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It's a shame that the vast majority of Americans and most of the elected officials in Congress haven't got a clue what this man has been talking about.
There comes a time when you need a politician in office who is right on the big issue of the generation, however rackety he may be on lesser issues. Churchill is the great example. But you've rejected Mr Paul, and two candidates are running for President who clearly have no views of any merit on the topic. Perhaps this highlights an advantage of the parliamentary system, though I'll grant you that your system of elective monarchy did deliver Reagan at the right time.
The nice things about Pauls "rackety" issues as you put it is that in his wordview you aren't required to participate in 99% of them! Legal drugs.....against them....no problem don't indulge! Gun issues....don't like them...fine don't own any (please don't attempt the gun controls deter criminals and crime line of reasoning....already settled!). Abortion, in general he is against it...but based on his view of the rights of the states to address issues not specifically constitutional you go to either of the coasts to have one. These states being the ones where you couldn't ban the procedure if you had the moral majority count the votes.Under a Ron Paul administration let the market set both the preferred currency and interest rates and nonsense like Greenspans Biggest Bubble never occurs because more adroit minds interpret the "frothyness" as incipient mania and without the always assumed Fed backstop of their positions they pull back afraid to lend to anyone who can fog a mirror. I particularly enjoy the notion put forth by Mish that this probably won't even fix things and I admit that it is entertaining to see who really runs this country! 532 marionettes all dancing to Hank Paulsons vile little tune!
Sunday, September 21, 2008Wall Street PerestroikaA Fait a CompliHaving watched the Sunday talk shows, it is obvious that the Wall Street Debt Reduction Plan is a done deal, with only minor detail to be discussed. I am not sure how to feel about it. But probably it is somewhere between bewilderment and incredulousness. Chutzpah, properly defined, is killing your parents and looking for sympathy that you have become an orphan. The one thing that this plan does not lack is chutzpah. The thieves on Wall Street have designed this plan so that they can improve their balance sheet, and in effect cover their losses on bad bets. Paulson will have absolute authority over the plan, and they will be able to buy instruments from foreign banks as well as commercial real estate paper. So the taxpayer has the added benefit of assisting his banker friends abroad and our Donald Trumps at home. This plan reminds me of another ambitious reform program. When Mikhail Gorbachev came to power, he knew that communism was not sustainable, and he believed it could be saved by a few reforms of the system, Perestroika and Glasnost (Rebuilding and Openness). The problem was that communism itself was a flawed system, and no amount of Perestroika could save it. The Soviet Union (and Russia today) had no finished product to sell abroad, and its collectivized farm system was unable to produce enough food for its population. It was completely reliant on oil exports to fund its ability to feed the masses, and when oil prices collapsed, it took out the USSR, despite all the attempts by the cronies to keep it propped up. So, as I look upon the landscape today, I see that Mr. Paulson is attempting a Wall Street Perestroika, so that the system can be saved!?!? However, one needs to ask a fundamental question, i.e. can our economic system, as currently designed, be saved? The parallels are frightening. As the USSR was dependant on oil exports to stay afloat, so to the USA is dependant on capital exports (treasuries/gse/mbs/derivatives etc…) to stay afloat. So just as a collapse of oil prices in the 80’s squeezed the USSR out of business, the last thing that the USA can tolerate is a new “price discovery’ on our capital exports. Because we are completely dependant on external powers to finance our budget and thus run our country is the reason why I believe these extraordinary measures are being undertaken. But just as Perestroika of the USSR failed because it was unsustainable, Wall Street’s Perestroika will probably fail. Adam Smith said that no country that has ever run up a large foreign debt has ever paid it back. I think that when foreigners understand that we do not have the capacity to pay back our debts, and that we are going to have to inflate our way our of our debt, they will pull the plug on the current finance agreements and in effect destroy the dollar’s standing as the world’s reserve currency. This may lead to the collapse of our whole economic system, despite Mr. Paulson’s best efforts to prop up the oligarchs.
It's very unlikely that Washington bureaucrats will ever come around to Ron Paul's ideas on monetary policy. And why would they? They've done pretty well for themselves with the print-as-you-go system now in place.However, Ron Paul has presented his ideas so well, that the average person is starting to actually get it. That is very encouraging since ignorance is the driving force to maintaining the status quo.
If this bill passes, the short but powerful market rally likely to follow will greatly reduce Obama's chances of winning in November IMHO. The Dems death wish is as strong as ever.Too, whoever wins will come under enormous pressure to further slash the already shredded social safety net because "the money will not be there" There always is plenty of cash for wars and bailouts of the rich but help for average folks is another matter entirely.Folks on medicare and social security will pay a heavy price if this legislation is enacted IMHO.
Well put NJDOC - if it's OK with you I'm going to reproduce this as a new post w/ a link back to your blog.
Ron and Ralph Fool's Overture. History recalls how great the fall can be, while everybody's sleeping the boats put out to sea. Borne on the wings of time, it seemed the answers were so easy to find. "Too late" the prophets cry, the island's sinking let's take to the sky. Called the man a fool, stripped him of his pride, everyone was laughing up until the day he died. And though the wound went deep, still he's calling us out of our sleep. Apocalypse Now...
Tim,It's fine with me. This problem is beyond any one person and the more people read, perhaps the more they will understand what may be in store for them.
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