Comments (3)

• A. Viirlaid

  I commend Matthew J. Novak on a very sobering, scary, and realistic assessment of today's stark state of affairs on Main Street.

  I think (and deeply hope) that he is right --- that today's young people won't be fooled by politicians and bureaucrats who are bent on "saving us" by "not wasting this next crisis".

  The sad reality of today's empty shop fronts and many forlorn ghostlike malls is that many of them were never needed in the first place.

  Perhaps this is overstating it a little.
  Perhaps some of those businesses were viable and were needed.
  But we'll never know which ones. This multiyear collapse will take down the good with the bad and the ugly.

  This is what happens when a government and its Central Bank are so committed to 'overstimulation' (as per Greenspan's FED tenure and as per Bush's running of annual deficits even in so-called good years).

  That is to say, we get many more businesses being established than can possibly be viable over the longer term.

  But what is the response of The FED and President's Obama's Treasury TODAY?

  Do they acknowledge (like Austrians do) that perhaps their forebears in those positions of power abused the Money System just a TAD too much in the past?

  That maybe this is the reason for the current misery?

  No, they'll never do that, not in a million years.

  Instead their Mantra, their Worldview, their Weltanschauung, their Paradigm, their Concept of Reality TELLS them only one thing.

  Just as Mr. Novak suggests, they will say that the 'normality' occurred BACK THEN, during the boom times (just like in the 1920-s) --- during those years of reckless overspending and Ever-So-Magically-Loose, EASY Money... they say to themselves... "I can just taste it, I can just swim in all that Moolah!"

  They will say what? --- That it is TODAY that is ABNORMAL and must be overcome with the proven-to-be-inept Back-To-The-Future policy of doing EVEN MORE overspending, even MORE money printing and even MORE piling on of the DEBT DEBACLE.

  When will it stop?

  Maybe, as Matthew Novak implies, when today's dispossessed young people take the reins of power from the Bernanke's of the world.

  Or maybe before that when the Whole Money System all collapses even more dreadfully than it has to date.

  Because what is the end result of what Mr. Novak is writing about?

  Combine his observations with the Trillions that are being poured into 'Stimulation' and 'Cash for Clunkers' and into other deliriously stupid programs like credits for first time homebuyers and whatnot.

  What are we going to see?

  The result is inevitable. When you give me Free Money (which BTW is immoral = OPM = Other People's Money) to help me buy a car or house I would not otherwise want, be able to buy, or would defer until later --- what do I do?

  I go buy that stuff. We 'steal' even more business activity FROM THE FUTURE.

  And businesses do exactly what they did before --- they open all those new storefronts that now sit forlornly alone.

  Folks, this ain't Rocket Science --- THE SAME THING WILL HAPPEN!!!

  Another Mr. Matthew J. Novak or maybe the same one in an older version, 3 or 5 years from will walk by even more shuttered businesses wondering the same thing that the current Mr. Matthew J. Novak is contemplating on.

  But I got another news flash for the "Funny Boys" in Washington --- IT AIN'T GONNA WORK even 1 MORE TIME!!!

  See Jerry Seinfeld in Episode 22 -- The Library -- http://www.seinology.com/scripts/script-22.shtml

  Mr. Bookman could have set the Funny Boys in Washington straight with his brand of Telling It Like It Is.

  But what about those Funny Boys in Washington?

  Do they care if they return the people's money let alone return some ancient borrowed library book? Riiiiiiite. You know the answer.

  Why do we revisit this issue every 2nd generation?

  Because we don't remember or we remember in historically very inaccurate terms, and because we have such poor collective memories (especially in the Economics Profession) we are DOOMED to repeat the same mistakes over and over.
  

  Published: October 29, 2009 5:48 PM

• Bennet Cecil

  Americans will vote for change in 2010 and 2012 if unemployment is high. The Fed is doubling the paper money and the congress is doubling the national debt. They are trying to bail out the politicians by ruining the dollar and diluting the wealth of American savers. Productive Americans will move their savings out of the US like the Germans did after WWI. Of course, the general public might be fooled into thinking everything is fine again as trillions of paper dollars push up the Dow and home prices.

  Eventually the bond market will charge Uncle Sam and everyone else 10%/year interest or more, exposing the charade. Debtors will lose their homes and commercial real estate will collapse. Chinese, Japanese and Saudis will buy huge chunks of American land and businesses at huge discounts.

  We are going to have to repeat the 70s and maybe the 30s before Americans elect better political leaders. Things are just not bad enough yet for 90% of Americans.

  Published: October 29, 2009 10:08 PM

• A. Viirlaid

  Bennet Cecil, Good comment!

  You have very knowledgeable people in agreement with you.

  Namely, from Marc Faber, this quote about the future of the American Dollar from the website moneynews.com

  Faber, publisher of the Gloom Boom & Doom Report, told Bloomberg, “It will go to a value of exactly zero eventually, but not right now.”

  Faber maintains that in about 10 years, 50 percent of U.S. tax revenue will be used just to cover interest payments on the government debt.

  Investment icon Jim Rogers is a big dollar bear too.

  “The same things that happened to the pound sterling, 60, 70, 80 years ago, are happening to the dollar,” Rogers told Moneynews.com.

  ““We’re the biggest debtor nation in the history of the world.”

  
  http://www.moneynews.com/streettalk/faber_dollar_zero/2009/10/29/278760.html?s=al&promo_code=8FC3-1
  

  Published: October 30, 2009 9:49 AM