Thank you Congress. By running back to the printing press you have jammed up the price of gold more than $35 bucks (some are excitedly saying $50), which is fine by us, but is this really the rational thing to be doing in here?
With stock futures pointing to a slight pullback at the open this morning, down may 50-75 points after yesterday’s nosebleed-inducing rally, there I was by the phone when long-term reader Nick called.
“So, George, let me see if I have this right: Congress needed to pass the debt ceiling so that we could keep paying our creditors, right?”
Well, uh, yeah….
“So wouldn’t it be safe to call this just one big Ponzi Scheme – you know – like the one Charles Ponzi set up where the new “investors” coming in had their money paying people their “returns”?”
I bet you know what happened next, don’t you? I spent the next few half-hour on the phone with him explaining that the difference is that when “crime” is done by government, (not Chuck Ponzi) under the color of law like this, it’s call monetary policy. It’s theft, but Theft Lite. It’s good for you. (“Git those hands back up where I kin see ‘em pardnah…”)
OK, just more smoke and mirrors, since there are some who argue that there never was a crisis in the first place.
You mean theater to perp the bigger shake-down? Gee, gosh, golly, look surprised! Emergency! Emergency! Everyone run from Street!
If you just went out back next week, printing up hundred-dollar bills when you happened to overdraw your checking account, you’d be a guest at Uncle’s (we’ll leave the light on for you) Iron Bar Hotel. The main difference, of course, being that Congress has an Army, and consequently taxes (including Obamacare) is magically not an insurance industry shakedown (look up protection racket). Instead, it’s national health care.
Of course, any competent business man can see that this just “kicks the can down the road” and as of this morning I think our next attempt at actuarial suicide will come in just 73-days.
Still, the Markets ought to now roll on to new heights, at least until the called-back federal workers getting a 16-17 day paid vacation (for not going to work) in this shows up on people’s screen.
All of which sets up furloughed workers who do get paid with the future prospects of getting almost four months a year of vacation. Here’s how: Say you’ve been around a good while and you get four weeks of regular vacation. Maybe you could roll up some comp time and get that up to five weeks, right?
Now, let’s say that this kick-the-can crap (coming back shortly, remember) can be scheduled to occur four times per year. That would make it…uh…64-calendar days or about 9.1 weeks, which when added to the five weeks of earned vacation is 14.1 weeks. OK, it’s only 3.68 weeks of vacation.
If I had suggested this to you six months ago, you’d have been right to call Ures truly a raving-mad lunatic.
Now, I’m an economic policy realist and I’m kicking myself six-ways to Sunday for not getting a cushy federal job back in the day.
But it certainly explains a lot of past government hiring actions, like those thousands of new employees at IRS and DHS, for example. My theory, waiting only to be proven out by events, is that the federal government won’t really be doing any more actual work.
They’ll just be beefing up to handle all the vacation time. God, we’re generous with all that free tax loot, ain’t we?. Makes me ever so much more anxious (even eager) to send in my Q4 tax payment in January. You too, I bet?
Oh, here’s another meaty morsel in all this: Mitch McConnell cut his state a fat hog – to the tune of $3-billion in earmarked funds for Kentuckians, as part of this..
Best government money can buy.
It’s just too bad that voters can hold multiple state residencies, otherwise I’d be inclined to take up residence in California. Nevada, and Kentucky, just so I could vote against the folks who jammed this through, rather than fixing our underlying (we’re bankrupt, right?) problem.
The way I figure it, about 3/4th of the senate needs to be shown the door at the next election and a like fraction on the other side of Ponzgress. Which leaves only the matter of keeping the country from being repo’ed out from under us by corporations (and China) between now and then.
Reader Charles figures it this way:
…All that was done is the Clowns all crowded back in the car to drive in a circle in the Main Ring and get out to do it all over again several weeks along!
Bread and what?
Look, if this was really such a big deal, how come the president is waiting until this morning to sign this and get things back on track? I know if you or I were in the White House, we’d be up till 3 AM, or whatever it took, to get ‘er done.
So the urgency is, how shall I say, a little suspect at a minimum.
Meantime, that blip on television of a House stenographer is out and about on the ‘net. In case you missed it, this woman got up from here House job writing down what was going on and blurted out:
“The greatest deception here is this is not one nation under God. It never was. Had it been, it would not have been. No. It would not have been. The Constitution would not have been written by Free Masons. They go against God. You cannot serve two masters. You cannot serve two masters. Praise be to God, the Lord Jesus Christ. Praise forever.”
The odd thing is she was sent off for a mental evaluation, reports various media, like the Washington Times. Quick, plug that leak!
More after you go buy something…
Don’t Say “Bank Runs”
…but a story this morning about how Chase is planning to limit large withdrawals ($50K and up) has us wondering if the Obama administration may be considering a two-tier currency system?
Whether this is just a shakedown to weasel more money out of the wallets of small businesses, or if something else is coming along November 17th when these changes go into effect, remains to be seen.
I was chatting with (another reader) on Wednesday and he told me things in his area were booming because there’s a real bubble developing in multi-family housing. He ran down how the numbers work out:
“Now is some markets, they’re building new 500 square foot studios and getting $1,200 a month for them. And that’s with construction costs running $135-$140, or so, per square foot.
It’s actually even worse: Some places report $1,500 a month on studios in the 500-600 sq. ft. class.
I ran the math out on this: At those kinds of rental prices, it means a unit which costs on the order of $75K to build will generate up to $18,.000 a year in cash flow. Or, another way to look at it is greedily: Excess cash might be as high as $5,000 a year for the owner/developers.
So, if you see a lot of apartments (and some condo’s) going up, that’s the reason. With so many people dispossessed of their own home, free enterprise is coming in to pick over the bones of those who still need a roof over their heads.
Madison Avenue Mike, meantime, see that the $25-billion national mortgage settlement which was supposed to help house bubble victims has been pretty much a flop.. I mean it’s in the NY Times, so it must be true, right?
Half A House
How would like like to be 76, have just purchased what you thought would be a nice retirement home up in Nampa, Idaho, and then come to find out that you only owned half of the house? Well, go meet Betty Galloway, who’s plight is outlined over here.
Big SupCo Case
You want to see how totalitarianism works in the real-life roll-out? Stick around as the US Supreme Court has a case where the government froze all the assets of a couple accused of a crime – but then as a result they couldn’t hire competent counsel. A few justices are reported bothered by this, but don’t be holding your breath. You are, just a “subject” after all.
Gun Right Demonstration
Look for some headlines this weekend when a bit “Line in the Sand” is planned in San Antonio where, our friends in Oathkeepers tell us, there will be a demonstration in support of open carry rights, which police seem to read differently.
That’s from 10A-2P Saturday at 300 Alamo Plaza. I figure it will be a fine opportunity to get yourself facial-recognitioned if you haven’t been already. You may not be allowed to film cops anymore, but that’s NOT a two way street.
Snowden: Bigger Disclosures to Come
According to a report over here, Edward Snowden’s father says more disclosures are in the wings about US/West conduct which has been – at best – questionable.
The main thing to be watching here is for a new news organization being formed specifically to get Snowden’s next round of disclosures out and about in the public mindset.
This will be funded by eBay founder Pierre Omidyar and it has attracted journalist Glenn Greenwald, who has been bid away from the UK Guardian which broke the first round of Snowden revelations.
As I say, we’ll keep you posted on this, but with a a kind of ultimate IP hipster (Omidyar) driving, I expect the IT-level exposures of this group will be small and the revelations BIG.
Especially if Vlad Putin’s folks are contributing content in background to help fill in missing pieces.
It’s just one more reason why the future of the Internet is bound to get dicey in the near future with an ever-increasing chance of licensing of internet use down to the reader level. I laid all this out in one of my books a while back, Broken Web The Coming Collapse of the Internet.
You see, there’s an assumption that “You can’t handle the Truth.”
But, in the meantime:
Bye-Byes at NSA
Two of the top dogs in the National Security Agency, which have been instrumental in putting together the massive government computer systems which pull all the odd bits of your digital life into one convenient place for federal inspection, have decided to leave…announcing retirement plans.
Go read the article at Reason which wonders if some of the abrogation of the Constitution wasn’t done using some strong-arming…
Middle East Blow-Up in the Wings
Now that Turkey has blown the cover of an Israeli spy organization, we have to wonder how much longer before Israel, feeling very, very lonely right now, will figure it’s do or die time on popping Iran’s nuke production.
Unwittingly, perhaps, Turkey have have actually moved up an attack on Iran, since Israeli intelligence will go stale without updates. Good going, Turkey.
As long as we’re making things on the calendar, how about a big quake along about the middle of next week? Off the latest advisories:
A slow faint full halo CME erupted on October 16, 15:48 UT (first seen in LASCO C2). It was related with a C1.8 flare from NOAA AR 1870. The bulk of the material was directed towards the west, with a speed of 300 km/s. An impact with the Earth is possible early on October 21, although geomagnetic conditions are not expected to be greatly affected by this weak event.
The usual sequence of this is: Energy hits Earth, things change down in the core (where matter condenses, right?) and we get a quake, sometimes large, a few days later. My, how comforting.