Michael Clark's  Instablog

Those readers who are advocating more easing, more Quantative Easing, more bailouts (which are essentially the government taking money from the poor and giving it to the rich), please look at the picture of the debt below -- note the massive deleveraging going on (smirk!) -- and tell me how we are going to get down the other side of this mountain without depression, fear, pain, social dislocation, and angst-become-outright-panic?

Remember, more borrowing just makes the problem worse.

Look at the same problem we had in 1929 when the last Great Depression began. The great Depression is about carrying too much debt and needing to deliverage. We deleveraged until 1955 that time: 26 years. Today's problem is MUCH worse. So we can't stall any longer. We have to face the problem. This means higher interest rates, and austerity for every part of our society -- rich and poor. Higher taxes for the rich -- to help pay for the social programs we will need to help the poor -- AND higher taxes to finance massive deleveraging.

Bernanke's policies are lies. They are just adding to the debt, pretending we can walk through the park and everything will be fine -- if we just spend a little more money. Money can't buy love -- it can buy sex; and it can buy a wife -- but not love. And it can't by Deflation Heaven either.

Better find your God -- because the times are going to get tough.

MJC

Hanoi, Vietnam