COMING: THE ECONOMIC "W"
What will be our economic trajectory? How will we do as we come out of the recession of 2008-2009?
There are those foolish optimists who predict a "V" shaped recovery - the swift crash will be followed by a buoyant surge. Others, more sober, believe in a "U" - the crash will gradually ease and slowly be followed by gradually increasing growth.
Pessimists see an "L" - the crash will be followed by a long period of stagnation and no growth.
I believe a "W" is more likely. Foreign stimulus (e.g. China) will rekindle export markets for American manufacturing and government lending will start the housing industry. But consumer demand, which accounts for 70% of America's growth, will continue to be stagnant in the face of high unemployment and lingering fears. The rebound will be short-lived and followed by a further downturn, the second part of the "W".
But this second dip will be accentuated by inflation. We will face, not the stagflation of the 70s, but depressflation, negative growth and high inflation simultaneously. Unfortunately, the policies that would cure one condition will only worsen the other one. The low interest rates and economic stimulus necessary to kindle growth will exacerbate inflation while the high rates that would cure price increases would depress the economy further.
There is just too much debt out there and inflation is inevitable. The United States now borrows between 40 and 50 cents of each dollar it spends. The deficit has tripled since 2008. And, with all the world's governments following the U.S. into debt and deficit, governments cannot find enough lenders and have to print their own money, a sure portent of disaster.
Voters are getting that the cycle of deficit, debt, and inflation is the inevitable consequence of statist economic policies.
Germany's decisive turn away from the left in its national elections signals this sea change in political behavior. After a decade of drift to the left, voters have discovered their bearings and their senses just in time.
Not only did Germany's Social Democratic Party, the world's foremost socialist political organization, lose more than one third of its vote, but the free market Free Democratic Party grew by more than one third. Merkel, who had to govern in coalition with the Socialists, now can indulge her personal philosophy and form a conservative coalition to lead Germany out of the recession. Now, Merkel can, indeed, be the Thatcher of Germany.
The next shoe to drop will be in the United Kingdom where Gordon Brown and his discredited Labor Party trail the Conservatives by seventeen points. London must call for elections by June of 2010. Brown can delay the day of his party's reckoning until then, but it must come.
Germany, the United Kingdom and France are moving right because they are growing tired of the social democrats and progressive politics.
These conservative triumphs will set the stage for the American Congressional elections of 2010. It seems certain that Republicans will gain enormously although whether or not this surge will be enough to capture either or both Houses of Congress remains to be seen.
Voters get that an orgy of debt can lead to an orgy of inflation. What better nation to teach the world this fact of economic life than one whose nascent democracy was strangled in its cradle by the hyper-inflation of the 20s opening the door to Hitler's ascension to power?
By DICK MORRIS & EILEEN MCGANN – Authors of CatastrophePublished on DickMorris.com on September 29, 2009
Franklin vs. Marx, Episode I: Taxes
Five Brave Dems Join Republicans Against the Public Option… Kill Public Option (at least for now)
When Senator Rockefeller was asked to explain how he was going to pay for his HC program amendment, which includes a public option… he refused to answer the question?!? Refused! Why? Because it is mostly on the back of seniors, through cuts in Medicare and Medicaid.
Five brave Democrats joined all Republicans on the Senate Finance Committee on Tuesday in defeating one version of a public option, or government-run insurance.
Sen. Jay Rockefeller, D-WV, sponsored an amendment that would have created a plan, run by the federal government, modeled on Medicare. But too many of his Democratic colleagues voiced concern that low level reimbursement rates in some states, though they would be in effect for only two years, could bankrupt hospitals that don't get much from the federal government.
Democrats also voiced varying levels of concern that doctors, for two years, would be required to offer a public option if they want to continue to serve Medicare beneficiaries, a point that came courtesy of committee Republican John Ensign of Nevada.
It appeared that Democrats were fighting mostly amongst themselves. Republicans, who have dominated the discussion on other days, did not speak nearly as much today, Tuesday.
If we ever get to see this final bill… better checkout the amendments
Harry Reid has put in some kind of exemption for his state.
Medicaid costs will be shifted to the states.
At best there will be a trillion dollar cost and cuts to the bill passed if ObamaCare options win.
Obama and the Dems are still talking reconciliation: Changing the Rules of the Senate to force through ObamaCare. If this happens, it will be time for the American people to look at at pursue all options:
Constitutional Reviews of all bills passed in both houses of Congress and simultaneous attempts at impeachment(s).
Keep up the pressure on Congress until the vote… ‘No Public Option’ and remember:
Co-Op = Public Option (by another name)
Trigger = Public Option (Just down the road)
Call the United States Capitol switchboard today... everyday at (202) 224-3121
Nets Give Obama Olympic Gold Medal for Flying to Denmark
Obama heads to Europe in Air Force One to promote the Olympics in Chicago, his adopted hometown with Oprah Winfrey, Valerie Jarrett, and Wife Michelle in tow. Many feel it is a pay back trip and endeavor for political favors and delivering the vote to Mayor Daly.
Another red herring for the American economy. Olympics cost lots of money that Chicago doesn’t have, so it will be another huge expense for America as a whole. :-( Something we really need in today’s financial climate?? Most say, “NO”!
The Fox News in Illinois was told that they could not run a piece on the negative of holding the Olympics in Chicago? (I guess this is already Venezuela or Cuba?)
Olympic-sized boondoggle: What Valerie Jarrett and Michelle Obama are up to??
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