Friday, October 24, 2008
The Bush depression
Depressions are well, depressing. I don't make this stuff up folks I just report it as it comes in. The speculators were kind enough not to let us see $200 a barrel oil, but we're just at the beginning of the economic mess. Our dear leader Mr. "I never saw a free unregulated market I didn't like" and his cronies have really done a number on us. And even now the rally cry from the right is cut taxes for the rich it will create more jobs. Well I'm here to tell you that will not work. It didn't work for Raygun and it truely won't work now. As I've said before inbalances are the cause of all problems, but our present situation is mulit - fold. With the lack of regulation (Thank you Mr. Bush and friends) greed went rampant ignoring the facts and fundamentals of the markets. Now the piper must be paid and the bill is a heafty one. In just one year the market has dropped 6000 points and we're just at the start of the nightmare. The scarey part is yet to come. We saw how well the bail out of wall street is working. That only got them partially liquid. There's still a ton of bad paper out there with little to no value that's been spread world wide. So what's next you ask?
Corporations having losses will lay off workers which in turn will create more losses as nobody buys and the cycle will continue. But that's not the really scarey part. You might want to hide your eyes for this. As farmers don't make enough money for their crops (remember commodities have dropped like a stone over the last few months) they'll be unable to pay their bills. Unfortunately this time around Willie Nelson won't be able to Farm Aid them out of it because the middle class is strapped for cash and loosing their homes as well. Fewer farms equals less food and higher prices (you recall supply and demand). But the real victims in the grand scheme of this will be people in other countries surviving on $2.50 a day and countries like Mexico where the average is $5 a day.
It's estimated that some 8 million people died during the years following 1929.
How do we get out of this mess? We only have two options. Either we let the whole thing collapse and start over. I doubt that will happen as the rich will do anything to protect what they have or we start some major aid programs like FDR and rebuild this nation. I'd say start with farming and work our way from there. You can't work on an empty stomach.