Scared Again, As Usual Anymore, About Taxes, Debt And Inflation

December 14, 2012

Mogambo Guru

 

                        Scared Again, As Usual Anymore, About Taxes, Debt And Inflation

Perhaps not surprisingly, my career is suddenly going nowhere since I retired and quit working completely.   For example: Is the wife asking me to take the garbage out?  "What do I look like," I ask incredulously, "some kind of janitor, or custodian, or maybe a professional garbage-taker-outer?  Ha! Screw that! You got the wrong boy, babe! That's work, and I'm retired!"

Of course, this is my usual empty bluster and whining about how one day things are going to be different around here, see, and I will run the show -- with an iron fist! -- and everybody will do what I want for a change, and yet there I am, taking the damned garbage out to the damned garbage can, but grumbling and mumbling incoherently under my breath to show that I am not the least bit happy about it.

However, if I ever decide to return to writing, willingly suffering the slings and arrows of outrageous editors ("Worthless trash from a no-talent hack"), I will apply at Reuters news service as a hot-shot editor, since I obviously have a knack for seeing the profound writing mistakes made by others, taking a cruel joy in hurting the writer's feelings because, I self-righteously ask, where were in the hell were THEY all those years when I was being criticized ("Worst crap I have ever read! I feel soiled from the experience!"), crying myself to sleep every night, boo hoo hoo.

You are probably saying to yourself "Who cares? You ARE a crappy writer! Is there a point to all of this? Is it because Reuters wouldn't even let you take their garbage out because you are a stupid, raving lunatic?"

"No," I imperiously say. "It's not about that at all. What I am talking about is how Reuters treats a simple news item like "The U.S. Internal Revenue Service on Wednesday released final rules for a new tax on medical devices, products ranging from surgical sutures to knee replacement implants, that starts next year as part of President Barack Obama’s 2010 healthcare law."

Reuters goes on to explain that "The 2.3-percent tax must be paid, effective after December 31, by device-makers on their gross sales. The tax is expected to raise $29 billion in government revenues through 2022."

Now get a load of this: The tax "applies mostly to devices used and implanted by medical professionals, including items as complex as pacemakers or as simple as tongue depressors," which is kinda scary since, apparently, medical professionals "use and implant" tongue depressors in people! Yikes! I had no idea!

Anyway, despite my little attempt at humor that seems to have fallen somewhat flat, that is pretty much it. End of story!  

If I was indeed the intrepid editor of this news story, and I had made it back to the office not too late from one of my famous two-hour power-lunches, and I was not too falling-down, snot-faced drunk to actually manipulate at least one of my fingers, I would sit at my keyboard and edit that last sentence to read "…which means only that the device-makers will happily charge more money for their devices so that the company can still make the same profit after paying another 2.3% tax, which means that the prices of medical devices will go up, which is popularly defined as inflation, which is a kind of tax paid by consumers, or companies will go out of business because their prices are now too high, whereupon all the stockholders (orphans, widows and your retirement account) lose everything, and the employees are all fired, which is kind of a tax, too, and all the millions of the people who pay these higher prices for the devices have to turn around and charge more money for their goods and services to try and break even, which means more inflation in prices and a shrinkage of the economy unless the Federal Reserve creates more money and credit, which they invariably do, which makes inflation in prices worse and worse in some horrifying dance of inflationary economic death, and which makes it so easy to predict that We're Freaking Doomed (WFD)!"

And, speaking of WFD, I note with a trembling horror in my voice and my heart pounding, pounding, pounding in my ears that the latest Consumer Installment Debt figures for October jumped up by a massive $14 billion, bringing the total to of this huge, strangling, staggering $2.753 trillion, which is -- unbelievably! -- higher than the $2.6 trillion in Consumer Installment Debt at its "height" in 2008! 

To be sure, that $2.6 trillion record-setting debt set in 2008 dropped over the next few years by a couple of hundred billion dollars as people cut gradually paid off some of their debt.

But now! Now, in the last couple of years, despite rising unemployment, rising bankruptcy, stagnant wages and an economy that is at death's door because the evil Federal Reserve created so irresponsibly much money and credit for the last three decades, people are again borrowing money with the greedy, reckless, mindless abandon of old, and have astonishingly gone another $300 billion deeper in consumer debt in the Last Freaking Year (LFY) alone!  A short twelve months! $300 billion in the LFY! That's $2,000 more personal debt for every adult in the Whole Freaking Country (WFC)!!

Like most of you, even the exciting use of two exclamation points cannot penetrate my shocked numbness from the steady drumbeat of disturbingly, terrifyingly higher and higher prices, and a higher and higher money supply, and higher and higher debts, both cash-basis and accrued.

Fortunately, this shell-shocked attitude is not universal, and Ed Steer of the eponymous Ed Steer's Gold & Silver Daily newsletter reports that Stephen King (if that is his real name!), and who is supposedly chief economist at HSBC Holdings Plc in London and a former U.K. Treasury official, said "There are lots of things central banks are worried about at the moment, and inflation is not the highest priority.  As long as people believe central banks are committed over the longer term to price stability, there is leeway to play around with other objectives.”

A high-decibel Mogambo Scream Of Outrage (MSOO) was literally in my throat when I was stopped the humor of Ed's reply.  I envision an arched eyebrow, curled lip and contemptuous sneer to accompany his understated "Such as???"

According to the Mogambo Rules Of Punctuation For Economics Stuff (MROPFES), the use of three -- three! -- question marks indicates extreme stunned incredulity mixed with anger and shock, as seems apropos to the very idea of a central bank not being foremost concerned with inflation in prices above all other concerns. ALL!

Well, the answer to Ed's question "such as?"  is, of course, that the central banks are committing yet another monetary sin, artificially holding interest rates down to near zero by creating mountains of new money and credit with which to buy up bonds (driving their prices up and their yields down) at the rate of almost $200 billion per month (about $90 billion mortgage bonds and, recently announced, other bonds, which, I assume, is on top of the $100 billion a month in new Treasury bonds that have to be sold to finance a $1.2 trillion federal budget deficit). That's $2.4 trillion a year in new money! Gaaahhhh!

You can see how I am on the verge of working myself into a screaming fit of fearful outrage, and how I could go on for hours and hours about the evil Federal Reserve, predictably ending with me telling you, with a voice rising hysterically in volume and timbre, to feverishly buy gold bullion, silver bullion, and oil stocks, because such absolute, suicidal idiocy like that is, I am chilled to say, running rampant, and thus We're Freaking Doomed (WFD)!

Rather than be drawn into one of my sick little melodramas, Ed wittily and pithily goes on, while expressing the exact same anger and outrage as found in any of my wild incoherent tirades packed with profanity and vague death threats, with a subtle "I can't believe he said that! Be very afraid."

Be very afraid, indeed. He correctly said that.

Buy gold, silver and oil. I correctly said that.

It's that time again

December 6, 2012

 

Mogambo Guru

 

 

                                    It's that time again

 

These are, indeed, times that try men's souls.  To such a profound revelation, some would perhaps delightedly say "Indeed, Mogambo!"   Perhaps you, too, are inclined to say "Well said, Mogambo! Thou art truly the greatest of writers, who can, with a mere fillip of prose or punctuation, turn a such simple phrase into immortal, graceful poetry, and anybody who criticizes you is an idiot and a jealous, loudmouth, know-nothing halfwit who wouldn't know true writing talent if it came up to them and took a whiz on their shoes!"

 

If so, I have to confess that I did not, alas, write it. But thanks, anyway.

 

That famous phrase is from, as it turns out, Thomas Paine, who used it in his "The American Crisis."

 

He actually wrote  Cached - SimilarYou +1'd this publicly. Undo"These are the times that try men's souls," so you can see how I vastly improved upon this Paine guy by cleverly inserting the word "indeed," brilliantly using a couple of commas, and deftly removing the "the."  

 

This, I am sorry to say, however novel and clever I hope it is, is sadly indicative of the woefully low level of personal creativity that I display these days, probably contributing to my appallingly "relaxed" attitude towards blatant, outright plagiarism.

 

In my own defense, please remember that what I admittedly lack in talent or professional ethics, I make up for with other, perhaps more endearing, qualities.

 

 I mean, who can deny my sheer, screaming paranoia?  And with that, I throw in -- for free! -- a howling, homicidal anger, and an incoherent, blubbering blood-thirst for awesome revenge against the treachery and betrayal of America by legions of greedy, smug morons for the last half century, ranging from the lowliest leftist voter thinking the government is there to "help people," up through the vast, expansive realms of "We're helping everyone, and borrowing ourselves into bankruptcy to do it" governments, and, perhaps most painful of all to see, up through the awful Supreme Courts.

 

All of these inexcusable dimwits are totally ignorant of the Constitution of the United States literally requiring that money shall be ONLY gold and silver specifically so that the money supply can't grow, thus preventing any inflation in the money supply, thus preventing the emergence of inflation in prices, and thus also preventing unsustainable, bankrupting bubbles in sectors like housing bubbles, stock market bubbles, bond market bubbles, size of government bubbles, size of debt bubbles, number of government dependents bubbles, and the entire, total tonnage of pure economic stupidity and simpleminded sophistry espoused by loathsome neo-Keynesian econometric halfwits like Alan Greenspan and Ben Bernanke and every other worthless butt-wipe who works, or ever worked, at the evil Federal Reserve, and the overwhelming proportion of the nation's colleges and universities, all of whom I blithely brand as a clot of clownish, intellectually-impoverished, poseur dimwits who see NOTHING wrong with ANY of this monetary and fiscal absurdity, when it is perfectly, blazingly, blatantly obvious that there is absolutely nothing right about it, and that is why it is a total failure and has achieved such disastrous results,  Decade after freaking decade! Dimwits all!

 

Whew! I pause to catch my breath, surprised at the raw anger pouring out of me, perhaps borne of fear that my wife will notice that I took a lousy twenty bucks from her purse when she, foolishly, was not keeping an eye on it, like I am personally to blame for her lack of responsibility and need to go to the bathroom.

 

Or perhaps I am upset about how the time is soon coming for rioting mobs of desperate people frantically flooding through the streets, their money inflated to worthlessness, ruined financially, economic zombies, looking for a handout and someone to blame for their plight, all because the evil Federal Reserve under the satanic Alan Greenspan, from 1987 to 2006, started the bank's treacherous trend of creating so incredibly much, so astonishingly much, so tragically too, too much money and credit, based on the sorry excuse of error-filled equations in worthless neo-Keynesian econometric lunacy.

 

And then these angry, desperate people, making the mistake of their lives, will think to themselves "Hey! That Irritating Mogambo Moron (IMM) was right!  If we had invested in gold, silver and oil like he said to do, we would be rich, instead of being poor and wretched!  Let's go over to his house, attack his stupid Mogambo Bunker Of Doom (MBOD), and if any of us survive the assault, we can split the gold and silver, and any leftover ammunition, we find inside!"

 

Through the periscope of the bunker I will, of course, see them coming. As they reach the perimeter that I have arbitrarily and secretly designated, I will give the klaxon a mighty, high-decibel blast, and the PA system will blare "Intruder alert! Intruder alert!", all of which has a very, very intimidating effect, as I found out the hard way when I came home one night, staggering from another alcohol-related incident, accidentally tripped the alarms and, just as accidentally, peed in my pants I was so startled and scared!

 

Well, it sure made a lasting impression on me! And on the family and neighbors, too, who came out to see what the fuss was about, and they saw me, and they laughed at me, mocking me, their insulting jeering and jabbering cutting through me like a Red Hot Knife Of Shame (RHKOS), yet they turn around the very next day and wonder why I hate them so much!  Stupid or what, huh?

 

Anyway, through the Mogambo Communication Portal (MCP), I will ask them "What do you want, or shall I startle you once again?"  They will say "We want you to give us some dry pants and some clean underwear; we peed all over ourselves here! And we want all your gold and silver, too, so that we can buy ourselves some food and get some nice clothes that haven't been slept in or peed in!"

 

I, of course, will say "No. But as true Democrats, you got the attitude down perfectly!"

 

After a lot of flustering and blustering, stumbling about in their confused stupidity, I will ask "Are you the same people who think that an idiocy like 'government deficit-spending to make up for lack of private spending because everybody is bankrupted under a massive load of debts, which is why they stopped spending' could possibly, possibly, ever in a million jillion years, work, when it never, ever has? Are you they? Is you them? Which or neither? Answer me! Now!"

 

Of course they will say "What? Uh, no, we are not those people, we don't think!"  I will laugh at them, and reply with a twinkle of amused merriment in my voice, "Are you telling me that you instantly, intuitively understand, like normal people with even half a brain, that a constant freaking flood of new, government money disastrously distorts an already distorted, government-centric economy, making a normal recovery totally, completely impossible, as seemingly proved --proved! -- because nobody has ever, EVER heard of a case, in all these thousands of years of history, of robust private demand, despite cancerous over-indebtedness (and impending pandemic bankruptcy) somehow, perhaps magically, growing to replace the artificial demand created with massive government deficit-spending of new fiat money?"

 

Having accumulated a lot of experience over the years, educating a lot of people about the inflationary horrors of allowing the Federal Reserve to create so much excess money and credit, and how you would have to be an idiot not to be buying gold and silver, I recognize that this is when the average person says "Huh? What? I don't understand!", as does, obviously, Ben Bernanke.

 

Don't believe me? Then find out for yourself! Call the Federal Reserve in Washington, D.C., and when they answer the phone, say "I want to ask that big butthead Ben Bernanke if he has ever heard of a case of robust private demand, despite over-indebtedness, replacing the artificial demand of massive government deficit-spending?  Now, put him on the line, and make it snappy, will ya? I ain't got all day!"

 

Go ahead! Call!  I'm betting that, like when I called and asked them this same question, they put you on hold and never picked up the call, or you were mysteriously disconnected when you called them back, over and over, getting more angry each time to helpfully let their Customer Service Department know how angry I am about Bernanke ducking my calls, probably because Bernanke DOES think this stupid crap!  Thus, it's proved, I tells ya! Proved! If he's innocent, why doesn't he come forward and deny it?

 

And that interesting-yet-terrifying tidbit of news is just another teensy, tiny clue to buy gold, silver and oil. All the other zillions of wonderful reasons to buy gold, silver and oil have 4,500 years of history backing them up.

 

And with evidence like that, against the foolish thinking of a guy who won't even answer the phone, what can one say except "Whee! This investing stuff is easy!"?