Comments (31)

• Manuel Lora

  Let's just get it over with. Instead of a decade of destruction, do as much damage as possible and maybe in 10 years we can start over. If it's not going to get better (and it won't), then I favor more pain during less time than a drawn-out, multi-generational decline.

  Published: November 24, 2008 9:42 AM

• indignant

  must...be... a ...joke

  WTF!

  Published: November 24, 2008 9:43 AM

• wijg

  Manuel,
  I agree. If we're going to be Zimbabwe, better in 3 years than in 20.

  At least they'll be too busy to destroy everything..

  Published: November 24, 2008 10:16 AM

• Michael

  Okay. I checked my calendar, and it's not April 1. So, while it's not an April Fools Day joke, I think that's exactly what it is. Tongue in cheek?

  Published: November 24, 2008 10:21 AM

• sundevilgrad

  Unfortunately, the time for "peacefully" changing the system is rapidly coming to a close. The actions by the US Government over the last 30-years show beyond a doubt that they care not for the liberty or freedom of individuals. They will enslave every citizen via debt, born and unborn, to provide the banking cartel with the ill-gotten, counterfeit profits they so desperately desire. I fear that, at this point, only a violent revolution will change the course that is currently set. The bond between the banking cartel and the federal government is too strong to expect otherwise. It is a sad time for a once great Nation.

  Published: November 24, 2008 10:40 AM

• jeff

  A few comical lines from that article...

  "The Treasury Department changed the tax code on Sept. 30..."
  - Nice to see that taxes are now controlled only by the Treasury and require no vetting out period by elected represenatives ...

  "...There better be a showing of increased lending roughly in the amount of the capital infusions” or Congress may not approve the second half of the TARP money."
  - Rep. Frank, you don't need to approve the money for it to be given to the banks.

  Published: November 24, 2008 10:49 AM

• matt

  Very nicely put Sundevilgrad. That is why the 2nd ammendment was so close to being numero uno.

  Published: November 24, 2008 10:58 AM

• J Cortez

  Maybe, if they go through with this, the collapse will come much sooner rather than later.

  It's almost like the Fed is trying to commit suicide.

  If I was a central banker, you know, a criminal that wanted to continue ripping people off-- I wouldn't do this.

  Published: November 24, 2008 11:09 AM

• Frank

  Said Representative Scott Garrett, a New Jersey Republican who serves on the House Financial Services Committee,“The time has come that we consider what sort of limitations we should be placing on the Fed so that authority returns to elected officials as opposed to appointed ones.”

  How about "limiting" the Fed out of existence and returning to the Constitution?

  Published: November 24, 2008 11:37 AM

• Brad

  Is this any more nuts than the $54 TRILLION of accrual basis debt? That's between 4-5 times our GDP and has been growing over the last decade. Is it any more nuts than adding $11 TRILLION in one swoop of a pen via Medicare Part D? Ever since I read the Financial Report of the United States Government for the first time I new I was in fantasy land while most everyone else (Mises et al excepted) couldn't get enough of entitlements, adding more, and easy credit. Everyone was delirious with wealth. And those few that I actually got to consider just where we were at - "We'll we gotta do something about _________." Every excuse was made to not change a thing.

  Fiscal conservatives (or real libertarians) were chased out of the Repubican Party once and for all over the last decade and the "borrow debt you NEVER have to payback!" became a party plank.

  So yes, it is nuts, but as far as being bat-***t crazy we've been there for some time.
  -------------------------------------------
  And I agree, it seems that revolution is the only answer. But I have some glimmer of hope that it can take the form of refusal to cooperate. Let the system die, refuse to submit. If our Rulers decide to kick their enforcement of their already abusive and offensive-minded policies to the next level, then it unfortunately will turn out differently.

  One can only hope that a moment of clarty descends on the US (at least those parts outside the Beltway, New York, and L.A.) and individuals and small business decide to stop paying taxes, stop withholding on payrolls, stop the flow of money to the Feds. By all means make good on contracts, just refuse to fund tyranny (after all we have a "voluntary" tax system, right?). And when the State comes to grips with the new reality, then perhaps we can forge a free society. It will be up to the boobs as to what the next step will be. It will be up to them to fire on the proverbial Fort Sumter. But they'd better be ready for the storm if they do.

  Published: November 24, 2008 11:56 AM

• eli

  Brad, agreed on everything but "after all we have a "voluntary" tax system, right?"

  I used to laugh too, but the 'voluntary' simply means in order to pay your tax, you can 'voluntaryily' file a 1040, or they (IRS) can just take your money w/o your 'voluntary' calculations. pretty sweet.

  but i can only read these news stories and shake my head while saying, "WTF?". oh and the change we can believe in? the head of the NY Fed is the new Treas. Sec. nice...

  Published: November 24, 2008 12:03 PM

• DD

  If they are prepared to lend more then 7.4 Trillion Dollars, then this only means that they will lend out at least 2-3 times that amount. Let's not forget the multiplication factor of the commercial banks that will multiply this quantity much further down the road.

  Am I missing something here, or are we looking at a possible increase of over 100 Trillion dollars in the next 2-3 years? Someone Help!

  Published: November 24, 2008 12:40 PM

• AJ

  This is pretty scary, does anyone have any good ideas of safe-haven currencies?

  Published: November 24, 2008 2:39 PM

• DD

  AJ,

  I don't know about a safe-haven currecy (maybee swill franks), but prescious metals will do the trick. Gold & Silver have been holding steady for the past few weeks. If I were to get rid of my dollars, I would do it now because I expect these metals will start to take off any day now.

  Published: November 24, 2008 2:53 PM

• Zach Jones

  They are rilling to risk half of US GDP? Under what crazy wall street derivative risk model is it acceptable to risk 50% of GDP? And how is this not slavery?

  Published: November 24, 2008 3:09 PM

• patriotsson

  In response to sundevilgrad:

  Your sentiments are, unfortunately, becomming more wide spread. Not because the masses are rebelious, but because they see the govt officials ingnoring the supreme law of the land i.e. The US Constitution. Heck, the president elect believes the US has "out-grown the Constitution."

  Welcome to the Peoples Republic of America!

  Published: November 24, 2008 3:38 PM

• Bruce Koerber

  With the general public still unable to recognize that the source of the problem is the government (it is really just serving as a front for the unConstitional coup), the rapid and total destruction of the dollar will 'justify' the 'need' for a worldwide fiat currency so that one 'central bank' can 'stabilize' the world economy!

  Can you see any other event that would create such a hysterical mandate from the terrorized masses who think that government has the role of stabilizing the monetary system?

  And why are the masses feeling terrorized? Because the power elite who are invested in the monetary hegemony of all of the nations in the world are economic terrorists.

  The nations in their crosshairs are the ones who are trying to gain independence from their monetary imperialism.

  It is critical that the members of the inner circle of the unConstitutional coup in the United States be identified and stopped before they destroy the dollar, before they try to impose a worldwide fiat currency, and before they torch all of the nations that they consider rogue nations.

  Published: November 24, 2008 3:45 PM

• Derek

  Jesus Christ...

  This is absolutely insane. If this does open up the credit markets, I would expect consumption to stay low but investment to increase. Open credit will not offer incentives to consume if the threat of a severe recession is still alive. However, the rapid inflation of the dollar will give people huge incentives to invest.

  This current deflation isn't going to last long. The Fed is trying to spontaneously create another bubble to ward off the economic collapse.

  Keynesians argue that inflation can be controlled if consumption increases with the money supply. Open credit markets won't affect consumption enough in this environment. The Fed is throwing a Hail Mary, praying that it creates an investment bubble large enough to keep the dollar strong, obviously before it would inevitably fall like a ton of bricks.

  I'm dropping my US dollars for Zimbabwe dollars. I've got a feeling they'll be a lot more valuable soon.

  Published: November 24, 2008 4:28 PM

• Michael

  I agree with J Cortez's comments. You'd think that the central banksters would want to continue their criminal ways through the inflation tax for the foreseeable future. I guess they want to scuttle it a little prematurely.

  Let's hand the unborn generation the nation's first Q-U-A-D-R-I-L-L-I-O-N dollar deficit? Who's with me?

  Published: November 24, 2008 6:59 PM

• Jeremy

  The best part of the claim is that it is equal to half of everything 'produced' in America last year, when we all know that GDP measures consumption (including capital consumption and consumption based on borrowing from abroad)

  It might be a lot closer to 100% than 50% of 'production' in America last year.

  Published: November 24, 2008 8:15 PM

• Anthony

  "Neither a borrower nor a lender be;
  For loan oft loses both itself and friend,
  And borrowing dulls the edge of husbandry."

  Published: November 24, 2008 9:13 PM

• prettyskin

  Long live another nation in ruins. Only a revolution can make these criminals lifeless. Are you ready for a revolution? The poor feels its, day and night. Get out stand up and identify yourself. Come Jan. 20th, African voodoo politics with white blood awaits America.

  Published: November 24, 2008 11:01 PM

• prosecessionist

  Whatever you do, don't put your money into Switzerland! The U.S. Feds have just leaned on the Swiss authorities with enough bite to get them to holler 'Uncle'! No more Tax havens in Eurotopia.
  Have you considered the Jersey Islands?
  Don't try Australia- our Feds have been your lapdog for too long for it to be healthy!

  Published: November 25, 2008 12:08 AM

• Dr J.A. Rambeau

  It really brings joy to my heart to see that I'm not alone in questioning this madness. The Fed should be abolished and the power to issue, control & regulate the value of money should be returned to the free markets. We all know this, right? But what can "We, the People" do to take away power from the "Sith Lords" that we call our government? This fight for for real change will have to be fought on all levels physical and mental; however, in true Orwellian fashion our government permeates every facet of our lives. As far as I'm concerned, we are living in a totalitarian state right now. The Central Planners will not reliquinsh power so easily. It must be taken by force if necessary. The first law of nature is self preservation. I am willing to die so that others may be free. Are there any other Sons of Liberty who will agree with me...that the inflationary policies of our government will certainly deprive us of our rights to life, liberty, & the persuit of happiness? The machine must be stopped. Fractional reserve banking should be deemed treason because it allows for the sovereignity of a nation to be sacrificed on the blood, sweat, & tears through the usage of institutionalized slavery (i.e.,surfdom)!!!

  Published: November 25, 2008 9:01 AM

• Michael

  Dr J.A. Rambeau, sounds like a plan. Count me in! Wait, does my IP address get forwarded to Michael Mukasey's email? Just kidding. I swear.

  Published: November 25, 2008 10:18 AM

• Christopher

  I can't believe it is coming to this.

  Published: November 25, 2008 1:12 PM

• C. Evans

  "Let me give you a word of the philosophy of reform. The whole history of the progress of human liberty shows that all concessions yet made to her august claims, have been born of earnest struggle. The conflict has been exciting, agitating, all-absorbing, and for the time being, putting all other tumults to silence. It must do this or it does nothing. If there is no struggle there is no progress. Those who profess to favor freedom and yet depreciate agitation, are men who want crops without plowing up the ground, they want rain without thunder and lightening. They want the ocean without the awful roar of its many waters."
  
  "This struggle may be a moral one, or it may be a physical one, and it may be both moral and physical, but it must be a struggle. Power concedes nothing without a demand. It never did and it never will. Find out just what any people will quietly submit to and you have found out the exact measure of injustice and wrong which will be imposed upon them, and these will continue till they are resisted with either words or blows, or with both. The limits of tyrants are prescribed by the endurance of those whom they oppress...Men may not get all they pay for in this world; but they must certainly pay for all they get. If we ever get free from the oppressions and wrongs heaped upon us, we must pay for their removal. We must do this by labor, by suffering, by sacrifice, and if needs be, by our lives and the lives of others."

  Frederick Douglass, 1857.

  He is discussing chattel slavery of blacks, but I think the quote is quite apropos of our situation. One of the problems of persuading the masses to realize the injustices heaped upon us daily is that their definition of slavery is too narrow. We should remember the words of Lysander Spooner regarding this matter: "...there is no difference, in principle --- but only in degree --- between political and chattel slavery. The former, no less than the latter, denies a man's ownership of himself and the products of his labor; and asserts that other men may own him, and dispose of him and his property, for their uses, and at their pleasure."

  Published: November 25, 2008 2:06 PM

• David

  Speaking of Bloomberg's story on the $7.4 trillion in taxpayer/debt-funded stimulus commitments: Jim Rogers was on Bloomberg's "Night Talk" program last night discussing these issues and the future of America's economy.

  Either of these links will take you to the full video clip of Roger's interview.

  http://financetrends.blogspot.com/2008/11/jim-rogers-on-bloomberg-night-talk.html

  http://www.bloomberg.com/avp/avp.htm?clipSRC=mms://media2.bloomberg.com/cache/vJzshG4o708g.asf

  You can bet he had a lot to say, especially given that this discussion took place right after the recent Citigroup backstop/bailout announcements.

  I think the program is a great, easy to understand intro to many of the free-market principles that are discussed here at Mises. Thought some of you might find this interesting, and worthy of passing on to others who might benefit from Rogers' views on the economy and our need to clean the system of its excesses.

  Published: November 25, 2008 3:10 PM

• StatusQuoJoe

  There was this article on Oct. 10th on the Fox News web site about the Central Bank being hacked, something about their software contractors in India and China having complete access to all banking accounts. Does anyone have any additional links or information? I haven't seen anything in either the MSM or the alternative sites since.

  http://www.foxnews.com/story/0,2933,435681,00.html

  Published: November 26, 2008 1:29 PM

• Black Bloke

  Everyone realizes that the old $7.4 trillion number is now outdated right? They've increased it as of this writing to $7.76 trillion.

  Published: November 26, 2008 10:50 PM

• Black Bloke

  And now the last number I've seen was $8.5 trillion.

  Published: November 28, 2008 10:03 PM