Dan W, "What We KNOW And What It MEANS"
"What We KNOW And What It MEANS"by Dan W
"There's a lot of stuff to sift through out here in the ether. Sometimes it gets a little overwhelming. So many voices, so many opinions. From Health Care to Afghanistan to H1N1 and beyond, our brains are constantly trying to make sense of the deafening amount of information presented in the news and in the blog-o-sphere. And so allow me, if you will, the chance to offer one simple truth- a truth upon which we can create a foundation as we analyze the constant barrage of data and opinions and information that, daily, we are being asked to synthesize.
Here is that one simple truth: We KNOW that our leaders don't want us to know the truth. If they were OK with the truth, they wouldn't create policies and make statements that serve only to obscure, rather than to illuminate, the truth. We know that they're trying to hide something from us.
For example: We KNOW that the banks and the U.S. Government are presenting false information with regard to the solvency of financial institutions. How do we know this? Simple. If banks had nothing to hide, than all assets would be marked to the marketplace and all banks and other financial institutions would optimistically adhere to GAAP. Instead, the banks have leveraged their influence by convincing the FASB (and Congress) to let them value their assets however they so choose- and to keep whatever assets they want to OFF of their books.
We KNOW that official claims that we have reached a "bottom" in the housing market are untrue. How do we know this? Simple. If the housing market were healthy, and if the talk of recovery were true, then the FHA wouldn't be offering blatantly unsustainable tax credits to first-time home buyers. Nor would they be offering mortgage terms that replicate the sub-prime notes that were part-and-parcel of the initial meltdown that occurred last summer and fall.
We KNOW that our leaders have no idea how we are going to extricate ourselves from this multi-trillion dollar tarpit of debt- the result of our "kick-a-buck" monetary policies. How do we know this? Simple. Because when we ask, they refuse to talk about it. Ben Bernanke and Tim Geithner and Larry Summers and Bob Rubin have all made the statement that it would be a mistake to pull back on current QE policies in light of the weak economic conditions. But when asked about "exit strategies", all of the aforementioned "experts" refuse to answer. (Bernanke even refuses to let us, the taxpayers, the ones on the hook for this whole thing, take a look at the FED's books. Now, why would they refuse such a reasonable request?
We KNOW that the claims made by the government, claims that they will seek stringent regulation of OTC trading in derivatives, are empty promises. How do we know this? Simple. Because we know that they know that any real regulation of trading in MBS or CDS or other like products would precipitate contraction in GDP, and our leaders have proven, time and again, that they are willing to do anything and to allow any and all illegal activity so long as economic "growth" results.
It is indeed a sorry state of affairs when the only thing that the citizens of a nation can count on with utter certainty is that the government is working very hard to conceal the truth from its citizens about the increasingly desperate state of their economy.
And yet despite the realities on the ground- 10.2% U3 unemployment and 2.5$ TRILLION in consumer debt and contracting credit and crashing monetary velocity, etc.- our leaders continue to obfuscate and to dissemble and to "play with the numbers" because they NEED us, the American people, to be "confident" and to believe in recovery and to spend more money and take out loans and NOT to panic and NOT to pull our money out of the banks and NOT to embrace a 'bunkering' mentality, etc. Our leaders need us to carry on as if recovery and better times are in the offing.
But here's the reality folks: Our leaders are terrified that if Americans knew the whole truth about the disastrous state of our economy that the entire financial system would grind to a complete halt. What our leaders KNOW is that the United States' economy remains only quasi-functional- mortally wounded but still limping along- due to the short term "successes" of their massive infusions of printed and borrowed money into the system. But what they also know is that, at any moment, the whole thing could come flying apart. And so they lie, and they encourage others to lie, and they expend all of their energies keeping the people from knowing just how scared they are and just how bad it is.
And that's the piece that I find quite haunting. We're not talking a few lies here. We're talking lies upon lies, more and more everyday, all aimed at papering over- literally- the fact that our nation is bankrupt. And as the lies become more ridiculous, more absurd in the face of the increasingly bleak reality faced by an ever-increasingly number of Americans, the backlash is going to be dangerous. Very dangerous.
Post Script: Remember, the National Student Strike that exploded in May of 197o did not explode as a result of Nixon's bombing of Cambodia. Nor was it a direct response to the events at Kent State. The student upheaval that literally shut down some of the nation's largest colleges and universities occurred because Nixon promised he wouldn't do "it"... and then he did it anyway. Americans can deal with hardship. What they cannot accept- and what they historically have always fought back against- is a leadership that lies to them in an effort to try and pacify them. Once the lies have been exposed, the government's legitimacy has suffered and violent protest has resulted."
For example: We KNOW that the banks and the U.S. Government are presenting false information with regard to the solvency of financial institutions. How do we know this? Simple. If banks had nothing to hide, than all assets would be marked to the marketplace and all banks and other financial institutions would optimistically adhere to GAAP. Instead, the banks have leveraged their influence by convincing the FASB (and Congress) to let them value their assets however they so choose- and to keep whatever assets they want to OFF of their books.
We KNOW that official claims that we have reached a "bottom" in the housing market are untrue. How do we know this? Simple. If the housing market were healthy, and if the talk of recovery were true, then the FHA wouldn't be offering blatantly unsustainable tax credits to first-time home buyers. Nor would they be offering mortgage terms that replicate the sub-prime notes that were part-and-parcel of the initial meltdown that occurred last summer and fall.
We KNOW that the claims made by the government, claims that they will seek stringent regulation of OTC trading in derivatives, are empty promises. How do we know this? Simple. Because we know that they know that any real regulation of trading in MBS or CDS or other like products would precipitate contraction in GDP, and our leaders have proven, time and again, that they are willing to do anything and to allow any and all illegal activity so long as economic "growth" results.
It is indeed a sorry state of affairs when the only thing that the citizens of a nation can count on with utter certainty is that the government is working very hard to conceal the truth from its citizens about the increasingly desperate state of their economy.
And yet despite the realities on the ground- 10.2% U3 unemployment and 2.5$ TRILLION in consumer debt and contracting credit and crashing monetary velocity, etc.- our leaders continue to obfuscate and to dissemble and to "play with the numbers" because they NEED us, the American people, to be "confident" and to believe in recovery and to spend more money and take out loans and NOT to panic and NOT to pull our money out of the banks and NOT to embrace a 'bunkering' mentality, etc. Our leaders need us to carry on as if recovery and better times are in the offing.
But here's the reality folks: Our leaders are terrified that if Americans knew the whole truth about the disastrous state of our economy that the entire financial system would grind to a complete halt. What our leaders KNOW is that the United States' economy remains only quasi-functional- mortally wounded but still limping along- due to the short term "successes" of their massive infusions of printed and borrowed money into the system. But what they also know is that, at any moment, the whole thing could come flying apart. And so they lie, and they encourage others to lie, and they expend all of their energies keeping the people from knowing just how scared they are and just how bad it is.
And that's the piece that I find quite haunting. We're not talking a few lies here. We're talking lies upon lies, more and more everyday, all aimed at papering over- literally- the fact that our nation is bankrupt. And as the lies become more ridiculous, more absurd in the face of the increasingly bleak reality faced by an ever-increasingly number of Americans, the backlash is going to be dangerous. Very dangerous.
Post Script: Remember, the National Student Strike that exploded in May of 197o did not explode as a result of Nixon's bombing of Cambodia. Nor was it a direct response to the events at Kent State. The student upheaval that literally shut down some of the nation's largest colleges and universities occurred because Nixon promised he wouldn't do "it"... and then he did it anyway. Americans can deal with hardship. What they cannot accept- and what they historically have always fought back against- is a leadership that lies to them in an effort to try and pacify them. Once the lies have been exposed, the government's legitimacy has suffered and violent protest has resulted."
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