Actual cash, in the form of bills and coins which some know as "currency in
circulation" - and others know as, "Please, daddy! I need 20 dollars!", as if
money just appears by magic in my magic wallet or something, and all I have to
do is get it out of my pocket and start handing out $20 bills to anybody who
asks me for one - was (unlike me who was down in cash last week), up another $4
billion last week, taking the 12-month total of new physical currency up
another $77 billion, bringing the grand total ("ka-ching!") to $894 billion,
which is not a lot when you consider all the tens of trillions of dollar's
worth of stuff out there all based on this little bit of "real" money! Hahaha!
But it is still, for each person in this country who has a private-sector job,
a $770 increase in the cash money supply in one
month with which to make a profit, with which to pay for everything, including
remitting taxes.
And in the week when the Federal Reserve increased credit in the banking system
by a big ol' $76.8 billion, of which the Fed itself bought up $56 billion
dollar's worth of Treasury debt, gross national debt increased by a huge $77
billion, taking the nation's federal indebtedness to a staggering $10.789
trillion, which is so much, and so bad, that it makes you involuntarily scream
out loud in your nightmares and then get up the next day and buy as much gold
as you can get your hands on. But it is even worse than that, as the damnable
Congress has further indebted us, in the last 12 months alone, by almost
exactly $1.5 trillion!
In one freaking year!
I thought that TheBurningPlatform.com was going to comment on this astonishing
fiscal irresponsibility of Congress and the Federal Reserve, but instead they
commented on the $787 billion, 1,074-page stimulus bill that was just signed by
Obama by noting, "The current ‘stimulus' package of $787 billion is more than
the entire National Debt in 1978 ($771 billion)."
I shook my head in bewilderment, and I thought, "What in the hell does this
have to do with the national debt and how the loathsome Congress is spending us
into the poorhouse by turning the purchasing power of the dollar into Pure
Unadulterated Crap (PUC) by spending so much and requiring that the Federal
Reserve produce, out of thin air, all the money and credit necessary for their
despicable, corrupt profligacy, which is a word that always reminds me of
whipping, and now that I think about it, I think that a mere whipping is too
good for Alan Greenspan, former chairman of the tyrannical Federal Reserve,
without whom all the inflationary spending and grotesque entitlement excesses
would not have been possible and we would not be where we are today,
economically bust-wise, although we would still be as old and decrepit since
you stupid Earthlings put your inventive minds to developing weapons and
bleeding-heart excuses to enlarge government entitlement spending instead of
creating a youth serum or a pill to give you 'six-pack' abs without dieting or
exercise."
But it turns out that they are talking about housing prices, and say that "It
is now 2009 and the median value should be $150,000 based on historical
precedent. The median value at the end of 2008 was $180,100. Therefore, home
prices are still 20% overvalued", which means that "prices need to fall 20%"
from here, and maybe more, as "long-term averages are created by periods of
overvaluation followed by periods of undervaluation", by which they mean, and I
quote, "could fall 30%" from here, which makes you catch your breath in dismay
at the prospect.
The catastrophe of such a thing like that happening kind of dazed me with a
sort of petrifying fear, and the next thing I knew they were talking about the
federal budget deficit, too, and that the deficit for 2009 "is now estimated at
between $2 trillion and $3 trillion, give or take a few hundred billion."
They go on, "These figures seem incomprehensible to the average person on the
street", and I think to myself, "You said a mouthful there, buddy!" as I am,
literally, sitting on the street, having been thrown out of the stupid bar just
because I was complaining about how the drinks all cost more these days, and I
was blaming the greedy bartender, and he gets right in my face and says the
reason that the drinks cost more is that the Federal Reserve creates money and
credit, which makes prices go up, which surprised me so much that I blurted
out, "This is incomprehensible to me! I always thought you were a stupid moron
lowlife ball of garbage who never listened to me, but I see that you are, at
least, not stupid about where we get inflation in prices!", which I thought he
would take as a compliment ... but he did not.
And as I sit here, I realize that, thanks to the drinks being more expensive, I
am not as plastered as usual, and with rare clarity, I see the need to get a
pizza and some more gold because I am going to be very, very happy with some of
each very, very soon!
Richard Daughty is general partner and COO for Smith Consultant Group,
serving the financial and medical communities, and the editor of The Mogambo
Guru economic newsletter - an avocational exercise to heap disrespect on those
who desperately deserve it.
(Republished with permission from
The Daily Reckoning. Copyright 2009, The Daily Reckoning.)
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Office: Unit B, 16/F, Li Dong Building, No. 9 Li Yuen Street East,
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