Share on Google Plus Share on Twitter Share on Facebook Share on LinkedIn Share on PInterest Share on Fark! Share on Reddit Share on StumbleUpon Tell A Friend 1 (1 Shares)  
Printer Friendly Page Save As Favorite View Favorites (# of views)   1 comment

Exclusive to OpEdNews:
OpEdNews Op Eds

Money Owes No Allegiance

By       Message David Glenn Cox     Permalink
      (Page 1 of 2 pages)
Related Topic(s): ; ; ; ; ; ; ; ; ; ; (more...) ; , Add Tags  (less...) Add to My Group(s)

View Ratings | Rate It

opednews.com Headlined to None 1/6/09

Author 17880
Become a Fan
  (90 fans)
- Advertisement -
Jan. 5 (Bloomberg) -- "The engines that have lifted the U.S. economy out of every recession since World War II will be of little help this time around.

Inventory rebuilding, household spending, home construction and payroll growth -- the forces that powered, to a greater or lesser extent, each recovery since 1945 -- may remain missing for much of 2009. A glut of unsold properties may keep housing depressed, while shriveled savings will discourage consumers. Companies may be reluctant to restock and rehire while their profits are squeezed."

Shriveled savings are the result of wages not keeping up with inflation. The glut of unsold properties is exacerbated by millions of foreclosures. The Fed chose to save the banks rather than the consumers; rescuing the consumers would have helped to save the banks. The Fed put their faith in the banks because that is what we are dealing with here, faith in the system, and the Federal Reserve has none.

Ironic isn't it that the paragon of capitalist financing has no faith in the system that created it. Money owes no allegiance; the imaginary jobless rate stands at 6.7% while the real number is closer to 10% now and headed towards 15%. The capitalists look at total US debt, like investors in GM stock, and ask, "Is this a viable entity?" The Fed lends to banks who then look at the American public saying, "Invest in them? Are you crazy? Those people are in the tank and we're not going in after them."

Lend $100,000 on a house that might only be worth $80,000 next year? No way! Besides, they don't have the 20% down payment. Of course, now, we'll let them sign for a new car with nothing down, or they can buy $10,000 worth of Snickers bars on their credit card. They could trash the car and eat the candy bars and the banks don't care because they made enough off the transaction to handle the loss. But they will not invest in the American public anymore because, point blank, you have no future. Like GM, you are no longer a viable entity.

The future is in China! Where plant managers make $8,000 a year and engineers make $10,000. Now, there is a smart investment for you! This country is broke; we've borrowed the money from foreign governments and how you spend your own money is your own business but how you spend someone else's money is another story.

The US economy shrank almost 5% in the fourth quarter and is kindly estimated to shrink by 3% in each of the next several quarters. So ask a banker, "Hey, mister, want to invest in America?"

FDR warned us seventy-seven years ago, "This is because the rulers of the exchange of mankind's goods have failed, through their own stubbornness and their own incompetence, have admitted their failure, and abdicated. Practices of the unscrupulous money changers stand indicted in the court of public opinion, rejected by the hearts and minds of men.

True they have tried, but their efforts have been cast in the pattern of an outworn tradition. Faced by failure of credit they have proposed only the lending of more money. Stripped of the lure of profit by which to induce our people to follow their false leadership, they have resorted..."

- Advertisement -

They have resorted to going elsewhere, somewhere, where the grass is greener.

Money knows no allegiance, so rather than face the music they move on like travelers with a paving scam. Oh, they'll keep the credit cards going until that peters out. Heck, why not? You borrow someone else's money at 0% and lend it back out at 14.4% and keep lending until they can't make the payments; then you really sock it to them. Citi and Discover Card have begun shutting off their inactive accounts because they know how you'll act when you get hungry or cold.

US manufacturing fell to its lowest point since 1948 when America only had half of today's 300 million souls. Economists now estimate job losses to continue into 2010, but hell, they've been wrong about everything else so far. Hell, it was a year before they admitted that we are in a recession (depression) in the first place. They have lost faith in the capitalist model in America and money knows no allegiance. The corporate model is loyal only to shareholders and whether it's the Star Spangled Banner or the Internationale, their only anthem is the sound of jingling coins.

The prospect of homeless, freezing Americans doesn't mean a thing to them; 200,000 homeless veterans, ha, suckers! But now, growth in China or India is very interesting. No social security to pay, no unemployment benefits or safety equipment to buy, to the bankers and investors it's God's country. So perverse is their love of coin that suddenly it is reflected in strange ways.

When I see a headline titled "Mexico's Peso Falls After U.S. Jobless Rolls Jump to 26-Year High," I ask myself, what's the connection? A cheaper peso should mean cheaper goods from Mexico, shouldn't it. Yes, unless you've invested in Mexico, then your investments are worth less relative to the dollar. So why should the US jobless rate have such a powerful effect on the peso? Maybe it's because after petro dollars the dollars sent home to Mexico by immigrants are the leading source of foreign currency in Mexico. Reaching a high of $23.8 billion last year, it is expected to fall this year due to the downturn in the US economy.

- Advertisement -

When you connect American investment in Mexican factories with the falling value of the peso, it shines a whole new light on the immigration issue. It explains why conservative politicians suddenly have such bleeding hearts for the poor immigrants trying to better themselves. It's the dollars they send home that props up the economy that churns out the cheap goods from the factories exported from America.

Free trade has been so beneficial to Mexico that even with its 2 million barrels of oil exported each day it still finds itself with a $5.5 billion hole on its current accounts balance sheet. Added to a national debt of almost $180 billion against Reserves of only $87 billion, it is only foreign investment to the tune of $260 billion that keeps Mexico afloat.

Mexico imports from: US 49.6%, China 10.5%, Japan 5.8%, South Korea 4.5%

Next Page  1  |  2

 

- Advertisement -

View Ratings | Rate It

I who am I? Born at the pinnacle of American prosperity to parents raised during the last great depression. I was the youngest child of the youngest children born almost between the generations and that in fact clouds and obscures who it is that I (more...)
 

Share on Google Plus Submit to Twitter Add this Page to Facebook! Share on LinkedIn Pin It! Add this Page to Fark! Submit to Reddit Submit to Stumble Upon


Go To Commenting

The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of this website or its editors.

Writers Guidelines

Contact AuthorContact Author Contact EditorContact Editor Author PageView Authors' Articles
- Advertisement -

Most Popular Articles by this Author:     (View All Most Popular Articles by this Author)

Hobo's Lullaby

100 Reasons for Revolution

Guns or Butter

Taken at the Flood

When will the Economy Collapse? You're Looking at It!

In this Country at Least, The Revolution Will Not Be Televised