“Patiently” Killing Capitalism and America

“Patiently” Killing Capitalism and America

Wednesday morning I checked the DJIA, and it was down just over triple digits. It stayed underwater all the way through lunch too. Then, miraculously, about 1:30 pm, it took off like a rocket, swinging 350 pts to the upside, closing over 200 pts in the black. Now I knew what caused it. I keep up with such things. The FOMC (The Fed) had just released their vague do nothing statement. They removed one measly little word. They removed the word, “patient”, meaning that they want us to think that they are going to begin to increase interest rates in the near future. This was meant to signal that all is right with the economy and that there is nothing but sunny spring days and tiptoeing through the tulips as far as the eye can see into the future for the U.S. economy. Is this capitalism? Should markets be hanging on the every word of unelected bankers about whether or not they will arbitrarily raise interest rates? Why does the Fed play such a large role in the economy? Because free markets are dead in America, that’s why.

Gone are the days when we actually looked at hard data. You know, things like the labor participation rate. Instead of looking at the phony government numbers that are built on new applications for unemployment insurance (which tell us nothing) , why not look at how many available workers are working. This tells us a far greater tale, and the story is bleak. Near all-time lows. Great Depression era lows.   Or, how about they tell us how many of these new jobs being created are minimum wage and/or part time. Truth be told, we know for a fact that about 90% of the good full time jobs created since 2010 were in the oil fields of North Dakota and Texas. We also know that oil rig leases are down, and that shale producers cannot be profitable at 50.00 a barrel oil, and that lay-offs have already begun. We know that the fourth quarter 2014 Christmas sales were abysmal, and that first quarter numbers are down as well in retail sales, wholesale orders, housing, commodities (the stuff it takes to make stuff), etc. We also know that the big jump in GDP in the third quarter last year were Obamacare costs coming online in the market. In other words, all that new money changing hands was coming out of workers pockets and going into state and federal healthcare exchanges. So yes, Americans did spend more…. on healthcare, not cars, tv’s, and restaurants. No magical Keynesian aggregate spending boost. Just plain old fashion inflation. The kind not reported by the government inflation numbers, which exclude food, energy, healthcare, and everything else in the average American’s home budget.

If we were living in a real economy, we would see wages rise against inflation, not fall, as they have done for 40 years now. If we were living in a real economy, the free market would set the “rent on money” (interest rates) according to the rules of competition. Savers would be able to save and earn a decent return for the lease of their capital (interest on savings). Banks would loan out the money that they receive through deposits. Banks would have strict credit standards so as not to lose their depositors money in bad loans. Banks would go out of business when they were reckless, and businesses would too. The market would clear bad debts, reallocate capital more efficiently, and actually recover from bad decisions. Unlike today, where we kick the can down the road for our children to pay the piper. Where are the adults? Where are the responsible men and women in the halls of power? Drunk on it likely. Neutered. To busy scratching the itch of some group or another. Having cocktail parties joking about us sloped forehead, knuckle dragging, morons out here in the real world paying the price for their cowardice and avarice.

When markets swing violently on the words of Janet Yellen and a private banking cartel, know that the end is nigh. Know that capitalism is dead. And that it took government collusion with those bankers to kill it. So, when your family suffers in the near future, blame the whole lot of them. Democrats and Republicans alike. Politicians, bankers, and lobbyists. And if we get the opportunity to make a change, choose individual freedom and free markets over the “fatal conceit” of an economy planned in the back rooms of Congress, the Treasury Department, and international banks. Remember, that it was individuals unfettered and far removed from the King of England that allowed the colonies of the New World to become prosperous. Same for Australia. Criminals given the ability to work, own land, and save, far removed from the British Parliament and it’s many laws and taxes, were able to escape poverty and even flourish in extremely harsh environment. 50 years ago, Hong Kong and Singapore were impoverished nations, yet today they are the freest and most prosperous nations in the world. Just in case you still thought this was the land of the free and the home of the brave. We are the land of the 18th most-free, and bravery, if Washington is any reflection, is all but lost.

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Why the French Lost North America and Why Washington Eventually Will Too

Why the French Lost North America and Why Washington Eventually Will Too

My kids aren’t in the State Indoctrination Camps, we homeschool. I teach world history to homeschoolers every Friday as part of a local tutorial. I love history and firmly believe that even though history doesn’t repeat, it certainly rhymes. Which brings me to my point. Today I was teaching the future leaders of the free world about The French and Indian War. The book I use as a guide doesn’t give the real reason why the French lost that war, and were driven from the continent. It wasn’t because they were bad soldiers or bad military tacticians. They lost because their leaders were out of touch with reality. Louis XIV was a hard-working, brilliant dictator. Even though he began to sow the seeds of France’s destruction with the construction of Versailles by the blood and wealth of his subjects, nevertheless, he was available and attentive to the state of his country. He may not have cared much about his people, but he at least knew of their suffering.

In contrast, Louis XV was a lazy man. His father did not care for him much. As the leader of France he was hated. He died fairly young, but not until he had squandered most of what his father had built in the New World. When he died of small pox, they covered him in lyme, and chucked him in a hole in the middle of the night. While alive, he was suppose to be leading his people in The French and Indian War. Instead, he was absent, aloof, and uncaring concerning the plight of his people. While William Pitt, the Prime Minister of England, with whom he was at war, was making sure his men had money, weapons, food, and supplies to fight the costly war, Louis was lying in the lap of luxury disconnected from the reality of the day to day existence of his citizenry and soldiers. French soldiers didn’t lose because they were cowards, but because they were cold and hungry. French citizens weren’t hungry because they were lazy, but because they were being legally plundered. The French lost North America in the end because of corrupt and aloof leadership

Does this situation sound familiar? While I am thinking of the broader political class, President Obama is a great modern example of this type of clueless, aloof leadership. Many have called him “Vacationer and Chief”. While our soldiers have shed their blood in unjust foreign wars, he appears regularly to be playing more golf than governing. And when he is governing he is busy catering to lobbyists for green energy, attempting to destroy coal power plants and vetoing oil pipelines knowing full well that in the end these actions will drive up the cost of energy for his citizens. Like Louis XV, he doesn’t really care.. Republican leaders are just as aloof and clueless, just on a whole host of different big business lobby driven issues. Republicans are at war with their own conservative and libertarian base, choosing rather to cozy up to the Wall Street and the Country Club wing of their party. Passing omnibus spending bills, fully funding Amnesty, refusing to audit the Federal Reserve, bailing out “to big to fail” banks and car companies, etc. The political class is aloof and out of touch. While food prices go up and wages go down, they publish phony jobs numbers, knowing full well that the jobs being created are either lower wage, or part time, or both. While companies like Hewlett Packard fire 50,000 employees in order to create reserve cash to buy back their own stocks, driving the stock price up, and amassing huge bonuses for their executives. Congress and the President turn a blind eye to such unethical practices because, of course, this pushes up the stock market and allows them to take credit for a fake “economic recovery” so they can get re-elected and continue plundering the American people. Meanwhile, the rich get richer, misguided youth join Occupy Wall Street. Mandatory Minimum Wage movements gain steam. Tea Parties erupt. Libertarians start having a moment. What do all these things have in common? They are all anti-elite-political class movements. Let’s go back to France and Louis XV for a moment.

What happened after his death? The Enlightenment, “The Bloody Revolution”, and the end of Aristocracy in France. What fills the void when elitist, corrupt leaders lose legitimacy in the eyes of their citizens? Before we answer that, we need to ask, “What causes elitist, corrupt leaders to lose legitimacy?” Economic disruption, brought on by the actions and policies of those leaders usually does the trick. When Marie Antoinette supposedly said, “Let them eat cake”, France was in the middle of a desperate economic disruption caused by the constant wars, taxation, and luxuries enjoyed by the Aristocracy. What fills the void left by elitist, corrupt political leaders? Usually populist movements that claim the noble goal of returning the nation to it’s former glory, and promising never to allow a corrupt elitists political class to rule again. Think of Germany pre-World War II. The Treaty of Versailles had stripped Germany of her former glory. Years of punitive damages inflicted by the victors of World War I stunted Germany’s ability to economically recover. An unjust peace left hundreds of thousands of hungry, unemployed, Germans. This major economic disruption toppled the Weidmar Democracy, and led to the rise of the Nazi Party.

Russia at the turn of the 20th century was in a similar state. Years of aloof, corrupt leadership led to constant foreign wars, high taxation, a virtual caste system that was impossible to break out of, and an extremely prejudicial justice system where the poor simply could not get justice. What filled this gap? A populist movement known as the Bolsheviks came to power through revolution, and every member of the aristocracy that didn’t run was summarily executed. This began 70 plus years of rule by communism, which featured millions of deaths, via starvation, execution, Gulags, etc. Russia today is in the middle of such a movement. What is Vladmir Putin trying to accomplish? He is trying to return Russia to its former glory. This Ukrainian business and the Crimean secession is exactly the type of movement I have been describing. Russia needed a leader. A strong, charismatic figure arises and wins the hearts and imaginations of many Russians. Especially older Russians that remember, with nostalgia, Russia’s former place on the world stage. Russia is currently eyeing their former Baltic states as “economic partners”. But the Baltic nations know this partnership is an “offer they can’t refuse”, to quote Vito Corleone.

The U.S. is now showing signs of this process as well. We’ve had one major economic disruption after another since the 1970’s. All caused by the policies of a corrupt and aloof leadership that promise more than they can deliver and then print more money to cover their spending habits. Because we are the reserve currency holder in the world, we are able to print up a fresh batch of cash and infuse it into our economy. But all we are doing is kicking the can down the road a bit. Debt does not build wealth. The debtor is always a slave to the lender. The piper will be paid. Economic disruption is coming in the near future. With interest rates at zero and quantitative easing not working anymore, what’s the plan this time around? We have painted ourselves into a corner with no way out. These populist movements will gain strength. Eventually, Washington, because of aloof, corrupt leadership will lose it’s legitimacy. It is the way of history. Sure as rain, as we say in the south. What kind of movement will fill the void? This question remains unanswered. I just hope the Libertarian moment, becomes a Libertarian day. Of course, as the Evangelical Libertarian, I know that, “the king’s heart is a stream of water in the hand of the Lord; he turns it wherever he will.” (Proverbs 21:1) My prayer is that the people of this wonderful land will peacefully return to the God of their fathers, not through government coercion, but because of the great love that He has shown to us in sending His own Son to die in our place. It is only the Gospel that can bring real peace. It must start between God and man. But when internal peace takes hold in the hearts of men, and the Holy Spirit permeates our homes and hearths, national peace will soon follow. That’s a populist movement to get excited about!

3Q GDP Adjusted Way Up! I Wonder What Americans Spent That Money On? Bet Your HR Director Knows.

3Q GDP Adjusted Way Up! I Wonder What Americans Spent That Money On? Bet Your HR Director Knows.

Boy, those 3rd quarter GDP numbers sure were adjusted way up. The economy must be doing great with Americans spending all that money. Hmmm, I wonder what all that new spending went for? Good try Obama Administration. Good try.

Surge in U.S. Spending in the 3rd Quarter Went to? Drum roll please……. Obamacare!

 

Clearly This Is The Most Inept Administration in U.S. History

So I’m watching Andrea Mitchell on MSNBC, I don’t know why, but that’s beside the point.  Anyway, she has Chuck Todd on to talk about this PFC. Bowe Bergdahl situation.  He says, “Well Andrea the Administration was caught totally flat footed on the Bergdahl backlash” (I’m paraphrasing here, it’s not an exact quote).  They expected some push back on the 5 released detainees, but they thought everyone would just be elated that Bowe Bergdahl was going to get to come home.  Now, I’m nothing but an armchair political pundit, but even I had heard tid bits about Bergdahl.  There’s been a lot of chatter about this guy, he was not an unknown item.  So here is my question, “How in the world did Fearless Leader and all his Ivy League minions not know that this guy had abandoned his post in a time of war, and cost at least 6 service men their lives while looking for him?” His anti-American sentiments were printed for all the world to see in their favorite Marxist rag, Rolling Stone.  How could they have missed it?  I guess if ESPN had run a story about it, Comrad Obama would have seen it while he was filling out his March Madness bracket.  These guys just seem inept at every turn.  The CIA chief doesn’t know anything when he’s questioned by Congress.  Eric Holder doesn’t know anything when he’s questioned by Congress.  Lois Lerner doesn’t know anything when she’s questioned by Congress.  Neither did her boss.  Hillary doesn’t think any thing even matters.  Joe Biden can’t even form sentences without shoving his entire leg down his throat.  No wonder Jay Carney wants to go home and help his kids’ rock career.  It’s like I’m watching some kind of HBO mini-series, except instead of being super smart and cunning, they’re all total idiots.  I look forward to the day that this sad 6 year long episode in our nations history will be over.  Until then, I guess I’ll make some popcorn and try and enjoy the complete evisceration of the progressive liberal movement by their own people.  Detroit, Seattle, Washington DC … where ever these people take control, financial, political, and moral bankruptcy follow them like Hades follows the pale horse.  If I was in Republican leadership, I’d just try and stay out of the way of these goof balls, they’re self destructing.   And I’d make sure to not put up a milk toast candidate in 2016 like they did in 08′ and 12′.  But, frankly, I have no confidence in them either.  I can hardly wait, Bush vs Clinton, there’s a choice.  And that’s why I am The Evangelical Libertarian.  Grace and peace to you all