The Democrats have taken off and are about to nuke the site from orbit.
I posted several days ago about how people who don’t have a sense of scarcity remain morally vacuous. When all things are possible and cost is no barrier, it’s impossible to set priorities and weigh issues.
I realize now that to understand scarcity, you need to understand some math. How many people have you heard complain that all their math classes were useless? I’ve always thought such people were idiots. Now I’m sure.
If you can’t balance a checkbook or read a balance sheet, if you think the most boring thing in the world is accounting, if you don’t know what the Dow is at today within 30,000 points, if you’ve never made a budget and tracked expenses, you might be a complete jackass. If this shoe fits your hoof, go out right now and learn about or start doing all of those things. It will make you a much more responsible, decent human being.
Clearly, the Democrats (and most of the Republicans) don’t get scarcity and don’t get math. For decades, gloomy fiscal conservatives have been warning about social security going bankrupt and making other “if this goes on…” dire predictions. Everyone admits they’re right, more or less. We just say, well, this won’t go on, or we’ll think of something, or something will change or it’s so far away, what, me worry?
So most people are yawning still at the dire predictions about what’s going to happen if we keep spending trillions to bail out billionaires and if Obama’s grand social plans get passed through Congress like shit through a goose. Most people think economic and social implosion is an impending problem, but still somewhat down the road.
This is because most people can’t do arithmetic for shit. Hey, math dummies: today is the big test!
A lot of people can’t even tell you how many billions are in a trillion. They have no idea how much the American economy produces in a year. Vaguely, they might know what the national debt is, but that’s only because they vacantly remember a news story a while back about having to take off the dollar sign to allow another order of magnitude on that big debt sign in New York or wherever the hell it is. Actually, these people think an order of magnitude is like, a felony warrant, or something.
I’m not going to tell you how big the annual American GDP is or how much the debt is or even what Obama’s proposed budget deficit is. but I suggest you go check out what all these numbers were a decade ago and then bar chart them and think about the implication of how much closer each of these bars are in height to each other than they were then. Use the CBO’
s numbers or the BS numbers that Obama is handing out: Bar chart-wise, it doesn’t look all that much different.
This week, the Brits had a government bond auction, and nobody came. This means the Brits are fucked, to use a technical term.
What does it mean when a government can’t borrow any more from objective investors? It means that the objective investors think that government is going to go bankrupt if they loan it any more. It’s the final warning to that government to knock it off or else. If that government doesn’t listen, the next step for investors is to dump all their investments at fire sale prices as fast as possible. Big deal, says the irresponsible government. You weren’t buying my debt anyway, so screw all of you.
Except that it’s not just foreign skeptics who are stuck with that debt, but every citizen in that country whose wallet has bills in it. That debt is denominated in currency–pounds or dollars or whatever Zimbabwean money is called. At this point, it’s all the same. I’m going to start a trend and start calling dollars Zimmies.
Irresponsible governments who won’t listen to reason don’t actually go bankrupt–unless someone sends an army across their borders.
Instead, they “monetize the debt.” They print more notes and hand them out to creditors and say, Here, I just paid you, shutup. But… every citizen of that country is also a creditor. Their wallets get hoovered too along with the investors. The citizens didn’t realize they were investors.
China is seriously warning the USA right now. Go, China!
They’re telling us, outright, to knock it off. They’re threatening to not buy any more of our debt. They’re alerting the world to the notion that the dollar might not still be the currency of last resort.
We have promised the rest of the world that we wouldn’t monetize our way out of our problems. But we just broke that promise, to the tune of the Fed buying a trillion dollars of our own debt to avoid our own most recent auction looking as pathetic as Britain’s. This is just like paying one credit card bill with a cash advance on another. Oh, and all you math-contemptuous dipshits: they distracted you from this with a dog-and-pony show over $165 million paid to a bunch of Connecticut Yuppies, confident that you don’t get orders of magnitude and don’t know the difference between a million or a billion or a trillion. But you do know that you hate Yuppies, for reasons that reflect better on the Yuppies than on you.
Either the Obama administration must be checked hard, by us, or we will be checked hard by the rest of the world. Not in 20 years. Not in 5 years. It will happen this year.
Unfortunately, Obama is one of those people who doesn’t get the scarcity thing. And Tim Geithner is just a weird fucking moron. It’s like watching Frodo be led to Mordor by Gollum. Frodo’s kind of a pussy, but a good guy, and we hope he’ll stumble onto something. Me, I just want to see Geithner burn in lava.
Frodo Obama and Gollum Geithner are paying no more attention to the warnings of the world than a 3 year old reaching for a toy in a grocery store when mom starts counting to 10. Obama and Geithner won’t back off at 9 because Obama doesn’t get math and Geithner is obsessed with his Precious.
The shit is about to hit the fan, with incredible velocity. Think of it this way, you math-impaired types:
You go along for months and months not paying your bills, ignoring your creditors’ phone calls, credit card debt going up and up. Then, finally, you decide the only way out is to bet on a get-rich-quick scheme that will require you to max out the rest of your credit cards, and even float a few bad checks. If you can just hold it together a little longer, everyone will get paid and you’ll be rich…
But once you raise your profile and your current creditors see what you’re doing, they know that you’re desperate, and desperation doesn’t usually work, and you’re just digging in so deep that there’s no chance they’ll ever get paid unless you really do pull a giant rabbit out of your ass.
So they start scrambling to get first in line to get paid or to cut their losses and suddenly your bank isn’t just sending letters and calling you but starting foreclosure, and the repo man takes your BMW and all your credt card account get shut down at once. It all happens in a week or two. When it all starts to collapse, it’s shocking how fast it goes.
This is where the US government is right now. That poor dumb schmuck Obama used the “you can’t turn an aircraft carrier on a dime” metaphor this week to encourage you to be patient. Wrong metaphor: it’s not how fast does an aircraft carrier turn, but how fast does it sink when shot full of big holes?