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Our
economy is at the peak of the third economic bubble in 12 years as we are desperately mortgaging our country's productive resources to reward reckless speculation and to fight the free market.
This new bubble is driven by borrowing and then wastefully spending $6 trillion over the past
4 years to prop up false prices. Compounding this tsunami of waste, the Federal Reserve has destroyed
free market interest
rates by pushing the Federal
Funds Rate more than
3,000% below the 10 year Treasury bond yield.
Our country and the world are ablaze in the intoxicating glow of easy money. Just like in 1999. Just like in 2005.
The government and The Fed have again
poured gasoline on our campfire
to keep The Wolves of Recession at bay.
Can this continue?
We can temporarily sustain the debt portion of the bubble if we decide to continue our financial child abuse and borrow another $10 trillion dollars that
we have no intention of paying
back. Surprisingly financial
child abuse is not a
crime in our society and being
drunk, especially on debt, seems an adequate excuse.
But there is no way that nature will allow us to abuse our free markets much longer. Even if Chairman Bernanke wanted to keep the Fed Funds rate 3,000% below the 10 year Treasury bond yield for an extended period, it is not possible. As phony rates turn real, they will become
a drag on the economy.
The government’s bond fire
that keeps the predators outside will eventually dim. This will allow the Three Wolves into our camp.
The first to enter will be the Wolf of Free Markets. It
will mercilessly attach the artificial interest rates and kill them dead.
Then and only then will the second and fiercest preditor be allowed to enter. Its bloodthirsty
eyes will spy the surroundings as it looks for the focus of its
rage. It will spot the children
cowering, lying in the smoke and soot from the government’s smoldering bond fire. With lightning speed it will jump to their side. The Debt Wolf will stand bristling and snarling in between us and the children.
The third Wolf will then be allowed
entry. Every ounce of its being will
be focused on us. We have attempted to live far above our means
by robbing resources from future generations in a
vain attempt to manipulate
asset values. The Wolf of Fair
Prices will allow none of this. As the Debt Wolf and the Free Market
Wolf protect the children,
the Wolf of Fair Prices will tear our
manipulated and bloated asset valuations to shreds.
The Three Wolves will lie next to the children and for the first time in their
lives they will get economic
warmth, protection and love. Nothing
shows more love than blessing children
with a sound
government, free markets,
fair prices and low debt. Our forefathers wished it for us many years ago, before
we had our first taste of the drug of easy money.
They will fall to sleep, finally free from our greed and abuse of power.
As the children wake to
the safety of the economic
sunrise the Wolves will be gone. The previous night will be a vague memory that is forgotten
with time.
As sure as corrupt and abusive government
policy nurtures unsustainable debt, false markets and unfair prices, The Recession Wolves will be
there to protect the
future generations.
Charlie Husen
Tax Home
Charlie Husen
owns a tax accounting business in Pleasant Hill California. You can contact him at charlie@incometaxhome.com.
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