atomic_fungus (atomic_fungus) wrote,
atomic_fungus
atomic_fungus

#2587: Stagflation now, Hyperinflation later?

Ace discusses the fact that Obamanomics gave us a single-month deficit that was bigger than the 2007 annual deficit.

We've got stagflation right now: commodity prices are rising (gold just hit a new record high) and prices of other goods are declining. This was a feature of the Carter "malaise", and "Carter 2.0" has checked that box.

Serious unrest in the middle east: check.

High energy prices: check.

High unemployment: check.

The only thing we don't have is high interest rates. Because of how the government figures inflation--by excluding food and energy--the numbers look like there's no inflation taking place. This leads the Fed to keep interest rates low, because if inflation is not occurring there's no need to make money more expensive. Right? Particularly when higher interest rates could jeopardize a "fragile recovery".

...of course, there is no recovery; it's more statistical fiddling by government agencies and most of the GDP gains are fictional: imports are down and government spending is up, two things which make GDP bigger.

So we're in a position of "no inflation" where a dollar simply does not go as far as it did last year; and we're in an "economic recovery" where unemployment remains high. (Since the labor market has contracted it looks like it's improving.)

And the government is running the printing presses at full speed, for two reasons: first, the Democrats safety-wired the speed control; and second, if anyone cuts the wire and turns it down, the economy will crash.

By making huge increases to non-discretionary spending (ie "if we cut these items, the inner cities will explode") the Democrats have made it politically impossible to reduce the federal budget. The entirety of the government's real income (not borrowed) is spent primarily on satisfying "entitlement" spending--SSI, welfare, various transfer payments--and it must borrow heavily to fund the rest of its operations.

The only major line-item in this category which is not "welfare" (in one form or another) is the military budget. The federal government attempts to conceal the magnitude of social spending by categorizing it; but the largest five divisions of the federal pie stack up approximately thus: welfare, military, welfare, welfare, welfare. This consumes (as of 2010) some $2,000 billion.

And everyone involved knows that cutting spending to more reasonable levels will be the end of the "recovery". Right now government spending is driving GDP growth, by creating new money and dropping it into the economy. The money doesn't exist before government borrows it, much the same way a bank can call your mortgage an asset even though it's going to take years of your personal economic output to pay it off--the money doesn't exist before the loan is signed. (We all agree on the fiction that the bank is loaning you Smith's or Jones' money to buy your house; but in fact the bank makes several loans on those deposits such that it actually has perhaps 20% of the reserves required to make good on all its debts, should they be called in...and FDIC is the mortar between the bricks of the conceit. That's why the limit was raised to $250,000 from $100,000, "temporarily", in 2009: if confidence in banks flags, if the fiction is revealed, the system goes belly up.)

Cutting spending to 2008 levels would make it obvious that there is no recovery, that there has been none; GDP would fall to its "natural" value and a lot of people would be out of work again--a lot more than are right now. They would be angry at the government and at the banks, and there would be blood on the sidewalks, lots of it...and most of it would come from rich bureaucrats and politicians, and the mobs wouldn't care about how those people voted.

But "extend and pretend" can't go on forever, either. It's simply impossible. Our government's fiscal system is nothing but a Ponzi scheme, and the one immutable fact is that--sooner or later--you run out of suckers to bilk. Either you need too many of them, or else they get wise to the con; regardless the flow of easy money stops and the entire thing collapses.

The whole thing with Wisconsin, Iowa, and Ohio--these are merely the ominous creaking noises that presage a collapse.

* * *

Speaking of gaming:

This post was linked by The Anchoress and it led me to do a search on "dark dungeons".

That led me here.

...

I have always been of two minds about Jack Chick. On the one hand, the message he attempts to get out is an important one. On the other--

Jesus Christ, get some freakin' perspective.

Whatever game Jack Chick is referring to in that story, it is not Dungeons and Dragons.

Chick tracts are always so damned over-the-top, they end up taking a positive message and turning it into caricature. And then there are the folks who take it seriously and think that D&D really is a satanic tool for recruiting kids into witchcraft and devil-worship, that you really do have to kill a real person to gain levels, and that Mazes and Monsters is a precautionary tale rather than a crappy movie whose mere mention makes Tom Hanks cry and hide under the bed.

Sometimes I think that if I were some kind of demon, and I wanted to turn people away from Christ, Chick tracts would be a pretty good way to manage that.

But then I shake myself out and remind myself that the seed that lands on fertile soil will bear fruit, and the seed that falls on rocks will not. However over-the-top Chick tracts might be, they still contain a vital grain of truth and they never distort or exaggerate the message of Christ. So they're not all bad.

They're not art for the ages, though, either.

* * *

Unions suck.

* * *

Drivers illegally detained for paying highway tolls with legal tender. Damn right there ought to be a lawsuit over that.

* * *

Push the Pull Door is a new addition to the Fungus blogroll, and this post gives me hope: could Illinois actually be creeping closer to becoming a "shall issue" state?

In general I don't really have any personal use for a CCW permit. I don't want to carry a gun; it's an awful lot of responsibility. It's just not something I want to do.

But:

...I detest to no end that my civil rights have been infringed. If I want to carry a gun I for damn sure ought to be able to, legally. Just because I don't want to take part in a protest march doesn't mean I am willing to waive my right to demonstrate. Just because I don't go to church every Sunday doesn't mean I'm going to waive my freedom of religion.

The Constitution guarantees me the right to keep and bear arms; and states like Illinois have laws which infringe on that right to an unfair and totalitarian extent. I am not a criminal; I am not a lunatic or mentally incompetent--if I wish to carry a firearm, I have a right to do so granted by the Constitution of the United States of America, and the Illinois state government has infringed unfairly on that right.

Even though I would usually not acually carry, I would get the permit...if I could. But I can't, not here, because I'm not a rich Democrat politician and Illinois is a "may issue" state.

* * *

I had the shittiest night's sleep on record for more than two months last night.

...compounded by getting about an hour or two, then waking up around 8 and needing to get out of bed no less than eight times after feeding the cats and bringing in the paper, because of various issues.

I finally did manage to sleep, though, and got perhaps five hours' worth. During the day, of course. *sigh*

During this time I was thinking about my D&D campaign world, and had some neat ideas about two of the countries and how they interacted in the past, so I guess the sleepless time wasn't totally wasted. (99.997% was wasted, though.)

I felt amazingly cruddy this morning: as in "I'm actually sick" cruddy. After some of the symptoms went away I realized that when I nuked the eggrolls last night, the frozen ones had not absorbed enough electromagnetic energy: they'd gone in for two minutes and really needed three, and I think that's what caused the gut malf.

But I was also suffering from very mild dehydration, and drinking about 25 ounces of water over the course of an hour helped a lot. (Whenever I got up for anything else, I drank a Dixie cup of water.)

Fatigue really does make you stupid, though. I didn't sleep well Sunday; in fact Sunday night I tried to get some sleep and failed, so I got back up and had a shower before nuking the eggrolls. The shower woke me up but didn't do anything about the fatigue, and so I didn't notice (until hours later) that I'd only heated the eggrolls for 2 minutes rather than the 3 recommended on the box.

Overall I feel better now, but only by degree.
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