Archives

Quote of the Day:
:::”Power tends to corrupt, and absolute power corrupts absolutely.”
:::– Lord Acton

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Subject: Greenspan’s Final Betrayal

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In 1967 Alan Greenspan wrote an essay titled “Gold and Economic Freedom.”

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If you read the essay you’ll see in the intro that he once told a Senate committee he favored an end to the Federal Reserve and a return to gold money.

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When Greenspan gained the power to run the Federal Reserve he changed his tune. He stopped singing the sound-money song, though when pressed in interviews he would still say that gold was the most stable money system.

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If you accept what Greenspan said in interviews, then he still believed in sound-money and he still opposed centralized banking. But his actions betrayed his professed beliefs. He was now the Counterfeiter-in-Chief, and he played the role with gusto. He inflated and deflated the money supply, doing exactly what he had criticized before. As a result . . .

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Alan Greenspan was one of the many contributors to the boom and bust cycle in general, and to the current boom and bust in particular. Greenspan clearly knew better, so what are we to conclude from his actions other than that . . .

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Downsize DC President Jim Babka will be doing radio interviews tonight and tomorrow. For more information, see the P.S. section.

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Quote of the Day:
:::”There are 10^11 stars in the galaxy. That used to be a huge number. But it’s only a hundred billion. It’s less than the national deficit! We used to call them astronomical numbers. Now we should call them economical numbers.”
:::~Richard Feynman, physicist, Nobel laureate (1918-1988)

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. . . or better yet, government numbers!

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Subject: Will the government repudiate its debt?

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The government caused the housing bubble. Even the editorial page of the Washington Post agrees. 

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But when the bubble burst, something strange happened. People fled for safety to . . .

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The arms of the government.

Downsize DC’s President Jim Babka will be a guest on the “Livin Free With JP” radio show this Thursday, October 23 at 7:00 p.m. Eastern Standard Time. The show is one hour and Jim will likely discuss several issues of interest to DC Downsizers. The call-in number is 1 (888) 747-1968. You can tune in by going here:

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http://www.livefreeradio.net/listen_live/index.shtml

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Quote of the Day:
:::” … the problem with the U.S. economy, more than lack of regulation, has been government’s failure to control systemic risks that government itself helped to create. We are not witnessing a crisis of the free market but a crisis of distorted markets.”
:::– from an editorial in (surprise) the Washington Post
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Subject: Too much is never enough for Congress

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We’ve been hammering on the Republicans for years. They’ve richly deserved it. Soon it will be the Democrats turn, and they too will richly deserve it. We’re beginning to see what Democratic control will look like. It will look a lot like Republican control. Meet the new boss, same as the old boss.

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The first evidence for this is the new “stimulus” package being pushed by the Democratic leadership, with sideline cheer-leading from America’s Counterfeiter-in-Chief, Fed Chairman Ben Bernanke.

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Economic stimulus, in the mind of the politician, means taking money away from productive purposes and spending it in ways that benefit politicians. They call it stimulus. We call it robbery.

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The first “stimulus” package, earlier this year, was a classic example. The government borrowed billions of dollars that it then gave to taxpayers. The politicians got to look like Santa Claus. This was supposed to stimulate consumption. Perhaps it did. But the wave of consumption came and went, leaving taxpayers to pay the interest on the resulting debt.

Quote of the Day:
:::”The whole reason we have elected officials is so we don’t have to think all the time.”
:::– Homer Simpson

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Subject: Did you hear about these big mistakes?

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A Fox News report claims that the World Bank’s computer network was hacked several times over the past year. The World Bank has tried to downplay this, but one internal email referred to it as an “unprecedented crisis.” [Source: Information Week]

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The World Bank is an organization of 180 national governments, originally intended to reduce world poverty. The Bank manages tens of billions of dollars and employs 10,000 people. The United States government is its largest donor and shareholder, and names its President.

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One might assume the World Bank’s computer network is as well-protected as any.

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But we must never make assumptions about the efficiency of government institutions — just because government can spend billions of dollars to address a problem, doesn’t mean the problem will actually be addressed, fixed, or handled competently.

Quote of the Day:
:::”We have nothing to fear but fear itself.”
:::– Franklin Delano Roosevelt

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Subject: Can you profit from a recession?

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The media has been busy doing what the media does — selling drama and sowing fear. This is what they did after 9-11, and leading up to Iraq. Look where that got us.

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Is the current fear different . . . justified?

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Was it justified leading up to Iraq, or in the previous economic downturns of the last thirty years?

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We think the answer is no. Cries of crisis and doom are often raised but rarely realized. The crash of ’87, the S&L debacle, the dot com bust, the post 9-11 hysteria — all of them came and went with only tremors in the upward climb of our quality of life.

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The track record for predictions of doomsday is by now so bad that prudent minds should develop a natural bias against such predictions.

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But aren’t the current events larger, and therefore more dangerous, than previous such events? The answer appears to be no. If you adjust for inflation and the current size of our economy, the current upheaval just doesn’t seem to rate.

Most Friday afternoons, DownsizeDC.org President Jim Babka appears on “Straight Talk with Jerry Hughes” on the Accent Radio Network and more than 15 stations. Because this is a regular (weekly) appearance, it’s far from scripted and the questions and answers go in unusual places. Jim rarely knows what to expect and some incredible conversations occur here.
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:::Jim’s hour-long appearance begins at 3:05 PM Eastern time (2:05 PM Central, 1:05 PM Mountain, 12:05 PM Pacific). To listen live, go here.
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:::You are encouraged to participate in the show:
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:::The toll-free call-in number is: 1-866-222-2368
:::The show email is: Jerry at AccentRadio dot com

Quotes of the Day:
:::I tried phone sex once, but the holes were too small.
:::- Unknown

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I sleep with my phone. We have that good of a relationship.
:::- Anonymous

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Subject: NSA listens to soldier’s pillow-talk

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You may remember we opposed warrantless surveillance of phones and emails by the federal government. We said it was unnecessary and un-Constitutional. We predicted it would lead to abuses — like virtually every other government program designed to “protect us.”

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Of course, the people pushing for this program said we didn’t understand the danger. They said they were too busy tracking various plots to screw around. Actually, the Intelligence Czar put it this way: “It’s not for the heck of it. We are narrowly focused and drilled on protecting the nation against al Qaeda and those organizations who are affiliated with it.”

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They’re all business. But even a conservative Republican Senator still wondered if they just weren’t looking to pry into people’s personal lives. The Intelligence Czar replied, “No sir.”

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Now, ABC reports that two whistleblowers have undressed the true behavior of the National Security Agency. Both of these people are Arab linguists. They said that the agency was listening to the truly personal conversations of people with absolutely zero connection to terrorism, like aid workers, journalists, and soldiers.

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Don’t our soldiers, who are fighting for democracy or something, deserve a little privacy when they’re separated from their spouses for a year at a time?

Quote of the Day:
:::George Kaufman, a finance professor at Loyola University Chicago, is skeptical. “The last refuge of a scoundrel regulator,” he says, “is to shout ‘systemic risk.'” Usually, the alarm is false. He notes that aside from inter-bank lending, the credit markets were functioning tolerably well at the height of the crisis. Rates on 30-year mortgages actually dropped last week.
:::– from a column by Steve Chapman, September 25, 2008

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Subject: Do you know who the “Primary Dealers” are?

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There’s a lot of evidence that we’ve been scammed. Treasury Secretary Paulson and Federal Reserve Chairman Bernanke told us they needed to spend $700 billion of your money to buy supposedly toxic assets that were crippling major firms and for which there was no immediate market. This was a lie even when they said it, because . . .

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Merrill Lynch was able to sell it’s most troubled assets back in July.

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If Merrill could do it, other firms could do it too. They might not have liked the price they got, but it could have been done. The Big Bailout was purposely designed to give favored firms a better deal than they could have gotten in the market.

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We’ve also been told, constantly, that credit markets are frozen. We’re still being told that today, constantly, around the clock, on the cable business channels. It wasn’t true before, and it isn’t true now. We could point you to many places for the evidence,