Leave the printing presses alone! Former Federal Reserve Chairman Alan Greenspan has come out in favor of what no rational person would ever endorse: printing valueless money to cover indebtedness. Here are his exact words: “The United States can pay any debt it has because we can always print money to do that. So there is zero probability of default.” Gee, I can remember when the money maestro said the best way to protect our currency was to back it with gold. I still like that solution.
What people buy when they’re worried. Of course, worried people buy gold and silver, which goes a long way toward explaining why the two precious metals have outshined all other asset classes over the past 10 years. But an alert reader reminded me of something else people purchase when they’re nervous about the future: guns. Check out the growth in shares of gunmaker Sturm, Ruger & Co., Inc. (RGR). It looks like their business is doing even better than gold.
Let’s have a vote of “no confidence.” Senator Rand Paul (R-Ky.) has called on the Senate to pass a vote of “no confidence” in Treasury Secretary Timothy Geithner. “I see no reason and no objective evidence that any of his policies are succeeding,” Rand said. It would be interesting to get every member of the Senate on record on this question: especially with one-third of them facing re-election next year.
How would your family fare? (Many thanks to the reader who sent me the following item.) Suppose your family’s income is $21,000 a year. But you currently owe $142,500, and you’re adding $36,200 of new debt every year. You don’t reduce any of the balances; instead, you borrow the money to make the interest payments. You hold a family council to discuss what you’re going to do about the situation. After a lot of wrangling and mutual accusations, you all agree to reduce your spending by $380 a year. Add nine zeroes to this account, and you’ve just described the situation with our national debt. Does this explain why Standard & Poor’s downgraded our debt?
Al Gore loses his cool. It seems all that loot the former Vice President is collecting (word is he’s close to becoming a billionaire, thanks to a bunch of insider deals) isn’t enough to bring him happiness. He went on “a profanity-laced tirade” at a conference last month, lashing out at all of us nincompoops who are skeptical about the validity of his alarms about man-made global warming. I’ve had plenty to say in the past about this extremely expensive hoax, but maybe I should revisit the subject again… if only to bug Big Al.
Another Obama whopper. Did you hear this lulu from our President about all the “cuts” that will be made in the Federal budget? “The result would be the lowest level of annual domestic spending since Dwight Eisenhower was President,” our obfuscator in chief declared. Seems he left out the word “discretionary” from his boast. This makes a huge difference. According to the Congressional Budget Office, nondefense discretionary spending was only 19 percent of total Federal spending in 2010. Figures don’t lie, but … you know the rest.
“Stop Coddling the Super-Rich” was the headline on a New York Times op-ed piece this past Sunday by America’s favorite multi-billionaire, Warren Buffet. His piece starts, “OUR leaders have asked for ‘shared sacrifice.’ But when they did the asking, they spared me.” Warren wants the super-rich, himself included, to be taxed more. But taking 100 percent of the earnings of every billionaire in America would pay for only a fraction of Obama’s profligate spending. In the meantime, Warren, why don’t you voluntarily send the big spenders in Washington more of your money?
No “little people” at this party. Did you read about President Obama’s 50th birthday party? He went back to Chicago to celebrate, which was no surprise. But the price tag sure was. Admission was $30,000 per person. But for that, I’m told, you not only got a decent meal and piece of cake; you also got to hobnob with the President, some Hollywood headliners and music stars. No wonder some folks said, “Priceless!”
Nobody loves Obama? In her Wall Street Journal column last Sunday, Peggy Noonan pointed out “something I’ve never seen in national politics.” The lady has seen a ton of stuff (and read about more) since her stint as speechwriter for Ronald Reagan. So what is it that’s surprised her now? “It is that nobody loves Obama.” Oh sure, he’s got plenty of supporters. Even some fanatical loyalists. But they’re all grim about it. What’s going on? Peggy’s conclusion: “He is a loser. And this is America, where nobody loves a loser.” Let’s hope she’s proven correct next November.
Another government default. In my Straight Talk column two weeks ago (click here if you didn’t see it), I mentioned that the U.S. government has defaulted on its obligations at least twice in the past. Ron Paul, my favorite LION in the House (that’s an acronym I made up; it stands for Libertarians In Office Now), reminds me that there was a third and more recent default. In 1968, Uncle Sam unilaterally reneged on all the silver certificates that were in circulation. The notes promised to “pay on demand” their equivalent value in silver. But as of 1968, all you could exchange them for were other Federal Reserve notes. Can you guess who got the worst of that deal?