the west. Sadly I have to live through it with insane assholes that still think that the government should waste even more money to accelerate the collapse.

Comments (3)add comment
jk noreen
written by jokin , August 05, 2011

Yeah..., but..., but..., er..., Obama saved Chrysler and General Motors and he gave us all free health care and he created one and a half million jobs (even though his press secretary said the White House doesn't create jobs) and he makes me feel all squishy about Hope and Change. We've got to follow the Italian lead and start detaining these insane crazies like Mark Steyn, the Tea Pary and S&P and Moody's for spouting these , as if they actually mean something. (sarc/off)

jk noreen
written by jokin , August 05, 2011

We've got to follow the Italian lead and start detaining these insane crazies like Mark Steyn, the Tea Pary and S&P and Moody's for spouting these PECULIAR THING CALLED FACTS , as if they actually mean something. (sarc/off)

Jonny Texas
written by Jonny Texas , August 05, 2011

"Carlo Maria Capistro – chief prosecutor of Trani, a small Adriatic port – told Reuters that his office was checking to see whether the rating agencies "respect regulations as they carry out their work". The raids took place on Wednesday as Italy's prime minister, Silvio Berlusconi, addressed parliament on the mounting crisis."

So basically you have the equivalent of the city prosecutor from Lakeville (56K vs 53K) investigating two of the three multinational financial rating agencies for malfeasance.

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