Smell of economic death

Friday, July 2, 2010
By Paul Martin

By The Mogambo Guru
AsiaTimes.com
Jul 3, 2010

I know, alas, that there is nothing that can be done to prevent unimaginable suffering and the collapse of the economy, now that the US Federal Reserve has created so much excess money and credit, and, to make matters infinitely worse, are still doing it, more than ever!

The exclamation point at the end of the sentence indicates that I still register surprise at the sheer stupidity and insanity of it all; the Federal Reserve has to create more money to be used to buy up the trillions and trillions and trillions of dollars in a for-the-rest-of-your-life tsunami of new federal government borrowing and spending.

Sharp Junior Mogambo Rangers (JMRs) noticed the use of the prosaic period as punctuation at the end of the last sentence, even though the content of said sentence is of such horrifying
magnitude that it would seem to merit at least one exclamation point. But no!

So what gives? What am I up to? What am I trying to say with my choice of punctuation, as if it is was some kind of code, communicating some secret, probably nefarious and almost certainly stupid, plan?

The answer is simplicity itself; creating so much money is Bad, Bad News (BBN), and thus requires the use of an exclamation point, while the lowly period used at the end of the sentence was describing how the Federal Reserve is acting, as usual for the last few decades, like morons.

I cry aloud in what supposed to be a lonesome and heartbreakingly haunting Mogambo Plaintive Wail (MPW) at the situation, reminiscent of tortured souls falling into the fiery pit of eternal damnation, but I have too much of an “edge” of anger and outrage to be truly plaintive and thus truly pitifully, pitifully sorrowful.

For example, try saying, in a sorrowful, melancholy way, the sentence, “I despise and hate the neo-Keynesian econometric halfwit ‘economists’ in the Federal Reserve, and their lowlife lackeys infesting academia and the shallow media, who have destroyed us with their stupid economic theories that are just the same old worthless, totally debunked theories that have been tried thousands of times before, and utterly failing each time, except now they call it ‘stimulus spending’ and ‘replacing private spending with government spending’ instead of using terms like ‘increasing the circulating medium.’”

And speaking of “increasing the circulating medium”, I notice that the Treasury/Federal Reserve has issued, in the last year, another US$32 billion in actual cash (bringing the total of cash and coins to $939 billion!) which is, by its very nature, a $32 billion increase in the money supply, which is Very, Very Important (VVI) to me because I am terrified, in a strange kind of psychotic-yet-charming way, of inflation in prices, and here it is! Inflation in prices is caused by an inflation in the money supply, which was inflated by the aforementioned $32 billion in the last year! Yow!

I embarrassingly admit that in my rush to condemn past and present Fed chairmen Alan Greenspan and Ben Bernanke for their stupidity in doing this, and condemn congress for aiding and abetting them in this monstrous monetary madness, I had forgotten that there are intermediate steps between boom and bust.

This particular point was brought home to me by Bill Bonner here at The Daily Reckoning saying, “It’s been three years since this slump began. We’ve seen the biggest stimulus effort ever mounted; and the economy is well, not dead … but it’s beginning to smell funny.”

Hahaha! “Smell funny”! I thought it was not only profound, but a funny line, too! Unfortunately, the wife and kids immediately took it up and opined that perhaps the odor Mr Bonner smelled was coming from me, and then the lively discussion moved to everyone trying to think of something that smelled as bad as my feet, or my breath, or my armpits, or my “big funky butt”, all vying for the top spot, and each with its champion.

However, there are many points to be made. The first point is not that We’re Freaking Doomed (WFD) by the insane excesses of the Federal Reserve and Congress (although we are), nor is the point even remotely connected with the finer points of personal hygiene or lack thereof, but that buying gold, silver and oil are the only things that are, by dint of the weight of 4,500 years of evidence proving this one point, going to save my big butt, funky or not.

There’s a lesson in there, and if you are half the Junior Mogambo Ranger (JMR) that I think you are, then you know just what that is: Whee! This investing stuff is easy!

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