Good question…

Well, some might contend that we’ve had a steady dose of stimuli, bailouts, subsidies, and other spending programs that have helped some “green shoots” pop up.

This, in reality, is utter, complete, and deceitfully inaccurate nonsense.

Honesty requires the realization that we have inflated our currency beyond repair (and this is not unintentional), increased the balance sheets of a corrupt central bank with all sorts of “toxic assets”, propped up our new Zombie banks with billions in government guarantees, and have placed a “made in China” band-aid on our gangrenous wound eating us away from the inside out.

Austrian economists talk about how centralized planning leads to the creation and persistence of bubbles, and how more government spending simply increases the size and intensity of the bubble. Since we are being led down the same path that got us here, we are doing two things: 1) increasing the size of the bubble which means a far more painful collapse when it comes, and 2) tossing the hot potato to the next person, hoping not to get burned ourselves.

This is dishonest, immoral, and ironically, the exact opposite of the most beneficial (and less painful) thing to do at this point. The net result of these actions is one of the largest transfers of wealth in the history of our nation—a coordinated theft of the middle class and the enrichment of the elite aristocrats in power.

Before our very eyes, America is being pick-pocketed by the individuals claiming to help.

What do I have to add to this post? Well, with each passing day and with each subsequent theft program enacted by the federal government, I believe that the problems coming our way compound themselves. We’re in for a bumpy ride, despite what the talking heads and political buffoons claim.

Makes you all warm and fuzzy inside, doesn’t it?

2001 $1 = 1.15 Euro
2004 $1 = 0.85 Euro
2007 $1 = 0.74 Euro
2009 $1 = 0.68 Euro

I don’t think the outlook is that our dollar will turn around in the near future, either.

Keep up the good work!

Connor is correct. I have been watching the exchange rate of the dollar vs. Euro religiously since 2001 when I went to Europe. One of my 2001-dollars would buy 1.15 Euros. I went again in 2004, but my dollar would only buy 0.85 Euro then. I went again in 2007, and my same dollar only bought 0.74 Euro. As I talked to different Germans about the exchange rate, they all told me their Euro was sinking fast in value. I was puzzled, and asked them why to me it appeared their Euro was strong compared to my dollar. They told me the sad explanation, which I later found out was true. Their Euro was indeed falling in value, but my dollar was falling even faster. I only was comparing the difference of values between the two currencies, and it had never occured to me that BOTH currencies were devaluating.

We now can plainly see in hindsight these Germans were correct. We now see the Eurozone in a financial crisis that has been coming on for a long time. The current rise in the value of the dollar against the Euro simply means that Europe’s situation is a smidgen worse than our situation.

Um, yikes.

It does if there are buyers. If knowledge is power, I suspect there will always be buyers of intellectual capital. I’m not saying that’s the savior, but as I said above, it may offset any manufacturing deficiencies.

Intellectual capital doesn’t put food in your belly. We’ve become a service-oriented nation which has worked well in recent years where nations to which we’ve outsourced a good portion of our commodity production continue to take our dollars. But once the monetary system falls flat and food prices skyrocket (as they have been—an estimated 40% in the past year), service will take a backseat to basic staples.

But neither is global currency, and a crumbled U.S. dollar is still more trusted than anything else, as proven by the recent rise of the dollar as world financial markets crumble. It’s not sustainable, but it does buy more time to get our fiscal policy in order.

Agreed. The dollar has “risen” in value in recent months when compared to a basket of currencies, but beware the deception. The value of the dollar is not increasing, but is simply decreasing more slowly than foreign currencies. All fiat currency is diminishing in value through massive inflation, and the dollar in recent months has done so a bit more slowly.

…we still live on some of the most fertile land in the world. Take comfort in that, after at least one season of starvation of course.

Yeah, I think we’re going to see a lot of people ripping up their lawns to put gardens in.

But when push comes to shove, I still think humanity can pull together to help one another, even if it’s not as admirable as it was in the 30s.

I agree. The short-term implications of a crashing economy are scary and chaotic (riots, robbery, physical violence, etc.), but there is always opportunity to reorganize and find the right way out.

My understanding is that our national debt is less than half of the percentage it was at its peak after WWII…

See figure 4 on this page (the whole thing is worth a read). After you add our obligations (social security, medicare, etc.), we absolutely skyrocket past WWII levels. IOUSA has some good charts showing this.

Some counterpoints:

1) “America is no longer a manufacturing nation.” I think you’ve undervalued how our intellectual capital, which is still the strongest in the world, may offset any manufacturing deficit.

2) “Unlike during the last major depression, the dollar is no longer backed by gold.” But neither is global currency, and a crumbled U.S. dollar is still more trusted than anything else, as proven by the recent rise of the dollar as world financial markets crumble. It’s not sustainable, but it does buy more time to get our fiscal policy in order.

3) “Our shopping habits and consumption rely entirely upon stocked shelves in the local supermarket.” No counter argument there. You are right on, but we still live on some of the most fertile land in the world. Take comfort in that, after at least one season of starvation of course.

4) “Self-reliance has been replaced with an overwhelmingly widespread entitlement mentality.” True. But when push comes to shove, I still think humanity can pull together to help one another, even if it’s not as admirable as it was in the 30s.

5) “America is up to its eyeballs in debt, with IOUs coming out of nearly every orifice.” My understanding is that our national debt is less than half of the percentage it was at its peak after WWII, as we followed Keynesian deficit economics to jumpstart the economy. Granted, our debt will grow exponentially as baby-boomers start demanding social security and medicade, but I take comfort that we haven’t yet surpassed our biggest deficit ever.

Does it really matter what happens to the righteous in the next few minutes of God’s time? The coming events are a lesson with a test affixed and when the test is graded everyone will know if their answers were right or wrong.

In the near future, we will all be called to put on a sorting hat (Harry Potterly speaking) to see which family or kingdom we will belong to in eternity. If we keep our eyes (and hearts) focused on our goal of eternal life, and if we are obedient to God’s commandments, every thing will be well for us in the end. DO what is right then let your personal consequences follow…Don’t worry, be happy, have faith and get your lives, houses and pantries in order it’s just that simple! Really:)

Unfortunately, like many comments above, I don’t think we are going to learn the lesson we actually need. We’ll just suffer through and stay on our current path (only, we might start running faster).

Right on as usual. I have found that most people I have been talking to the past few years about the coming economic struggles thought I was nuts, or all “doom and gloom”. Well, I suspect many may look at their condition in November 2008 with regretful longing sometime in the next few years. The time for preparation is passing quickly.

Yeah – I’d probably agree with that.

On the bailout side of things, we can really see how dire our situation with the evolution of the TARP. We went from purchasing bad assets, to purchasing equity to trying to find a way to issue credit to consumers. Yes, we need to solve the current deflation process caused by over extended credit by issuing more credit to put off til later what should happen today.

Economic weakness is supposed to happen. Economic weakness is from where future profits are supposed to come. By playing God and privatizing the profits while nationalizing the losses for the last several cycles, we have artificially inflated our economy under the guise that this is capitalism.

Interestingly enough, since I made my last comment, I read a phrase from a news article that said: demonstrate his statesmanship in the dying days of his administration has in effect passed over to president-elect Barack Obama’s White House efforts to steer the international community to a new financial world order.

Has the phrase “new financial world order” become a code word for something to come? I suggest it has.

When the government goes bankrupt next February, all of us will probably be begging for a new financial world order.

How do you pronounce Amero?

Good point, Chris. But I am referring more to the existence of artificial capital in the system that these companies are able to obtain (through loans, funding, etc.) Were it not for the heavily-inflated fractional reserve system, there wouldn’t be as much capital to be leveraged by companies to begin with. Would you agree?