-- Posted Thursday, 3 April 2008 | Digg This Article
| Source: GoldSeek.com
Things are getting weirder and weirder out there, and I am getting weirder and weirder in the semi-gloom of the Mogambo Bunker Of Ultimate Paranoia (MBOUP), like when I (for some reason) weirdly thought that if I called 911 to report the emergency of a rampant 20% monetary inflation that is going to lead to unbelievable consumer price inflation which will lead to food riots and societal breakdown, it might do some good!
The reason I did that was that I am just about to give up using the Mogambo Method Of Societal Change (MMOSC), variously called "crazy drunkard screeching and writing hate mail to the Federal Reserve, Congress, the Supreme Court, the United Nations and all the other lying, thieving, scumbags of the world, most of them Marxist trash who depend on the damned Federal Reserve and their own central banks to create so much money so that they can finance their loathsome socialist/communist agenda". It did not, obviously, work.
Well, the 911 operator is, I am sorry to say, just as stupid as the rest of the people around here, and she did not think that an explosive 20% growth in the money supply was an "emergency" either, even after I explained to her, like I patiently explain it to my neighbors, how she was beyond stupid if she didn't think that zillions of dollars being jammed into the economy was an "emergency" - because it is! We're going to be murdered by inflation! And murder is an emergency!
"Hell," I told her, "Get up off of your lazy fat butt and look around you! Inflation in consumer prices is already zipping along at terrifying levels!"
I even told her how even the laughably low "official" government estimate of inflation is a terrifying 4%, and the new "official" government Gross Domestic Product Deflator (used to wring out the effects of inflation from raw GDP data) is 2.4%!
Well, apparently calling her "stupid fascist moron worthless lowlife goon-squad trash" was violating a half dozen or so laws, and after being reminded of it, I knew that the 911 emergency system was just another government agency in league with those Federal Reserve and Congressional devils, and I hung up in rude dismay.
So now you know how weird things are getting, and thus you are primed for a recap of the Insane Economic News Of The Day (IENOTD), such as Total Fed Credit, the magical ultimate source of credit, which turns into debt and literally into money if someone borrows from a bank, being down a whopping $9.3 billion last week! Zounds!
And as more Insane Economic News Of The Day (IENOTD), the Fed's personal stash of U.S. government debt is down another gigantic $48 billion last week! $48 billion! In one week! One freaking week! In fact, the Fed's stash of U.S. Securities Bought Outright is down a whopping $151 billion in the last 12 months alone, and this mighty drawdown leaves them with only another $629 billion!
If you want a little MORE of some hold-onto-your-hat IENOTD, how about the fact that last week total reserves in the banks was $44 billion, and of that, a negative $62 billion was "non-borrowed"! Does that make them "borrowed"? Hahahaha! What? Hahaha!
I have to admit that I never was much good with negative numbers, and so I am having a Very Hard Time (VHT) getting my faltering few functioning brain cells around the concept that "free reserves" in the banks are a sudden, staggering negative $75 billion! Total reserves are only $44 billion, but "free reserves" are a negative $75 billion? What in the hell is going on here? It feels like we are going backward through a time warp or something!
I mean, the banks should be loaded with money, as Rick Ackerman of Rick's Picks says, "Since August, the U.S. has thrown more than a trillion dollars of rescue money at the banking system in a desperate attempt to restore confidence."
And as more Insane Economic News Of The Day (IENOTD), gold went down! Hahaha! This is truly, truly insane, because if there was ever a time when gold should be soaring, this is it! But it ain't! Yet.
All of this is taking a toll on the dollar, and Bill Bonner here at The Daily Reckoning writes, "In terms of what a dollar will buy in the United States, a dollar is down around 25% so far this century. In terms of what it will buy in Europe, it is down by about 50%."
Please notice the way the two sentences seem so well written, so informative, yet non-threatening. Now, notice that since this century is only eight damned years old, this makes the sentences seem even more grotesque if they are emended to, "In terms of what a dollar will buy in the United States, a dollar is down by around a whopping 25% in the last eight short freaking years, and in terms of what it will buy in Europe, the dollar is down by a staggering 50 freaking percent in the last stinking short eight years, too!"
Naturally, I think that this is a good opportunity to remind the viewers at home that gold, as a store of value, has gone up in price to compensate for the loss of buying power of the dollar, which is only one of the beauties of gold!
Apparently in response, Mr. Bonner then said, "In terms of gold, it has shrunk 75%"!
Naturally, my computer-like brain instantly deduces that since the dollar has lost 25% of its buying power for a market basket of goods in the last eight years, but the dollar has lost 75% of its value against gold, then gold is not only a store of value; sometimes you can actually make money on it! Like now! Whee!
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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, 3 April 2008 | Digg This Article | Source: GoldSeek.com
