'MILE'stone

My little Dodge Dakota had a big day today. On the way home from work this morning it rolled past 200,000 miles. Pretty darn good for a truck that still has the original plugs, wires, etc. Never been tuned up and still runs like a champ.
Admittedly it looks its age. But then again, so do I. :-)

Uh oh!

When does this, equal this?


I'm just making a point. Some people say we're on our way to greatly devaluing our currency. I disagree.
Of course there's really no comparison between our currency and Monopoly money.
First of all Monopoly money is only worth something because your fellow players agree that it is. So at any given time the other players could simply decide they don't want it anymore. It is not backed by any tangible asset such as gold like our currency, umm....., used to be.
Ok, but Monopoly money will never have any real value, like our currency does, because of the Law of Supply and Demand. Any time the makers run short of it they just print more and more. But our government exercises strict restraint in print.... ummmmmm..........,
This isn't going like I wanted it to!

The Unstimulating Stimulus

And you thought the stimulus package wasn't working!
Well, it is. Just ask the Obama team. They wouldn't make things up, would they? (see post below)
They report that the stimulus package has "created or saved" 1.5 million jobs. Of course they also say, now, that the intent was to save the jobs of teachers, firefighters, etc. and that it has done so. That's not the "shovel ready" mantra I remember. But I digress.
I don't how how you quantify 'saved' jobs, but even if we presume their numbers are accurate (stop laughing) that comes out to roughly $380,000 per job. I wonder how much of that the teachers and firefighters get.
Let's make something clear. The ONLY thing that government can do to stimulate the economy with any lasting effect is to GET OUT OF THE WAY!
Relieving burdens on business, either tax or regulatory, would help. ANY and EVERY attempt to micromanage the economy or any segment or industry therein can only hurt in the long term.
The Free Market is the economic equivalent of Darwin's Natural Selection.
Fiscal liberalism is a species that should be allowed to become extinct.

Then, or Now?

During the presidential campaign last year the Obama campaign often repeated that our economy at the time was "the worst economy since the Great Depression". (Is Obama too young to remember the Carter administration?)
Now, under pressure to rationalize their 'stimulus' package, Veep Biden says they just didn't realize how bad things were. This laughable contradiction means one of three things: 1-They were lying (ok, greatly exaggerating) during the campaign. 2-They are lying now. 3-(this is my favorite) BOTH!
No surprises there though. Eagles have to fly, fish have to swim, and Dems have to lie. It's the natural order of things.

Sarah Palin a quitter?

Sarah Palin shocked the nation Friday by announcing her resignation as governor of Alaska. While the circumstances were quite unusual and surprising, I don't quite understand some of the criticism.
Gov. Palin was immediately attacked by Republicans and Democrats alike for "quitting on Alaska", "leaving Alaska high and dry", etc. And on the surface I understand the sentiment. But forgive me for expecting highly paid analysts to look beyond the superficial and obvious.
In principle, how is resigning this way any more "leaving them high and dry" than politicians that resign to take higher office? Did Pres. Obama not "quit" on Illinois the moment he decided to run for president without first finishing out the senate term to which he was elected? Which he, by the way, ran for without first finishing out the state senate term to which he'd been elected.
Politicians resign mid-term all the time. Apparently doing so is more noble when it is opportunistic and self-promoting.

Why States' Rights?

It has been my observation over the years that few people truly understand why "States' Rights" were first instituted. Once that is understood it becomes a crucial principle, as opposed to just a concept that feels good because we tend prefer more local control.
Remember first the government that our founders and citizens had fled was enormous, and centrally controlled. These were the days of "The sun never sets on the British empire". They had witnessed, and suffered under, the corruption that ensued.
That said, we need not look much further than the name of our nation to understand what they were attempting to accomplish. The definition of the word "state" at that time was a sovereign government body. Noah Webster's 1828 edition defines it "A political body, or body politic; the whole body of people united under one government, whatever may be the form of the government." The premise under which this nation was formed, and named, is that we we would be individual sovereign governments forming a sort of Co-Op for specific purposes, such as common defense, commerce regulation, negotiating with foreign nations, etc. We were to be a group of sovereign states, united together for protective strength and position. (The electoral college is a fascinating tangent to this discussion. It creates a delicate balance in which it is the 'several states', not the people, that actually elect the president.) It's interesting to note that the term "States' rights" is actually a Civil War era creation, in response to the federal government expanding beyond its intended parameters. To our founders the concept was axiomatic.
The Constitution does not give rights to individuals. It gives very limited powers to the federal government with the presumption all others remained with the several states. The Bill of Rights was added later, only after intense debate. Proponents wanted to delineate some of our most important rights in order to protect them. Opponents feared that listing any rights would leave the impression that the list was all inclusive. The 10th amendment is the compromise between the two arguments.
Somewhere along the way most of our citizens lost track. Proposals made by elected federal officials began being debated on the merits of the idea, rather than on whether it is a legitimate federal function. As a result we now have, in practice, the type of government that our founders most feared. They foresaw that a powerful, centralized government would be a breeding ground for corruption.
I think time has proven them correct.

I hope I'm wrong, but....

I hate to be pessimistic, but as I look on the horizon I think I see some hyper-inflation in our future.
There are many factors that can contribute to economic inflation. The most pernicious is the devaluation of currency. There are also many factors that contribute to devaluing a currency. The two most common are listed here. See if they sound similar to our current economic conditions.
* Oversupply of money - In keeping with the basic law of supply/demand, when a government prints currency, particularly currency not backed by anything, the increase in the money supply creates a decrease in the value of that currency.
* Creditor confidence - As a nation's debt load increases, potential creditors (bond purchasers) confidence that the debtor will be able to repay it decreases. This has the two-edged effect of devaluing the currency and forcing the debtor to pay higher interests rates on debt. The long term effect of the higher interest rates will be even higher debt. Which will mean even further devaluation of the currency. (note- we have record deficits, record debt, and diminishing international interest in purchasing our treasury bonds)
Increased costs in the production of goods is another major contributor to inflation. These costs are passed along to the consumer in higher prices. Given the priorities announced by the administration it seems quite likely, in fact inevitable, that there will be initiatives that will make the cost of current forms of energy rise sharply, and that corporate taxes will be increased. These costs will be passed along.
Inflation then can begin to feed upon itself. Prices rise, including those associated with production of goods and services, which in turn causes prices to rise again. The traditional methods for attempting to stem inflation (increasing interest rates to slow down the supply of money) has its own deleterious side effects.
The wise solution it would seem is sound economic policy. Reduced governmental spending to prevent current and future debt. Reduced taxation to encourage economic activity and growth. Unfortunately it appears we are heading in exactly the other direction.