D e b t I n c r e a s e
May 10, 2006 (Updated Jan 09, 2007)
I promised myself that I would stop writing about our economy but...
On May 9th, CONgress reached an agreement for a decrease in
tax rates on dividends and capital gains of $14,000,000,000 per year.
Also, 15 million middle class workers will save an average of $20 per year
by avoiding the alternative minimum tax.
Republican leaders said the tax cut is essential to sustain a strong
economic recovery.
If our leaders really think we are in a recovery, I'd like to sell them some
Florida swamp land. Or, if they don't like Florida, I am the owner of a
famous bridge across the East River in New York that I'll let go at
the ridiculously low price of $100.
Think about the math below --
Before this give-away to the rich,
the 2005 INCREASE in total US Debt was --
-
3.5 Trillion $ per Year
- 292 Billion $ per Month
- 63 Billion $ per Week
- 10 Billion $ per Day
- 400 Million $ per Hour
- 7 Million $ per Minute
- 111 Thousand $ per Second
- It doesn't seem so bad when you calculate it in seconds, does it?
It's the peril of selective reality.
Assuming this increase stops this year (same chance as a snowball in
you-know-where), and we start paying it off like a 30 year mortgage at say 7%,
the average worker (our children & grandchildren) will have to pay $976 per
Month above what comes out of their paycheck already.
Even if we don't start paying off this debt right now, let's stop the insanity of
passing laws and budgets that send us into a faster downward spiral.
This isn't funny-money. We owe this. We can't just "print" more money -- that's
exactly what the debt is. Our debtors aren't likely to say, "I have all the
money I want, so forget it."
It can only continue until our debtors decide they are tired of waiting for us
to straighten out our finances -- then the USA will be forced to devalue the $
(or it will be devalued with the stroke of a pen by China). Then it will only
take each person maybe $100 per month to pay off the debt. -- Though our savings won't
be worth much and we will have to take our money to WalMart in a wheel barrow
to buy a Chinese flashlight battery.
That's exactly what has happened before to other countries. Only our economic size
and our (dwindling) influence in the world has saved us so far.
In the history of our country, only during the Cuban missile crisis, and the
days before Black Tuesday have we have been in such a precarious position.
-- And our government knows it.
Do you think the Administration wants to bomb Iran because of their nuclear
development and the Iranian president's rantings about Israel?
Think again:
There are only two exchanges for trading oil in the world. One is the New York
Mercantile Exchange (NYMEX) and the other is the International Petroleum Exchange
(IPE - London). Both of these deal only in US Dollars.
In 2000 Iraq converted its oil transactions to Euros, bypassing NYMEX and IPE.
In late 2002, other mid-Eastern countries were talking about trading oil in Euros.
Early 2003, we invaded Iraq.
In 2001 Hugo Chavez of Venezuela talked about using the Euro for it's oil sales.
At the same time, the Administration (and the yes-yes press) started talking
about how evil a dictator Chavez is -- even though he was elected by popular vote
in an election that the international election monitors found to be fair (This
same election group gave our 2004 election the equivalent of a C-.)
In our present situation and with the world's dependence on oil, we couldn't hope
for a more stabilizing influence on the US dollar than oil traded with dollars.
Now Iran is almost ready to open a commodity exchange, the Iranian Oil Bourse,
trading primarily in Euros. This exchange on the Iranian island of Kish in the
Persian Gulf is designed for trading any or all oil in the Middle East, not just
Iranian oil. If the other Middle Eastern countries (who don't like us anyway for meddling
in their affairs) start using this exchange, it will break the monopoly of NYMEX and IPE
and send the US dollar to the graveyard.
In the next few weeks the Administration and the media will tell everybody
again and again and again that Iran is dangerous, insane, and evil and we can't allow them to
have nuclear weapons (someday). -- Maybe none or some or all of the above is true, but if we
go to war with Iran, you now know real reason.
- What can you and I do?
First, I hope and pray I'm wrong... Or at least, that we are not beyond the point of no
return and our government will change course. Somebody said, "If you're in a hole
it's time to stop digging." In any case, I hope we have a few years.
-- So, get out of personal debt (If possible) except for your mortgage and, If you
have any money left over, get out of stocks and bonds and invest in gold or
international monetary funds.
~~~~~~~~~~~~
Update Jan 09, 2007:
2006 is over and still no Iranian Oil Bourse. Did you notice a decrease
in the news about Iran's nuclear program? Yes, the UN did give them a slap
on the wrist. Is Iran holding their future Oil Bourse as a bargining chip?
Likewise, Russia needed the World Trade Organization. The Russian Trading
System was announced by Vladimir Putin to start trading in rubles on June
8th, 2006. Never happened. See my blog:
Rubles for Oil
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"The enemies of freedom will be defeated." - George W. Bush, 2005
"We have met the enemy and he is us." - Pogo, 1971
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Aloha, Larry
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