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Torture numbers… they’ll confess to anything

November 15, 2007

I read President Bush’s prediction that the dollar will get stronger with a bit of amusement. Not that seeing a deflating dollar makes me smile — quite the contrary. The continually shrinking dollar means that my money, like that of every other American — especially those on a fixed income — doesn’t buy quite as much as it did last month. Not a new trend, but as the dollar shrinks against world currencies, price increases are more noticeable.

What makes his statement amusing is that for most of this year, we’ve seen news articles like Dollar Recovers From All-Time Low and Iran Asks Japan to Pay Yen for Oil. Who can forget that just two months ago, we saw that China threatens ‘nuclear option’ of dollar sales? Articles such as these should come as no surprise for a nation of debtors, and we the people are indeed a nation of debtors. Of course none of these were page 1 stories… we wouldn’t want a wave of panic to break out, would we?

Admittedly, I’m not an economist. I don’t play the stock market game. I’m not wealthy by any stretch of the imagination. I do however have a vested interest in how far I can stretch a paycheck. My firm belief is that my paycheck – and yours – would go a lot farther if the folks at the Fed would quit manipulating the money supply. Indeed, their failed policies are the cause of much of the volatility in the devaluation of the dollar.

Gary North wrote a series of four prescient articles in May of this year. Start with Debt: An Inescapable Concept – Part 1 and continue reading the entire series. Like all of his works, the articles are well written, easy to understand and informative.

I also recommend reading an excellent piece written by Alex Merk titled Seven dollar myths, published April 28th. I think you’ll find it of use in the days ahead.

No matter how you slice it, our economic situation is like a roller-coaster ride. Depending upon which set of politically motivated economists you listen to, inflation is currently running at between 2 and 8 percent. They torture the numbers until the numbers support their economic theory. My own personal experience puts the inflation rate at 6.5%.

These days, nobody will use the term recession until we’re up to our necks in the middle of one. And God forbid anyone utter the “d” word. An old truism goes something like this… a recession is what happens when a couple of your neighbors lose their jobs. It becomes a depression when you join them in the unemployment line.

Republicans complain about spending only when the money is spent on a Democrat earmark. Democrats complain about spending only when the money is spent on a Republican earmark. Both of those parties need to take a good long hard look at the $9+ trillion national debt and decide where to cut expenses, not where to spend more.

Every time I hear a politician promise something, I can hear the words attributed to Thomas Jefferson: “any government big enough to give you everything you want can take everything you have.”

As I’ve said before, as a nation, we’re more than $9 trillion in debt. Every bit of that debt has accumulated during the span of my lifetime. Every single dollar of that debt can be attributed to political decisions made without a single thought of how many lives will be ruined when the debt is finally called. How many generations of Americans will live, work and die to pay for the fiscal irresponsibility of their government?

Until next time,

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