[underdose]

The wildcard here is Bernanke’s promise to print money and buy treasuries if there is a broad sell-off. But then, choose your poison, a glut of treasuries no one wants, or a glut of greenbacks no one wants. Either way it is inflationary. In fact, it looks like a potential death spiral to me. I think Buffett is way understating this by saying it is on par with the internet and housing bubbles. This is much bigger. It likely will be the complete collapse of the dollar.

On the other hand, of course, if Helicopter Ben does not in fact fire up the helicopter, our government is on the wrong side of the “magic of compound interest”. They have the biggest neg-am adjustable rate loan of all time. Every bond that matures and is retired is replaced with a new issue (at today’s interest rate). Every penny of interest is being payed by auctioning new issues. AND, more is being borrowed beyond that by the $100’s of billions. Compound interest makes the principle grow exponentially. Rising interest rates makes the exponential growth accelerate exponentially. What was $10 trillion yesterday will double to $20 trillion before you know it, then in less time double again to $40 trillion, then 80, then 160… Well, at some point we’ll have to be in default. Not good, not good. Really hard to come up with a plausible way out of this….

[underdose]

The wildcard here is Bernanke’s promise to print money and buy treasuries if there is a broad sell-off. But then, choose your poison, a glut of treasuries no one wants, or a glut of greenbacks no one wants. Either way it is inflationary. In fact, it looks like a potential death spiral to me. I think Buffett is way understating this by saying it is on par with the internet and housing bubbles. This is much bigger. It likely will be the complete collapse of the dollar.

On the other hand, of course, if Helicopter Ben does not in fact fire up the helicopter, our government is on the wrong side of the “magic of compound interest”. They have the biggest neg-am adjustable rate loan of all time. Every bond that matures and is retired is replaced with a new issue (at today’s interest rate). Every penny of interest is being payed by auctioning new issues. AND, more is being borrowed beyond that by the $100’s of billions. Compound interest makes the principle grow exponentially. Rising interest rates makes the exponential growth accelerate exponentially. What was $10 trillion yesterday will double to $20 trillion before you know it, then in less time double again to $40 trillion, then 80, then 160… Well, at some point we’ll have to be in default. Not good, not good. Really hard to come up with a plausible way out of this….

[underdose]

The wildcard here is Bernanke’s promise to print money and buy treasuries if there is a broad sell-off. But then, choose your poison, a glut of treasuries no one wants, or a glut of greenbacks no one wants. Either way it is inflationary. In fact, it looks like a potential death spiral to me. I think Buffett is way understating this by saying it is on par with the internet and housing bubbles. This is much bigger. It likely will be the complete collapse of the dollar.

On the other hand, of course, if Helicopter Ben does not in fact fire up the helicopter, our government is on the wrong side of the “magic of compound interest”. They have the biggest neg-am adjustable rate loan of all time. Every bond that matures and is retired is replaced with a new issue (at today’s interest rate). Every penny of interest is being payed by auctioning new issues. AND, more is being borrowed beyond that by the $100’s of billions. Compound interest makes the principle grow exponentially. Rising interest rates makes the exponential growth accelerate exponentially. What was $10 trillion yesterday will double to $20 trillion before you know it, then in less time double again to $40 trillion, then 80, then 160… Well, at some point we’ll have to be in default. Not good, not good. Really hard to come up with a plausible way out of this….

[underdose]

The wildcard here is Bernanke’s promise to print money and buy treasuries if there is a broad sell-off. But then, choose your poison, a glut of treasuries no one wants, or a glut of greenbacks no one wants. Either way it is inflationary. In fact, it looks like a potential death spiral to me. I think Buffett is way understating this by saying it is on par with the internet and housing bubbles. This is much bigger. It likely will be the complete collapse of the dollar.

On the other hand, of course, if Helicopter Ben does not in fact fire up the helicopter, our government is on the wrong side of the “magic of compound interest”. They have the biggest neg-am adjustable rate loan of all time. Every bond that matures and is retired is replaced with a new issue (at today’s interest rate). Every penny of interest is being payed by auctioning new issues. AND, more is being borrowed beyond that by the $100’s of billions. Compound interest makes the principle grow exponentially. Rising interest rates makes the exponential growth accelerate exponentially. What was $10 trillion yesterday will double to $20 trillion before you know it, then in less time double again to $40 trillion, then 80, then 160… Well, at some point we’ll have to be in default. Not good, not good. Really hard to come up with a plausible way out of this….

[underdose]

The wildcard here is Bernanke’s promise to print money and buy treasuries if there is a broad sell-off. But then, choose your poison, a glut of treasuries no one wants, or a glut of greenbacks no one wants. Either way it is inflationary. In fact, it looks like a potential death spiral to me. I think Buffett is way understating this by saying it is on par with the internet and housing bubbles. This is much bigger. It likely will be the complete collapse of the dollar.

On the other hand, of course, if Helicopter Ben does not in fact fire up the helicopter, our government is on the wrong side of the “magic of compound interest”. They have the biggest neg-am adjustable rate loan of all time. Every bond that matures and is retired is replaced with a new issue (at today’s interest rate). Every penny of interest is being payed by auctioning new issues. AND, more is being borrowed beyond that by the $100’s of billions. Compound interest makes the principle grow exponentially. Rising interest rates makes the exponential growth accelerate exponentially. What was $10 trillion yesterday will double to $20 trillion before you know it, then in less time double again to $40 trillion, then 80, then 160… Well, at some point we’ll have to be in default. Not good, not good. Really hard to come up with a plausible way out of this….

[underdose]

[quote=Casca]Bernanke isn’t stupid. He’s obviously trying to land this turkey in the river, instead of the middle of Wall St. A good man in a bad cause.
[/quote]

Really? Have you read his 2002 speech? He is either grossly misguided (ie, stupid, incompetent) or downright malevolent (ie, evil). A good man would either not have taken the job knowing full well the turkey can’t be landed in the river, or would have more honest candor about what truly needs to be done. Since neither are the case, he’s either an imbecile with delusions of grandeur, or he’s on the take and feeding some greedy agenda.

Today he said that inflation will not be a concern because when the economy picks up and inflation pressures return, he’ll be able to just raise interest rates and soak up all the extra money that’s currently being printed. This statement is so glaringly self contradictory he is either too dumb to recognize how illogical it is, or he’s trying to do a snow job. If the economy recovers before inflation takes off (that is, if we don’t find ourselves in the more likely stagflation situation), raising the interest rates will promptly derail any recovery, pummel ARM-holding home owners, and devastate the federal treasury, which you may have noticed, is borrowing by the trillions. If inflation takes off while the government is still trying to stimulate the economy, especially if Ben is making good on his 2002 promise to buy treasuries with newly printed dollars, he’ll be caught between trying to print enough to soak up all the treasuries being dumped by our foreign creditors and trying to soak up what he’s printed. Simply, it’s impossible. When inflation hits, we’ll be too far down the road for him to be able to stop it. He’s not a good man if he is trying to pass off something other than that truth.

[underdose]

[quote=Casca]Bernanke isn’t stupid. He’s obviously trying to land this turkey in the river, instead of the middle of Wall St. A good man in a bad cause.
[/quote]

Really? Have you read his 2002 speech? He is either grossly misguided (ie, stupid, incompetent) or downright malevolent (ie, evil). A good man would either not have taken the job knowing full well the turkey can’t be landed in the river, or would have more honest candor about what truly needs to be done. Since neither are the case, he’s either an imbecile with delusions of grandeur, or he’s on the take and feeding some greedy agenda.

Today he said that inflation will not be a concern because when the economy picks up and inflation pressures return, he’ll be able to just raise interest rates and soak up all the extra money that’s currently being printed. This statement is so glaringly self contradictory he is either too dumb to recognize how illogical it is, or he’s trying to do a snow job. If the economy recovers before inflation takes off (that is, if we don’t find ourselves in the more likely stagflation situation), raising the interest rates will promptly derail any recovery, pummel ARM-holding home owners, and devastate the federal treasury, which you may have noticed, is borrowing by the trillions. If inflation takes off while the government is still trying to stimulate the economy, especially if Ben is making good on his 2002 promise to buy treasuries with newly printed dollars, he’ll be caught between trying to print enough to soak up all the treasuries being dumped by our foreign creditors and trying to soak up what he’s printed. Simply, it’s impossible. When inflation hits, we’ll be too far down the road for him to be able to stop it. He’s not a good man if he is trying to pass off something other than that truth.

[underdose]

[quote=Casca]Bernanke isn’t stupid. He’s obviously trying to land this turkey in the river, instead of the middle of Wall St. A good man in a bad cause.
[/quote]

Really? Have you read his 2002 speech? He is either grossly misguided (ie, stupid, incompetent) or downright malevolent (ie, evil). A good man would either not have taken the job knowing full well the turkey can’t be landed in the river, or would have more honest candor about what truly needs to be done. Since neither are the case, he’s either an imbecile with delusions of grandeur, or he’s on the take and feeding some greedy agenda.

Today he said that inflation will not be a concern because when the economy picks up and inflation pressures return, he’ll be able to just raise interest rates and soak up all the extra money that’s currently being printed. This statement is so glaringly self contradictory he is either too dumb to recognize how illogical it is, or he’s trying to do a snow job. If the economy recovers before inflation takes off (that is, if we don’t find ourselves in the more likely stagflation situation), raising the interest rates will promptly derail any recovery, pummel ARM-holding home owners, and devastate the federal treasury, which you may have noticed, is borrowing by the trillions. If inflation takes off while the government is still trying to stimulate the economy, especially if Ben is making good on his 2002 promise to buy treasuries with newly printed dollars, he’ll be caught between trying to print enough to soak up all the treasuries being dumped by our foreign creditors and trying to soak up what he’s printed. Simply, it’s impossible. When inflation hits, we’ll be too far down the road for him to be able to stop it. He’s not a good man if he is trying to pass off something other than that truth.

[underdose]

[quote=Casca]Bernanke isn’t stupid. He’s obviously trying to land this turkey in the river, instead of the middle of Wall St. A good man in a bad cause.
[/quote]

Really? Have you read his 2002 speech? He is either grossly misguided (ie, stupid, incompetent) or downright malevolent (ie, evil). A good man would either not have taken the job knowing full well the turkey can’t be landed in the river, or would have more honest candor about what truly needs to be done. Since neither are the case, he’s either an imbecile with delusions of grandeur, or he’s on the take and feeding some greedy agenda.

Today he said that inflation will not be a concern because when the economy picks up and inflation pressures return, he’ll be able to just raise interest rates and soak up all the extra money that’s currently being printed. This statement is so glaringly self contradictory he is either too dumb to recognize how illogical it is, or he’s trying to do a snow job. If the economy recovers before inflation takes off (that is, if we don’t find ourselves in the more likely stagflation situation), raising the interest rates will promptly derail any recovery, pummel ARM-holding home owners, and devastate the federal treasury, which you may have noticed, is borrowing by the trillions. If inflation takes off while the government is still trying to stimulate the economy, especially if Ben is making good on his 2002 promise to buy treasuries with newly printed dollars, he’ll be caught between trying to print enough to soak up all the treasuries being dumped by our foreign creditors and trying to soak up what he’s printed. Simply, it’s impossible. When inflation hits, we’ll be too far down the road for him to be able to stop it. He’s not a good man if he is trying to pass off something other than that truth.

[underdose]

[quote=Casca]Bernanke isn’t stupid. He’s obviously trying to land this turkey in the river, instead of the middle of Wall St. A good man in a bad cause.
[/quote]

Really? Have you read his 2002 speech? He is either grossly misguided (ie, stupid, incompetent) or downright malevolent (ie, evil). A good man would either not have taken the job knowing full well the turkey can’t be landed in the river, or would have more honest candor about what truly needs to be done. Since neither are the case, he’s either an imbecile with delusions of grandeur, or he’s on the take and feeding some greedy agenda.

Today he said that inflation will not be a concern because when the economy picks up and inflation pressures return, he’ll be able to just raise interest rates and soak up all the extra money that’s currently being printed. This statement is so glaringly self contradictory he is either too dumb to recognize how illogical it is, or he’s trying to do a snow job. If the economy recovers before inflation takes off (that is, if we don’t find ourselves in the more likely stagflation situation), raising the interest rates will promptly derail any recovery, pummel ARM-holding home owners, and devastate the federal treasury, which you may have noticed, is borrowing by the trillions. If inflation takes off while the government is still trying to stimulate the economy, especially if Ben is making good on his 2002 promise to buy treasuries with newly printed dollars, he’ll be caught between trying to print enough to soak up all the treasuries being dumped by our foreign creditors and trying to soak up what he’s printed. Simply, it’s impossible. When inflation hits, we’ll be too far down the road for him to be able to stop it. He’s not a good man if he is trying to pass off something other than that truth.

[underdose]

[quote=cr]… how do you now tell your kids pot is okay but cocaine, LSD, speed, meth, and X are not?[/quote]

How do we currently tell kids alcohol is okay but pot is not?

We tried the “war on drugs” before. It was called prohibition. It was repealed during the last depression. The precedent for legalizing a drug, partially because it makes fiscal sense, during an economic catastrophe has already been set.

[underdose]

[quote=cr]… how do you now tell your kids pot is okay but cocaine, LSD, speed, meth, and X are not?[/quote]

How do we currently tell kids alcohol is okay but pot is not?

We tried the “war on drugs” before. It was called prohibition. It was repealed during the last depression. The precedent for legalizing a drug, partially because it makes fiscal sense, during an economic catastrophe has already been set.

[underdose]

[quote=cr]… how do you now tell your kids pot is okay but cocaine, LSD, speed, meth, and X are not?[/quote]

How do we currently tell kids alcohol is okay but pot is not?

We tried the “war on drugs” before. It was called prohibition. It was repealed during the last depression. The precedent for legalizing a drug, partially because it makes fiscal sense, during an economic catastrophe has already been set.

[underdose]

[quote=cr]… how do you now tell your kids pot is okay but cocaine, LSD, speed, meth, and X are not?[/quote]

How do we currently tell kids alcohol is okay but pot is not?

We tried the “war on drugs” before. It was called prohibition. It was repealed during the last depression. The precedent for legalizing a drug, partially because it makes fiscal sense, during an economic catastrophe has already been set.

[underdose]

[quote=cr]… how do you now tell your kids pot is okay but cocaine, LSD, speed, meth, and X are not?[/quote]

How do we currently tell kids alcohol is okay but pot is not?

We tried the “war on drugs” before. It was called prohibition. It was repealed during the last depression. The precedent for legalizing a drug, partially because it makes fiscal sense, during an economic catastrophe has already been set.

[Author]

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