US Economic Crisis Options: Dabble, dither, dump, default, destroy or be daring

US Economic Crisis by Dr. David Goldenberg: Strategies to Deal with the Economy (before late is too late.)

[Dr. Goldenberg is the author of Creating Condo & Homeowner Association Documents and The Art of War 3: Canons of Commerce.]

Here’s a mutually exclusive and exhaustive list of the broad families of strategies to deal with the current U.S. economic crisis. Which would you prefer? Tell your Congressmen.

I. Dabble and dither: This is our current strategy. Both political parties persist in offering variations of this inferior choice. Why inferior? Because the specific proposals either address only part of the problem or are economically unsound or ineffective. Each political party takes turns proposing treatment(s) which the other adamantly opposes. Relying primarily on an austerity program, a special case of fiscal policy, is one example. A dabbling and dithering strategy enables politicians to avoid doing anything they might later regret personally while allowing them to continue to hope that the problem eventually will evaporate without changing the status quo.

II. Devalue: Previously known as inflation or printing money wherein worthless dollars are used to pay off our debts. This special case of monetary policy simply would make things much worse. (Monetary policy is the exclusive province of the Federal Reserve Bank. But the Fed recently admitted that it has all but exhausted the power of monetary policy except for devaluation. Presumably the Fed hopes that some other policy set [fiscal, human, …] or combination will do the job. Finding that set is up to some other part(s) of the government. Viewed positively, this is an opportunity to earn lots of curses in Mandarin.)

III. Dump on other countries: Boost our economy by exporting more. Exports are such a tiny part of our economy that even tripling exports wouldn’t help much. Besides, the potential target countries are too weak economically to buy so vast a quantity of exports.

IV. Default: renege on the prior commitment to repay the debt and interest on it. Defaulting not only would cause a long and deep global recession but also would ruin the U.S. dollar’s reputation as having the world’s safest currency.

V. Destroy: World War II brought the world out of the Great Depression. But a replay is unaffordable today in both blood and treasure.

VI. Daring: Several generations of ignorant, desperate and apathetic voters allowed short-sighted, self-serving politicians to unintentionally create this mess. A consensus of experts’ recommendations is more likely to get us out of this mess than any proposals by the politicians who caused it or let it happen.

© 2011 David I. Goldenberg, Ph.D. Boynton Beach, FL USA

 

Federal Reserve Audit: Why Bernanke held First Fed Press Conference

California could have fallen into the sea, but the stock market would continue to spiral upwards – at least until the powers that be decided otherwise.

Why? Because that’s what it’s been programmed to do. Anyone who thinks the market is being pumped by new money is having an out-of-mind experience.

The Federal Reserve – Oracle of Delphi – held its first press conference this week since it was established in 1913, (only took 98 years). The markets lapped up Fed Chairman Ben Bernanke’s indecipherable blather and zoomed higher.

The market couldn’t possibly go down following Bernanke’s insistence that our economy is on the right track. He stated that rising prices are a passing phenomena, that inflation is under control.

Over 200 tornadoes devastated a broad swatch of six southern states hours after Bernanke spoke (a sign?), leveling cities in Alabama and elsewhere. Over 300 dead, 1500 injured, but the market rallied further the next day – and yes, the day after that. Worst tornadoes in 40 years – perhaps in the history of our country. Devastating losses that left people stripped of everything but the clothes on their backs. For many, those were in shreds as well. Who cares? Not Wall Street.

Remember when the market “flash crashed” 500 points in May, 2010, supposedly due to one trader pushing the wrong button, (you really believe that?). Nearly a trillion dollars in wealth instantly disappeared. That single “mistake” allowed the government to institute a limit on how much the market can fall in any given day – no more than 10 percent. No crashes allowed here. Everything is orderly, and the market will never, ever, not in your life-time, go down. Or at least not until Bernanke and his bankster friends decide that it should.

I just loved the part where Bernanke declared that he’s personally committed to transparency. Give me a break. He’s committed to avoiding the Fed audit that Members of Congress have been trying to pass for years. He’s committed to defusing calls for an end to the Fed’s “private” cartel power. Ben Bernanke reminds me of Sara Bernhardt. He’s a fantastic performer.

Or perhaps he has more akin with Mae West, who said: “An ounce of performance is worth a pound of promises.”

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Federal Reserve Declares Recession is Dead: Twelve Indicators that Economy is in Trouble

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YOU KNOW THE ECONOMY IS BAD WHEN…(in reverse order)

12. CEO’s are now playing miniature golf.

11. I received a pre-declined credit card in the mail.

10. I went to buy a toaster oven and they gave me a bank.

9. Hotwheels and Matchbox car companies are now trading higher than GM in the stock market.

8. Obama met with small businesses — GE, Pfizer, Chrysler, Citigroup and GM — to discuss the Stimulus Package.

7. McDonald’s is selling the 1/4 ouncer.

6. People in Beverly Hills fired their nannies and are learning their children’s names.

5. The most highly-paid job is now jury duty.

4. People in Africa are donating money to Americans. Mothers in Ethiopia are telling their kids, “finish your plate; do you know how many kids are starving in America?”

3. Motel Six won’t leave the lights on.

2. The Mafia is laying off judges.

And my most favorite indicator of all.

1. If the bank returns your check marked as “insufficient funds,” you have to call them and ask if they meant you or them.

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To your economic recovery rights!

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