-- Posted Thursday, 7 February 2008 | Digg This Article
| Source: GoldSeek.com
To show you how much debts are rising and how much government spending is rising, I present a part of an advertisement for the new movie from Agora Financial, I.O.U.S.A., which just premiered at the Sundance Film Festival, a snooty little enclave of movie snots that always rejected my entry, which is a cinematic tour de force where The Mogambo contemplates his navel, as per the rest of the introspective genre, but who finds some lint in there! This clever plot twist, for some unexplained reason, makes lots of scantily-clad dancing girls suddenly appear pout of nowhere and prance around provocatively for about an hour or so, which takes economic philosophy to whole new levels of entertainment, everywhere except the snooty Sundance Film Festival.
But this is not about how The Mogambo's cinematic creative output is cruelly censored, but how the ad quotes filmmaker Patrick Creadon as saying, "America's federal debt is $8.6 trillion and growing at a frightening rate. In addition, our major entitlement programs (Social Security, Medicare and Medicaid) are dangerously unfunded. As a country, we are slowly spending ourselves to death."
Well, he couldn't be more right about us spending ourselves to death, as the national debt is actually $9.1 trillion, already grown by $500 billion since he was interviewed for a movie so new that it just premiered! Hahaha! We're freaking doomed!
And this reminds me of Junior Mogambo Ranger (JMR) Bob B., who says, "Amazing huh? The United States created 18,000 jobs during November while 270,000 (9,000 /day) of the U.S. population turned 62 years of age in the same month and became eligible for Social Security on January 1, 2008. Let me get my calculator. OK. That's 1 new contributor (to Social Security) for every 15 new beneficiaries. When is this going to hit the fan?"
I am not sure that there is anything "hitting the fan" in the movie I.O.U.S.A., but there might be, as it could be clever, and I assume that there are many, many clever parts in this movie. For instance, one of the most clever is the joke that is right out there in plain sight; the title of the movie is I.O.U.S.A., which is witty because this is a movie about following, "U.S. Comptroller General David Walker as he crisscrosses the country explaining America's unsustainable fiscal policies to its citizens", which is the sad, sad story of a corrupt Congress (except Ron Paul) letting the corrupt Federal Reserve create the excess credit, which creates the backbreaking debt, that creates the money that the government wants to borrow, all of which radically distorts the economy and expands the money supply, which dooms us to suffer from horrendous inflation in prices as a result of this horrendous inflation in the money supply.
No, the really clever part was the subtitle, which was, "It's a big budget movie"! Hahahaha! Trust me when I say that there are parts of the galaxy where creatures are cracking up even as we speak because this is so, so funny, in so many ways! So funny, in fact, that it makes me smile even to read it again as I typed it! Hahahaha!
The best part of the ad, from my perspective, is the review by Mary Milliken of Reuters, who said, "I.O.U.S.A. may not be the sexiest film at the Sundance Film Festival, but it could be the most timely." Not sexy! This was the very point I was raising in the initial planning sessions for the movie, where my terrific unsolicited suggestion was to star me, The Mogambo, running around in nothing but a Speedo swimsuit and a big cigar, which would turn the movie into box-office gold, as the unmistakable symbolism of the cigar alone guaranteed boffo reviews!
They ignored me and never returned my calls, and now the movie is forced to stand on its own merits, and my dreams of stardom and celebrity are but dust. Or butt dust, which sounds the same, but seems more descriptive.
But dust or butt dust, either way, the fact is that the economy is ditto down the crapper, as I can confidently say since the BLS reported that inflation is already starting to kill us as, "Consumer prices advanced at a seasonally adjusted annual rate (SAAR) of 5.6 percent in the fourth quarter of 2007. For the 12 month period ended in December, the CPI-U rose 4.1 percent."
The worse news is that "The index for energy turned back up in the fourth quarter, advancing at a 37.1 percent annual rate. Overall energy costs rose 17.4 percent in 2007. The food index, which rose 2.1 percent in all of 2006, advanced 4.9 percent in 2007."
Brian Bloom of beyondneanderthal.com is my kind of guy, and you can detect his concern and fear when he writes that the Labor Department said that not only are prices up according to the CPI, but that it is actually worse than that, as, "From January 2007 to December 2007 the US$ Index fell, roughly, from 85 to 75. Thus, the price of an imported article - if it was priced in a foreign currency - would have risen from 100 to 113 or by 13%." Yikes! 13% inflation!"
He says, "Of course, the 'poor' Chinese manufacturers would have absorbed some of the impact because they price in US Dollars", which is certainly true as far as contracts are concerned. But he thinks it is worse than that, as for the Chinese manufacturers, "their own input costs rose far faster than their Yuan rose relative to the US Dollar. It follows that they must have shared some of the US's inflationary pain, but not enough to have put a 4.1% cap on US inflation."
We look at each other. I know what I am thinking, and he knows what he is thinking. I'm thinking that he agrees with me that anyone who thinks that inflation in prices in the United States is only 4.1% is a Big Stupid Idiot (BSI).
After examining a few clues related to the Chinese economy, Mr. Bloom comes to the conclusion that, "the stated 4.1% inflation rate in the USA is a crock." Then he is reminded that that is the same opinion of The Mogambo, and did he really want to be associated with "people like that"? His face turns ashen and his hands tremble.
Hurriedly, he re-examines the inflationary evidence, and again comes to the conclusion that "the stated 4.1% inflation rate in the USA is a crock." But his heart really wasn't in it anymore.
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Editor's Note: Richard Daughty is general partner and COO for Smith Consultant Group, serving the financial and medical communities, and the editor of The Mogambo Guru economic newsletter - an avocational exercise to heap disrespect on those who desperately deserve it.
The Mogambo Guru is quoted frequently in Barron's, The Daily Reckoning and other fine publications. Click here to visit the Mogambo archive page.
-- Posted Thursday, 7 February 2008 | Digg This Article | Source: GoldSeek.com
