There is a great bit of theater going on in the world of politics and finance—more, even, than usual. To wit: Ben Bernanke is hosting a press conference after the Fed's two-day meeting concludes on Wednesday (Fed Chairman, historically, we should note, do not have press conferences after making their often opaque and arcane Fed Statement, which is then interpreted by the press ... though other central bankers around the world do hold press conferences, and with some regularity) and there is much anticipation as to what Ben will say or tell, what kinds of questions he will field (germaine, not so germaine, utterly stupid, not so utterly stupid), what, in short, will happen at this unprecedented press conference given by Fed Chairman Bernanke.
Since QE2 (the second round of what is euphemistically called "quantitative easing," what is more pejoratively referred to as "monetizing the debt" or simply as "money printing") was announced at a meeting in Jackson Hole, Wyoming, last August, and implemented in November (the Fed buying, with dollars created by a keystroke, 600 billion in US Treasuries), the stock market and commodities, generally, have soared, while the dollar has plummeted, which has been good for companies selling overseas, and for the rich and investor classes (hereafter referred to as "The Club"), and not so good for savers, people who find rising gas and food prices burdensome, or for those on fixed incomes who aren't brilliantly placing calls on gold and silver options. Why these people aren't making much of a fuss, if not rioting in the streets (as they are in the Middle East, for arguably similar reasons), is something of a mystery. Instead they seem more or less content getting negative interest on their savings, paying more for food and gas, while the politicians discuss cutting taxes even more for the rich even as we struggle with debt that threatens to destroy Medicare as we know it, and otherwise choke the beast that would see to the basic needs we've come to count on (whether we realize it or not) given that we can't make any money in our savings accounts anymore, and don't know nuthin about no calls or puts or shit like that ...
Yet some of these same people are taking seriously (or just willfully not understanding the consequences of) the much fussed-over, utterly delusional, yet no where near sufficient to meet the task at hand Paul Ryan plan, wherein, "What is good for The Club is good for you."
Don't you be so sure.
As I've said before, we're on the breast of a mommy who doesn't love us very much. The sooner we recognize this, the better, lest we discover the hard way that mommy really wasn't where it's at ...
Obscured in this Johnny come lately drama/pageant is the reality that we are, very definitely, facing serious trouble financially. The fact that we are in the warm uneasy company of those (Europe, Japan, Great Britain) who are in more serious trouble still is beside the point (unless you gain comfort from seeing others lined up against a wall and shot ahead of you). Before long, something is going to have to be done, something more substantial than what is currently being discussed in polite circles, as we are well past the point where whatever it is, if it is going to do any good, is going to be pleasant, and so ...
Are we going to share the unpleasant hangover ... or are we going to, once again, lower taxes on the rich (in a revenue neutral tax reform, which is to say in a way that doesn't raise anymore money than is currently getting raised), and, of course, not touch the military that is currently engaged in three very likely fruitless wars, and otherwise hasn't actually been called on to defend our borders, or defend the union, in roughly a century and a half, and instead gut Medicare, take an axe to Medicaid, and choke Social Security, and in doing so actually believe that's going to help get things rolling again?
Really?
We're going to seriously consider doing this in a country soon to be populated with aging boomers who haven't by and large saved well, who haven't, for years, in a world of easy credit, of a depreciating dollar, frankly seen the sense in it?
Have we really imagined what our society would look like without Medicare and Social Security, not to mention Medicaid, which, as it stands now, will be paying for indigent aging boomers to live in a nursing home as opposed your or someone else's basement ... are we going to let these programs get gutted so that the rich can "invest" more into our economy, as they are now, with their record levels of cash sitting on the sidelines, with their record amount of lending (laugh track) of the QE2 money that ended up, largely, in their hands, to do with what they more or less felt like ... and look what they did? Did they hire? Did they lend? No, they are sitting on cash, investing in stocks and commodities, not because they are evil, but because they understand the situation and are manipulating and preparing accordingly. Or because they're just greedy, and we let them do it.
What more evidence does a person who isn't utterly stunned need to see that this approach to maintaining a civilized society leads only to more people who don't need it getting more, and those with squat living in their basements, or being taken out and shot ... I don't know, but as an approach to growth and debt reduction it's a load of shit, and it's time we wake up and quit deluding ourselves. Before it is too late.
