-- Posted Sunday, 14 December 2008 | Digg This Article
| Source: GoldSeek.com
Every time I get upset about the stupidity of the morons who infest American government, I find that I can usually calm myself by taking a lot of prescription and over-the-counter medications or getting really, really drunk. Or both.
The rest of the time, I can soothe my raw nerves by just being thankful that I am not, for example, British, who, for example, not only sold their nation's gold at the exact low price of the last couple of decades on behalf of their socialist/communist touchy-feely Leftist stupidities, but now the Wall Street Journal reports, "The U.K., faced with its own funding headache," has now decided that a little more socialist/communist stupidity is in order! Hahaha! Now they are, "requiring banks to become buyers of government bonds." Hahahaha!
People are looking at me like I am weird for laughing so insanely at this, but come on! Requiring banks to buy government bonds? Hahahaha!
Still, no one laughs with me, and so I explain that the article said that this will, "cost U.K. banks ($1.91) billion based on an estimated 1.5 percentage points a year of lost revenue." Hahahaha!
Still nothing! Then I explain that "Everybody is trying to bailout their banking systems, and here the British are crippling theirs! Hahaha! Too much! Hahaha!"
In desperation to divert everyone's attention, I quickly agree with the Journal when it concludes that "good news for the government isn't necessarily good for the U.K. economy" whether or not they like it when I agree with them, but we soon disagree again when they go on to say, "banks will be forced to cut back lending to the rest of the economy as they divert funds into government debt."
Well, with a cruel sneer in my voice, I say, since they are not here to defend themselves, that they are idiots, and that this "cutting back" on lending is not remotely true! Banks can simply create as much money as is needed, to do anything they want, including being diverted into any amount of government debt, all of which is the Big Freaking Advantage (BFA) of having a fiat currency in the first place! Hahahaha!
I was just about ready to call them up on the phone and tell these British geeks, "The reason that we have a recession that is going to morph into a depression is that the damned Federal Reserve, under the despicable Alan Greenspan from 1987 to 2006, kept interest rates too low, by the simple expedient of lying through his nasty teeth about the true rate of inflation! What's the matter with you morons? Don't you jerks know anything about economics? I mean, you call it 'football' instead of 'soccer', for crying out loud, and you are always sticking an extra 'u' in everything, such as spelling it 'colour' instead of 'color', and 'Thank you for calling us idiots, and would you now do us the favour of desisting in such behaviour?' instead of 'drop dead!'"
Fortunately, they seemed to take some pains to calm me down when they went on to admit that "The paradoxical truth may be that the less volatile business cycle (until recently) encouraged investors to take bigger risks with borrowed money, driving asset prices too high and ending in damaging busts", which is exactly right!
Not content to let them off that easy, I nit-pick at them by saying that they did not finish the thought, and I would have added a clarifying "because a worthless lying piece of crap named Alan Greenspan, along with his fellow morons at the Federal Reserve and the odious Michael Boskin of Stanford University and the Hoover Institution, came up with ways to lie with statistics about inflation, such as 'adjusting for quality' and other asinine tricks, so that inflation in prices that was truly in double-digits for years and years was statistically reduced to an amazing 1 and 2%, which made real, inflation-adjusted GDP look bigger after the necessary adjusting of raw GDP prices by this miniscule estimate of inflation, which allowed them to keep interest rates too low for too long, and then everybody conveniently looked the other way as their nasty little bank buddies and co-conspirator Wall Street sharpies securitized all that toxic debt crap and sold it to unsuspecting investors around the world, who borrowed massive amounts of money from their own stupid banks and their complicit central bank excesses to buy all those worthless securities as some sort of hedge, with everybody operating with insane levels of leverage of 10-to-1, 20-to-1, 30-to-1, 40-to-1 and higher! No wonder the Mogambo Guru is going out of his freaking mind at the stupidity, cupidity and sheer corruption of the banks and the governments around the world, who are all doing this same silly crap, using the same silly fiat currencies, and allowing their same silly banks to do this selfsame silly crap!"
You can see how their idea is improved with my terrific editing.
Perhaps in response to my terrific editing, The Economist then went on, "But some would still blame the Fed, for not deflating asset bubbles with higher interest rates."
Again, I reach for the phone to yell at these Economist weenies that yes, the Fed IS to blame, but not for "not deflating asset bubbles with higher interest rates", but because they caused the damned inflationary asset bubbles in the first place by creating too much money and credit for so long!
Anyway, this is not about how we Americans are a stupid bunch of lowlife morons who also consistently elect a subset of us stupid bunch of lowlifes to government posts and who are so corrupt and ignorant that they let the banks do that kind of crap, but about the stupid British, who (says The Economist magazine) have let the Bank of England "cut the base rate by a full percentage point, from 3% to 2%", which is significant in that "The Bank of England, established in 1694, has never set the official interest rate below 2%."
Not once in over 300 years, but now!
In fact, in my last request to Zaxxtor, Tyrant Overlord of this quadrant of the galaxy, to be taken off this ridiculous planet, I included in my official pleadings a quote from The Economist magazine to prove that Earth creatures are so stupid about the horrors of inflation that they almost uniformly think, as does The Economist magazine, that the European Central Bank's tiny 2.5% interest rate should be cut even more because "inflation is no longer a barrier to big rate cuts and the banks needs to act to ensure it does not fall too low." Hahahaha! "Fall too low"? Hahaha! I laugh in scorn and contempt!
How in the hell can inflation be too low? Inflation is supposed to be zero, or better yet, prices should be gently falling as the fruit of rising productivity, you halfwits!
So how low is this "low" inflation rate that will allow the cutting of interest rates even though inflation is still positive? Well, it is now 2.1%, which has just fallen from 3.2%, and 2% inflation is the ECB's target! "Inflation falling too low"! Hahahaha!
I could use this to segue into a rant on buying gold, but government stupidity is too easy a target these days. So, let's just call it a day and all go home early, perhaps to buy more gold with which to capitalize on governmental monetary stupidity!
Whee! This investing stuff is easy!
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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 Sunday, 14 December 2008 | Digg This Article | Source: GoldSeek.com
