Wednesday, February 27, 2008

The World is Going To Hell

Part 576 in a never-ending series

Sore throat, what feels like a fever (if I could find the damn thermometer I'd confirm that), racking dry cough (easily the worst thing, for my money, about having a cold), and general mind-sludge preventing me from expanding on the sixty or so manuscript pages of my ongoing apocalyptic novel.
My world meets its end at the hands of a hellish virus that amps up aggression. It's a far-fetched scenario (I hope), especially versus the "little deaths" I'm seeing in the news each and every day.

For instance, today's roundup:

Ben Bernanke, Chairman of the Federal Reserve, signalled today that he will act to lower interest rates further. He has little choice, having backed himself into a thorny corner. If rates jig up even slightly, the economy will simply nosedive. But lowering interest rates is no small part of what got the States into this trouble in the first place...and making money cheaper is something akin to handing out free crack to addicts.
It would help, of course, if money meant anything anymore. Since the world abandoned the gold standard (there being simply not enough gold to suit the legions of fat cats), the concept of "money" has become more and more abstract. Sure, you and I use money to buy and sell things, because we agree on its worth. But suppose you offered me $100 and I said "that's just a rectangular piece of paper, signifying nothing?" What then, friends and neighbours?
There is a real danger of something like this happening on a global scale as the U.S. dollar continues to tank. Gold edges ever higher, scaling towards $1000 an ounce. Scary to think that just forty years ago, you could walk into a bank with $35 and, by law, walk out with one troy ounce of gold.

Just one U.S. Presidential candidate has noticed this...and of course, Ron Paul is dismissed as a freak. Reinstating the gold standard (or indeed any standard) would be incredibly painful, as it would expose the utter worthlessness of vast sums of "money", but at least whatever was left would have some tangible value. The writedown of billions upon billions is exposing the worthlessness of vast sums of "money", but the object here is to keep playing the game. The U.S. is rather like that poor sap who juggles ten credit cards, using each one to pay off the balance owing on another...and adding more cards whenever possible. As any juggler knows, there comes a point when it all must come crashing down.
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From Statistics Canada, we read that Canadians are spending just ten percent of their household income to food. This sounds like a good thing on the surface--hey, less money devoted to keeping myself alive means more money to play with, right?--until you stop and consider that cheap food is almost invariably unhealthy, laden with sodium, sugar, a surfeit of carbohydrates, and a veritable pharmacy of chemicals. And we wonder why we're all getting fat.
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It's looking more and more like Obama will become The Name on the Democrat ticket. If any Republican can beat him (and I think it unlikely) it'd be John McCain, by far the most moderate of the bunch.
I like Obama...it seems like almost everybody does. And the fact he's a Democrat bodes well for Canada; historically, we get along much better with Presidents from that party. But there's one thing that scares me. Barack (and Hillary, too) are protectionist. They both want to at least rip open NAFTA, if not rip it up entirely. The Canadian dollar (which could almost be said to have a standard of its own, tied as it is to commodities) currently sits above par, a level unthinkable ten short years ago. Between the high dollar and the quicksand of the U.S. economy, our exports are taking a serious beating. New trade tariffs would probably finish us but good. If there are any wise heads in Ottawa, they are frantically seeking new trading partners on other continents. If not...well...

4 comments:

Rocketstar said...

We will never go back to the gold standard.

You should check out the movie Zeitgiest, it goes into the history of the federal reserve and the families that created the system, the corruption etc... It is a 3 part movie, 9/11, Christ and the federal reserve

zeitgeist.com, free.

Ken Breadner said...

Okay, you're the third person to recommend this flick. The description sounded so much like one of those "secret cabals are running the world!" things that I was a bit turned off. But I'll check it out.

Peter Dodson said...

Hey Ken - have you read Kunstler's latest article? We are all in some serious trouble...

Ken Breadner said...

I never miss Kunstler. It's the first thing I read each Monday after work. And yep, I agree with him (and you): we're all in some serious trouble.