The End of All Things

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Don’t worry.  Be happy!

As I sit here typing, I can hear the financial experts on CNBC discussing the stock market.  I should mention it is 2:00pm CDT and the Dow Industrials are in line to fall 400 points today.  Even gold is down $50 per ounce.  I can hear the stress in those knowledgeable voices.  In their own way, they are all saying the same thing: “EEeekk!”

Okay, I will admit a few things are wrong with the economy.

First, the US has a $60 trillion unfunded liability for various pension and health programs.  Second, the US Congress recently demonstrated that as petty and mean-spirited as they are, they cannot cut a single dollar from their spending addiction.

Next, 20 million or so folks are out of work or under worked.  The lucky employed are largely paid on a par with workers in India or Russia.  That is not good.

Then, there is Europe.  Specifically, the European Union, sometimes called the “EU” (Rhymes with “Pee Euw”) is falling apart and they have no central bank or printing press to save them.  Soon, most of Europe could return to the dark ages.

The US has trouble and may not fare much better than Italy or Ireland when push comes to shove.

I am not worried.  Why?  I am not concerned because the US Congress is on vacation for five glorious weeks.  I plan to relax; sun bathe (10 minutes at a time, y’know?) and mebbe sip a cold beer in the evening for as long as they are out of town.  Everything might blow over and get better in their absence. :)

When they return, I will begin to worry.

Until then, I suggest everyone eat, drink and make merry.  (No, not make Mary... sheesh!) The unpleasantness will be upon us soon enough!

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U.S. Economy Circles Drain?

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Recently, it occurred to me that we may be in more trouble than we know. Over the weekend, I had an opportunity to reflect on the Congressional approach to cutting a relatively small amount of money from the current budget. Overall, it was an unflattering spectacle. There were plenty of threats, name-calling and outrage on every side of the issue. Every party stretched truth beyond recognition and lies hovered near the lips of the speakers.

It was only at the last minute that the parties reached agreement. I am sure the nation sighed with relief, as did I.

The next hurdle for our federal government is the debt ceiling. Since we are in the hole for more than $14 trillion, what harm could come from borrowing another trillion or two? I expect very little.

Then, the notion crossed my mind that the harm lies in the process. As nervous creditors watch, our Congress may put on another “show” over this issue, too. Then, at a quarter ‘til midnight, they’ll announce an agreement. It will be too late.

I imagined the emotions and judgments a serious creditor might make while watching the federal circus, day after day. The thought made me queasy. What would it do for the sensitive digestive tracts of, say, the Chinese? I hope they have a large wok handy as they watch. I can imagine them needing a wash-up before meeting to decide what to do – days or weeks before the deadline.

Then I imagined a large container ship might sail into the Port of L.A. a week later. The cargo of redeemed U.S. Treasuries would have the ship decks awash under the load. In a few more days, trillions of dollars in U.S. currency would arrive at a port in China, say, Shanghai.

Then? Well, let’s just say our debt problem would be less, but we might soon feel nostalgia for $5.00 per gallon gasoline.

Gee. I truly hope I am wrong about this.  Or, maybe not.

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