We've Been Conned

 

A few years ago I flew to Calgary with my eldest son to visit family after Christmas. Because he was/is serving and we were flying AA, the airline upgraded us to 1st class. What a welcome surprise and how pleasant, there we were, flying to the land of the ice and snow with room to breathe, metal cutlery, decent food, glasses made of actual glass and all of that.

Gazing out of the window of the plane in search of UFOs I thought about this and it all came back to me, flying used to be this way, for everyone. But now? You have to be rich to afford yesteryear's standard of comfort and quality.

The same thought flashed across the mental horizon while strolling in Newtown, Edinburgh, earlier this year. All these beautiful Georgian houses which are mostly cut up into apartments, you have to be rich to own and live in a whole one today.

I said as much to barrister pal who lives in Leith and was showing us around, "Yes," he replied, "Only the wealthy can afford the lifestyle of the old middle classes." Again, in beautiful Ludlow, within the orbit of the old medieval city wall you never have to go to a supermarket. There's three butchers, bakers, green grocers, cheese shops, 2 fishmongers and on. 

All of this was commonplace, if not so picturesque, not that long ago but now you have to be well favored to live in a place like Ludlow. You know, maybe here in the States people who live in Martha's Vineyard have that kind of old world luxury.

Point being, all of the above wasn't luxury so very long ago, just the way people lived, and I tell you this, we've been conned. As our part of the world's wealth has increased so too should our standard of living. But no, in many respects it's declined and quite literally; your Dollar doesn't go as far as it used to. And no wonder, it's an instrument of debt at interest to the private consortium of bankers that is the Fed.

They, the people profiting off of the way we live now, are doing very well. They're mostly invisible and can enjoy the storied delights of private islands via their private jets while we count ourselves lucky to get an apartment the staff used to live in. Yes indeed, but what shall it profit a man to gain the whole world and lose his soul? 

This isn't a screed against wealth, eye of the needle aside I wish we all had more, but it is a caveat. We've been had, conned, and further complacence will only exacerbate the problem. Churches, I'm looking at you. OK, good luck with that.

Arma Virumque,

LSP

Hypersonic Debt

Now that Dallas has removed its infamous statue of General Lee, we can safely assume that everyone's going to be better off and a brave new world of tolerance, diversity and equal opportunity can begin now that institutional racism is finally erased from our parks. But not so fast, readers.

In your excitement over statues you may not have noticed that we're $20 trillion in debt and climbing at a rate of around $1.1 trillion a year. That's something like $34,880 a second or if you picture it in terms of the speed of sound, which is 1,125 feet per second, our debt is flying at over Mach 30. Eat your heart out, Chuck Yeager.

This means that the US is hurtling towards bankruptcy at hypersonic speed and looking somewhere down the pike at a Grecian-style sovereign debt crisis. So how do you resolve a >104% debt to GDP ratio, with a $19 trillion economy and a $20 trillion debt overhang?

Through tax cuts and economic boosting? Good call but not enough. You solve the problem by devaluing the dollar, by inflation.

Jim Rickards, at Zerohedge, suggests this can be done by the Treasury inflating the price of gold, from around $1,330 an ounce to $5,000 through the use of a Gold Certificate issued to the Fed. It's been done before, in 1934 and 1953, under the Roosevelt and Eisenhower administrations respectively. And sure enough, inflation ensued.

Problem? Solution, except that your dollars will be sadly worthless. Of course there's another option which perhaps goes hand in hand with the first, war.

You can read all about the debt here and here. Or obsess about statues in parks, your call.

Midas Touch,

LSP