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Showing posts with label depression. Show all posts
Showing posts with label depression. Show all posts

Wednesday, December 12, 2012

The Decline and Fall of the American Socialist System


Rather than recent events being a triumph of the Leftist agenda to transfer the assets of successful people to those less successful and of Governments attempts to gain unrestricted control of the nation’s economy, we are actually seeing the final downfall of Socialism in the world.
Much like other totalitarian regimes before it, the takeover of the Federal aspect of the United States by the Liberal Left is failing just ahead of what many are pointing to as its greatest triumph: Total responsibility for what is produced and not produced in the nation.

Of course this all hasn’t happened overnight. Economic historians can point to Franklin Delano Roosevelt’s New Deal and broad powers of administration for not defeating the depression but prolonging it by almost a decade. Imagine what would have only lasted 3 or 4 years was stretched by bad policy to 13 years. Then WWII came along and we HAD to dedicate resources to making stuff again. But that demand came without the means of actually paying for it so the debts began to pile up.
Later President Lyndon Banes Johnson provided us with The Great Society, a war on poverty in America! But as always happens, his war on poverty only cause poverty to increase. The rewards for not being successful started to gain on the rewards of actually being successful. Coupling this with the Civil Rights movement of the 1960s really was a wealth of positive information for the Socialist Left of this nation: They discovered that they could make the slaves love their slavery.

These “Movements” have nothing to do with actually taking care of people or caring for their economic situation or even “Fairness” since statistically their situation overall doesn’t improve. It only means that the beneficiaries of the Welfare State don’t have to work as hard or educate themselves to stay where they are. And it’s all about making people happy to be where they are even if it’s comfortably poor. These people actually think they’re getting away with something. The joke is on them.
But at any rate, bad policy takes decades to manifest itself in the shaping of the collectivist mind, the attitude that the common good outweighs the rights and successes of the individual. What’s yours is also mine. It’s that air of entitlement that the left needs so much to drive its mobs of newly uneducated.

This is why it was imperative to take over the National School System and to buy its way into public media, to control the message and to control the mind.
So now they have 51% of the vote. But here is the fatal flaw in their newest plan: It Doesn’t Work!

It can’t work. Every new set of Leftists throughout the recent history of Karl Marx think that this NEXT TIME will work, that every time before there was something done wrong and that THIS TIME they will make it work. They will take from the successful and buy their influence with the majority of less successful or just plain unsuccessful. Of course government has helped those less fortunate from actually being successful in so many ways by controlling access to capital, providing the standard, sub-standard education and by taxing money out of your pocket so that you can’t do anything with it yourself. BUT they’ll lend your money back to you if you want to go to college. Just as long as it’s the government hand you go running to for your sustenance, it’s good.
But subsequently the Left is always doomed to failure unless they can force you to stay and take it. This is why the Soviet Union had to build wall around the entire country and put people with guns in towers. But even doing that, people never stopped trying and dying to reach the other side of that wall. Why? Because they’d rather die than live the way they were living.  And this is the end-game of all totalitarian Marxist regimes.: Shortages, Hardship and Financial Ruin.  

When have you ever heard of a CAPITALIST PURGE? Never? That’s because freedom doesn’t need a purge. Joseph Stalin is “credited” with killing up to 50 MILLION Russian people during his bloody reign. Mao Tse-tung? He leads the way with up to 70 MILLION Chinese people. Then there was Pol Pot who only managed to kill 2 Million Vietnamese in his quest for a Communist farming society.
And who did these purges target? Smart People! If you had any brains or education you were TOAST! They didn’t want a guy/gal like you around telling people things. You were out in a bad way.

Knowing this, how can anybody speak in admiration of these killers? Yet Mao and Stalin are actually revered by the left. The Chinese totalitarian regime, though decidedly more Capitalist than Communist is still a totalitarian regime. No one has a vote and no one gets to decide how they are to be governed. They are told what to do and what to make. The government decides what it wants and it takes it. Just ask the people of Tibet. Way to go China!
But ultimately the Socialist Systems always crumble because they lack imagination and the freedom to pursue an idea. An idea like a personal computer or a new way of drawing oil from a place previously thought impossible. A Socialist System cannot think like this. It draws resources but cannot replace what it has taken nor increase its production since many times it will make what people don’t want. It ignores the Strongest Force in the World: The Market. And without that swirling force of ideas, risk, failures and triumphs, Socialism cannot stand.

So as of right now, The Federal Government has spent 17 times the country’s Gross National Product and has nothing to show for it. It has artificially held up its public workforce with tax money that has yet to be earned. But even the United States cannot defy gravity. Now Obama’s government owns the economy. Who can they blame?
It’s a shame that freedom loving peoples all over the world have to endure such misguided ideology and hardship but such is freedom that it has to be savored and revered to survive. It’s when people trade their freedom for the promise of a Pot o’ Gold is where the figure of man so imperfect still stumbles from time to time.

People will find alternatives. They'll join the underground economy and step away from the taxed goods. They'll vote with their feet and the successful will move to the red states. The country will stratify and there will be successful states and very, very unsuccessful states. The Federal overlords will eventually capitulate to the forces of the Market since the Government will be totally broke and the dependent class without it's mother's milk.

The wheels are already in motion.   

Sunday, October 9, 2011

Fannie Mae and Freddie Mac: Government Sponsored Bankruptcy


It seems that global investors are just figuring out that banking on the debt of what is known as Government Sponsored Enterprises is a bad idea. As Claude Reigns said in the movie Casablanca; "I'm shocked!"

Fannie Mae and Freddie Mac are GSEs which means that the full weight of the United States Treasury is standing behind them, guaranteeing the loans they purchase from banks. Or rather the US taxpayer will cover any losses they may tend to incur because, you know, every banking entity, despite their best efforts, can make a bad loan here or there, right?

But it is being reported that the purchase of Fannie & Freddie’s mortgage debt by Russia, China, Brazil and India have declined and their faith in the US government’s ability to back up that debt has been shaken. These countries are divesting themselves of this debt as a government holding fearing a lack of return.

But why?

Perhaps not knowing how much in debt these two GBEs are in may play a roll.

Picture rooms full of brokers, hundreds no, thousands of brokers all over the nation and their job is to get one loan every hour. And picture this happening every weekend for 12 years and know that every one of those loans, no matter how good they may be or bad, was sent to Fannie & Freddie and they BOUGHT them.

So how much in debt are these two “companies”?

I’ll bet that as of right now, three years after the beginning of the housing market collapse, that nobody knows. The Feds don’t know, the people at Fannie & Freddie don’t know and most important, the idiots buying their debt sure as hell don’t know. How can they know if they bought them?

The Federal government has no business being in the mortgage business. There is no Constitutional mandate nor business need to be involved in who gets a mortgage. And a "Government Business Enterprise" has no reason to even exist. Fannie & Freddie became instruments of a government agenda, an agenda that everybody should be able to achieve the “American Dream” of owning their own home. And if Fannie & Freddie were going to buy the loan, the banks writing these loans didn’t need to carry the paper and were absolved of responsibility.

With Fannie & Freddie driving the bus, it was full speed ahead for the wanton purchasing of mortgages that fueled unbridled speculation and runaway lending practices that drove housing prices through the roof. And just when we thought it couldn't get any worse, the “No Income Verification” loans, otherwise known as “Liar Loans’ and “Interest Only” loans (which cannot be refinanced) were the last products of a dying enterprise.
Then, in a final effort to keep the money spigot on, Federal Reserve Chairman Allen Greenspan lowered the interest banks pay to borrow money to zero. Nowhere to go from zero is there?

And here we are. The music stopped and the Fed was all out of chairs. Allen Greenspan’s apology was sincere and dramatic: “Sorry” he said before collecting his pension and flying off to Hawaii.

It is now classic comedy to view the youtube recordings of  US Congressman Barney Frank, the guy in charge of the House Financial Committe, saying in 2004, having been warned by the Republicans of mismanagement at the agencies and of a possible failure, stating that he had seen nothing to indicate that the safety and soundness of Fannie & Freddie was an issue and there was nothing to worry about, just three years before the colapse.
Fannie & Freddie, although still buying loans, have had to tighten up the rules considerably. All those people who were looking for the American Dream found it was fool’s gold and for all the “Good Intentions”, the government once again finds that it cannot defy gravity.

And for Fannie & Freddie, well it will be years before we find out just how much in debt they really are. The final number will have a “T” in it.

Government Business Enterprises should be constitutionally banned. All they do is run a deficit. They don’t make money and only serve to drive out legitimate business from a given industry. They don’t solve any problems and suck funds from the economy. Having been established in 1992, it only took a little over 13 years for Fannie Mae to drive our economy into the ground. Quite a feat.

Now just think about what would be in store for us if Barack Obama had gotten his Public Option piece included in our overwhelmingly foolhardy National Health Plan? The Public Option called for esentially a GBE to compete with private insurance businesses in the marketplace for healthcare coverage.

Who here now thinks that this would be a good idea? Show of hands please?