So I passed the new year driving around, taking people to and from their parties and profiting from it. My last customer was a drunk guy who said he ran a hundred million in investments. It turned out we saw and agreed on many things, although our viewpoint differed on some things (I defended the UAW, he wished it would die an ugly death).
As I drove back home, I thought about the past year. I expected fuel prices to rise to $4.50/gallon in Northwest Indiana, and while they made $4.25, they never rose to my estimated price, preferring to use the $4.00 level as their base over the summer. What I didn’t see was the fuel prices dropping to the $1.50-1.60 range for much of the fall and into December…but then, I remember saying that I had no idea what would go on after the $4.50, so I can say there was no falsehood going on here.
In the meantime I’m watching the apparent decline of the Republicans and the Democrats ready to “take charge.” Meanwhile the economy seems to have stopped everything but the absolutely necessary stuff; even the medical community is suffering. My dentist is offering discounts for visits; I wonder about my masseuse.
And I have a few concerns:
- Will Obama’s coming stimuli work?
The issue behind this question is of where the money is going? Used to be you gave a thousand dollars to an American and while much of the money would make its way back into the Government’s coffers the money would circulate in the American economy, making work and products before its eventual swallow-up by Uncle Sam and his little sisters (The states and other units). Now you give that American the same thousand dollars, and much of the money will end up in the hands of China, some shipping magnate and/or other foreign entities. The money drains faster and ends up helping fewer Americans because the necessary jobs ain’t here anymore.
Now we still have a lot of heavy industry (Car and Farm Implement production counts as such) but there’s little or no consumer production. Only American Apparel makes their stuff here, and they’re specialty clothiers for young anorexic hotties of all genders to flaunt their bodies with. As for other toys and doodads, they’re all imported – why else would we now worry about our toys poisoning our children nowadays?
Fact is, that money would have put Americans to work in years past and made any recession/depression weaker just by being around. It’s also the reason why the debt load in the United States Government stayed steady during the construction of the Interstate System, Vietnam and the Carter years – that money stuck around. Now it may not, the debt may end up funding the Chinese stimulus instead by bankrupting ourselves.
- Will Obama be able to even do a stimulus package?
The Radical Right has activated itself. There’s two (three?) senate seats empty — senate seats that would be filled by Democrats under normal times. Maybe the Republicans can filibuster long enough for the Chinese, Russians and Arabs to buy up everything and force us to redeem the bonds we sold them. Add into that the Toxic Bonds we sold everyone based on our building boom (buying other people’s debt – talk about utter stupidity) and we may find ourselves unable to even repair what needs repairing, never mind all the stuff out there waiting for $$$ for building.
- Can Hyperinflation happen without wages rising?
Think of it this way: the hyperinflation bouts we know about happened because the people got paid rising wages to go along with the rising prices. However, there have been times when prices have increased and the wages held still. What happens?
Ask the Thais. When you find yourself unable to eat, you sell off your girls. Yes, girls. And yes, things got so bad that their pay couldn’t cover what it cost to eat.
Now consider: What happens when the Chinese and Arabs and Russians buy up everything and it becomes illegal for anyone (outside the military, taking their training in Iraq and Afghanistan home with them to practice on us) to get raises? Prices for everything (including food) shoot up, and our jobs MIGHT cover a day’s eating.
Will part of my job be the shipping of four-year old girls from Northwest Indiana to newly founded brothels west and south of the loop? And what happens to debts when I have to decide between paying off the Student Loan or eating for that day? Does the 13th Amendment become moot (the debts were entered into voluntarily, even though refusal of them meant “the imminent death of their future,” so the 13th Amendment doesn’t apply)?
- Will we be able (or allowed to) prepare for the next energy crunch?
This last summer I saw mopeds out almost every day from early Spring till mid Fall, and loved it. What happens if this present price regime stands up long enough to make Mopeds look stupid again? And what will happen when, the next time, we’re unable to even make things because we’ve gutted our futures for a parade of todays?
I have no prediction over the next year, but to say prepare for the future which you cannot like.