Recommended by Ricochet Members Created with Sketch. Death Spasms of a Debt-Driven Economy

 

I intended to post something on this days ago, but every day brings a new outrage that forces me to rewrite it. At this point, I’m simply stunned.

COVID-19 is not the fundamental cause of the stock market crash and the insane response to it of the Federal Reserve and the Federal Government. The fundamental cause is a nation that has not saved for a long time, lives on ever-expanding debt and cheap credit, and expects bailouts anytime something goes wrong. Such a system is extremely fragile, and what otherwise would be an inconvenient but manageable financial problem turns into an existential crisis. We are like the man with half a dozen maxed-out credit cards, living large as long as he can make the minimum payments, but has his life destroyed when he loses his job. Instead of having savings to tide him over until he finds the next job, he’s now homeless.

The financial system was already giving signs of falling apart before COVID-19 hit. The Federal Reserve’s plan to normalize interest rates came to screeching halt in Dec. 2018 after only reaching 2.5%. Since then it’s been slowly dropping them. They were also supposed to run off their balance sheet in a process that would be like “watching paint dry” in the words of Jerome Powell, but abruptly began expanding it again last Fall. Ominously, in September the Fed began intervening in the overnight bank lending market (the “repo market”) as banks suddenly decided lending to each other, even on a very short term basis, was too risky. The Fed has been supporting that market at increasing levels ever since. The virus was just the push that finally brought the house of cards down.

These past few weeks have brought Fed interventions that boggle the mind and snuff out whatever we had left of free-market price discovery. Zero percent interest rates (of course), daily intervention in the repo market to the tune of $1 trillion dollars, and QE Infinity. The latter finally ends the farce that the Fed was doing anything other than monetizing debt with its QE programs. And they are doing it with gusto, adding $586 billion to its balance sheet this past week, the equivalent of 7 months of its old QE3 program. The balance sheet is now $5.24 trillion and going parabolic.

The Fed traditionally manipulates interest rates by buying and selling U.S. Treasuries in the open market. Now they are buying everything in sight in a frenzy: Treasuries, corporate bonds, municipal bonds, stocks whatever, all with money created through a few strokes of the keyboard. Another name for “the Fed buying stocks” is the “nationalization of industry.” All this is 100 proof banana republic stuff. The result? Initial unemployment claims surge by 3.3 million and the stock market goes up! This is corporate socialism. Where is the outrage?

The Federal Government is doing its part with its grotesque $2 trillion “stimulus” package of payouts and bailouts. Do people realize that the Federal Government has no wealth and that any money it gives to anyone must come from either taxation or debt? How is a government $23 trillion in debt able to bailout anyone? We all know, of course, that this only works because the Federal Reserve’s printing press is behind it.

In a more sane world, people would have six months of expenses saved in case they lose their job or some other misfortune occurs. Things happen in this world. Corporations would similarly have cash reserves to fall back on. Instead, they spent their cash, and borrowed more at the Fed’s ridiculously low-interest rates, to buy back their own stock and goose the price to fatten year-end bonuses and stock options. Now, this has caught up to them and they are crying for a bailout. This is what you do in Bailout Nation.

We supposedly had the “greatest economy of all time” these past few years, but somehow it necessitated massive federal deficits and historically low-interest rates. The orthodox Keynesian idea is that the nation goes into debt and lowers interest rates during a recession, then pays down the debt and raises interest rates during the subsequent recovery. Orthodox Keynesianism is bad enough, but we’ve been lowering interest rates and ramping up debt even in the supposed recovery. What do we do now that a crisis has hit?

The only thing we know how to do: Bailout everyone in sight with yet more debt-funded by the printing press. I guess I understand it because we’ve been doing it so long that pulling back now would be too painful to contemplate. Given the absurd size of the interventions and the tepid response to them, it might be that we are finally at the end of the debt extravaganza.

The worst part of this is that it was authored by so-called “conservatives”, who pat themselves on the back because they prevented Nancy Pelosi’s woke priorities from being jammed through on the bill, completely oblivious to the socialist and even fascist aspects of this monstrosity.

The Tea Party is truly dead and buried. Its ghost isn’t even hanging around anymore. I’m simply stunned.

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  1. Kozak Member
    Kozak Joined in the first year of Ricochet Ricochet Charter Member

    Sigh. This was the inevitable pin the latest mega bubble.

    If it wasn’t this it would have been something else.

    • #1
    • March 26, 2020, at 4:02 PM PDT
    • 2 likes
  2. philo Member

    J Climacus: In a more sane world, people would have six months of expenses saved in case…

    This part made me giggle so hard I cried…or was it that I cried so hard I giggled?

    J Climacus: The worst part of this is that it was authored by so-called “conservatives”…

    I have seen and heard more of my senior senator (Cornyn) in the last two weeks than I have in the last four years. When the “so-called conservatives” are on the move like that you know it is not going to be good for our pocketbook.

     

    • #2
    • March 26, 2020, at 4:05 PM PDT
    • 3 likes
  3. Bruce Caward Thatcher
    Bruce Caward Joined in the first year of Ricochet Ricochet Charter Member

    I don’t know enough about finance to comment intelligently. But I know enough about nature, and reality, and the wisdom of no-free-lunch.

    Everything you’re saying sounds right; it’s what many of us have been feeling for a long time. I thought the Tea Party would awaken a resolve to correct all this before we all went over the waterfall. But it died. Well, it was effectively killed.

    We are big and strong and powerful, the “richest nation in the history of the world”, as so many keep insisting. But by any way to count, if we are even ONE trillion dollars in debt we are poor. We are $23, 000,000,000,000 in debt – numbers have long since become a joke. We are by far the brokest nation in the history of the world, not the richest. And our promises to the future are something like $150,000,000,000,000! It just becomes zeros after the first few.

    My favorite way to try to imagine large numbers is this one:

    You go out of your door today and get to spend a million dollars. On something, anything. There, you did it – one million. Took a day.

    If you spend at that rate, a million dollars every day, to spend one billion dollars, it would take you three years! A million every day, for three years.

    If you want to spend a trillion dollars at that rate, it will take you every single day, one million dollars, to 1,000 years before Christ was born!

    And our government finds a way to require 3 trillion – or is it now 4? . . . hard to keep up with imaginary numbers.

    And that’s every year!!

    There isn’t this much money in the world. Though Bernie [I know . . . who?] evidently thinks “the rich” are sitting on it.

    All of the illusory systems we have set up to keep the lie hidden – cheap credit, borrowing (from the Chinese! – Ha!), etc. might now be exposed. It won’t be pretty.

    I wish we could have been smart enough to tell hucksters to get effed when they came selling us miracles. But we didn’t. We like miracles.

    I fear it’s going to take a genuine one to get us out of this.

    • #3
    • March 26, 2020, at 4:08 PM PDT
    • 13 likes
    • This comment has been edited.
  4. GrannyDude Member

    In my extremely simple way, I was wondering about this. 

    Like: thank God the economy was in good shape…

    But…wouldn’t it have been better not to have a bajillion dollar budget deficit already? Just in case Something Bad Happens? 

    Bad things do happen, after all.

    • #4
    • March 26, 2020, at 4:17 PM PDT
    • 7 likes
  5. Michael Minnott Member
    Michael Minnott Joined in the first year of Ricochet Ricochet Charter Member

    Fiscal conservatism has been dead since at least the “W” Bush admin, if not the 1990s. People want their government goodies, but not to pay for them.

    Rather than wasting time agonizing over people’s follies, instead we should talk about how to survive this. Maybe start putting our money in assets; real estate, precious metals, guns & ammo, etc.

    Unfortunately I think we are at the point in history where avoiding a catastrophic reckoning is no longer possible and just surviving it is the only viable option.

    • #5
    • March 26, 2020, at 4:22 PM PDT
    • 7 likes
  6. philo Member

    Michael Minnott (View Comment): …since at least the “W” Bush admin…

    I’m still trying to get that Bush-Frist knife out of my back. Oh well, at least it was placed there with the gentle touch of “compassionate conservatism.” So I got that going for me….

    • #6
    • March 26, 2020, at 4:30 PM PDT
    • 7 likes
  7. Randy Webster Member

    It’s the way democracies die. They don’t die in darkness, they die in debt.

    • #7
    • March 26, 2020, at 4:44 PM PDT
    • 13 likes
  8. J Climacus Member
    J Climacus

    Michael Minnott (View Comment):

    Fiscal conservatism has been dead since at least the “W” Bush admin, if not the 1990s. People want their government goodies, but not to pay for them.

    Rather than wasting time agonizing over people’s follies, instead we should talk about how to survive this. Maybe start putting our money in assets; real estate, precious metals, guns & ammo, etc.

    Unfortunately I think we are at the point in history where avoiding a catastrophic reckoning is no longer possible and just surviving it is the only viable option.

    I haven’t been participating much on Ricochet in some time, largely for the reasons you state. It’s been clear for years that we are committed to riding the debt train to oblivion, so debate seemed beside the point. Better to think about how to prepare. I’ve never thought of myself as a “prepper”, but I’ve accumulated the sort of things you mention. The catastrophe is no longer in the future, it’s unfolding before us. If you haven’t prepared yet, time is either out or almost out. If you haven’t got your PM’s yet, good luck getting any physical now.

    But I think it is important for us to talk about what is going on. It won’t be the end of the world, just the world as we know it, and we should try to make it so the blame is appropriately placed when the new world is formed.

    • #8
    • March 26, 2020, at 5:41 PM PDT
    • 6 likes
  9. Ed G. Member
    Ed G. Joined in the first year of Ricochet Ricochet Charter Member

    J Climacus (View Comment):

    Michael Minnott (View Comment):

    Fiscal conservatism has been dead since at least the “W” Bush admin, if not the 1990s. People want their government goodies, but not to pay for them.

    Rather than wasting time agonizing over people’s follies, instead we should talk about how to survive this. Maybe start putting our money in assets; real estate, precious metals, guns & ammo, etc.

    Unfortunately I think we are at the point in history where avoiding a catastrophic reckoning is no longer possible and just surviving it is the only viable option.

    I haven’t been participating much on Ricochet in some time, largely for the reasons you state. It’s been clear for years that we are committed to riding the debt train to oblivion, so debate seemed beside the point. Better to think about how to prepare. I’ve never thought of myself as a “prepper”, but I’ve accumulated the sort of things you mention. The catastrophe is no longer in the future, it’s unfolding before us. If you haven’t prepared yet, time is either out or almost out. If you haven’t got your PM’s yet, good luck getting any physical now.

    But I think it is important for us to talk about what is going on. It won’t be the end of the world, just the world as we know it, and we should try to make it so the blame is appropriately placed when the new world is formed.

    The end of the world as we know it – what does that mean? I think we’ll come out of lockdown, go back to work, same politicians, same divisions, same old same old. Perhaps we’ll see changes based on a desire to bring back supply chain so we’re not beholden to communist dictators in the event of an emergency or God forbid an actual attack from such a country. Perhaps we’ll see changes to payroll tax in favor of sales tax or even tarriffs. Perhaps we’ll see real change to immigration policy. The debt will lumber on as long as we’re the world’s reserve currency and safety deposit box. 

    • #9
    • March 26, 2020, at 6:08 PM PDT
    • 5 likes
  10. J Climacus Member
    J Climacus

    Ed G. (View Comment):

    J Climacus (View Comment):

    Michael Minnott (View Comment):

    Fiscal conservatism has been dead since at least the “W” Bush admin, if not the 1990s. People want their government goodies, but not to pay for them.

    Rather than wasting time agonizing over people’s follies, instead we should talk about how to survive this. Maybe start putting our money in assets; real estate, precious metals, guns & ammo, etc.

    Unfortunately I think we are at the point in history where avoiding a catastrophic reckoning is no longer possible and just surviving it is the only viable option.

    I haven’t been participating much on Ricochet in some time, largely for the reasons you state. It’s been clear for years that we are committed to riding the debt train to oblivion, so debate seemed beside the point. Better to think about how to prepare. I’ve never thought of myself as a “prepper”, but I’ve accumulated the sort of things you mention. The catastrophe is no longer in the future, it’s unfolding before us. If you haven’t prepared yet, time is either out or almost out. If you haven’t got your PM’s yet, good luck getting any physical now.

    But I think it is important for us to talk about what is going on. It won’t be the end of the world, just the world as we know it, and we should try to make it so the blame is appropriately placed when the new world is formed.

    The end of the world as we know it – what does that mean? I think we’ll come out of lockdown, go back to work, same politicians, same divisions, same old same old. Perhaps we’ll see changes based on a desire to bring back supply chain so we’re not beholden to communist dictators in the event of an emergency or God forbid an actual attack from such a country. Perhaps we’ll see changes to payroll tax in favor of sales tax or even tarriffs. Perhaps we’ll see real change to immigration policy. The debt will lumber on as long as we’re the world’s reserve currency and safety deposit box.

    I suspect at the end of this the dollar will not be the reserve currency. It will be just one of many competing currencies. That will be bad for us in some ways and good in others. But it will be very different

     

    • #10
    • March 26, 2020, at 6:27 PM PDT
    • 3 likes
  11. Ed G. Member
    Ed G. Joined in the first year of Ricochet Ricochet Charter Member

    Michael Minnott (View Comment):

    Fiscal conservatism has been dead since at least the “W” Bush admin, if not the 1990s. People want their government goodies, but not to pay for them.

    I’m not so sure fiscal conservatism has actually existed since Coolidge.

    If there were any actual conservatives around in the 70’s then they weren’t very prominent. Nixon – the extremely popular Republican president – instituted price and wage controls and took us off of the gold standard, opened the door to China and globalization on a much larger scale.

    The 80’s weren’t exactly fiscally responsible either. Defeating the Soviets wan’t cheap. Tradeoffs were made. The debt ballooned. 

    In the 90’s the meaning of fiscal conservatism transitioned away from fiscal responsibility to global free trade. Also, fiscally conservative but socially liberal was all the rage. Seems to me that usually resulted in a leftward drift as such people seemed to care more about social liberalism than they did about fiscal conservatism in practice. 

    None of the Republican majorities or presidents since then did any different. They all squandered opportunities and failed to actually conserve much of anything. Here we are now trillions in debt, trillion annual deficit, much of the culture war lost, and now we face extreme identitarianism. Donald Trump isn’t perfect, but he’s actually picking some conservatiev battles and trying to win them. Fiscal responsibility is not one of them (except insofar as some economic nationalism is called for IMO), but neither has it been an actual issue in play for decades and decades – Trump ignoring fiscal responsibility is not new or unique. Who knows? Maybe Trump would try to address that too in a second term. 

    • #11
    • March 26, 2020, at 6:31 PM PDT
    • 4 likes
  12. Ed G. Member
    Ed G. Joined in the first year of Ricochet Ricochet Charter Member

    A while back I read something in a conservative or libertarian website which was describing how China had net exports, low debt, high savings, and looking to purchase capital in other countries. And such a financial position was being criticized as not good. That was one one of the first moments where I stopped simply nodding along with the received wisdom of globalist free trade (as opposed to actual fiscal conservatism). I remember thinking: shouldn’t everybody want the financial position that was being described? Why aren’t we working to get there ourselves? I think I found out how some would answer that later on: we send them green pieces of paper while they send us real goods and then they even send back the green pieces of paper. They (China) are fools for doing this, they are only doing damage to their own citizens. We don’t care that whole industries have been offshored – heck, some said, we don’t need or even want certain industries here. 

    We still have a lot going for us and I believe it’s not too late. Trump might not do it, but we need people to follow his lead in boldness. Don’t be afraid of smears. Steer into the skid and double down – there is wisdom and good arguments on our side and all we need are people courageous enough to represent them forthrightly. Not couched our watered down. If they are good ideas then advocate for them. Now is the time. The Trump phenomenon provides cover for such an undertaking; covid19 provides cover for such an undertaking. Certain realities seem to be percolating in the country’s consciousness as we remember that there are always tradeoffs and that we can’t just shut down the economy without real and lasting effect.

    • #12
    • March 26, 2020, at 6:59 PM PDT
    • 7 likes
  13. Stina Member

    This is why I’m an economic dunce. This intuitively feels foolish and stupid to me. Any economic theory that assumes this state as acceptable or at least not worthy of comment and can be worked in is not describing a rational system. It is completely irrational.

    • #13
    • March 26, 2020, at 8:28 PM PDT
    • 6 likes
  14. Joseph Stanko Coolidge
    Joseph Stanko Joined in the first year of Ricochet Ricochet Charter Member

    Kozak (View Comment):

    Sigh. This was the inevitable pin the latest mega maga bubble.

    If it wasn’t this it would have been something else.

    FIFY

    • #14
    • March 27, 2020, at 1:52 AM PDT
    • Like
  15. Joseph Stanko Coolidge
    Joseph Stanko Joined in the first year of Ricochet Ricochet Charter Member

    Ed G. (View Comment):

    I’m not so sure fiscal conservatism has actually existed since Coolidge.

    In the 90’s the meaning of fiscal conservatism transitioned away from fiscal responsibility to global free trade.

    The Gingrich House was fiscally conservative, as I recall we actually had a fleeting budget surplus before the NASDAQ crash and 9/11 triggered a spending binge.

    Romney/Ryan ran on a platform of fiscal conservatism. We’ll never know if they would actually have implemented it, but they ended up hated and reviled figures in the era of Trump.

    • #15
    • March 27, 2020, at 2:00 AM PDT
    • 5 likes
  16. J Climacus Member
    J Climacus

    Stina (View Comment):

    This is why I’m an economic dunce. This intuitively feels foolish and stupid to me. Any economic theory that assumes this state as acceptable or at least not worthy of comment and can be worked in is not describing a rational system. It is completely irrational.

    I had exactly the same thoughts in 2008, which changed me from being a typical American retail investor who chucked his retirement savings into a 401k mutual fund and forgot about it, to someone who has been playing close attention to financial matters ever since.

    The response to the 2008 crisis – which was a debt crisis in the banks that nearly collapsed the global financial system – was to bailout the banks and begin an even larger debt binge at the level of sovereign nations. This defied common sense and couldn’t possibly be right. How do you solve a debt crisis with even larger debt? You can’t, it only papers over the problem for a time by making it much worse. Eventually the can-kicking comes to an end when the can is too big to kick, which is happening now. But since can-kicking is all the Federal Reserve and our government know, they are kicking it with everything they have to no avail.

     

    • #16
    • March 27, 2020, at 3:01 AM PDT
    • 6 likes
  17. J Climacus Member
    J Climacus

    Ed G. (View Comment):

    Michael Minnott (View Comment):

    Fiscal conservatism has been dead since at least the “W” Bush admin, if not the 1990s. People want their government goodies, but not to pay for them.

    The 80’s weren’t exactly fiscally responsible either. Defeating the Soviets wan’t cheap. Tradeoffs were made. The debt ballooned.

    Exactly. I’ll accept that debt was necessary to defeat the Soviet Union in the Cold War, which was a historic achievement. But the final judgment as to that debt has to wait until the time it is paid off. And it still hasn’t been paid off. Thus the judgment of the 80’s as a success has to wait until the consequences of starting the debt train rolling are fully realized – and we are just now finally about to see those consequences.

    David Stockman saw and predicted all this in the 80’s and was run out of the Reagan Administration for it. He’s worth listening to now.

    • #17
    • March 27, 2020, at 3:11 AM PDT
    • 7 likes
    • This comment has been edited.
  18. Saint Augustine Member

    What should I be doing? Pray for a chance to buy gold later? Now doesn’t seem like a good time.

    • #18
    • March 27, 2020, at 3:56 AM PDT
    • 1 like
  19. Kozak Member
    Kozak Joined in the first year of Ricochet Ricochet Charter Member

    Joseph Stanko (View Comment):

    Kozak (View Comment):

    Sigh. This was the inevitable pin the latest mega maga bubble.

    If it wasn’t this it would have been something else.

    FIFY

    Wow. Didn’t know Trump had been Emperor since when Nixon took us off the Gold Standard. Or when the Fed was created.

    Who knew?

    • #19
    • March 27, 2020, at 4:31 AM PDT
    • 4 likes
  20. Stina Member

    J Climacus (View Comment):
    I had exactly the same thoughts in 2008, which changed me from being a typical American retail investor who chucked his retirement savings into a 401k mutual fund and forgot about it, to someone who has been playing close attention to financial matters ever since.

    Yeah. I’m having a difficult time breaking out of this. Everytime I tried to invest with our savings, there’s this niggling doubt in my head. All the “smart” buys are debt laden and I knew a crash was coming soon and I didn’t know how to ride the wave on risky investments with uncertainty in the air.

    How to handle personal finances is becoming a challenge. Do I keep up the Dave Ramsey thing? Or do I pursue gold? Or something else.

    This is where the zero sum wealth feels like truth. Having cash feels like wealth. But cash is nothing. It has no standard. It’s being printed at asinine rates even by creditors. It’s all fake. Everyone with a roof over their head with mountains of debt intuitively know that nothing they own is their’s. And if it isn’t their’s, whose is it? Well someone owns it. If I have zero wealth, then who has wealth? I mean, my husband is being paid with pixel dollars that appear in our bank, created with debt supplied by a bank that outpaces the cash in the system. Do we really have that money or does a debt crash make it all disappear? And if that’s the case, then cash is the worst possible thing I could have.

    Basically, how does this incredible macro issue change how I play at the micro level?

    • #20
    • March 27, 2020, at 4:52 AM PDT
    • 5 likes
  21. Stina Member

    Joseph Stanko (View Comment):

    Kozak (View Comment):

    Sigh. This was the inevitable pin the latest mega maga bubble.

    If it wasn’t this it would have been something else.

    FIFY

    Trump was a necessary first step. If debt cash in this country outpaces saved cash, then the money left the country and it isn’t coming back. Globalization and Financialization (manipulation of debt to create “wealth”), off shoring wealth creating industries, and turning to services instead of production weakened our economy severely. It was easily ignorable with enough manipulation.

    Trump opened a line to challenge the status quo. We need educated people to keep questioning, challenging, and passing better knowledge down to future leaders. This isn’t going to be resolved for the next 20 years – and that’s optimistic. You need to break the education stranglehold to get better leaders.

    • #21
    • March 27, 2020, at 5:12 AM PDT
    • 3 likes
  22. J Climacus Member
    J Climacus

    Saint Augustine (View Comment):

    What should I be doing? Pray for a chance to buy gold later? Now doesn’t seem like a good time.

    We will have to have a separate thread on this… and I’m no financial expert, just a layman trying not to get buried. But it would be good to have a thread discussing personal preparation.

    • #22
    • March 27, 2020, at 5:18 AM PDT
    • 3 likes
  23. Miffed White Male Member
    Miffed White Male Joined in the first year of Ricochet Ricochet Charter Member

    The stock market crash and wild volatility as a response to the Virus is easy to explain.

    The stock market at it’s most fundamental level is nothing more than a method for pricing the expected value of “the future”.

    Along comes the pandemic, and suddenly no one really knows what the future is going to look like. It’s impossible to price the unknown, so prices dive, and swing wildly.

    Now there’s a certain level of clarity coming back into the picture, so the market is starting to price the expected future again.

     

    • #23
    • March 27, 2020, at 5:35 AM PDT
    • 6 likes
  24. I Walton Member

    We’re printing it. It will end up as inflation. If not then something new is going on and I don’t know what it is or what the effect will be. If offering to bail everyone out gets people back to work, then we don’t have to bail, if not, then what?

    • #24
    • March 27, 2020, at 6:04 AM PDT
    • 1 like
  25. Western Chauvinist Member
    Western Chauvinist Joined in the first year of Ricochet Ricochet Charter Member

    Ed G. (View Comment):

    Michael Minnott (View Comment):

    Fiscal conservatism has been dead since at least the “W” Bush admin, if not the 1990s. People want their government goodies, but not to pay for them.

    I’m not so sure fiscal conservatism has actually existed since Coolidge.

    If there were any actual conservatives around in the 70’s then they weren’t very prominent. Nixon – the extremely popular Republican president – instituted price and wage controls and took us off of the gold standard, opened the door to China and globalization on a much larger scale.

    The 80’s weren’t exactly fiscally responsible either. Defeating the Soviets wan’t cheap. Tradeoffs were made. The debt ballooned.

    In the 90’s the meaning of fiscal conservatism transitioned away from fiscal responsibility to global free trade. Also, fiscally conservative but socially liberal was all the rage. Seems to me that usually resulted in a leftward drift as such people seemed to care more about social liberalism than they did about fiscal conservatism in practice.

    None of the Republican majorities or presidents since then did any different. They all squandered opportunities and failed to actually conserve much of anything. Here we are now trillions in debt, trillion annual deficit, much of the culture war lost, and now we face extreme identitarianism. Donald Trump isn’t perfect, but he’s actually picking some conservatiev battles and trying to win them. Fiscal responsibility is not one of them (except insofar as some economic nationalism is called for IMO), but neither has it been an actual issue in play for decades and decades – Trump ignoring fiscal responsibility is not new or unique. Who knows? Maybe Trump would try to address that too in a second term.

    ^^^This.

    Trump has been doing “the politically possible,” but not without a huge battle with the status quoists. Until this crisis, addressing the debt and entitlements wasn’t possible. Maybe in a second term, and only with a lot of other adults in the room — that’s a wish and a prayer.

    • #25
    • March 27, 2020, at 7:22 AM PDT
    • 4 likes
  26. Western Chauvinist Member
    Western Chauvinist Joined in the first year of Ricochet Ricochet Charter Member

    I’m by no means up on all this, but my nephew the astrophysicist (NTA) has been trying to prep the family for years. It would seem the doomsayers are going to have their day, and soon. 

    My attitude toward precious metals is, “you can’t eat gold and silver.” However, we did inherit some coins from Mr. C’s dad, so we have a modest supply. My nephew would probably say gold is unaffordable for most people, and recommend silver if you can get it (from him and the people he’s been counseling). 

    My speculation is things could get so bad we’d be living in a barter system for some time with our “currency” having almost no value. In that case, things like ammo, flour, rice, beans, sugar, toilet paper(!). . . will be much more advantageous to have around. It’s also good to have family who are preppers and have practical skills, which might just strengthen the “little platoons” concept against Leviathan. Trying to look on the bright side. No one gets out of here alive anyway. — Did I just ruin it?

    • #26
    • March 27, 2020, at 7:36 AM PDT
    • 5 likes
  27. Unsk Member

    COVID-19 is not the fundamental cause of the stock market crash and the insane response to it of the Federal Reserve and the Federal Government. The fundamental cause is a nation that has not saved for a long time, lives on ever-expanding debt and cheap credit, and expects bailouts anytime something goes wrong. Such a system is extremely fragile, and what otherwise would be an inconvenient but manageable financial problem turns into an existential crisis. We are like the man with half a dozen maxed-out credit cards, living large as long as he can make the minimum payments, but has his life destroyed when he loses his job. Instead of having savings to tide him over until he finds the next job, he’s now homeless.

    Fundamentally this comment is from a person who does not understand what is going on in the world and has very little empathy for the plight of his fellow American.

    Most American families are not “living large”. Wages and Salaries have tanked for over the last thirty years while the cost of living has grown exponentially causing many to go into severe debt. This financial squeeze play has financially stressed the vast majority of Americans. You seem to think this is the fault of poor individual American financial planning and life style choices, but it is not. Why has this financial squeeze play really happened? Government Socialism. One only has to the look at the response of our Blue State governors who, using COVID-19 as an excuse, have shut as many “non-essential” businesses as possible that portends to ruin as many of these same businesses as possible and throw tens of millions out of work, many permanently. They want a huge expansion of the American Welfare Police State and boy howdy are they close to getting it. 

    Posts like them one who seek to blame the wrong actors for what really has been a huge power grab by the left are only helping to further the cause of those same sicko Lefty monsters who want to ruin this country. 

    • #27
    • March 27, 2020, at 7:57 AM PDT
    • Like
  28. Western Chauvinist Member
    Western Chauvinist Joined in the first year of Ricochet Ricochet Charter Member

    Unsk (View Comment):

    COVID-19 is not the fundamental cause of the stock market crash and the insane response to it of the Federal Reserve and the Federal Government. The fundamental cause is a nation that has not saved for a long time, lives on ever-expanding debt and cheap credit, and expects bailouts anytime something goes wrong. Such a system is extremely fragile, and what otherwise would be an inconvenient but manageable financial problem turns into an existential crisis. We are like the man with half a dozen maxed-out credit cards, living large as long as he can make the minimum payments, but has his life destroyed when he loses his job. Instead of having savings to tide him over until he finds the next job, he’s now homeless.

    Fundamentally this comment is from a person who does not understand what is going on in the world and has very little empathy for the plight of his fellow American.

    Most American families are not “living large”. Wages and Salaries have tanked for over the last thirty years while the cost of living has grown exponentially causing many to go into severe debt. This financial squeeze play has financially stressed the vast majority of Americans. You seem to think this is the fault of poor individual American financial planning and life style choices, but it is not. Why has this financial squeeze play really happened? Government Socialism. One only has to the look at the response of our Blue State governors who, using COVID-19 as an excuse, have shut as many “non-essential” businesses as possible that portends to ruin as many of these same businesses as possible and throw tens of millions out of work, many permanently. They want a huge expansion of the American Welfare Police State and boy howdy are they close to getting it.

    Posts like them one who seek to blame the wrong actors for what really has been a huge power grab by the left are only helping to further the cause of those same sicko Lefty monsters who want to ruin this country.

    Did we read the same post?

    • #28
    • March 27, 2020, at 8:12 AM PDT
    • 3 likes
  29. TallCon Coolidge

    Unsk (View Comment):
    Fundamentally this comment is from a person who does not understand what is going on in the world and has very little empathy for the plight of his fellow American.

    That’s a little like saying that when I say “You have a flat tire and you shouldn’t drive on it” I’m not being empathetic. I didn’t say you didn’t have places to be. I didn’t say that you’re in a bad spot. But you have a flat tire. And you shouldn’t drive on it. Empathy doesn’t enter into it.

    Believe me, my tire is flat and I really should not be driving on it. And now the road seems to be splitting in half.

    • #29
    • March 27, 2020, at 8:17 AM PDT
    • 3 likes
  30. Stina Member

    Unsk (View Comment):

    Fundamentally this comment is from a person who does not understand what is going on in the world and has very little empathy for the plight of his fellow American.

    Most American families are not “living large”. Wages and Salaries have tanked for over the last thirty years while the cost of living has grown exponentially causing many to go into severe debt. This financial squeeze play has financially stressed the vast majority of Americans. You seem to think this is the fault of poor individual American financial planning and life style choices, but it is not. Why has this financial squeeze play really happened? Government Socialism. One only has to the look at the response of our Blue State governors who, using COVID-19 as an excuse, have shut as many “non-essential” businesses as possible that portends to ruin as many of these same businesses as possible and throw tens of millions out of work, many permanently. They want a huge expansion of the American Welfare Police State and boy howdy are they close to getting it. 

    I think you misunderstood. He was comparing the US Govvernment to a man living large. He’s blaming the government.

    But neither is this fully on socialism, either. The global free traders and financial manipulators have played a serious role in this, making socialist policies either A) the easy way out or B) a convenient way to get more of what they want.

    Consider that if GDP is the most important economic statistic and your population can’t afford to buy product, then production drops. The government bailing out people raises GDP without ever addressing why the people can’t afford to buy stuff in the first place. This, in turn, raises the cost of goods and you end up doing it all over again. Increasing credit lines and the debt is seen as a method of keeping GDP up by increasing consumption. That’s what the policy makers want.

    • #30
    • March 27, 2020, at 8:23 AM PDT
    • 2 likes