The Great Depression Online




Great Depression Online Archive Issue:

The Long Hard Road to Economic Recovery

Great Depression Online
Long Beach, CA
February 06, 2009

Inside This Issue You Will Discover…

*** Everything that’s Wrong with Everything
*** How Intervention Works
*** The Long Hard Road to Economic Recovery
*** And More

Everything that’s Wrong with Everything

Sometime in the late 1970’s public educators came up with the grand ideal that elementary school students should receive no worse than C grades.  The reasoning was that D’s and F’s were too harsh for the children to handle…would stifle their education…and would scar them emotionally.

Suddenly all kids were gifted.  All kids were above average.  And all kids were granted straight A’s just for trying.

Such nonsense, such moronic bosh has successfully produced a coddled generation of idiots.  You find them in low level service positions.  You know the ones.  You see them everywhere.  They’re generally overweight and communicate with single syllable grunt like utterances. 

~~~~~~The Nicolas Darvas Story~~~~~~

“How a Full-Time Dancer Rocketed His Trading Account From $25,000 to 2 Million Dollars And How You Can Do The Same In Only 15 Minutes Per Day.”  Amazing secrets discovered by Nicolas Darvas can identify significant market price moves before they happen. Learn all about it here: The Nicolas Darvas Story

~~~~~~~~~~~~~~~~~~~~~~~~~

Naturally, making everyone above average is not how the world works.  By the law of averages, half the students in a class are above average and half the students are below average.  It doesn’t matter if everyone’s given straight A’s…half the class is still below average.

Denying such simple facts, attempting to overrule them with policy and legislation, is as ridiculous as a helicopter with an ejection seat or as worthless as a lame quarter horse.  But it’s attempted with gusto.  And while the intentions may mean well, it exemplifies everything that’s wrong with everything.

Here’s another example…

How Intervention Works

This week the government diddle-daddled away, addressing an unintended consequence of their making.  The big bank bailout of 2008 – a radical government intervention into the free market – now requires more government intervention to undo one of the many upshots of its existence.

It seems banks like AIG, BofA, CitiGroup Inc., and others, have been collecting bailout funds while continuing to pay outrageous executive compensations.

“President Barack Obama on Wednesday imposed a $500,000 cap on senior executive pay for the most distressed financial institutions receiving taxpayer bailout money and promised new steps to end a system of ‘executives being rewarded for failure,’” reported Jim Kuhnhenn for AP.

Did we miss something?  Isn’t $500,000 pay for an executive running a failed bank precisely rewarding failure?  How about $0?  That sounds about right to us.  But who are we to decide?

Of course these executives wouldn’t have any pay if their banks had been allowed to fail.  By the natural laws of the universe…if you oversee a bank where your employees recklessly lend out money to people who can’t possibly pay it back…to buy overpriced houses…then your bank goes bankrupt.  So by the natural laws of the universe, these banks should no longer exist…and the executive pay from these banks should no longer exist too.

But that’s how government intervention works.  It try’s to solve problems created by past intervention…with more intervention.  Where does it stop?

You know the answer…it doesn’t.

The Long Hard Road to Economic Recovery

Everyday there’s not less intervention…there’s more.  We can hardly browse the headlines without coming across some new plan or proposal to make the world a better place.

For example, the latest stimulus bill is making its way through the Senate.  Last we heard it was over $900 billion and includes all sorts of grand programs to stimulate the economy…

…$50 million for habitat restoration in the San Francisco Bay Area…$62 million for military projects in Guam…$500 million for biofuel makers…$198 million to compensate Filipino World War II veterans for their service…and more…

What gives?

So far numerous government bailouts have been attempted and numerous new acronyms, like TARP, CPFF, MMIFF, TAF, have been created to “reflate” and “reliquify” financial markets.  Yet for their efforts, the government has scored a big fat goose egg.  Not one of these bailout schemes to save the world from itself has worked.

And the latest stimulus bill will not do much better.

Moreover, we’ll be left with a hideous public debt, a handicapped and immobile economy, an endless line of unemployed, and a government full of meddlers, quacks, and crackpots, who’ll not stop until they’ve introduced so much ruin that the whole sagging edifice of the high office buckles and crumbles under the obesity of their larded up stimulus plans and squanderous bailouts.

Then, with a little luck, we’ll commence the long hard road to economic recovery.

Sincerely,

M.N. Gordon
Great Depression Online

P.S.  If you haven’t already, we urge you to pick up your free copy of the important and vital Emergency Report: How to Survive and Prosper in the Coming Global Depression.  Inside, bestselling authors Bill Bonner and James Dale Davidson, explain how we got into this mess, what will likely happen next and how you can protect your wealth and even prosper in the coming bad years.  Get your free copy here: How to Survive and Prosper in the Coming Global Recession.

 

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