The Economic Meltdown: Dismantling, Yes; Doom, No 55 comments
-
Font Size:
-
Print
- TweetThis
Yes, Christmas and all that turkey derailed our 2008 review / 2009 preview series, so yesterday’s scheduled piece on Venture Capital will be published later rather than sooner. But speaking of venture capitalists, this morning I was reading Fred Wilson’s piece called Bits of Destruction, in which he argues that while the causes of the economic meltdown “have more to do with risky lending and owning securities that are toxic than anything else” he argues that the consequence will be the death of many doomed industries whose days are numbered due to the Information Revolution.
It is a fascinating argument, but an incorrect, or rather, incomplete one. The truth is, what we are seeing is mainly the destruction of American industries and companies. After all, while Toyota (TM) did post its first loss in decades, the company is anything but doomed. Toyota’s problems are short term and very different than the ills facing General Motors (GM), Ford (F) and Chrysler. While some European financial banks have suffered losses, few are doomed and none look like Citigroup (C) or JPMorgan (JPM).
In other words, I am not even sure if all of the industries that Mr. Wilson thinks are doomed are in fact doomed. So what we are now seeing is not a wanton destruction of companies around the world, but a systematic dismantling of American industries, institutions and companies: housing, financial, automotive and potentially now also technology and many others. Ultimately, these are interdependent industries that all tumbled like a house of cards after a largely household-related bubble burst.
But to answer the question “why” the answer is plain and simple: the war.
Vladimir Lenin argued that war serves as an accelerator of history. In 1917, he wrote:
this required a great, mighty and all-powerful “stage manager”, capable, on the one hand, of vastly accelerating the course of world history, and, on the other, of engendering world-wide crises of unparalleled intensity — economic, political, national and international. Apart from an extraordinary acceleration of world history, it was also necessary that history make particularly abrupt turns, in order that at one such turn the filthy and blood-stained cart of the Romanov monarchy should be overturned at one stroke.
This all-powerful “stage manager”, this mighty accelerator was the imperialist world war.
In fact, the 21st century was to be a century that saw America start to share power with Russia, China and India. But during George W. Bush’s reign, the US imploded due to a foreign policy which can be described at best as greedy and arrogant and at worst criminal.
Regardless of your thoughts on the war, the simple result of combined
a) increased spending on the war and
b) tax cuts for the wealthy
resulted in loose money, easy credit which then in turn led to the housing bubble.
To this day, mainstream media starts the story on Chapter 2: the Housing bubble, easily forgetting that Chapter 1 of this history is in fact this illegal and immoral war that is costing Iraqi civilian and US soldiers’ lives for no reason. We can say all that we want about greed on Wall Street and whatnot, but the real cause goes back to Washington DC for setting such a poor example for everyone else to follow.
Prediction: In one year's time, many of the global industries and companies will tower over their American counterparts, who will have either shut down or been sold to foreign institutions and become subsidiaries. After all, the US Currency has yet to decline the way most economists predict that it will, and many companies’ projected earnings have yet to be downgraded to really reflect the future. Once these two things happen, the impact on company valuations will be severe and foreign companies will trade at a premium.
Related Articles
|
-
The Seeking Alpha 100
See allThe top 100 stock
market authors
selected for publication
Seeking Alpha 100 » -
Fastest Climbers
Authors with the largestSee all
increase in followers
in the last 7 days
Fastest Climbers » -
Top Commenters
Top commenters,See all
as ranked by their peers
Top Commenters » -
Top Instabloggers
The 100 most activeSee all
Instabloggers.
Top Instabloggers » -
Top StockTalkers
TopSee all
StockTalkers.
Top StockTalkers »
This article has 55 comments:
Suppose Wilson is correct in his prediction (and hope) that in their restructuring, the automakers will adopt a far more efficient distribution model, using internet purchases and direct delivery in lieu of a dealer network. There are some important reasons why this is problematic, but let's just suppose that it does come to pass.
If the Big 3 implemented such a model because it reduced their overhead significantly and gave them a competitive advantage, do you not think that Toyota, Honda, Nissan, Mercedes, et al would also adopt this business model? In fact, they would suffer less hardship in converting from the current dealer-model because their dealership networks are less entrenched and less powerful than those of the American car makers.
Lets look at another industry that Wilson talks about: mainstream media. If American newspapers and magazines get universally transformed from printing presses and physical delivery infrastructures, why would foreign newspapers and magazines prosper under the current model of physically printing and delivering content?
You actually make no hard case for your thesis that the US war makes things different for US companies - that this is the reason they will transform their business models. The sea-changes that are coming for industries world-wide, will be hastened by the war and its financial effects for American companies. But the changes will occur internationally, nevertheless. If anything, this would bode well for American industries, if they are ushered into a more prosperous future earlier than their international counterparts.
This piece, cloaked in the garment of "analysis," is a thinly veiled effort to espouse your political views rather than to inform. The internet will transform (is currently transforming) many businesses in many industries. The financial implications of the US war effort may hasten this metamorphosis for America, but the rest of the world will follow. If the business climate is better, and operations more profitable under a bit-based economy, there is no reason why they wouldn't.
I, too, deplore the way the Iraq war was (mis)handled. I, too, believe that it was criminal to divert so many billions of dollars on this trumped-up war when it could have been spent on education or health care in this country. But you do yourself and your argument a disservice with a red herring effort to cite the war as the reason that American companies will be changed by the Internet.
The Internet will change business globally simply because it will make business sense. American business may be forced into this change prematurely because of the financial drain of our war efforts. But this is ancillary, not causal.
We must keep in mind that the best minds our country has to offer are thinking (hoping) that a $1 trillion infusion will turn things around. If that number is correct, then lets us recall that Bush's war took a trillion (maybe more) out of our economy and this certainly supports your thesis.
Pack up your pen.
THe idea that AMerica will be left on the outside looking in, diminshed forever in its influence and power is more a wish on the part of those who believe that America must fall in order for them to ascend. The structural problems in the rest of the world are evrey bit as deep as those in America. THe difference is that America has long demonstrated a sort of resilience and transformational ability that the rest of the world envies but cannot match. THe dollar may or may not fall but the fact that is did not when the crisis was most clearly defined and recognized shows that the rest of the world may not like America but they are loathe not to follow it. You can make money in the short run betting against America but the idea that you can successfully short America in the long run is done at your own risk. I will take the other side of that trade until it is clearly shown to be wrong and again this is just your wish and not any immanent "reality."
The war may have accelerated the process, but it didn't cause it. We would have got to the bubble sooner or later to deflate. Did the war cause investment banks to leverage up 30 or 40 to 1?
Regardless of your view of the war on moral grounds, its economic impact is insignificant, and its cost pales by comparison with the bailouts distorting our economy.
I do not believe that tax cuts "for the wealthy" damaged the economy either. On the contrary, tax cuts of help any economy to better direct its resources by those who earn them. Since "the wealthy" pay most of the taxes, they will benefit the most from any rational tax cut.
The real diagnosis is failure of central banking. We've had a fed that for fifteen years focused on maximizing current propsperity at the expense of long-term prosperity. Now that the long-term has arrived, "Houston, we have a problem".
The author is obviously a biased America hater who does not have a clue about the current economic crisis - which was caused by Carter, clinton and the democrates pushing sub prime loans to people who could not afford them, not 'tax cuts' for the rich ( which resulted in more tax revenue for the government) and the deregulation of the American banking industry.. The war against Iraq was against an evil dictator with WMD who had invaded Kuwait, tortured and murdered his own people, and stole billions of dollars from the UN directed oil for food program that should have gone to the people of Iraq. So, what kind of example is this for the international community?
the US is not 'sharing power' with any of the third world POS countries like India, except in the author's imagination. The US (taxpayer) gives untold billions of dollars in aid to foreign countries - how much foreign aid has india , russia, or china given?
the actual cost of the war in iraq is a very small part of the US budget and cannot possibly cause the effects the author is claiming.
Ignorant articles like this should never had been written and are a waste of time for the readers of this site.
A quote from Lenin. How preposterous. How out of date.
For that mass murderer to call the Romanovs a "filthy blood-stained cart" is like the "pot calling the kettle black."
WWI accelerating something? The “great accelerator?”
Think of the political and economic impact of that war.
16 million deaths and 21 million wounded.
We are supposed to believe that amount of carnage accelerated something?
The war depopulated Europe and the US of young men. It killed native young men who were conscripted from the colonial empires.
Surely WWI accelerated the growth of sorrow but a depopulation on that scale did not accelerate economic behavior.
Nor did sorrow on that scale accelerate any political behavior.
Sometimes I think the Roaring Twenties were just an attempt to numb the emotional pain of WWI.
Think of the WWI reparation payments. And we should believe that reparations were part of a historic acceleration of something. The debt burden of the reparation demands did not accelerate anything.
And consider the rise of authoritarian governments in Europe, North America and South America. Those governments accelerated what exactly?
The march into the Great Depression perhaps?
Lenin is discredited. Reasoning from his thoughts gets us nowhere.
I'm tempted to mention the "ash can of history." But that is too obvious and Mr. Karbasfrooshan might take it personally.
If China and Russia soon become the world's superpowers, I can say we're going to miss the US, warts and all.
Be that as it may, military expenditures are one element of the problem. Congress acts like a group of kids without conception of budget limitations, the Federal Reserve acts like a Soviet price control committee, the money supply constantly increases, and public policy consistently encourages malinvestment and other bad behaviors.
50+ years of this kind of bad policy has done wonders to destabilize our society.
This is pure insanity. It is bankrupting America. Our global empire is now doomed as we sink under this sea of red ink. We cannot afford to have a military that costs more than the entire planet's military costs! Anyone who thinks this has not looked at the statistics.
Free trade is the other deficit sinking our ship. We are running both a trade and budget deficit this last 35 years except for 2 years. This has caused a multi trillion dollar drain on the US economy.
The end is now in sight. When the world ceases to use the US dollar as the basis for international settlements, our empire will totally collapse, as a catastrophically as the collapse of the Soviet Union.
Family squabbles turn into hostage situations with sniper swat teams. Men dressed up like Terminator 3 stomp through our air ports.
"Whilst I support the Iraq War on a moral ground I agree with your financial analysis. America's far too overstreched providing safety for almost the whole globe..."
You support the war on MORAL GROUND? I beg you to tell me what that moral ground might be. To be rid of Sadam Hussein? I hate to put words into your mouth, but that's absurd. The US never met a right wing dictator it didn't like, from Samoza in Nicaragua to the Arena party in El Salvador to Joseph Mobutu in the Congo to Suharto in Indonesia to Pinochet in Chile to the Duvalier family in Haiti - and please note that the leader of the FRAP retired not to Russia or Cuba, but to Queens NY after that CIA sponsored farce ended. And of course the reams of papers retrieved in Port au Prince were never either returned to the Haitian government or made public. Never in recent history has there been a more effective cooperation between the networks & the government as in what took place in Haiti to keep Bertrand Aristied out of office for over three years.
And saying that the US provides safety for the globe is like saying that Billy the Kid provided safety to the old west. Who provided safety to Panama from us? Somewhere between two and four thousand civilians were killed to ... arrest a drug dealer?! (Did you understand that "war" on moral ground too?) That nut case was a drug dealer when the CIA hired him to be their guy. We invaded Panama to teach him not to mess with Uncle Sam, the Godfather to the world. To show the world that we were a loose cannon & not to mess w/ us. To showcase the stealth line of aircraft & boost sales. To show that we didn't spend more on our war machine than the next - what, 104 countries combined? - for nothing. With that huge investment in arms, Washington has to be known to the rest of the world as DANGEROUS & unpredictable or why spend the money?
If you underestimate the cynicism of Washington DC, you'll always be having problems reconciling modern history w/ the absurdities broadcast over the propaganda machine commonly referred to as the "free press."
On Dec 27 07:09 AM Yamu wrote:
> Whilst I support the Iraq War on a moral ground I agree with your
> financial analysis. America's far too overstreched providing safety
> for almost the whole globe, rather than the Middle East and Pacific
> it should concentrate on still being the no1 influence in Latin America
> as that's far more cost effective, not to mention that it will stop
> pissing off Russia, China and the Arabs...
On Dec 27 09:15 AM jamino1 wrote:
> THe war may turn out to be a very expensive piece of misplaced ideology;
> more or less a retaliation for 9/11 but it is certainly not the prime
> reason for the financial problems that are occurring now. Now were
> the tax cuts which freed up large amounts of capital for investment..
> More likely it was the unwillingness of central bankers around the
> world to allow for corrections to take place as should have occurred
> after the investment excesses of the dot com era.
>
> THe idea that AMerica will be left on the outside looking in, diminshed
> forever in its influence and power is more a wish on the part of
> those who believe that America must fall in order for them to ascend.
> The structural problems in the rest of the world are evrey bit as
> deep as those in America. THe difference is that America has long
> demonstrated a sort of resilience and transformational ability that
> the rest of the world envies but cannot match. THe dollar may or
> may not fall but the fact that is did not when the crisis was most
> clearly defined and recognized shows that the rest of the world may
> not like America but they are loathe not to follow it. You can make
> money in the short run betting against America but the idea that
> you can successfully short America in the long run is done at your
> own risk. I will take the other side of that trade until it is clearly
> shown to be wrong and again this is just your wish and not any immanent
> "reality."
Do yourself a favor and turn off the propaganda. Your whole comment is just a list of right-wing, Bush apologist talking points (the seeking alpha editors should be ashamed for allowing your ignorant rant to be published). Each one is retarded. The American century is over. Get used to it.
On Dec 27 10:45 AM rcs wrote:
> The seeking alpha editors should be ashamed for allowing this anti-American
> ignorant rant to be published.
> The author is obviously a biased America hater who does not have
> a clue about the current economic crisis - which was caused by Carter,
> clinton and the democrates pushing sub prime loans to people who
> could not afford them, not 'tax cuts' for the rich ( which resulted
> in more tax revenue for the government) and the deregulation of the
> American banking industry.. The war against Iraq was against an evil
> dictator with WMD who had invaded Kuwait, tortured and murdered his
> own people, and stole billions of dollars from the UN directed oil
> for food program that should have gone to the people of Iraq. So,
> what kind of example is this for the international community?
> the US is not 'sharing power' with any of the third world POS countries
> like India, except in the author's imagination. The US (taxpayer)
> gives untold billions of dollars in aid to foreign countries - how
> much foreign aid has india , russia, or china given?
> the actual cost of the war in iraq is a very small part of the US
> budget and cannot possibly cause the effects the author is claiming.
>
> Ignorant articles like this should never had been written and are
> a waste of time for the readers of this site.
Have we had the last straw? I don't think so. We have a very strong camel. The straws accumulated have slowed his pace, swayed his back and staggered his pace, but the back has not broken yet. If we feed the camel and carefully lighten the load, our caravan will not end.
"Do yourself a favor and turn off the propaganda. Your whole comment is just a list of right-wing, Bush apologist talking points (the seeking alpha editors should be ashamed for allowing your ignorant rant to be published). Each one is retarded. The American century is over. Get used to it. "
This is so typical of left wing nut jobs
example "Bush is stupid" well, why? "Bush is real stupid" well, why?? "Bush is really really stupid".
Your unsupported hate rant shows just reflects your ignorance.
I suppose you get all your news from the "unbiased" CNN people (they told you they were unbiased, right?)
You probably think SNL skits are reality TV.
As far as the American century, after Russia, China, and India implode economically in the near future,the US, though in bad shape, will be the only man standing.
We have also had a failure of other leadership positions, call it Quality Control. Where was the FBI, CIA, NSA when the Towers went down. How many Billions are spent for these agencies? We could have hired MI6 or Mossad to protect America for Christs sake!. I'm not going into that failure, because it makes the point.
Who controlled Greenspan? What was the SEC doing? What about Treasury. Isn't Congress supposed to be snooping around? The Real Estate bubble shows how greedy and corrupt America is.
.......money for nothing, chicks for free.....
Ok then, so it looks to me like the Bush Administration did the RIGHT thing to help the cause of the cave dweller, Osama Bin Laden. In addition, we spent Billions for Homeland Security, which is ongoing currently, This one though really hurts, One and a half trillion on Vietnam in the DESERT....
To be fair some of the blame goes to Clinton (911) dictated policy of no profiling, directed at the FBI in '94', Bush though, deserves to go down into history with the likes of Carter, and Millard Fillmore.
Barak should shock the US economy by immediately moving to use Natural Gas for heavy trucking ( 42% of USA daily consumption) in USA. Americans should be warned that the fuel of the immediate future is Natural Gas and that imported fuels will be subject to high taxation at port of entry. China is promoting use of Nat, Gas autos.
T. Boone Pickens Plan is THEE plan to begin a reshaping of American Energy usage. If not we are nothing more than ENERGY JUNKIES manipulating the World for a FIX.
Iraq was for one thing-OIL OIL OIL OIL
Democrats and Republicans can share in blame about our current crises. Republicans hand-off attitude toward financial and investment controls have hurt the stability of our country. There was a reason the controls were issued after the Great Depression. “Trickle down” from the rich to the poor doesn’t work in sharing the prosperity of the entire country, unless someone aspires to be a maid in the rich man’s house. Tax cuts to the rich and tax breaks to the wealthy companies, held mostly by the rich, have not spurred the economy to produce more effectively. They produce profligate use of the funds. (Witness AIG, et. al.)
The US can’t go up against every “evil dictator”. Financially, it’s not reasonable. Logically, it’s not an excuse for intervention, which was really, as everyone knows, because of oil and politics. The government tells us a lot of things, e.g. WMD—and you believe them? Well, then they have accomplished their purpose to persuade you with disinformation. Who’s smarter, the citizen or the government?
Foreign aid usually is to some extent misappropriated when it goes through the government. One intention is probably to make a positive impression. That’s not so bad. Supposedly, the better venue for aid would be Christian charities. More of the money gets to the people, although it will probably have a Christian message with it about loving everyone. Whereas, the “charity” that may go through China, Russia, and Cuba, may seem philanthropic, but is to influence the recipients into liking those donors and their philosophies.
This is quote from your comment, rcs, “the actual cost of the war in iraq is a very small part of the US budget and cannot possibly cause the effects the author is claiming.” The actual costs are very high: military expenses that could have been put to use teaching children in our schools and universities to function better in this unpredictable world; loss of life, loss of limb, loss of mental stability, loss of relationships of those involved, both for Iraqi and US victims; loss of international functionality and cooperation with allies and also possible opponents. Diplomacy would have certainly been more economical and positive in its results to control the stimulation of radical Muslim fundamentalism.
This isn’t an ignorant article. It is an invitation to our discussion, just like the one we are having in the comments below it. Good going Seeking Alpha, for letting us comment on this article and our fellow blogger’s thoughts. (And let’s use more civility and avoid the epithets, rcs. No need to call some someone “ignorant,” even when their comments show signs of it.)
The war in Iraq is certainly wrong headed and has had adverse impact on America, for sure. But, does the unprovoked attack on the twin towers carry any adverse impact for the religious zealots who perpetrated it? I mean, who gave them the right to do fly planes into our buildings, destroy them, and kill 3000 people?
Had that not happened, our troops would still be home. Though, at first, I was happy to finally have a president who would no longer take such acts lying down. Well, until the war in Iraq began, anyway. Yes, blame Bush for the Iraq war. Ah...that's long and heated topic. I don't care to get into it.
And blame Bush for not acting fast enough to counter the crisis in it's infancy. But, the war? No, Mr. Ashkan, we were taken down by greed and gluttony, generally, and debt, more specifically. We may well be in a period of restructuring. I hope we are. But, America is not the only nation who suffers from the deadly sins. It's pretty much global: east and west, Christian and Muslim.
But, the restructuring we are likely to go through is financial. We might see some regulation in the sector and improved fiscal and monetary policies. We might even, I pray, see some social restructuring: folks living more within their means with a fresh memory of what greed and gluttony can do.
Maybe, just maybe, we'll learn something from this crisis, bring our troops home, and regain a sense of who we Americans really are.
But to answer the question “why” the answer is plain and simple: the war."
======================...
War is generally the culmination of larger, multi-generational cycle(s) that occur(s) over a very long span. War is NOT Chap 1 as the author believes, it's Chap 4:
The author picked the wrong Russian, he should have picked Stalin's "1st economist", Nikolai Kondratieff, who pointed out these long cycles based on "accumulation and consumption": From the site below: "...what the Kondratieff wave is about is a study of long cycles of debt buildup and repudiation."
www.kwaves.com/kond_ov...
The "K-wave" explained, "succinctly":
"Chap 1": Post WW2 we had a huge period of wealth building in America, based on the "accumulation" of wealth (savings).
Chap 2: This expansion leads to higher prices (inflation) and then stagflation (collectively the "70's"). This results in...
Chap 3: Society shifts from savings to consumption (80's and 90's), until the consumption results in an unsustainable level of debt.
Chap 4: Then the corresponding debt-related bubbles burst, starting with tech-bubble and then the housing bubble, but in essense, it is the credit/consumption bubble that it bursting.
Wars often occur in this last stage (Chap 4), but thankfully, the "bubble-phase" (Chap 3) often brings the innovation that leads to the next boom (the new Chap 1).
This article had ONE redeeming aspect: It pointed me to Fred Wilson's (and Tom Friedman's articles). Whether Fred Wilson knows it or not, he is describing the K-wave "Chap 4 + Chap 1", which (economist) Joseph Schumpeter rightly described as "Creative Destruction". The Internet IS changing the world, just as railroads/phones/autom... did at the ending and starting of the last K-wave.
I do fear there will be further downside (economic and market) to this "Chap 4", but as Friedman hopes, there will be a lot of creation out of this destruction. I just hope Obama helps it start sooner rather than hinder it to make it start later.
Capitalism is always destructive when it is practiced properly. Inefficiency is destroyed by the efficient. Just because companies fail does not mean the economic model is flawed. New businesses spring up created by entrepreneurs' motivated to succeed. Also, capital is now more international than ever. There are many Americans who have stakes in Toyota and Honda, and these companies have built plants here, have their supply chains here and lodge their executives here. If the playing field is level Americans can compete with anyone.
jegan
The debate over the moral grounds of the Iraq War is pointless, despite Bill Bennett's tireless insistence to the contrary. If we as a nation want to embark on moral endeavors, we must be able to pay for it. Our leaders have bankrupted this country, and it's folly for us to think we can maintain our role as the world's policeman while running 9 or 10 figure budget deficits.
On Dec 27 07:09 AM Yamu wrote:
> Whilst I support the Iraq War on a moral ground I agree with your
> financial analysis. America's far too overstreched providing safety
> for almost the whole globe, rather than the Middle East and Pacific
> it should concentrate on still being the no1 influence in Latin America
> as that's far more cost effective, not to mention that it will stop
> pissing off Russia, China and the Arabs...
On Dec 27 03:52 PM jegan ;-) wrote:
> Dubya and his posse converted me from a life-long Republican to a
> Democrat. He has proved to be the worst President in my 60 year lifetime.
> I am only sorry that San Fransisco couldn't come up with the necessary
> 50% vote to rename the local sewer works as the 'George Bush Memorial
> Sewer Treatment Plant'... It was close though.
>
> jegan
Consider- the USD will weaken v. other currencies. While US companies like KO with established overseas markets should do ok, other US companies needing to pay for overseas supply chains in USD will suffer.
Consider- the P/E of Vanguard Total Stock Market Index (VTSMX) is 15.46. The P/E of Vanguard Total International Index (VGTSX) is 11.97. In the private sector, there is more capital and less debt outside US borders. (Markets are just starting to price this!)
Consider- the US has the largest energy import/export deficit in the world (almost 700m tons oil equivalent in 2004, source: The Economist).
Consider- the US ranks 15th worldwide in broadband speed, access and price (source: ITIF).
Of course, it was morally the right thing to get rid of a dictator. How absurd to deny this. Just shows how far left and right have come from their origins.
US interest in the Middle East or not does not change the moral reasoning. The question whether doing the right thing for the wrong reasons is fine is a whole another case, in the case of reality doing the right thing has precedent.
To deny that America provides and has been providing safety for Europe, Japan and Korea and thus been spending an incredible amount of money is well, not worth my time. As long as America meddles with Russian and Chinese interest these countries will make sure that America will be stretched beyond capacity (see Iran/North Korea).
To be honest, your whole argument is inconclusive at best.
Really surprised by the comments on here, if they're even remotely represantative for America...
Struck a nerve there with some people ;)
In a way it's funny to see a Fox v CNN like debate pan out, but it's also sad as it makes for terrible discussion.
I was a solid "mainstreet" republican until Reagan; I voted for him enthusiastically in 1980 and reluctantly in 1984; ironically enough he was a former Democrat that became a Republican in 1962 (interestingly enough about the same time as Strom Thurmond). Unfortunately for us the modern Republican party combined the worst elements of the pre 1972 Republican Party and the pre 1960 Democratic Party.
The current fiasco will be the 4th great challenge that has confronted the US (I include the fight for indpendcence from Great Britain, the Civil War, the Great Depression/WW II and now finally the financial collapse/the Iraq War. There may be some fans here of the claim of the singularity of American national greatness and/or America as the chosen land. Unfortunately, it is unlikely that either are true and we will only surmount this challenge by a combination of grit, hard work and providence.Some of the intials signs are however disquieting.
We arrived at this point through a combination of wishful thinking, suspension of common sense and a refusal to face reality. The modern Republican party has been promising that we could have economic growth, low taxes, loads of debt and a happy ending; or merely an updated version of a fairy tale. While the hardcore idealogues will attempt to argue this is all the the fault of George Bush, or the CRA, or the Republicans or Reagan or Democrats or flouridation my own analysis for the blame is as follows: the American electorate-60%, the modern Republican Party 25%, the modern Democratic Party 10% and a deep, abiding sense that we are Americans and deserve a free lunch-5%.
The modern Republican Party has largely been in control of the levers of finance for at least the last 20 or 30 years and have used this power to cut taxes, weaken regulatory systems and in general just screw up almost everything they touched. George Bush has provided the last bit of comical relief to the Republican's reign of power: the man could find a way (as my grandfather would say) to f***-up an an anvil.
Two last thoughts: 1) I have to laugh when die-hard Republicans's go searching for culprits and arrive at the CRA and/or Jimmy Carter; it just looks pathetic that you are unable to critically view events and examine ideology and sometimes find it lacking; and 2) Democrats and the American people went along with these ideas, sometimes enthusiastically.
Of course, most of our current difficulties are our own fault. Right now, we are at the point in a nation's life cycle where most empires collapse. People get complacent and start looking for a free lunch: they fall for the illusion that they can just vote for healthcare and get it. They end up consuming the very infrastructure that the nation relies upon to survive.
At the moment, it is not hard to see America follwing this path to downfall.
But America is more resiliant and adaptable than any other nation on earth. Most Americans know that we are not on the right path, and we are ready to cut our losses and start rebuilding. We just need someone who knows which way is up to say "That way - GO!"
The reason that America will survive this (if it does) is because this person doesn't need to be President, a politician, or even an adult to lead the country. They just need to know where to take us. Personal freedom and individuality are the cornerstones of our soceity . . . we have three hundred million people all with the freedom to do their own thing and make thier own statement.
We only need one of them to come up with the right answer.
While I have been short the market for over a year, I keep that fact well within sight. Eventually, the U.S. market will turn, and I will not want to be short at that time.
As to the "illegal war", and the related deaths , perhaps he would like to comment on the "legality " of the previous regime in that country, or the tens of thousands of deaths associated with Saddam's brutal reign.
As to the economics of war , he makes an obvious point ,that war is an expensive undertaking. But to tie America's economic problems soley to the war is simplistic - how does he account for the dozens and dozens of other countries in the grips of recession that had no ties to the war?
On Dec 27 10:45 AM rcs wrote:
> The seeking alpha editors should be ashamed for allowing this anti-American
> ignorant rant to be published.
> The author is obviously a biased America hater who does not have
> a clue about the current economic crisis - which was caused by Carter,
> clinton and the democrates pushing sub prime loans to people who
> could not afford them, not 'tax cuts' for the rich ( which resulted
> in more tax revenue for the government) and the deregulation of the
> American banking industry.. The war against Iraq was against an evil
> dictator with WMD who had invaded Kuwait, tortured and murdered his
> own people, and stole billions of dollars from the UN directed oil
> for food program that should have gone to the people of Iraq. So,
> what kind of example is this for the international community?
> the US is not 'sharing power' with any of the third world POS countries
> like India, except in the author's imagination. The US (taxpayer)
> gives untold billions of dollars in aid to foreign countries -
> how much foreign aid has india , russia, or china given?
> the actual cost of the war in iraq is a very small part of the US
> budget and cannot possibly cause the effects the author is claiming.
>
> Ignorant articles like this should never had been written and are
> a waste of time for the readers of this site.
History is litered with propaganda machines that you never hear from again once it is shown that they are flat wrong and if you were ever to see a picture of them, no further words would be required.
My Prediction: Without the "WILDCARD", Mr Karbasfrooshan is right in his prediction.
Ahhh! The "WILDCARD", that is "THEE " card to play (sorry not T Boone's play), The "WILDCARD" is Clean Coal / Hydrocarbon Technology. It ALONE will change the way the world views Fossil Fuels. With this "WILDCARD" Fossil Fuels are the "Construction Materials " of the future AND the "CLEAN FUELS" at the SAME TIME! Instead of Poluting OUR Enviroment the Carbon Dioxide is destroyed and permantly removed from the carbon cycle. In the process the carbon is used to make carbon fiber material. This process is owned by ONE AMERICAN! This IS America at its BEST! The USA is leading the world and will continue to do so!
See for yourself: www.faqs.org/patents/a...
FYI: there's not a Continent, a Country, a Territory or a Government on planet Earth that has come about which did not rise from Conflict or Conquest. Even Christianity rose to power in this way! You ever hear of the "Crusades" or the "Spanish Inquisition"
Fact: More people were massacred "in the name of god" during these two historic world events than in ALL WARS combined.
Fact: the United States of America DID NOT declare war on Iraq! George W Bush Jr did & it was PERSONAL for two reasons:
Sadam Husain tried to assassinate his daddy TWICE (vendetta/payback) once when he was Head of the CIA and the second while he was our President
Next; the Bush Family ownes one of the largest offshore drilling platforms in the world. It's a mega producer & it sits in the Persian Gulf. [PROTECT AND DEFEND HIS INHERITANCE]
I guess he figured the war would distract or act as a diversion as to his true agenda & the intel on the 'Weapons of Mass Distruction', well that was about as much garbage as the column im rebutting.
HAD ENOUGH YET
Wasn't it old Bob Dylan who said "he who is first will later be last"
Maybe the US needs to stop being world "cops" and live a bit more
frugally, starting with top of the food chain CEO's who we pay multi
millions in packages just to position themselves to get out before the
storm in time at our expense. 10 years ago I remember a software
CEO telling me how he shorted his own company after the price was sky
high- I've never trusted my money in managed companies since.
I blame both highly corrupt parties, they live very comfortable lives and
get to help lots of their old pals and cousins out. We are headed toward
late stages of our current system. It could be 10 years or 30 years, but
the system is broke from every possible angle- the signs are there, just read the tea leaves. I wish our new "leader" well but judging by "key" staff appointees, it looks "same old same old" to my eyes with a new suit,
although I support ending the bully's war and alternative energy fully.
Thanks to massive corruption from my generation, future kids get to pay much higher taxes, much higher food and resource costs, and the beauty of urban sprawl. Thanks to Steve Jobs and Bill Gates, we did do a few good things.
Though maybe the "paperless" society we enjoy has allowed to "bad guys"
to go stealth.The world has changed dramatically since worldwide electronic finance became the norm.
We might save a buck or two by ending our little "shock and awe" war.
Nothing better than a 5-10 year war to break the piggy bank, just ask
say Robert E Lee, Hitler, the Kaiser, or Napolean. Maybe next time prudent
to include the UN on any decisions, kinda common sense kind of thing.
I must admit though, it was a little more exciting for a few weeks than say watching "Dr Phil" of "Seinfeld" reruns.
“Mission accomplished” oil and natural resources for almost nothing for a few chosen ones continue to make the world unsafe. The “feel good” war bubble is busting around the world, as the US funds and aids terrorism abroad.
IMF chief Dominique Strauss-Kahn has warned that advanced nations will be hit by violent civil unrest if the elite continue to restructure the economy around their own interests while looting the taxpayers. 22 of 50 states (including California, Michigan and Detroit) are already getting deeper in serious budgetary trouble.
Some capital market analysts predict the “Dow Jones going below 5,000 as stock markets slides into oblivion; unemployment would rise to 30%; hundreds of business, banks and bonds would continue to crash; US dollar value would fall by up to 50%; American federal government departments for food stamps and the job of providing welfare provisions will be overwhelmed; urban areas will see skyrocketing crime and in parts of some cities, life could become totally uninhabitable; those needing food help will rise to 30,000,000 in the US (up from 650,000 in 2008) mostly children, leading to armed food riots civil unrest against the ruthless and war-hardened US homeland army.
Deeply flawed, irrational and political bailouts and foreign policies only delay the eventual fall of the American empire, hegemony.
The result: US presidential votes in November 2008. But war mongers, FOX and their fans still support farcical US lies and illogical defense/security waste on bankrupt “moral grounds” blindly and in denial… A taste of consequences: a beef burger joint advertised vacancy in the US for one burger-flipper, and received over 1,000 job applications! Is the project for new American century (PNAC) is over as the empire crumbles at home and around the globe? Yep, the “feel good” illusions, including hegemonic wars at any cost, as well as greed are good for the global and regional super powers, particularly as empire collapse and ten inch media shoes in December 2008 speak louder than words… It is too easy to duck flying shoes than one’s own flaws, misdeeds, wrongs, miscalculations, greed, hegemony…...........