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Empire on the Brink

Discussion in 'Political Zone' started by Sasquatch, Mar 13, 2008.

  1. Sasquatch

    Sasquatch Lost in the Woods

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    [FONT=Times New Roman, Times, serif][SIZE=+2]Empire on the Brink[/SIZE][/FONT]

    [SIZE=+2]Republicans and "Free Market" Zealots Bring Disaster to America [/SIZE]

    [SIZE=+2]By PAUL CRAIG ROBERTS [/SIZE]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=+2]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=+2]M[/SIZE][/FONT][FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]arch 12. Crude oil for April delivery hit $110 per barrel. The US dollar fell to a new low against the Euro. It now takes $1.55 to purchase one Euro.[/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]These new highs against the dollar are the ongoing story of the collapse of the US dollar as world reserve currency and corresponding collapse of American power.
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]Each new decision from the insane Bush regime pushes the dollar a little further along to oblivion. The same Fed announcement that boosted the stock market on March 11 sent the dollar reeling and the price of oil up. The Fed’s announcement that it and other central banks are going to deal with the derivative crisis by monetizing $200 billion of the troubled instruments signaled more dollar inflation.
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
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    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1] Of course, something needed to be done to forestall an implosion of the financial system, but a less costly alternative was at hand. The mark-to-market rule could have been suspended in order to halt the forced sale and write down of assets and to provide time in which to sort out derivative values, which are higher than the fire sale prices.[/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]More pressure on the dollar resulted from the decision to award the European company, Airbus, a $40 billion contract that could reach $100 billion to build US Air Force tankers. In simple terms, that means another $40 to $100 billion added to the US trade deficit, and a loss of $40 to $100 billion in US Gross Domestic Product and associated jobs.
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]Of course, the Bush regime had to award the contract to Europe as a payoff for Europe’s support of the Bush regime’s wars of aggression in the Middle East. Europe is not going to provide Bush with diplomatic cover for his wars and NATO troops for his war in Afghanistan without a payoff.
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
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    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1] Here is the picture: The US economy, which has been kept alive by enormous debt expansion that has over-reached its limit, is falling into recession. The traditional way out by expanding the supply of money and credit is blocked by the impaired banking system, the levels of consumer debt, the collapsing value of the US dollar, and rising inflation.
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]The Bush regime is attempting to bypass the stalled credit expansion by sending Americans $600 checks, money that will mainly be used to reduce existing credit card debt and not to fund new consumption.[/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]The US is dependent on foreigners not only for energy but also for manufactured goods and advanced technology products. The US is dependent on foreigners to finance our consumption of $800 billion annually more than the US produces. The US is dependent on foreigners to finance its red ink wars, and the US government’s budget deficit is now expanding as tax revenues decline with the declining economy.[/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]The bottom line: US power is enfeebled. US power depends on the willingness of foreigners to finance our wars and on the willingness of foreigners to continue to accumulate depreciating dollar assets.
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1] The US cannot close its trade deficit. Oil prices are rising, and offshore production of goods and services for US markets results in a dollar-for-dollar increase in imports, while reducing the supply of domestic goods available for export.
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]The US cannot close its budget deficit while it is squandering vast sums on wars that serve no US purpose, handing out $150 billion in red ink rebates, and falling into recession.
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
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    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]US living standards, which have been stagnant for years, will plummet once dollar decline forces China off the dollar peg. So far prices of the Chinese-made goods on Wal-Mart shelves have not risen, because the Chinese currency, pegged to the dollar, falls in value with the dollar. In a word, tottering US living standards are being supported by China’s willingness to subsidize US consumption by keeping its currency grossly undervalued.[/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
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    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]The US is overextended economically and militarily, just as was Great Britain with the fall of France in the opening days of World War II. The British had the Americans to bail them out. After the chewing gum and bailing wire patch-ups are exhausted, who is going to bail us out?[/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]
    [/SIZE][/FONT]
    [FONT=Verdana, Arial, Helvetica, sans-serif][SIZE=-1]Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review. He is coauthor of The Tyranny of Good Intentions.He can be reached at: PaulCraigRoberts@yahoo.com

    LINK
    [/SIZE][/FONT]
  2. BrAinPaiNt

    BrAinPaiNt Brotherhood of the Beard Staff Member

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    The fall of the dollar is a huge part of the increase in oil no doubt, however one can not overlook China's growing consumption of oil as well.
  3. heavyg

    heavyg Active Member

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    Be carefull BP that kind of talk doenst go along with the blame Bush for everything including the fall of the Roman Empire thinking.
  4. BrAinPaiNt

    BrAinPaiNt Brotherhood of the Beard Staff Member

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    I can still find a way to blame bush.;)
  5. heavyg

    heavyg Active Member

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    Seems most can...lol
  6. Jon88

    Jon88 Benched

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    Well, I just went outside.

    The sky is still up.
  7. BrAinPaiNt

    BrAinPaiNt Brotherhood of the Beard Staff Member

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    Were you doing a handstand? :laugh1:
  8. Jon88

    Jon88 Benched

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    :laugh2:
  9. Jordan55

    Jordan55 Active Member

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    This article coming from the same guy who wrote

    Impeach Bush And Cheney now
    By Paul Craig Roberts
    Online Journal Guest Writer


    Jul 17, 2007, 01:03

    Email this article
    Printer friendly page


    Unless Congress immediately impeaches Bush and Cheney, a year from now the US could be a dictatorial police state at war with Iran
    Yeah he creditable, we have four more months till were at war with Iran

    And this paragraph from above, is a winner
    More pressure on the dollar resulted from the decision to award the European company, Airbus, a $40 billion contract that could reach $100 billion to build US Air Force tankers. In simple terms, that means another $40 to $100 billion added to the US trade deficit, and a loss of $40 to $100 billion in US Gross Domestic Product and associated jobs.
    So we should have awarded the contract to Boeing, even thogh it would have been a total waste of tax payer money for a plane that does not meet the specifications.
    The sky is falling, the Antartic is melting, OH NO! what do we do
    The answer Vote for Hililary or Obama, Right!
    Raise our taxes thats the answer
  10. Sasquatch

    Sasquatch Lost in the Woods

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    Well, we are talking about a Reagan appointee here and the father of "Reagonomics."
  11. Jordan55

    Jordan55 Active Member

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    I saw that, but from a few of the articles I glanced at
    He's a little bit a Fear Monger, As far the economy goes up until the last year with the hyped mortgage industry collapse the economy was actually doing quite well.
    The republicans biggest problem during this current administration
    was their inability to control government spending and it only looks to get brighter with the socialistic policies of the Democratic party.
    God Help us
    Can you say TAX ME:rolleyes:
  12. BrAinPaiNt

    BrAinPaiNt Brotherhood of the Beard Staff Member

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    A fear monger writer talking about a fear monger admin...how quaint.:laugh2:
  13. iceberg

    iceberg detoxed Zone Supporter

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    well -we'd better start hauling arse now outta here!!!

    [IMG]

    RUN AWAY - RUN AWAY!!!! SAVE YOURSELF FOR WE SUCK BADLY AND ARE ALL DYING!!!!
  14. iceberg

    iceberg detoxed Zone Supporter

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    we are talking about someone you pre-agree with so you'll already kiss his nuggets and promote how bad we are.
  15. ConcordCowboy

    ConcordCowboy Mr. Buckeye

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    :laugh2:

    That is a joke.

    This Administration wrote the book on fear mongering.
  16. theogt

    theogt Surrealist Zone Supporter

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    1. The TSLF itself is not a cause of inflation as it adds absolutely nothing to the money supply (actually it nominally reduces it).

    2. Getting rid of mark-to-market accounting for these securities IS NOT a solution to the problem. It only masks the problem. It's not going to suddenly make investors purchase CDOs/ABSs.

    3. The Airbus deall WILL NOT add $40 to $100 billion to the trade deficit as the majority of the project will be completed within the United States.

    4. Yes, the traditional way out a recession is expanding the supply of money and credit, but isn't that exactly what he's criticizing? This is called talking out of both sides of your mouth. Also, the entire reason the Fed set up the TSLF was to fix the banking crisis in order to allow it to expand the money supply.

    5. He talks about the tragedy of being unable to close the trade deficit, then two paragraphs later talks about the tragedy of not being able to rely on China for cheap imports.

    What an ignorant article.
  17. Jordan55

    Jordan55 Active Member

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    The joke was Ohio State winning the National championship against the Canes

    Fear Mongering, look it up in the dictionary and you will see a picture of Al Gore
  18. Sasquatch

    Sasquatch Lost in the Woods

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    Interesting offhand dismissal of a decorated economist who admittedly has dumbed down the economics for mass consumption.

    My questions/observations:

    1. When the TSLF is accepting junk assets that no one wants as collateral and is rolling over the 28 day period in which the borrowed money is to be returned, essentially allowing the borrowers to pay them back at their discretion, doesn't that amount to a short-term cash infusion?

    2. He does not say it's a solution. He suggested it, as have other economists, as a temporary stop-gap measure. That's very clear from the article.

    3. The deal is for some 500 bln dollars. The parts are assembled primarily in France. A 40-100 billion trade imbalance when all is said and done is not an unreasonable estimate.
  19. Danny White

    Danny White Winter is Coming

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    The headline of that article is pretty misleading.

    Nowhere in the article does he reference "Free Market Zealots" so why did they choose to title the article thusly?

    Curious.

    I tend to respect PCR as a writer and thinker. I think this particular piece makes some good points too. I just don't understand the attack on "free markets" that the headline writer makes.
  20. iceberg

    iceberg detoxed Zone Supporter

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    why does a child cry LOOK AT ME.

    so you'll look at them.

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