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State of Union Speech Shows Obama

Seeking Utter Dominance of AWI

            In the good old days, the so-called “Misery Index” (MI) was achieved by adding the unemployment rate to the inflation rate. Notable, for example, was President Jimmy Carter inheriting Gerald Ford’s 13.45  misery index and then handing off a staggering 20.76 misery index to Reagan.   The term “stagflation” was invented to describe the particular type of mess that Carter had generated with his big government policies. Reagan in turn handed off a relatively low 9.57 misery index to his former Vice President G.H.W. Bush.  By the way, the only reason Carter got off so well is that the Democrats were keeping the stats and didn’t admit that inflation was 19% when he left office.

            Rajjpuut would like to submit for contemplation, however, the far more sensitive and indicative AWI or “Absolute Wretchedness Index” created by adding the weekly interest on the REAL NATIONAL DEBT (RND) to the Misery Index. Currently the nation’s REAL NATIONAL DEBT based upon a National Debt of $14.1 TRillion and UNfunded liabilities (just in Social Security, Medicare and the federal side of Medicaid) amounting to $114.6 TRillion equals a grand total of . . . (Drum-roll, Maestro please . . . ) $128.7 TRillion. Welfare costs are another huge UNfunded outlay which the nation is obligated to cover, but the math gets too complicated so let’s stick with a current RND of $128.7 TRillion. That means the weekly interest on a Real National Debt would amount to $ 73 Billion or about $250 per week per American man, woman or child . . . not the debt itself, just the interest we pay on it . . . so with 9.5% unemployment and .4% inflation and $73 Billion weekly RND interest rates Mr. Obama’s current Absolute Wretchedness Index stands at 82.9 easily the worst in history. His predecessor George W. Bush’s highest AWI reading was 72.6. The closest thing we see to Obama’s 82.9 AWI is Carter’s at roughly 76.6.

            For those who decry any measurement system which disparages the noble contributions of that stalwart statesman Barack Hussein Obama, perhaps a little deeper study is required. While we appreciate that it’s just not cool to talk about esoteric subjects like having revenues meet obligations, according to information found in a book recently written by a former Comptroller General of the United States (Comeback America: Turning the Country Around and Restoring Fiscal Responsibility by David M. Walker) at the time he wrote his book the National Debt was about 5.5 times our income (the revenues of the nation). So considering our UNfunded liabilities as well as the debt, our obligations are now more than fifty times our revenues. We have thus severely mortgaged the country’s future and our children’s, grandchildren’s and great grandchildren’s future all the while facing a markedly different world in which America no longer has a virtual monopoly on desired goods and services and technologies but every year faces more and more serious competition in the global marketplace. Current taxes are one thing, but if we don’t start reducing our debt and the interest on the debt, then deferred taxes will destroy the nation. Let’s be clear on this: future taxes could triple and we’d still have trouble paying off both the interest on the National Debt and our future now UNfunded liabilities. That is, unless we do something NOW, everyone in the future would be taxed 100% of earnings and we still could not pay off either debt interest or obligations . . . and, of course we would have zero dollars for Defense or any other budget item . . . and still would not be dealing with the debt itself (again, just the interest).

            How far in the future are we talking about? Within 12 or 13 years the interest on the National Debt will be the single largest item in the nation’s budget unless current trends change dramatically. And you get absolutely nothing in return for it, all this interest we pay . . . hence we’ve named this measure of problematical agony: the Absolute Wretchedness Index or AWI.   50% of this money is owed to foreign governments with China being #1 and Japan #2 in holding our debt; a bloc of oil producing nations combined hold’s the #3 amount.  This is a crucial factor. Why did we back Freddie Mac and Fannie Mae with $5 TRillion? Because foreign debtors demanded it, since they held so much of these U.S. debt instruments.

            The problem has two components, but despite all our current “pain,” only one of them matters. In the short term due to the economy, our two wars, and unemployment things are going to be painful . . . but this is a small drop in a huge ocean. The main component is the long-term structural imbalance. The budget and the deficits and the debt and the interest payments on the debt which are NOT sustainable.  Once the economy recovers we get out of the wars and finally see 5% unemployment again . . . things will be even worse because we’ll have continued on several more years increasing the debt; the interest on that new higher debt; and all our UNfunded liabilities as well. Huge unending deficits, year after year, as far as the eye can see will still loom ahead of us. It is this structural imbalance that threatens to destroy the country . . . hence our headline “State of Union Speech Shows Obama Seeking Utter Dominance of AWI.”

            Mr. Obama has, in real terms not in CBO configurations, increased the federal budget 41% if Obamacare and his other initivatives are considered. Now he talks about freezing discretionary federal spending at this super-elevated level for three years. What utter nonsense that pretense of his amounts to. We must begin to slash spending immediately towards 2006 or even 2004 levels. If we don’t we will lose the confidence of foreign lenders and find ourselves floating down the proverbial open sewer lacking a paddle or other means of locomotion other than our own hands as the dollar drops precipitously, interest rates and inflation soar, and our mild recession becomes a real depression and we see truly scary unemployment. Walker in his book called Washington “a lagging indicator” meaning that the politicians in their ivory towers and the political class who adore them aren’t getting the picture nearly as rapidly or as clearly as the people now do.

            It is the people, the voters, who are demanding something be done about these problems even if the solution is arduous and unpopular among politicians and their allies with a vested interest in the current unstainable structure. The current Obama administration and the Democratic majorities they had in Congress have called the TEA Party movement “astroturf” rather than a true grassroots movement; accused them of being merely a more rightwing version of the Republican Party; and shown them no respect at all.   Many of the current Republicans, such as John McCain’s daughter, lightweight pundit and columnist for The Daily Beast Meghan McCain, are proving just as blind about the TEA (Taxed Enough Already or Taken Enough Abuse?) Party as the Democrats. Ms. McCain objected to the TEA Party’s Michelle Bachmann commenting on Obama’s State of the Union address in addition to the Republican response so ably handled by Rep. Paul Ryan, saying, Bachmann was “at best a poor man’s Sarah Palin.”

            Ms. McCain, whose only accomplishment in life is being the daughter of a famous man, ought to show a little respect when she’s talking about her elders and about a woman of true accomplishment. As Walker’s book points out, the people are aroused now and Ms. Bachmann, Sen. Paul and Sen. DeMint recognize it even if she can’t.

            Let’s give you a real blast from the past when Time Magazine which loved Jimmy Carter finally had to admit things were none too rosy in their March 24, 1980 edition . . . .

                  "As Jimmy Carter stepped before the television cameras in the East Room        of the White House last Friday, his task was not just to proclaim another new anti-inflation program but to calm a national alarm that had begun to border on panic. Inflation and interest rates, both topping 18%, are so far beyond anything that Americans have experienced in peacetime—and so far beyond anything that U.S. financial markets are set up to handle—as to inspire a contagion of fear. Usually confident businessmen and bankers have begun talking of Latin American-style hyperinflation, financial collapse, major bankruptcies, a drastic drop in the American standard of living."

            We’ve heard plenty of talk about Obama’s and Bernanke sooner or later handing us a hyper-inflation and moving America toward Banana Republic Status so it appears history if it’s not repeating itself is at least humming the same rhyming song. Knowing that lesson in absolutely wretched history, let us pray not repeat it. Instead let us be pro-active in the Reagan sense and severely constraining the parasitic government, let us unleash the free market by cutting debt**; cutting spending; cutting taxes; cutting regulation; and ultimately under-cutting unemployment.

Ya’all live long, strong and ornery,

Rajjpuut

** actually Reagan’s negative legacy is the mountain of debt he handed us because dominated by Democratic congresses the welfare state continued to expand even during his eight years.

A Sad End to the American Era??

            Greatly accelerated by the policies of Barack Obama and his progressive supporters, the bankruptcy of the United States is now a fact of life. The only questions left are A.  how and when the masses will become aware of it and B.  Will there be an honorable rebound or complete chaos as a result. Rajjpuut has long been warning about the ills of big government, unconstrained spending and of the deliberate betrayal of the country by the progressive-wing of the Democratic Party. 

            When the American Dollar loses the position it’s held for the last sixty years as the world’s reserve currency; virtually immediately a shift toward large-scale inflation will be incurred. How will you know that the curtain’s coming down on the American Greenback? Here are seven likely warning signs marking the end of the global U.S. Dollar standard (for most Americans that would mark the figurative “end of the world”) based upon historical antecedents in other countries which have seen their own currencies destroyed:

Warning Indicator #1: the price of gold will begin to accelerate toward it’s natural balance level of $12,000 per ounce. 

Since the price of gold has already risen over ten consecutive years some say gold has already achieved the acceleration required to prove the point. Others might be suspicious, “If it’s risen that much, isn’t it time that gold started to drop, no investment always goes up.” True, true, but when a currency is being deliberately devalued by its government, gold and silver always get much more valuable compared to that country’s money; and make no mistake, the United States has been deliberately devaluing the Dollar for roughly the last 28 months; and incidentally devaluing it for roughly the last 45 years. Normally markets and the price of commodities fluctuate all over the place as time passes. But the steady rise of gold (the world’s preferred money) as it is priced in dollars over such an extended time period shows that the dollar is not being taken seriously by knowledgeable people. 

Warning Indicator #2: Government’s deficits and liabilities are out of control and the interest on the national debt becomes a major source of deficit increase. 

Because the deficits of the United States government are right now well over $1.3 TRillion annually; our national debt has doubled since 2005; our total national debt is over $14 TRillion; and UNfunded liabilities without counting items like welfare and food stamps have now reached $112 TRillion . . . it’s a safe bet that this benchmark has been passed. By the way, even the numbers we’re fed are absolutely false. Did you know that the government counts all $850 billion of payroll taxes (Medicare and Social Security) as current income when we all know that the money in question is supposed to be a “set aside” marked for its intended use only rather than included as “general revenue.”  If you or I or any business carried on their accounting this way, jail-time would be in the offing, but our government has been handling things this way as far as the Social Security "set-aside lockbox" for nearly 80 years.  That's why UNfunded liabilities for Social Security, Medicare and the federal side of Medicaid amount to $112 TRillion, twice the Gross Domestic Product (GDP) of the entire world.

Warning indicator #3: Spending gets so out of control that generating high enough tax revenues to deal with federal spending becomes impossible.

            Annual deficits are no longer related in any way to tax revenue.   Last year the Democratic-controlled congress refused to pass a budget . . . their most important duty according to the Constitution . . .  revenues were $1.1 TRillion and spending amounted to almost $3.7 TRillion and they want to raise the ceiling on the National Debt. Even if taxes tripled we’d still have run a significant deficit for the year . . . and yes, the interest on the debt runs to roughly $170 Billion yearly . . . all of that’s a sign that the crisis point has been passed.

Warning Indicator #4:   The political class begins to bail out and in doing so takes care of their cronies and of the masses to keep them under control -- all at the expense of the middle class. 

            Right now federal government unions; state and municipal unions; and other special interest groups are looting the U.S. and the 50 state treasuries. The Obama $787 Billion stimulus cost us a lot of free market real jobs, but the looters maintained and grew the government enormously while the rest of us suffered. $200 Billion per year is wasted on just the federal pensions; welfare amounts to $450 Billion per year; Social Security and Medicare and the federal side of Medicaid cost $1.8 TRillion and much of those funds is tied up in fraud, abuse and waste benefitting the political class . . . none of this was ever authorized by the U.S. Constitution . . . but wait, there’s more: remember national defense; border control and roads and all the other stuff the Constitution actually said the federal government must do? That an an equal amount on “discretionary spending that was never authorized by the Constitution amounst to roughly another $2.6 TRillion . . . aha, now you see why they didn’t want to create a budget! Tell me that a $5.1 TRillion budget with a $1.4 TRillion deficit wouldn’t shock the sensibilities of all sensible Americans. This warning indicator has been passed also.

Warning Indicator #5 The government will begin creating money out of thin air.

            Yes, this too has already happened. Between late October, 2008 and today, the Federal Reserve Bank has printed and electronically created “magic money” amounting to roughly 29 times the amount of dollars circulating in September, 2008. Technically speaking the 2011 U.S. dollar is now worth 3.4 pennies-worth of the September, 2008 Dollar. In other words, all those banana republics we used to laugh about . . . well, our money is becoming less valuable than theirs. As Stansberry & Associates financial advisors reminds us:  “If printing money were truly good for an economy, Zimbabwe would be the world’s wealthiest country.”  Yet that's precisely what we're being told by our President and by our financial leaders . . . .  Our Federal Reserve Chairman Ben Bernanke has alternated between denying that he was “monetizing the debt” (a.k.a. “printing money”) and then defending the practice. Bernanke and Treasury Secretary Timothy Geithner denied the United States would ever resort to such “devaluation of the dollar” but it’s going on anyway; meanwhile Bernanke keeps busy explaining that it's not exactly "counterfeiting" what he's doing and it's actually good for the economy in the long run (not mentioning that it's a huge gamble with the future of the country and the planet in the short run). A planetwide “run on the dollar” could literally destroy our currency overnight. The whole world has warned about this; the credit-rating firms have pretended it’s not so, but expect it very soon.

Warning Indicator #6: We will not be able to repay our debts in the international community.

            America’s $55 TRillion international debt amounts to $681, 178 per each American family of four. The average income of American families amounts to less than $50,000 per year. Just the interest on our international debt amounts to $34,000 per family per year. And if we resort to the printing presses to print of more dollars to pay the debt (OOOOPS, I forgot, we’re already doing that!) Then, first the interest rates for borrowing will skyrocket; then people and nations will stop loaning money to America, period.   Friends, once that happens the printing presses can run day and night and there’s no helping us . . . yep, we’ve passed this crisis point, too. The world’s greatest creditor nation has within the 45 year lifetime of President Lyndon Baines Johnson’s “Great Society” which ushered in Medicare and Medicaid and dramatically expanded welfare programs of all ilks become the greatest DEBTOR nation the planet has ever seen.

Warning Indicator #7:   American citizens will catch on and, discovering that debt has the potential someday to evaporate in hours, they personally will churn out new debt like a bullet-train parting the atmosphere.

            Despite all the talk of the American consumer “cutting back” and practicing austerity issuance of new debt in the United States is soaring. Public and private debt both reached record levels in 2010. The potential is that the economy will twist inside-out if this practice continues. This is the only one of the seven warning indicators that hasn’t yet come to pass.

IS THERE, INDEED, NO HOPE?

            Teddy Roosevelt, a Republican, was the first Progressive president, indeed his personal “Bullmoose Party” was officially called the “Progressive Party.” TR was, thankfully, a great American patriot and his modest progressivism actually benefitted the nation for the most part leading to modernization of the navy, for one good example and the building of the Panama Canal (the land for which was actually stolen from Colombia and renamed “Panama”; not only progressive but unethical as well). Woodrow Wilson was, up till Bill Clinton and Barack Obama, the most sinister progressive politician of them all. After running for a second term under the slogan “He kept us out of war,” within a month of his March, 1917 inauguration he put us into the European War. He left office with the nation undergoing the biggest depression up to that time. The conditions were much worse than what Herbert Hoover (another Republican Progressive) did himself in with. That late 1920 depression came to be known as “The Invisible Depression” after Wilson’s successor Warren G. Harding cut spending 49%; cut taxes 48%; and paid down the National Debt by 30% and was ended within 15 months . . . so it is possible to avert disaster but the Democrats seem to have embraced it and the Republicans must show the political will to do it pretty much on their own, with, of course, constant pressure from you and me.

Ya’all live long, strong and ornery,

Rajjpuut

 ^^  Purchasing a $100 face-value bag (or more) of "junk silver" might be the simplest most patriotic act you can do while saving yourself.  The bag would cost roughly $2,100 - $2,400 depending upon the value of silver when you buy.  IF and WHEN the currency fails, some sort of new money is going to be in high demand and the 90% silver dimes or quarters minted before 1965; are the most likely candites.  To a lesser extent the 40% silver money minted between 1965 to 1970 would also be accepted as a "new currency" but not nearly so readily as they will be worth 56% less than the 90% coins.

Some more important reading:

Here’s some other key reading that’ll shake the earth under most Americans’ feet:

http://rajjpuutsfolly.blogtownhall.com/2010/10/26/obama,__to_gop,_%e2%80%9cride_in_back%e2%80%9d;_no_one_tells_truth.thtml

 http://rajjpuutsfolly.blogtownhall.com/2010/10/26/%e2%80%9chow_brainwashed_are_you%e2%80%9d_a_test_for_american_voters.thtm

All the worst ideas still plaguing America (and a lot of other bad ideas as well) right now are rooted in progressivism, all of them. Think of the worst UNfunded liabilities initiated for “all the best motives” and you’ve described  tyrannical progressivism to a “T.” Here are some of those ideas and the president’ in power when they began: 

1.       Truly Big Government: Teddy Roosevelt

2.     Government Control over large land tracts: Teddy Roosevelt

3.     The Federal Reserve Bank: Woodrow Wilson

4.     The Income Tax: Woodrow Wilson

5.     Fighting in Europe’s Wars: Woodrow Wilson

6.     Government propaganda: Woodrow Wilson

7.     Internment Camps: Woodrow Wilson

8.    Controlling (and shutting down) the press: Woodrow Wilson

11.Ultra-high protective tariffs: Herbert Hoover

12. Huge Tax and Spend Government: Franklin Delano Roosevelt

13.Confiscation of Gold: FDR

14. Devaluing the Dollar to fill government coffers: FDR

15. Ultra-big Government: FDR

16.  Social Security: FDR

17.  Expansive Welfare: Lyndon Baines Johnson

18.  Medicare: LBJ

As Ben Bernanke Deliberately Collapses

the American Dollar, George Soros Chortles

Within the last 18 months, both Treasury Secretary Timothy Geithner and Federal Reserve Bank Chief Ben Bernanke swore that America would never devaluate the dollar, would never resort to inflation as a way to deal with our incredible debt, would never sabotage the American people and those who hold debt instruments from the American treasury . . . . Yep, they lied. The terms “Q1” and “Q2” are now becoming familiar to Americans who do other things than watch sitcoms and “reality” shows on TV. “Quantitative easing” has taken place in both of the last two fiscal quarters.

The Quantitative Easing which Mr. Bernanke is taking us through is a polite way to say that the government is deliberately making toilet paper of your savings, pension funds, etc. That’s what the government is doing. Rajjpuut first mentioned the German Weimar Republic back in a blog in early 2004. The astute Mr. Glen Beck of the Fox News cable network has this very month said that America is now heading for a “Weimar Moment.” The Weimar Republic was the government forced upon Germany when they lost World War I. The infamous Treaty of Versailles also forced upon Germany an impossible set of reparations payments. In order to deal with the demands from the victorious French, the Germans had to inflate their currency. The Deutsch Mark which was worth 25 cents (four DM to the dollar) in 1917 deteriorated so rapidly that in November, 1923; it took 26 Billion Deutsch Marks to equal a dollar. You may also remember November, 1923, as the time when Adolf Hitler led a group of dissatisfied individuals in the so-called Beer Hall Putsch (coup d’état) trying to usurp the government of Bavaria. The resulting trial for treason made Hitler a household name across Germany. Such are the benefits of state-sponsored inflation . . . .

In October of 2008 at the height of the financial crisis, Mr. Bernanke took it upon himself (there are virtually no limits to the power of a Federal Reserve chief’s to inflict intended or unintended pain) to begin printing up money. When he was done he’d printed up 14 times as many new bills as there were dollars previously in circulation so in total: 15 times as much money was circulating as before. In effect, the potential effect on the dollar was that the 20o9 dollar was worth 6.7 cents worth of 2008 money . . . NICE!

In the summer of 2010 when it became difficult to sell American debt instruments because foreign governments were reluctant to risk buying up dollar instruments without a much higher interest rate, the federal government in the form of Mr. Bernanke’s Federal Reserve Bank began printing again and bought up some of the Treasury instruments that were on sale, about one-third of them. This is called “monetizing debt” something you’ll recall from the top of this blog that Timothy Geithner and Ben Bernanke promised would never happen. That didn’t seem to have cured the problems so now Ben’s busy again with the printing presses and monetizing more debt a.k.a. quantitative easing . . . Q1 earlier; Q2 now. Back when Q1 was going on you might recall, Rajjpuut telling Americans to buy gold or silver because paper dollars were becoming worth less and eventually might prove worthless. Now Rajjpuut says that Americans should buy things of value like gold or silver, etc. because “worthless” is the watchword for the dollar. Of course, in ignorance the stock market investors believe Q2 is a good idea and the stock market is shooting up . . . dance while you can, boys, the bill’s coming due. Aren’t you glad “they” are looking out for us in Washington?

Here is the straight skinny and Rajjpuut crosses his heart while typing this: The crisis in the world’s finances comes down to one thing and one thing only . . . a crisis in the American dollar. The U.S. National Debt is almost $14 TRillion. Unfunded liabilities (owed by the country to the citizens) amounts to roughly $110 TRillion. We are by far the greatest debtor nation the world has ever known. While scarfing down junk food and watching American Idol a few other simple facts have escaped the good citizens . . . .

ITEM: Americans are not aware that the U.S. (private controlled central bank) Federal Reserve Bank, creates money out of thin air, is the primary cause of inflation in America, abets the politicians in their horrendous spending, and abets the creation of financial bubbles in the stock market and real estate.

ITEM: The American mainstream media (MSM) are largely “controlled” by their allegiance to the progressive elements in the Democratic and Republican parties. The MSM which did not report on Climategate when it happened one year ago, has also kept the American people ignorant of the coming crisis. Call it “mind control,” if you choose. Just five or six major corporations run the largest of the media outlets. When it comes to the broadcast media: Disney owns ABC, CBS is owned by Viacom, GE owns NBC all of whom are in bed with the progressive agenda in Washington and have a vested interest in keeping Americans entertained, dumb and happy rather than informed about the truth behind Cap and Trade and the value of their dollars.

ITEM: Not only have ultra-progressive George Soros’ words and activities gone unreported, but the IMF (International Monetary Fund) and World Bank, both have already said the dollar will be devalued. However, this has never been reported in the US media.

ITEM: President Clinton’s former economic adviser Robert Reich recently told Canadians that the U.S. dollar will collapse. Again, NOT reported.

ITEM: Collapse or “devaluation” of the dollar means a decline in the dollar’s purchasing power and a huge decline in Americans’ living standard. No one wants to hold a currency declining in value so they must demand higher prices for their goods and services and can use the dollars they receive to bid up the cost of whatever they buy from America in order to get rid of the dollars they hold as quickly as p0ssible.

Item: Today, Barack Obama made several monetary deals with India. Overtly we were told it was “a natural union between the world’s two most populous democracies.” In reality, Obama seeing that China is becoming reluctant to buy dollars was looking for a trade-partner who would be more or less forced by the agreement to keep the dollar respectfully in its hallowed place as a “reserve currency” . . . thus he hopes easing some of the pain the decline will bring to Americans by sharing that turmoil with India.

Item: The world will flee to gold, silver and other precious metals; to the Swiss Franc; and even to the recently despised Euro. Commodities of all kinds can be expected to rise in price FAST.

Ultimately what can we expect? For one thing the rest of the world understands our own crisis far more than our own leaders have informed us about it. So . . . expect a run to get out of the dollar . . . call it “hot potato economics.” People are going to be eager to discard the almighty buck and to buy whatever they can with it, rather than being the last one holding it. Of course that will happen among highly aware foreigners like the Chinese government, or the governments of Russsia, Brazil, Japan and India(?) long before the man in the street in America figures it all out. So expect a brief boom in America. And expect prices of our American products especially foodstuffs to go through the roof . . . so besides gold or silver, it might be nice to have a supply of canned and packaged and non-perishable food on hand while prices are comparatively cheap . . . as a result of these sad truths, expect huge amounts of unrest in the inner cities; expect huge amounts of problems for senior citizens and others living on fixed incomes. Expect George Soros to chortle all the way to the bank . . . .

Ya’all live long, strong and ornery,

** if we had Cap and Trade laws in effect right now, the immediate effect would be 67% inflation on average and inflation on food, electricity and gasoline and other necessities closer to 100%. Where does that 67% inflation figure come from? Founder and President of the Chicago Climate Exchange Richard Sandor (other influentials involved include Obama, Franklin Raines, Joel Rogers, John Ayers, Valerie Jarret, etc. and the Chicago ShoreBank supported by Hillary and Bill Clinton as well as ten or more progressive foundations financed by George Soros) put the value of Cap and Trade as an industry at $10 TRillion. In good times the real U.S. economy amounts to $15 TRillion. On paper, that means that selling blue-sky nothingness (that’s what Cap and Trade basically does) is “worth” 67% of the real U.S. economy. So in a $25 TRillion economy including Cap and Trade . . . 40% of the economy is literally “nothing” and that 40% is being stolen from the real economy by the crooks running the CCX. Note: Obama said directly in an interview with the San Francisco Chronicle that his energy plan would “bankrupt the coal industry” and “necessarily make electricity prices skyrocket.” So it’s actually far more likely in reality that the whole U.S. economy would amount to $20 TRillion and half of that economy would be Cap and Trade not only running prices up 100% but reducing the standard of living by 33% at least.

While Rajjpuut is NOT a fan of big and politically powerful labor unions, in the union’s favor it must be stated that the government of Greece has been guilty of outright lying and manipulating debt with “funny” statistics for about a decade now and the news that came out when the truth finally was released was more than shocking, it was abysmal. Oh, and for you Obama-watchers here, the D/GDP ratio in the United States has now risen to 76%.

To put things in perspective, and thus realize just how badly off the economies of Greece (also Spain, Italy, Ireland and Portugal) and the United States are, consider that the next worst of the European countries (England) had a ratio of only 11% w hen the following memorable speech linked immediately below was made to the EU by Daniel Hannan criticizing the actions of Prime Minister Gordon Brown a year ago. England’s ratio now is roughly 14% . . . .

https://www.youtube.com/watch?v=94lW6Y4tBXs

Many believe that Greece’s “contagion” will spread quickly to the other “PIGIES” (the next five weakest countries in Europe mentioned earlier, Greece is the "G") with one-time European financial bulwark Spain possibly the next to go. Spain about seven years ago had the strongest fiscal situation of any European power. Then they decided upon a critical experiment (one that Obama wants to work over here) and aimed to become the world’s #1 power in green technology. Spain’s 3% unemployment has spiraled all out of control and is now at 20%, second only to Greece’s problems. In the Spanish experience every green-tech job created cost $677,000 in government subsidies and killed 2.2 jobs in the real market place because of government spending and taxation. Most Spanish green jobs lasted from six weeks to nine months and only 1/10 of them proved permanent. In the United States that would translate to Obama’s promised “five million new green jobs” costing the loss of eleven more real economy jobs to subsidize them; and then with only 500,000 of those jobs proving permanent and a 22/1 ratio of lost real jobs to permanent green tech jobs. Additionally the typical green job pays $10-$14 per hour which is a huge letdown to most Americans’ way of thinking about new technologies.

The violence created in the streets by the Greek labor unions cost three bank employees their lives two days ago. The unions say they’ll refuse to make any financial concessions. Their intransigence might worsen the Greek debt situation or repel the other EU countries completely. As for Germany’s hesitation, the Germans suffered one of the two greatest inflations in European history (during the Weimar Republic after WWI, which eventually spawned Adolph Hitler and the Nazis) and the country is loathe to get involved with the fiscally irresponsible Greek government at risk of inflation to their own country. However, German Prime Minister Merkel has made it plain in her speeches that the “survival of the European Union is at stake.” Once again the European experience may prove to be a harbinger of things to come for the USA, because Fed Chairman Ben Bernanke has inflated our money by 1500% so that now there is 1600% more money in circulation in the country and today’s 2010 dollar is now potentially worth only about 6.3 cents compared to the 2008 buck. Of course in this country we're talking about fifty individual states in financial disarry not twenty-four separate countries.

Worse news for Greece, the violence and fiscal unrest don’t look like they’ll be ending anytime soon. If that ugly scenario keeps repeating the EU may not loan the money and Germany's refusal also could be in the cards. And the possibility of a worldwide depression is always on investors’ minds. Additionally, with the latest round of worries that the Greek debt contagion will spread to Spain and elsewhere in Europe. The looming specter of massive debt default and deflation is heavy in the air for investors worldwide and fear dominates the markets. All this and unending days of national strike are NOT painting an encouraging scene.

Ya’ll live long, strong and ornery.

Rajjpuut