Emerging Markets and Commodities: Where Stimulus is REALLY Going

Thursday, December 9, 2010
By Paul Martin

Bill Bonner

Imagine going from England to Australia on a sailing ship, shackled ‘tween the decks. The convicts must have been happy to finally get here.
Imagine getting sent to Australia for failing to pay a debt (even one that was never intended by the creditor)! That would discourage you from spending money that is not your own!
It was a tougher world back in 1855. The “laws were more harshly administered” then.
Now, the laws aren’t administered at all. The culprits are in so tight with the feds you’d need some WD40 to get them loose. The banks seem to have taxpayer money on tap. As much as they want. 24/7. On/Off. And the feds spend money that is not their own…and promise to replace it. That replacement money will never come to hand. And an examination of the feds’ accounts exposes immense deficits – about 20 times the entire annual output of America’s private sector.

And along comes Washington with word of a deal. The bargain was struck yesterday. The rich get to hold onto their money for another two years. And the poor get another 13 months of unemployment benefits.

Win/Win, right?

Are you kidding? The feds’ accounts show a deficit of $1.3 trillion. Tax cuts and further spending? Lose, lose, lose…

Well, why not? Give everyone a Christmas present – whether you can afford it or not. Stocks will probably go up today. The papers are reporting that the extension of the Bush tax cuts may be all the economy needs. No further stimulus may be necessary. Because if rich people can look forward to the same tax rates next year…

The Rest…HERE

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