Tuesday, November 11, 2008

The Die is Cast

In an idle moment earlier today, I checked back on some old blog posts of mine to see if I had ever mentioned the potential for financial calamity or economic collapse in North America. I stopped looking through the Atavist archives at about midway through 2006. In past posts I had mentioned a number of times my fear of an eventual financial collapse and even discussed why I was concerned.

So, I saw the collapse coming a long time ago. So did some other individuals, mostly a few select newsletter writers. No main-stream economists or financial experts, and certainly no prominent politicians were among those who sounded alarms and warned people to get out of the financial markets, to de-leverage their investments, and to get out of debt.

Why not? Because we are a culture of fools who are always seeking greater fools to lead us. And when they lead us down the garden path, rape us and leave us for dead, we wait for them to come back to save and rehabilitate us. We have long given up independent, critical thought. We prefer instead to listen to 'experts'. We especially like experts who give us warm and fuzzy prognostications. We deserve what we get.

It amazes me is that now everyone, far and wide, is suggesting that we bail out this, subsidize that, prop up the rest, and then wait for things to get better, as surely they must because so many 'experts' are saying so.

Must things get better? No, at least not until all of the nonsense and financial excesses are purged from our political and economic systems. The experts are wrong. The politicians are wrong. The academics are wrong. Sure, there may well be some temporary improvements in some areas of our economies as things sort themselves out. Largely though, as our politicians meddle in things they know nothing about, the inevitable will only be delayed and the final results will be worse than if there were no attempts to 'help.' The die is cast. We're screwed. To protect ourselves and our families, we should all get out of debt, cut back on our expenses, then hang in there until everything falls apart and we can start over again.

Maybe, some day, we will stop listening to politicians and start thinking and acting for ourselves. That's not very likely though, is it?


  1. I think it should have been apparent to many more people, but I find recently in all areas that people abhor the thought of anything besides constant advancement. Housing prices are going up, and never coming down. The dot com market is going up and never coming down. Whoops, people forgot that markets (and other things in life) have a pattern and fluctuate all the time, but on the upswing people forget this.

    When we thought of buying a property, I was really concerned with the way things looked, and we held off for a while. Once we were more able, we purchased, but even then, we seemed to have purchased at the high point. Nonetheless, my financial situation is good, and I expect that someday not too far from now, the next upswing will come and I won't have lost anything.

    Keep up the good advice to your readers. More people need to hear sound concepts on money management.

  2. Thanks, Trooper. There are still some good bets for people who have some spare cash: gold and silver; real estate in some countries where prices haven't been run up yet; even shares in some undervalued and well-performing North American corporation. Best advice of all is what I said in the post: pay down debt in the quickest way possible. Also, especially stay away from credit card debt.

    Then, relax and wait it out.

  3. I've been wondering if things would top out back in the late 90s...

  4. Why do we get 50 choices for Miss America, but only two for President?
    Mr. Obama said he believes in "wealth redistribution", but at $60 trillion in debt to foreign governments and the great globalist credit tap turned off to this new non-Papist President, is there any "wealth" to "redistribute" other than wheelbarrows full of worthless, fiat, toilet-paper?
    It's been wisely said "The devil always gives you two choices...Both equally wrong."

  5. The main headline in our local newspaper this morning proclaimed something about the wealthy nations being encouraged to spend more money. I haven't had time to read the article yet but if it is true to form it will include the United States as a wealthy nation. No. The U.S. is broke and there is no hope for it. If the article instead means the individual citizens of of countries like the U.S. and Canada, then there are surely some people who are wealthy -- but the vast majority of individuals are living just at or even beyond their means. Increasing spending by anyone, whether governments or individuals, is not the answer. Everyone needs to concentrate on creating balance in their finances and above all, to get out of debt. Yes, that applies to national debts created by profligate governments as well.

    The overwhelming stupidity of our 'leaders' and 'experts' is still astonishing to me, even at my ripe old age.

  6. I quite agree - the flagrant over-spending in US society has been rampant and not just individuals and not just the government or big corporations. There's a national culture in which people feel they are not really alive if they don't have the newest, latest thing. As for myself, I am saving, paying rent ahead (now paid through march) and paying off the teeny amount of my remaining debt. I'm selling stuff on ebay, and getting rid of excess furniture. The pare-down is an overall inner makeover for me, actually. I'd prefer to make do with less than to work more to maintain an excessive lifestyle that doesn't always feed my soul. MOstly, I'm looking forward to getting the hell out of the city, before the cities turn into abject hells.

  7. Phlegmfatale: Good work. Cities kinda scare me. The prospect (however remote) of thousands running amok for whatever reason is frightening. Simplifying life is certainly a good idea.

    Luckyzmom: You're right. I know some people who, like you, like to think and act for themselves, take responsibility for themselves and who ask nothing of anyone but to be left alone. I wish there were more.

  8. All true except for the last part. I don't necessarily want to be left alone.

    Also, thought you might like to know that I have written two posts and am working on a third in as many days.

  9. "To protect ourselves and our families, we should all get out of debt, cut back on our expenses, then hang in there until everything falls apart and we can start over again."

    Well said. Unfortunately, most of my generation (in their forties) and all of my son's generation (in their teens) do not know how to do this. It's instant gratification no matter what the cost, and the wiser ones seems to be the ones paying for it.

    I'm trying not to be afraid of our new President-elect. He doesn't seem to have that much sense to me. But, what do I know? I think it's foolishness to tax the hell out of the big businesses which keep our economy rolling.

  10. You are of course right about the fact that no-one knows anymore how to suck it in and exercise fiscal discipline, Bellezza, but I fear that many will have to learn the hard way. I would be very happy if we could somehow avoid the result of decades of foolishness but sooner or later we will have to pay the price.

  11. Someone has to "pay the piper" and I am afraid for us Americans it will be us through these bailouts and such because we kept our heads in the sand and let others make decisions for us. Gone are the days of poor communication and transportation. We no longer have to relie on the pony express. So, why hasn't the way we allow Senators and Congressmen who lie through their teeth to get elected, then wield their power for self interest, changed. We could all vote on important issues instead of paying these representatives to puff out their chests and spend more and more of our money.

    Whew! I'm not real sure where that came from. And the solution seems to get more and more complicated as I try to work out the details (If I were Queen!) in my brain.

  12. With common sense like yours, luckyzmom, you would make a great queen or elected representative or whatever. What everyone needs to do is to start taking responsibility for themselves and to stop looking to others to do their thinking for them.

  13. I look for this economic "crisis" to mlast another couple months, then government will cover up the problem the way it usually does during post-war depressions/recessions: The mint will be nationalized temporarily, and enough toilet-paper will be printed up to appease the biggest creditors, then borrow/tax-and-spend will continue as usual.
    The media, which aided greatly in fabricating more of an issue than was actually there, will start telling U.S. how "vwonderful und glooorious" everything is, now that we have the "right" kind of leftist leader in power, the dumbasses at the top and bottom will buy it, and the idiocy will continue...
    Til it comes time to move the shells around again and make everyone guess where the pea is.
    Hope you like $200 Big Macs.

  14. Hyper inflation is indeed a real threat, after a shakeout period during which deflation appears to be a greater immediate concern. Do I have to eat Big Macs? I like Wendy's burgers better.

  15. Not a boast, but I have been fearing this depression (no, not depression) ever since our POTUS decided to do away with our American language IT people. Although there is regret, there is no surprise.
    My Dad, who lived through the great Depression of the 1930's once told me, "Son, there are two things that people could find money for during the Great Depression. Booze and Food. If you see a depression coming, get into one or the other."
    That's looking better and better.

  16. Your dad was a wise man, Catmoves. I had a discussion with my son last night about societies with high levels of alcoholism and why that might be so. Eastern Europe and especially those areas under erstwhile Soviet control were good examples. Despair, hopelessness, anything to escape drudgery and oppression create demand for booze.

    And, of course, we all have to eat, even if it is only macaroni and cheese.