The French Signal a Financial Collapse and Offer Advice on How to Cope with such a Disaster. Armageddon?

Abstract: We have allowed cheap credit world wide to expand debt beyond belief or our ability to pay it off. An economic tsunami engulfed our house asset base and deleted about 1/3 of our assets and wealth. The far left now spends wildly on bigger government and prints money with abandon while trying to seize healthcare and more. The national debt is now 12 trillion and headed for 20.  The interest on the debt alone will soar to 1 billion dollars a day. The economy is sinking and the far left will not stop spending and they just allow the debt to rise to levels we cannot ever reverse. Only massive inflation will ‘fix’ this.  Printed monies pumped into phony stimulus programs like the Cash for Clunkers and other subsides give only a false illusion of economic growth. All our big banks are hollow zombies. The French have offered some three scenarios for their clients of Société Générale to cope with each level of potential disaster and selling the dollar is key to a workable strategy. Meanwhile our worthless Senate lies about their HC bill and gives us 34 hours to digest the wreckage of their 2,074-page mumblings before they want to put it to the floor of the Congress. The French follow the Chinese and others like India who confidently predicts that the US economy is collapsing and our currency will be destroyed in a whirlwind of worthless paper. It may be time for a revolt.

The giant 15 decade old French bank-investment house Société Générale[1] is now offering some suggestions as how their clients can manage their investments under three scenarios in the looming world’s potential financial collapse led by the United States. Many of us have been issuing warnings on this matter for months.[2][3][4][5] Our government, animated by the puppetry of our Secretary of Treasury Tim Geithner, offers us lies[6] about the strength of the dollar[7] and the effect of our debt and how some economic ‘recovery’ is in progress.  Unemployment and debt continue to soar. An analysis by the international economic authority follows:

An expert view by Ambrose Evans-Pritchard:

“In a report entitled "Worst-case debt scenario", the bank's asset team said state rescue packages over the last year have merely transferred private liabilities onto sagging sovereign shoulders, creating a fresh set of problems.

Overall debt is still far too high in almost all rich economies as a share of GDP (350pc in the US), whether public or private. It must be reduced by the hard slog of "deleveraging", for years.”[8]-- Société Générale tells clients how to prepare for potential 'global collapse' Société Générale has advised clients to be ready for a possible "global economic collapse" over the next two years, mapping a strategy of defensive investments to avoid wealth destruction. By Ambrose Evans-Pritchard 18 Nov 2009 [Emphasis is mine in all quotes.]

To put this in perspective, there are three cases studied and a scenario given for each case with the worst case being the "Bear Case." Our government is now trying to print money to restore lost wealth on defaulted mortgages and other improper uses of credit to rescue their political basis.

“Governments have already shot their fiscal bolts. Even without fresh spending, public debt would explode within two years to 105pc of GDP in the UK, 125pc in the US and the eurozone, and 270pc in Japan. Worldwide state debt would reach $45 trillion, up two-and-a-half times in a decade.”—Prichard 18 Nov 2009

There is only 6 trillion in capital left.[9][10]

“The underlying debt burden is greater than it was after the Second World War, when nominal levels looked similar. Ageing populations will make it harder to erode debt through growth. "High public debt looks entirely unsustainable in the long run. We have almost reached a point of no return for government debt," it said.--[Ferman quote]

Inflating debt away might be seen by some governments as a lesser of evils.

If so, gold would go "up, and up, and up" as the only safe haven from fiat paper money. Private debt is also crippling. Even if the US savings rate stabilises at 7pc, and all of it is used to pay down debt, it will still take nine years for households to reduce debt/income ratios to the safe levels of the 1980s.”—Ferman comment

So, if we put all our US domestic savings into debt relief it will take almost a decade to do so and there will be nothing for investment and hence no growth.  If we raise taxes then savings rates will plummet and more businesses will fail. Higher taxes will lower tax revenues so the government will have to spend more by printing more money. We have to cut spending, but the left-wing nuts currently in power until, hopefully, 2010, are stating flatly that this is not an option. Inflation, now in progress, is the apparent ‘solution’ to the problem by our worthless government. All this argues for the ‘Bear Case’ scenario cited above.

The survival options suggested by Ferman:

“The bank said the current crisis displays "compelling similarities" with Japan during its Lost Decade (or two), with a big difference: Japan was able to stay afloat by exporting into a robust global economy and by letting the yen fall. It is not possible for half the world to pursue this strategy at the same time”-- Société Générale Ferman comment

Apparently, we expect to debase our currency and export into China and the rest of Asia. China will resist this and other panicked nations will also debase and follow suit in a competitive devaluation war like we had in the Great Depression.

Specific investment maneuvers:

“SocGen advises bears to sell the dollar and to "short" cyclical equities such as technology, auto, and travel to avoid being caught in the "inherent deflationary spiral". Emerging markets would not be spared. Paradoxically, they are more leveraged to the US growth than Wall Street itself. Farm commodities would hold up well, led by sugar.”-- Société Générale Ferman comment

Background on the problem—massive debt

There is a most important problem[11] with the world economies at this moment and little future opportunities to correct unremitting problems with the astronomical debt levels according to the widely-respected economic analyst Ambrose Evans-Prichard of the Telegraph, London.  The debt levels are a direct result of unacceptably and dangerously low interest rates and excess and unsound credit resulting in defaults on loans and the subsequent collapse of subprime and other mortgage bundles now known as ‘toxic assets.’ The toxic assets are still with us and governments had to stuff liquidity into the capital reserves of banks all over the planet to stop the financial world from collapsing. This is the correct explanation of the “… transferred private liabilities onto sagging sovereign shoulders…” comment above. The government is trying to sustain ‘affordable housing’ and failing miserably.  Subprime mortgages, for example, are becoming even more toxic as time passes with even the AAA mortgages of 2007 falling to 28 cents on the dollar and AA at only 4 cents.[12] Equity lost by homeowners is capital lost almost forever with now nearly 8% of all FHA loans in default and Fannie Mae and Freddie Mac having an unknown pile of hollow mortgages probably in the region of 3-5 trillion dollars.[13] Home foreclosures continue to burn down wealth and savings here and abroad.[14]

Each trillion dollars in debt is $16,000 in tax liability to the mere 60 million who pay federal taxes.

Our worthless government is currently treating the debt-driven deflationary spiral[15] with more debt and that solution is novel in itself.  We can justify a defense of the banks and a fight against a massive deflationary debt spiral[16][17] but in end the debt has to be handled properly. The current debt levels cannot be sustained and printing money as the sole choice is not an option to economic recovery—it would be even worse than a depression if hyperinflation launches off. Our currency would collapse.  There is a debt chart below based on several assumptions and you can judge for your self how this affects all of us. See Details of the Debt below.  I cannot find a translation of this report in English. My French is worse than my German or Latin or  my English is some cases.

From Evans-Prichard:

“Under the French bank's "Bear Case" scenario (the gloomiest of three possible outcomes), the dollar would slide further and global equities would retest the March lows. Property prices would tumble again. Oil would fall back to $50 in 2010.

Governments have already shot their fiscal bolts. Even without fresh spending, public debt would explode within two years to 105pc of GDP in the UK, 125pc in the US and the eurozone, and 270pc in Japan. Worldwide state debt would reach $45 trillion, up two-and-a-half times in a decade.”-- Société Générale tells clients

“Mr Fermon said junk bonds would lose 31pc of their value in 2010 alone.”-- Société Générale tells clients

From rising interest rates? Probably.

“Mr Fermon said his report had electrified clients on both sides of the Atlantic. "Everybody wants to know what the impact will be. A lot of hedge funds and bankers are worried," he said.”-- Société Générale tells clients

Electrified is probably some idiomatic French understatement. It is clear that our debt is unmanageable and that Obama and his loony leftists only want to spend more and transfer as much wealth to the government as possible for distribution to key supporters in the last election such as SEIU and other unions. The government now owns some banks and a couple of auto manufacturers and much of our private real estate now. The healthcare scam is the best way to soak up taxes from all of us. Cap and trade will cap us all.

The Reptile[18][19] or some similar inhuman slithering being frequently  known as  Spartacus [20]-- in honor of the Marxist heroine Rosa Luxemburg--the former chair of the Marxist Progressive Caucus[21], Nancy Pelosi, now wants an international tax on transactions so that people cannot escape Wall Street taxes and socialist regulations  and do business elsewhere.[22] I expect this serpent or some of her drug-whacked familiars in Sacramento to attempt to enact such a law to keep California’s[23] citizens captive to her slimy, perverted Marxist taxes too.

It is revolt time….

This is a mockery of the democratic process and justice and law, but that describes the liberals—does it not? Get ready to defend your homes and assets against misappropriation as your government is trying to grab it all with taxes and spending and a “redistribution” of wealth.

rycK [a 5^th generation Californian in exile]

Comments to: ryckki@gmail.com

General footnote to the above: Details of the Debt:

You can peruse this chart below and see if any of this data presented are unreasonable. If only half of this is true then we are clearly busted and the hysterical quest for our money and wealth by the left will begin soon. They have no problems with crime, sloth, sodomy and assorted perversions but they do have major problems white people having wealth that they cannot grab. Numbers are in trillions in the left columns.

Prepare for the worst…..

rycK

Comments to: ryckki@gmail.com

The NYT’s Frank the Crank Mumbles about Missing Links. Typical propaganda

Abstract: Frank Rich of the New York Times dutifully throws every leftist cliché at Glenn Beck in a hasty and crude dance reminiscent of a head hunter’s celebration with fresh onions and a big pot.  He grinds away on a typical smear piece dropping as many names as will fit into his drifting cranium.  He offers nothing but spite against Glenn Beck and Sarah Palin as his custom with anybody to the right of Fidel Castro.  He offers moral and political support to the Islamo-terrorist Major Hassan [SoA] from Fort Hood who desperately needs a public platform to spew his hatred and the urgent need of a partner like the New York Times who will subvert any legal efforts to put this guy away or give him the injection he needs. The US is ultimately to blame for this massacre and Glenn Beck and Governor Palin are unindicted co-conspirators who deserve the ultimate blame for the deaths or our soldiers.  The Creator of Macacaism grinds out another pulp plop for his readers to share aloud in their Sharia Séances and drug parties.

The New Y0rk Times is a slick propaganda machine that shines like a star in the midst of the left.   The Times fosters a cluster of soothsayers, imported toadies and other busy little types to form and maintain a phalanx against decency and truth. They have a long history of attacking anything decent or American in value and nature with venom and spite disguised as concern or analysis.  They worship Marx.

Their most prestigious journalist and political disinformation specialist for this paper  was Walter Duranty[1] who in 1932 wrote 13 articles for the NYT on the Soviets and their gulags and murders and was awarded  the distinguished honor of the Pulitzer Prize. He was actually at or near the events [or knew the precise details] of what is known in Ukrainian history as Holodomor (Ukrainian: ?????????; translation: death by starvation)[2] and dismissed the horrors in his writings and denied their existence.[3]  His work, although manufactured lies designed to excuse the murderous excesses of Stalin, was politically correct before the term became fashionable and any suspicions about Walter from his editors on facts and details were quashed because he printed what the far left wanted to read. They still do.  Rich still does and does honor to the history, political views and image of Duranty.

Keeping with this hallowed tradition, we submit for today’s studies in propaganda and smear tactics the instant work of Frank the Crank. [4][5] Frank Rich is well known for his supernatural ability to crank out sophomoric and dogmatic far-left literary brats with sausage-machine tedium even when they apply to nothing in particular. He can sometimes identify a pratfall, even when it happens to a Clinton.[6] He is the hyperessayest[7] and self-anointed priest of macacaism. [8] His sharpest literary weapon is the use of negative evidence as he doesn’t have to defend elements of nonexistence.  He can spread the caca of macacaism around with a broad brush and bring tears to the eyes of True Believers who adore his works.  Inciting to racism is his sworn duty and personal honor and he excels in this art.

He begins:

“THE dead at Fort Hood had not even been laid to rest when their massacre became yet another political battle cry for the self-proclaimed patriots of the American right.”[9]-- The Missing Link From Killeen to Kabul By Frank Rich Op-Ed Columnist Published: November 14, 2009 [Emphasis is mine in all quotes.]

Paraphrasing by rycK:

“THE dead at Fort Hood had not even been laid to rest when their massacre became yet another political battle to apologize for and expose America’s sins by the self-proclaimed commanders of the Un-American left.” --rycK

That is what Frank is really saying, in my not-so-humble view, given my license to interpret his words and insert missing thoughts and comments—a process I learned from a colleague of his of sorts. This ‘journalist’ taught us  to use the ‘Unspoken Words Theorem’--so aptly invented by Maureen Dowd the Old Red Lady [10][11][12]of the Old Gray Lady[13] [e.g. Quoting Dowd: “But, fair or not, what I heard was an unspoken word in the air: You lie, boy!”[14]]—and here it is!

The unspoken words [translated in gangrenous  green] I heard from Rich go something like this: “I am glad this marginalized citizen, a true hero of the progressive revolution,  had a chance to express his anger at what Bush and the right have done and now this gives me an excuse to attack Republicans at will. “

That is slick. This is the new Stuff-and-React propaganda process invented by the left: Just put in what you think he said and that becomes fact. Then dump on him.

That is fair under New York Times standards as we know from the Dowdy Dowd. The Crank’s opening salvo has a great deal not said that projects volumes about Glenn Beck.  We now search for substance in this article, vainly, to see just what Beck has done to upset the NYT other than being a white male, a conservative and an American. What we will find is the hysterical and racist images of a journalist set to paper by a person far past his prime and helplessly stressed with an insoluble conundrum.

The Crank cranks on:

“With all due respect to Jimmy Carter,[15] the racist component of Obama-hatred has been undeniable since the summer of 2008, when Sarah Palin rallied all-white mobs to the defense of the “real America.”-- Even Glenn Beck Is Right Twice a Day By Frank Rich

Do we have any evidence that Palin recruited “all-white mobs” to attack somebody?  Anybody read hatred of Palin in this or other articles by the NYT?? No, this is standard smear tacticism by the Times.[16] When Joe Wilson called to Obama that “you lie!” the response from Rich must be:

“It’s not good for the country that a lawmaker can’t control his anger at Barack Obama. It gives permission to crazy people.”-- Frank Rich

Translated: “Since Palin and Beck are white we can always play the race with impunity and rate rave reviews from our Friends of Islam, SEIU, ACLU, M-13 and New Black Panthers. Go ahead and scream at them because we need your votes.“

I think Obama lied too and I would have done the same as Joe Wilson and excused myself with a lengthy parting  essay on civil disobedience at the podium in the House. Somehow, we are to be muzzled when we point out that Obama has no past, has no accomplishments and has done nothing for the economy other than advocate more massive spending and thus more massive debt from which we probably cannot recover. He is a liar;[17] I don’t like him.  He is a cultured stooge and lackey of Jeremiah Wright of 20 long years standing; I don’t trust him for that. Here is the implication that some white legislator, paying attention to the color of Barrack’s skin and ignoring that fact that he is half white—although this is never mentioned—gives comfort and encouragement to loonies or goon squads to do harm by questioning his veracity.  I call this disease cryptomisoxeny[18]. Thus, it appears that the thus afflicted Rich is conjuring a conspiracy theory with all the usual spangles and tinsel to warn us that hoards of howling armed white, red neck racists will soon rise up in some holy libertarian race war and demolish the presidency.  Thorazine is indicated here.

More and in detail as Rich outlines the attributes of this new threat:

“Time put Beck on its cover this week. Man of the Year may not be far behind. Beck is not, as many liberals assume, merely the latest incarnation of Rush Limbaugh. He is something different. That’s why he is gaining on his antecedents — and gaining traction in the country’s angrier precincts.

Though Beck’s daily Fox News show is in the sleepy slot of 5 p.m., his ratings are increasingly neck and neck with the prime-time tag team of Bill O’Reilly and Sean Hannity, and he has beaten them in the prized 25-to-54 demographic. It’s not just because he is younger (45). This self-described “rodeo clown,” who wells up with tears for dramatic effect, doesn’t come across as cranky or pompous, like Limbaugh and O’Reilly. A fervent Mormon convert and proselytizer, he is untainted by association with the old Dobson-Robertson-Reed religious right. Unlike Limbaugh, he bonds with his fallible listeners by openly and repeatedly owning up to his own mistakes, including his history of drug and alcohol abuse. Unlike Hannity, he is not a Republican apparatchik.”--Frank Rich

Translated: “ Beck is obviously  guilty  by association with my enemies  so I will smear him by plopping down names of the most  hated conservatives and interweave them in his work always referencing Nazism. “

And this analysis is politically correct in all ways and a refreshing example of the existence of some ethical limits—however slight--to Jaysonian License[19] to perturb the truth at the NYT.  But, do we detect some anti Mormon bias here? Can Frank be a bigot? Does he drink? Is he pompous? Has he taken drugs?

Frank drops names whenever he can until his sentences bulge with hate.

Frank quotes Beck:

“Americans “know that SOMETHING JUST DOESN’T FEEL RIGHT,” he writes, “but they don’t know how to describe it or, more importantly, how to stop it.” This is right-wing populism in the classic American style, as inchoate and paranoid as that hawked by Father Coughlin during the Great Depression and George Wallace in the late 1960s. ”-- Frank Rich

Coughlin was a leading anti-Communist during the Depression thus the mechanical hatred and spite emanating from the stilted script here.[20] Here the association with FDR and Huey Long gets complicated but the thrust of this article is all about the new alarming evils of populism and that is what Frank is glubbering about. He and other patriots like Ronald Reagan ruined a lot of the dreams of fellow travelers and worse.

I also think that SOMETHING JUST DOESN’T FEEL RIGHT when we are spending ourselves into the financial grave yard and are supposed to blindly support slimy groups like ACORN or SEIU.  I think Obama’s associations with Jeremiah Wright, Bill Ayers and others make him an ideological racist[21][22], a liar[23] and a Marxian advocate or a simple stooge.[24] That is something far advanced from merely stating that Barack has ‘lied.’ He is a consummate liar.

Frank sputters on until his truss is too sticky to continue:

“Beck has notoriously defamed Obama as a “racist,” but the race card is just one in his deck. His ideology, if it can be called that, mixes idolatrous Ayn Rand libertarianism with bumper-sticker slogans about “freedom,” self-help homilies and lunatic conspiracy theories.”-- Frank Rich

The word freedom here is the most accusative of all Becks’ comments in leftist terms. Freedom means freedom from taxes and demigods like Obama and the now-subservient Clintons who somehow escaped jail and grovel in his shadow.

“Unlike liberal critics of capitalist inequities, of course, Beck and his claque are driven by an over-the-top detestation of government.”-- Frank Rich

Translated: Beck hates my precious Marxists.

Note the connection between detestation of government and liberalism that would consume all we have USSR style.  I detest liberalism and can give this process no good words given its performance since FDR and corruption from people like Gore, Clintons, Pelosi, Reid, Carter, Farrakhan, Rangel, Geithner, Schumer, Barney Frank and Cold Cash Jefferson that make liberalism what it is today. I detest all of these social parasites. These people are Un-American and crude parasites. I detest the Obama government.

Obama is a reverse racist, and ideological racist, a Marxist, a socialist and an anti-capitalist who can make speeches but deliver nothing except debt and despair. His approval ratings are plummeting hence the frenzied damage control antics by little squeakers like Frank.

In a final futile utterance, Frank reverses Glenn Beck’s warnings about Timothy McVeigh: [25]

“Beck frequently strikes the pose of an apocalyptic prophet, even insisting that he predicted 9/11. This summer he also started warning of domestic terrorism in the form of a new Timothy McVeigh. On this, one fears he knows whereof he speaks. For all our nation’s unfinished business on race, racism is not Obama’s biggest challenge during our unfinished Great Recession. He — and our political system — are being seriously tested by a rage that is no less real for being shouted by a demagogue from Fox and a backbencher from South Carolina.”-- Frank Rich

Translated: “Beck and his real Americans are a threat to the Marxian bloating of government and must be stopped.”

Yes, the test is on. Frank’s Cranklings are sour and reflexive and are obvious distortions of Beck’s original thoughts and comments. The need here is to stir up the violent factions of the left like the New Black Panthers or LaRaza or revive the old SDS and indirectly back their Islamo-Fascists allies that did so much good for Obama when he protested against President Bush. The left needs urging to go to the streets as they did in the 60s. He has nothing better than to place the reverse race card in an attempt to encourage this outcome as he is so adept at doing. He might be successful in some inner cities.

Beck’s popularity and presence is hacking away much unearned and residual faith in Obama and his wild-spending Democrats like Nancy Pelosi and Maxine Waters and, yes, Americans know that something is indeed wrong.  We expect the worst of propaganda and smear tactics from the Walter Duranty Papers and today Frank Rich has given us more than an average dose. Frank condemns and besots his own twisted liberalism with his words and insinuations.

Great work Glenn!!

rycK

Comments: ryckki@gmail.com

Paul Krugman Juggles Apples and Oranges until He has the Perfect New Economic Stew:  Government Subsidies for Idle Workers.

Abstract: Paul Krugman juggles fruits from different cannery bins[1] in a classic circus performance that rings of the Russian Circus in its halcyon days. He has an impressive array of hoops and ropes and noise makers to entice the marginalized into accepting his little story for today. He now, quite audaciously, compares the current unemployment rates of Germany with the U.S. using some A, B, C alphabetic soup analogy that would be received as an insult to even an imbecile as he unashamedly ignores the trends of the last 25 years of both countries and focuses only on 2009’s year’s difference between A and B to make his sorry point. Tables that date back to 1980 are provided here to illustrate this omission. He then muses and wanders upon the plethoric wonderlands of socialistic mechanisms that attack capitalism for a general solution to his problem  but brushes dangerously close to the concept of temporary tax  cuts now being conjured as new ideas by the worried left who now see Obama’s ‘recovery’ as a sham and a joke. The suggestion of a formal tax cut for business is forbidden fruit in krugmanical séances and is properly omitted here by the Nobel Prize Laureatte. Lamenting the fact that 787 billion dollars did not moderate the upcoming depression-levels of unemployment Krugman searches for government subsidies in various veiled and jaded forms to keep little fingers busy and happy and arrives at Kurzarbeitergeld—the German worker subsidy system. The idea is wonderful except it seems to produce a net loss in tax revenues which prompts us to wander aimless in the ether for an explanation as who will pay for this.  As usual, there is no discussion of costs and only abuse for capitalism—the process that embarrassingly provides nearly all the tax revenues for this planet.  This is a classic bit of anything-but-capitalism-goes form of ‘objective’ thinking offered in the classic liberal manner and the facts smothered by the quest for something ‘different.’  Apparently, the stimulus was not ‘different’ enough and we need a bigger one. The collapse of our currency in a swamp of inflation would be ‘different’ too.

The New York Times (that is known affectionately as the Walter Duranty Papers[2] in honor of their most beloved Pulitzer Prize winner) may be likened to watching and then expertly commenting on some new and sensational TV programs while the set is disconnected. The intellectually myopic structure of their articles is a curious blend of rote propaganda[3][4][5][6], noisy and erratic pandering to special interest groups such as unions and certified Ouija board prophecy whose original concept can be traced back to 1848. No matter what happens in the world, the analysis of any event must be viewed through the prismatic lens of progressive visualizations. Persuasion is always more important than truth and failure is always more important than success if that success includes any contribution from capitalism.

Today, we venture into an exciting admixture of economic partial truths and associated political nostrums guided with song and tinsel waving by our resident economist Paul Krugman[7][8][9][10][11][12] as his works provide guidance, and hopefully, a platform for aggressive government action by those currently in power. We are treated to an analogy on comparative government policies [sans details of course] and we are thrilled to learn how many planes and surfaces and points of singularity can be geometrically warped into an ostensibly coherent message in a single setting.

The premise:

“Consider, for a moment, a tale of two countries. Both have suffered a severe recession and lost jobs as a result — but not on the same scale. In Country A, employment has fallen more than 5 percent, and the unemployment rate has more than doubled. In Country B, employment has fallen only half a percent, and unemployment is only slightly higher than it was before the crisis.

Don’t you think Country A might have something to learn from Country B?”[13]-- Free to Lose By Paul Krugman Op-Ed Columnist Published: November 12, 2009 [Emphasis is mine in all quotes.]

Here are the unemployment data with the caveat that the GDR data are not included here before 1990.

The chart is shown in this link: http://i235.photobucket.com/albums/ee208/ryckpb/GermanvsUSUnemployment.jpg

Moving right along with reality:

Consider, for a moment, the predictable intellectual shallowness of this unsophisticated offering:  We are offered the prospect of comparing two singular and isolated data points plucked from the mass of information circulating in our universe and instantly incorporated into some economic theory as if they defined some eternal trends. What direction does a point point to? Anywhere!  What we might learn about from this riddle is the starting point for an exciting expansion of government and a new form of progressive socialism where the government subsidizes those who have had their work hours reduced in lieu of being laid off. But, that is an old story—not a new one.

The German Kurzarbeitergeld scheme:

“One particular measure that deserves close attention is the reduced-hours compensation scheme (Kurzarbeitergeld), which has been very successful in Germany. Under this scheme companies can radically reduce the working hours of staff. The affected employees are, however, not laid off but compensated with up to 60% of their net salary (67% if childcare is involved) for up to 24 months by the federal government.”[16]-- A shift in spending to save jobs By Henning Meyer guardian.co.uk,Thursday 17 September 2009

Is Krugman aware of this interesting measure?

“This story isn’t hypothetical. Country A is the United States, where stocks are up, G.D.P. is rising, but the terrible employment situation just keeps getting worse. Country B is Germany, which took a hit to its G.D.P. when world trade collapsed, but has been remarkably successful at avoiding mass job losses. Germany’s jobs miracle hasn’t received much attention in this country — but it’s real, it’s striking, and it raises serious questions about whether the U.S. government is doing the right things to fight unemployment.”-- Free to Lose  By Paul Krugman

“The alternative would be policies that address the job issue more directly. We could, for example, have New-Deal-style employment programs.”-- Free to Lose  By Paul Krugman

Failed attempts:

Apparently the promises of Obama celebrated and orchestrated by Romer and Summers with song and dance were not the right thing to do. Notice that tax cuts for corporations and a reduction in ‘fees’ and nasty rules not to mention  restraining unionism are not mentioned. The unions already had a version of this pay-for-no-work swindle at GM and the shrunken remains of Chrysler. It is customary to avoid any mention of tax cuts in the presence of liberals owing to their tendency to fall ill and desecrate the rugs and wall paper with certain aromatic effluviums.  We hear nothing to the effect that the stimulus was phony from the onset and destined to fail anyway as it only boated government with metastatic disease and failed to halt the unemployment rates even though the books were cooked to say so.

The Christine Romer Prophecy:

“…, even with the large prototypical package, the unemployment rate in 2010Q4 is predicted to be approximately 7.0%, which is well below the approximately 8.8% that would result in the absence of a plan.”[17][18]--CNSNews.com Monday, July 06, 2009

The Christine Romer Un-Prophecy: Did Romer recant?

“Most analysts predict that the fiscal stimulus will have its greatest impact on growth in the second and third quarters of 2009,” Romer said. “By mid-2010, fiscal stimulus will likely be contributing little to growth.”[19]— Christine Romer Oct. 22

I thought we were at 10.2% unemployment and rising with no end to the misery. Is it possible the stimulus was only a seedy payback to loyal voters, SEIU thugs and to bloat government? The frantic effort to tell us that ‘jobs were saved’ is also a sick joke. Oh! NO, we saved jobs at only an expenditure of printed money to the tune of $92,000 per job![20] And, we only spent $24,000 per car on the Clunker Follies and a mere $43,000 on the housing scam. [21] Now, that is ‘government’ by liberal standards.

Success revealed:

“And that’s what the Germans have done. Germany came into the Great Recession with strong employment protection legislation. This has been supplemented with a “short-time work scheme,” which provides subsidies to employers who reduce workers’ hours rather than laying them off. These measures didn’t prevent a nasty recession, but Germany got through the recession with remarkably few job losses.”-- Free to Lose  By Paul Krugman

Two points for Krugman! He has found a solution by probing the lower reaches for more socialism! Well, at least this does not involve the dreaded tax cuts and he does not have to denigrate the evil Tax-cut Zombies[22] ring for a while. We can just print money and subsidize lost work time! What an idea!

An analysis of this novelty:

So, on a theoretical basis and or illustration, we can assume we have a nation with a factory and in this widget factory we have some employees who are busy assembling widgets and then the sales drop so the manager decreases full employment to, say 50%, for 2 of his 10 employees and the government picks up the tab.  Now, “9” employees work fewer company hours to match the lower widget sales and the employer pays 5% less for labor. That works? We can thus assume that the good news must be that productivity is maximized or sustained [no idle hands and fingers] and that the general efficiency of widget production is maintained. But, since the government is now subsidizing the missing salaries for 5% of the workforce we wonder where this money comes from? If the entire state depended upon Widgets GmbH to fuel the total tax receipts then they now short 5% in revenues—are they not? Surely, the government cannot tax the employee at his full rate!  Or can they? This is not quite double dipping as one of the employees would have been laid off and those tax proceeds lost anyway and some unemployment expenditures would have been necessary.  There is something fundamentally out of step with business reality here. The government is subsidizing excess capacity! This is a farce. This is inefficient and must affect the tax rate or widget prices and lower tax returns from the widget company.

The empire either borrows money for  this 5% subsidy or prints more money or increases the taxes on the Widget company 5% higher to make up for the loss in revenue. How does this all work out? Is there an attempt to make this system tax neutral?

If the company is taxed 5% more on only 90% of production then that will probably tear away some profits due to economies of scale.  If the government prints 5% more money and uses that to pay the half idle employees  then the money supply increases by 5% and inflation comes along and the Widgets must be price elevated by 5% or else more workers have to be laid off.

Notice that everybody apparently loses by this scenario as there is no way to subsidize defunct or inefficient elements of business with government-derived tax funds without creating a greater problem.  Notice too that if one employee was laid off [instead of two cut back 50%] and received half his salary as an unemployment benefit then this would be a 5% loss to the system.

 I can only see a 5% loss [or more] here. Any suggestions on how go get around this?

But, who pays for this and how??

We already have ‘different’ [read different from socialistic] methods to encourage employment and growth and these two nasty words are tax cuts and fewer government rules and regulations.

The tax credit idea revealed:

“One version of the approach, to be unveiled next week by the Economic Policy Institute, a labor-oriented research organization, would give employers a two-year tax credit if they increased the size of their work force or added significant hours of work (for example, making a part-time worker full time). Employers would receive a credit worth twice the first-year payroll tax for each new hire, amounting to several thousand dollars, depending on the new worker’s salary.”[23]-- Support Is Building for a Tax Credit to Help Hiring By Catherine Rampell

Published: October 6, 2009 [Emphasis is mine in all quotes.]

The payroll tax is complicated and includes income tax withholding and Social Security taxes. [24] It is difficult to believe that ‘stringy strings’ would not be attached to any such program and that such entanglements would differ greatly from the TARPie’s Pox.[25] [26] CEOs taking this potentially poisoned pill might have their businesses constrained by those who whoop and slobber and squawk at the stars along with the mystical palm readers in our government and be subject to a mountain of paperwork and extra tax forms. The ‘savings’ offered under this plan is minimal as it costs many thousands to hire and train a new employee but when some business reasons compels a CEO to lay off an employee the reasons may be significantly other than just financial. What happens if the employer finds out that the employee is on drugs or a thief or an idiot? Do we subsidize this person? Probably so in the warped context of liberal thinking.  

Okay, let’s think about this tax  credit in Widget terms: If we really want to eliminate the federal tax proceeds of a new hire for 2 years and that tax is X [as above] then where does the money to replace this lost revenue come from?  For a company with 10 employees we now subsidize the new employee with the amount of their tax liability—some 40% or so counting FICA and FICM taxes. Thus, we have a 4% problem like the one we had at 5% under the Widget follies supra.

A critical inspection of this table and associated chart seems to make anyone wonder why we should choose the German system since the US unemployment rate is considerably lower from 1984 to 2008 [with one exception], a mere quarter of a century, but, then the lefties are not so excited when they survey the full facts and tend to cherry pick out jewels that give bit of scintillation to their notions.  This is part of their show-and-tell mentality where any bauble that sparkles or shines and could be traded for a lollipop is an instant advance in their culture.  Three such ‘discoveries’ of this galactic magnitude qualifies you for entrance into the Ivy League and start off with an independent study and a guaranteed  PhD in any area you wish or invent. This  full data range is not mentioned in the mumblings of Krugman in this little propaganda piece and only the last entries in the table seems to act as the magic  fulcrum that drives this approbation of the German system. All that was necessary to trash the 1980 to 2008 levels and elevate them to absurd heights would have been for the greens to have won control in Germany and instituted more of their phony EcoNazi[27]programs such as CO2 elimination.  And, that may come soon if they watch their British brothers closely and heed predictions of destruction such as bestowed upon the world their fearless leader the Princeling of Wails, or Flop Ears the Dolt.[28].

Maybe we should be different and start reading other economists other than Krugman or one of his tribe. Losing is not free in capitalism.

rycK

Comments: ryckki@gmail.com

Geithner Lies About The Strength Of The Dollar. The Local ‘Recovery’ In The US Depends ONLY On Government Printing Money and this Will Sink The Dollar.

The chief difficulty in pursuing paths forward in nasty economic times is choosing among conflicting ‘experts’ in the economic arena who, unfortunately, are divided along political lines. Thus, a given political power structure would obviously select some gnome with a world class reputation to instruct the world on how to orchestrate a recovery that only benefits their constituents. I believe that this is what Tim Geithner is doing. He tells fibs with impunity.

Tim Geithner speaks:

“"It's very important to the United States that we have a strong dollar," he said at a news conference at the Asia-Pacific Economic Cooperation forum, or APEC in Singapore on Thursday. "As growth recovers, (we will) move our fiscal position back into balance."”[1]—Reuters UPDATE 1-Geithner stresses strong dollar's global role Thu Nov 12, 2009 7:40am ES [Emphasis is mine in all quotes.]

It is the weak dollar that propels this surge in the stock market and the synthetic ‘recovery’ our government boasts about. The weak dollar just sets up another bubble in the future.

Krugman refutes Geithner:

The truth is that the falling dollar is good news. For one thing, it’s mainly the result of rising confidence: the dollar rose at the height of the financial crisis as panicked investors sought safe haven in America, and it’s falling again now that the fear is subsiding. And a lower dollar is good for U.S. exporters, helping us make the transition away from huge trade deficits to a more sustainable international position.”[2]--Misguided Monetary Mentalities By Paul Krugman

This is an essay in circular logic. There is no recovery now and no recovery will occur without a massive downward shift in unemployment—now heading slowly to 12% or higher—because the necessary stimuli to business [tax cuts and lowering government costs to small business midlines] will not occur for political reasons. The dreaded tax cuts are needed and those are off limits to any leftist who can spell the world economics.

From the recent past:

“Mr Luo, whose English tends toward the colloquial, added: “We hate you guys. Once you start issuing $1 trillion-$2 trillion [$1,000bn-$2,000bn] . . .we know the dollar is going to depreciate, so we hate you guys but there is nothing much we can do.””[3]—wild rant by Luo Ping, a director-general at the China Banking Regulatory Commission [Emphasis is mine in all quotes.]

They are buying and stockpiling gold and other metals.

Support for these follies from the left at Harvard:

“Rogoff the notorious Harvard/IMF/FRB economist was on the Charlie Rose show advocating large tax increases and increased deficit spending and saying a currency crisis was five years away. Academics like Rogoff have been responsible for promoting all these ‘designed’ for failure products and policies. Indeed the roots of this crisis are the Rockefeller economists like Rogoff.”[4]-- Gold and Market Commentary Posted by zionistgoldreport Nov 11, 2009

I also watched the Charlie Rose show last night on Bloomberg and heard Rogoff say that the bond holders should pay for a lot of the recovery [as they did for Chrysler where they given a haircut and the unions got the assets!]. I think he is a zero-grown advocate or something similar to that because higher taxes will stifle new jobs and the green job sector has no product to sell otherwise than an oppressive, business-destroying energy tax. Kenneth is coauthor of the new book This Time is Different: Eight Centuries of Financial Folly. [5] Here is a link to a transcript of an interview.[6]

Let us all be advised that this loose and rather ill-defined group of New Keynesians  probably consisting of Paul Krugman, Kenneth Rogoff, Ben Bernanke,  Lawrence Summers and others are advocates or some close approximation of this.[7][8] There are no consistent definitions of their works and theories that precisely place them in such narrow confine as they differ on important aspects of macroeconomics but they all seem to agree that big government and big spending and, later, big taxes are the solution to a ‘recovery.’ This is socialism by any other name or something worse than socialism—a potential blend of Fascism and Marxism into a carefully-controlled government domination of the corporate world.[9] This is necessary because governments can scarcely run governments and never efficiently and the efficiency inherit in capitalism runs in the opposite direction and away from government controls. Thus the politician must combine both essential attributes and extract efficiency and apply it to political goals. Fascism does this in the context of state control of the economy with the necessary attribute of the brutality of Marxism and the mandate to redistribute he wealth and minimize private property.

The Obama Economics in the future: National Socialism or Fascism:

“The Nazis viewed private property rights as conditional upon the mode of use. If the property was not being used to further Nazi goals, it could be nationalized. Government takeovers and threats of takeovers were used to encourage complance[sic] with government production plans, even if following these plans cost profits for companies.”[10]

How does this sound in terms of Obama and Geithner speeches? Sound familiar?

Geithner [the tax cheat] prophecies:

“Geithner dismissed a suggestion that pouring hundreds of billions of dollars worldwide into spurring economic activity might lay the ground for a future inflationary surge and said finance ministers must stay focused on getting growth on more solid footing.”-- Geithner stresses strong dollar's global role

"Inflation is low and still moderating across most of the major economies," Geithner said. "The most important thing we need to be doing is try to make sure we are reinforcing this early recovery."-- Geithner stresses strong dollar's global role

They are frantically fighting a deflationary debt spiral[11][12] now and must be prepared to claw back much of this printed money before it gets multiplied by 10X in the fractional reserve system we now use for our banks.

Buffett thinks we will inflate and contradicts Geithner:

“Every country that has denominated its debt in its own currency and has found itself with uncomfortable amounts of debt relative to the rest of the world, in the end they inflate,” Buffett explains. That becomes a tax on everybody that has fixed dollar investments.”[13]--Buffett Sees Massive Inflation to Handle Staggering Debt. Monday, May 4, 2009 By Dan Weil [Emphasis is mine in all quotes]

There can be no recovery unless consumer spending returns to 66% of the GDP unless there is a way for the government to make up the difference with subsidies and energy taxes and mere unemployment entitlements. Printing money and funding phony green projects can accomplish this along with confiscating our health care system and taxing corporations to death. No wonder Ontario, Canada and Mayfair in the canton of Geneva are advertising for businesses to flee the US and U.K. Fascist governments now forming in Washington and hanging on in London.

Rogoff and Carmen Reinhart offer criticism but no solutions to the current financial crisis:

“If you looked at financial crises across virtually every continent for something like 800 years, is it just something in the nature of human beings that we go through these cycles?

KENNETH ROGOFF: There's no doubt about it. I mean, the recurring theme is arrogance and ignorance: ignorance that this has happened before in other places, in other countries; and arrogance thinking we're special, this time is different. We have financial globalization. We're running our economy better. "They're lending us a lot of money because they love us and we're doing a good job." That's what the officials think.”

So what? How do we end ‘ignorance?’ Spend more money on ‘education?’ Is Obama arrogant?

This curious circular essay states that we have a problem and we know the problem was caused by arrogance and ignorance so we have to avoid these negative attributes soon [or now] although we are locked into another financial crisis described accurately by the well-defined arrogance and ignorance of the last 800 years. This and $4 will buy you a latte at Starbucks.

We are not going to pull ourselves up from this crisis with this kind of ‘advice’ or the refocusing of our economy on  statism or blends of Marxism and Fascism or  even EcoNazism— all merely euphemisms for higher taxes that attack business. This recession will persist and government will restrict or prevent a recovery so that they can gain more control over the remaining assets and redistribute them according to leftist political theories.

Tim Geithner’s pronouncements are so much political fluff and he prevaricates openly with no regrets in China as our currency is being debased under his aegis and inflation will soar when unemployment falls or we see the end of deflation. Thus our government must do the spending for the unemployed with entitlements and strict controls and must carefully orchestrate business to not allow growth that will promote inflation. The left attempts to shift our economy to jobs in ecology and healthcare so they can forcefully mange profits, which produce the kind of independence that circumvents socialism. Only then can such a Geithner Vision be realized in fact.

Inflation will bury us. Buy gold

rycK

Comments: ryckki@gmail.com

The Hag of Harpur Polishes the Tarnished Image of Nancy Pelosi: The Singular Bright Spot in Her Current Political Analysis.

Abstract: Camille Paglia eviscerates the current Democratic political platforms in all dimensions and praises Nancy Pelosi only for her reptilian attributes. The rest of her comments read like they were generated in the strategy rooms of the American Spectator.  Paglia rips the rabid left apart for nearly all of their caustic and expensive legislative forays and cuts deeper into their obvious omissions in governance. Her comments cut dreadfully deep. She criticizes nearly ever facet of their policies and legislation. She is now The Dragon in the midst of the hallowed leftist lair at Salon.com and scatters her intellectual enemies before her.

One of the more focused and unbending leftist sirens peddling cupie dolls and palm readings in the ragzine circuit is Salon.com.  They attempted to showcase a crude version of objectivity in their early days by featuring David Horowitz and his posts with subscribers on their Tabletalk[1] threads who crustily submitted articles for public comment such as his article on the phony Rigoberta Menchú Tum [2] thus tarnishing a sacred leftist icon[3] without remorse. He received much abuse for reporting the truth and his version of that esoteric notion. These articles were sensations in the chat rooms such as Carville’s War Room[4] and where three Horowitz threads exceeded 30,000 posts[5][6][7] and they still magnetize the frustration and anger of the left.[8] Rush Limbaugh has had a similar success in absentia with my Sock it to Rush! Series[9][10][11][12] although some of these threads have apparently been deleted from the Salon Archives for political reasons. Salon.com now continually struggles to cope with the untamed political beast in Paglia in some strange quest for a reward from self-inflicted flagellation.  Today, she hammers the left and offers ridicule where it is due and annihilates the last two years of leftist dreams.

In her last screed Camille Paglia,[13][14] portrayed in satire as the Hag of Harpur,[15][16] questioned the legislative process of the Health Care Follies:

“I just don't get it. Why the insane rush to pass a bill, any bill, in three weeks? And why such an abject failure by the Obama administration to present the issues to the public in a rational, detailed, informational way.”--Heads should roll -- beginning with Nancy Pelosi's! By Camille Paglia

Paraphrasing Oscar Wilde in reverse, the beauty of the Hag is in her intellectual gifts.[17] She frequently sits on the throne as the Queen of Darkness in political matters on Salon as she ostensibly resides somewhere in the leftist camp and would normally be expected to be groveling under the shadow of the Great Obama. All predictions that follow from these assumptions generate only madness. Her hastily  and politically constructed statuesque image frequently wavers in the eyes of the dedicated in Salon as she criticizes the uncriticizable and they shriek in horror for the bloody desecrations performed in their own kitchen. The relative truth is apparently more important to the Queen here than the pedestrian chucking chum duties for the ordinary propagandists who turn the cranks of their one-song hurdy-gurdies. This then defines her as an elegant independent intellectual entity rarely found in history let alone politics. Her next attack on the left commences:

Theme: When you live in the sewers a rat is the thing to be:

“Speaker of the House Nancy Pelosi [e.g. “The Reptile”[18][19] or otherwise known as Spartacus [20][21]] scored a giant gain for feminism last weekend. In shoving her controversy-plagued healthcare reform bill to victory by a paper-thin margin, she conclusively demonstrated that a woman can be just as gritty, ruthless and arm-twisting in pursuing her agenda as anyone in the long line of fabled male speakers before her. Even a basic feminist shibboleth like abortion rights became just another card for Pelosi to deal and swap.”[22]-- Pelosi's victory for women Sure, her healthcare bill is a mess, but her gritty maneuvering shows her mettle.  BY Camille Paglia 10, 2009  [Emphasis is mine in all quotes.]

This paragraph’s first line appears, at a first interpretation, to be an example of stealthy wart polishing, but this stippled analysis fades in the next sentence with more appropriate abuse for the Speaker. This is a hack job reminiscent of Jack the Ripper.

“It was a stunningly impressive recovery for someone who seemed to be coming apart at the seams last summer, when a sputtering, rattled Pelosi struggled to deal with the nationwide insurgency of town hall protesters -- reputable, concerned citizens whom she outrageously tried to tar as Nazis. Whether or not her bill survives in the Senate is immaterial: Pelosi's hard-won, trench-warfare win sets a new standard for U.S. women politicians and is certainly well beyond anything the posturing but ineffectual Hillary Clinton has ever achieved.”-- Pelosi's victory for women

Hillary recently had her nasty mouth cleansed.[23]

Not to surrender to the sticky-but celebrated role of Keeper of the Pelosi Cult of Personality, Camille eviscerates Nancy’s phony healthcare bill:

“…But this rigid, intrusive and grotesquely expensive bill is a nightmare. Holy Hygeia[24], why can't my fellow Democrats see that the creation of another huge, inefficient federal bureaucracy would slow and disrupt the delivery of basic healthcare and subject us all to a labyrinthine mass of incompetent, unaccountable petty dictators?...”-- Pelosi's victory for women

We already suffer from much of this liberalism.

More:

“A second issue souring me on this bill is its failure to include the most common-sense clause to increase competition and drive down prices: portability of health insurance across state lines….”-- Pelosi's victory for women

The questions wax uglier and give offense to those who cluster around Nancy’s skirts for sustenance:

“And why are we even considering so gargantuan a social experiment when the nation is struggling to emerge from a severe recession? It's as if liberals are starry-eyed dreamers lacking the elementary ability to project or predict the chaotic and destabilizing practical consequences of their utopian fantasies.”-- Pelosi's victory for women

And more:

“The plight of the uninsured (whose number is far less than claimed[25]) should be directly addressed without co-opting and destroying the entire U.S. medical infrastructure. Limited, targeted reforms can ban gouging and unfair practices and can streamline communications now wastefully encumbered by red tape. But insurance companies and the pharmaceutical industry are not the sole cause of mounting healthcare costs, and constantly demonizing them is a demagogic evasion.”--Pelosi's victory for women

Here, the cruditity of the leftist political offal chucking process is exposed. Red tape is their corn bread and sodas and provides remuneration for their swarms of menials.

Selecting more infected warts:

“Last week's startling gubernatorial victories by Republicans in Virginia and New Jersey were routinely dismissed as local aberrations by the liberal media or inflated as referendums on President Obama by the conservative media. But voters were clearly revolting against the deranged excess spending of government at both state and federal levels. So it was as much a protest against Congress as against the White House.”-- Pelosi's victory for women

Can truth become heresy if uttered in the enemy camp? It occurred to me than the current election results were a strong signal to people like Nancy Pelosi that the end is near.[26][27]

 Exposing almost of the remaining Obama’s flaming political warts:

“Obama sure needed a lift and got it from Pelosi. The administration has seemed to be drifting lately. Obama has dithered for months about a strategy for Afghanistan -- another rats' nest we should pull our troops out of overnight. Then there was the bizarre disproportion in Obama's flying to Denmark to flog a Chicago Olympics yet not having time to make it to Germany to celebrate the fall of the Berlin Wall -- which suggests a frivolous provincialism as well as ignorance of history among the president's principal advisors. And Obama's muted response to last week's massacre at Fort Hood has exposed ambiguities and uncertainties in the U.S. government and military about how to respond to homegrown militant Islam. The presidency is a heavy burden -- a prize that can become a curse.”-- Pelosi's victory for women

Well, that just abut cracks it for the last few months for the polemics nominations in political analysis. The only thing we can identify in this communication is that Nancy Pelosi has grit and guts but no brains, finesse, tact or honesty. Camille failed to acknowledge that Nancy’s Plastic Face has been restored to something more recognizable by humans by the skill of numerous plastic surgeons. Her mental state is still in question and unaddressed here  so perhaps  she needs a good shrink and could we suggest Major Hassan?

“On other matters, I was recently flicking my car radio dial….”-- Pelosi's victory for women

Alabama: we rest here.

Camille has dragged the power-drunk leftists and their phony social Neo-Fascist-Proto-Marxian politics[28] through the grinder and chucked the mass into the latrines. When dealing with this behemoth in their own wikkiups the lefties appear to only revert to their most effective weapon of churlishly tossing soggy bagels at The Dragon and whining. It will be interesting to see how much flak Camille gets from the Salon loyals  and other zombies on the thread I created for her on Salon. Talbletalk.com: Camille Paglia the Sage of Salon http://tabletalk.salon.com/webx/.86217c43/5?14@315.qC2CaSN0eK4@

rycK

Comments to: ryckki@gmail.com

The Good Folk Jump Off of California’s Sinking Ship Leaving it to the Leftist Rats

Many local newspapers try to emulate the New York Times [the NYT—aka the Walter Duranty Papers[1][2]--a turn-of-the-crank Marxian siren] in their zeal and Sturm und Drang to ‘educate’ the wandering masses as to their proper role in society. The Bees in California scrounge around for some identity and participation in politics and society and do their little bit to propagandize the news and encourage Californians not to leave but to embrace socialism.  All social problems can be solved with either large quantities of high explosives [according to the terrorists] or with soothing dollops of leftist persuasions and massive income taxes or so we glean from recent history. We are encouraged when we are again reminded that government is best when it is biggest. We can trust these good souls to look out for us and even provide us the food stamps and some neat pot for our government and entertainment.

Today’s instant catastrophe is revealed to us in the form of a key resignation from the government that threatens to tarnish the Golden Image of the Communist Pot State.  Good people are also fleeing the state?

Here is the alarm:

“Mike Genest, who announced recently that he's resigning as Gov. Arnold Schwarzenegger's budget director, deserves a respite after four years of dealing with the state's chronic fiscal crisis.

Genest is a genuinely nice guy, as well as one of the few people who truly understand the state's tangled finances. "It feels like a good time for me to step back from the day-to-day fray of things," he said.”[3]—Sacramento Bee. Dan Walters: California budget boss jumps off before train wrecks By Dan Walters [dwalters@sacbee.com] Published: Sunday, Nov. 8, 2009  [Emphasis is mine in all quotes.]

There was a lot of slobber on the keyboard when this piece was constructed from the electrons California gets from Nevada and Idaho so as to proffer the illusion that they are doing something about the smog problem that has been around for 5,000 years. Some of us have been following California’s[4] descent into the Financial Maelstrom of Woe.[5] There is no hope if you look at the details. They will not cut spending.

The status:

“State revenues are running billions of dollars below even the pessimistic estimates on which the current version of the budget was based. Several of the gimmicks and unspecific spending cuts in the budget, as insiders knew at the time, aren't bearing as much financial fruit as advertised. Adverse court decisions are torpedoing other cuts. Federal bailout money is running out. And the economy remains moribund, with unemployment likely to rise.”-- California budget boss jumps

State revenues are falling for what reason? Oh, is it the psychopathic hatred of capitalism and the drug-inspired intention of taxing away this social monster? Are people either losing money or escaping this state and we can stare at the stars and wonder if either of these factors contributes to lower tax revenues? This report is as stale as it gets and is a mere sausage-machine squeezing of third-hand maudlin mumblings. The problem here is ‘education’ and the concomitant metastatic unionism that is wrecking the state with monumental taxes, enormous spending on education and wild spending on social programs. Let us probe this blurb for anything new that we didn’t already predict.

From a previous blog on Dec 14, 2008 and is offered as prophecy: It was easy [and still is!] to predict that California was heading for social and financial oblivion:[6] [7]They have no concern for a balanced budget. Their ability to reason and plan for the future seems to depend on how many drugs they take. Their wild spending on ‘education[8]’ and astronomically high salaries and benefits for the teacher’s unions and state employees have bankrupted the state and produced a school system that ranks with the worst known in the Western Hemisphere just one click ahead of Washington, D.C. Their Marxian teacher’s unions have strangled the state in concert with the EcoNazis. The quest for tax money is now insatiable. The CA budget ‘process’ was a circus in Sacramento last summer and the ‘compromises’ and calls for spending cuts went unheeded so they floated some phony bond issue.[9] Their social insanity and solemn barrenness of morality and reason are described in suitable [their] terms in this parody, written [in parody] by me:[10] They did manage to sooth enough suckers to buy their phony bonds in a wild attempt to remain solvent until about Feb 2009[11], but this is not working out as their bond rating resembles that of Somalia:

From the past:

“SACRAMENTO, Calif. (AP) — California's budget deficit will reach $41.8 billion over the next 18 months, potentially forcing the state to pay it electricity bills and other expenses with IOUs if lawmakers don't solve the problem, Gov. Arnold Schwarzenegger's administration said Thursday.”[12]-- California sliding toward $41.8B budget deficit 12.12.08 [Emphasis is mine in all quotes.]

And this happened.

But hope shines through the ugliest smog cloud and we can have look forward to relief:

“An educated estimate is that the 2009-2010 budget is about $7 billion out of whack and that the 2010- 2011 version will have at least a $10 billion gap between income and outgo. That's why Capitol insiders are now talking about a $15 billion to $20 billion problem that Schwarzenegger and lawmakers will confront when the Legislature reconvenes in January.

The options for dealing with another big deficit, meanwhile, are shrinking.”-- California budget boss jumps

How about the options of cutting spending and cutting taxes for small businesses who flee California as the most hostile state in North American for business with the possible exception of New Jersey?

Tax hikes are the only way:

“Schwarzenegger and lawmakers already have raised income, sales and car taxes temporarily, and the heat that a few Republicans took for voting for new levies, including a recall campaign against one, likely takes more tax hikes off the table.”-- California budget boss jumps

What about spending cuts??

“At the same time, however, spending advocates, such as public employee unions, are ramping up pressure on Democrats to resist more cuts.”-- California budget boss jumps

“That leaves spending deferrals, raids on other funds and bookkeeping gimmicks – the sleight-of-hand that has been used too often to make budgets balance on paper.”-- California budget boss jumps

If you defer debts do they need to be paid back?? Not if Washington bails you out or some bankruptcy judge vacates the bond holder’s rights.

Where is the bawl for alms from Washington? Where is the new nostrum of taxing dope at a mere 30% tax rate that will pay off the greedy unions? What is the solution here??

“No wonder Genest is jumping off the train.”-- California budget boss jumps

Yes, no wonder. Here we read a reasonably objective and accurate description of the California Syndrome and find NOTHING that will give us any hope. Nothing.  But, they are willing to spend more billions on phony EcoNazi [13]programs such as CO2 elimination.

As the dog returns to its vomit the left returns to lies, maudlin slogans and new tax schemes.

Abandon all hope if you live in California.[14]

rycK [a 5^th generation Californian in exile]

Comments to: ryckki@gmail.com