This past week, media outlets from the Wall Street Journal to Yahoo News blared their trumpets and shouted ‘the recession is over!’ as important economic indicators came in with better than expected numbers. The stock market has steadily risen over the past few months, but we have forgotten what really matters. Millions have lost jobs and hundreds of thousands of Americans continue to lose jobs each month. The 9.8 percent and rising unemployment rate does not seem to be a concern as of late. What about the exponential increase in our money supply, the depreciation of the greenback, and the national debt at over 56 trillion dollars? What about our congressmen and women who continue to borrow billions a day to pay for failing federal programs, wars, and drive consumer spending?
As of today, each person in the United States owes $39,000 and federal spending increases by about $3.79 billion dollars a day. Democrats and Republicans alike truly believe that they can continue to spend money without dire consequences. People who stand behind the stimulus package totaling hundreds of billions of dollars clearly do not understand what drives real economic growth. A society that spends money on credit without producing and saving is doomed to fail. Countries like China, Taiwan, Singapore, and South Korea do exactly the opposite of what we are doing and produce goods, which benefit immensely from our irresponsible and nonsensical policies. Our society will soon feel the pain.
An example of this pan can be seen in the happenings in Zimbabwe, Iceland, the Weimar Republic, and Argentina. Those in control of the central bank thought it was economically feasible to grow the money supply by monstrous amounts to pay for their bureaucracy and debts. Little did they know, those countries woke up to a worthless currency, skyrocketing unemployment rates, and great pain among their citizens. In the 1970’s the United States money supply was raised by about 14 percent. The U.S. saw double-digit inflation and interest rates were increased to almost 20% to stop it. Our money supply in the past few years has increased by an incredible 120%. The United States has a very big problem and we will likely fall victim to its wrath.
So what about a few years from now when the dollar has collapsed and hyperinflation kicks in, our unemployment rate is through the roof, and the Chinese stop supplying us with goods because our economy and currency are completely worthless? The Costco and Safeway shelves will be empty and our flexi will be of no value. An overall substantial decline in standard of living is not too farfetched. Yes, the United States has a tendency to pull through tough times, as we did during the Great Depression, World War II, and other periods of hardship. However, as a society we are not completely immune to the possibility of a societal meltdown.
(Sources – Shadowstats.com, federalreserve.gov, US Treasury reports.)