The “American Rulers” are telling you we have no alternative. That is false. Smart thoughtful people like Dr. John Hussman and NYU professor Nouriel Roubini have been right on this issue for years and proposed alternative solutions. John Hussman’s solution relies upon the rule of capitalism and wipes out the stockholders and bondholders of these bankrupt banks before placing any burden on the American people. The problem with this solution is that Jim Cramer, Larry Kudlow and the rest of the ruling elite would lose millions. To see Dr. Hussman’s proposal, go to his webpage.
Remember the Government Motto: If you think the problems we created are bad, wait until you see the solutions.
I see the following implications to various passengers onboard U.S. Titianic:
Rich ruling elite
- In the short-term they were joyous. The stock market briefly soared as their millions were protected. the market has since declined.
- I would recommend that they buy some books about the French Revolution and the Russian revolution. The huddled masses have had just about enough. Class warfare is closer than it has ever been. The anger in this country is building. The passing of the bailout bill against the wishes of the vast majority will be the trigger for civil unrest.
The Poor
- You’re screwed!!!
- You don’t have any money or investments, so you have nothing to lose. There will be less jobs. The money that Obama promised you will be used to keep rich bankers rich. Sorry, you’re going down with the ship.
The Middle Class
- You’re really screwed.
- The dollar will decline. You will pay more for gas, food, and other basics.
- Interest rates will go up, making your debt more burdensome.
- Taxes will be raised and/or benefits will be decreased because the rich will need to maintain their lifestyle.
- Your home value will continue to decline for the next five years.
- Your salary, investments and 401k will not keep up with inflation, thereby reducing your standard of living.
- I recommend that you: pay off your car and use it for 10 years or 150,000 miles, whichever comes first; stop buying crap you don’t need; pay off your credit cards; try brown bagging your lunch; wash your car in the driveway; cut your own lawn; let your kids play outside rather than trying to dictate all their time; use your appliances until they break; if the cushion on your couch is ripped or stained, turn it over; contribute as much to your 401k as possible; and buy generics.
- If you own a home, stay in that home for the rest of your life. Pay down your mortgage. Make necessary repairs. Do not get a new kitchen or bathroom because your neighbor did. Do not borrow against your equity to buy stuff you don’t need.
- If you rent, continue to rent until you have at least 20% to put down on a house and can easily make the monthly mortgage payment using a 30 year fixed mortgage.
- If your Congressman or Senator voted for the bailout bill, vote them out in the next election.
Alan Greenspan
- His legacy has already been discredited. His actions in the last ten years will be seen as the root cause of all the financial problems America is experiencing today.
- Because of his reckless reduction in interest rates to correct the excesses of previous bubbles, the world economic system is on the brink of collapse.
- History will not be kind to Alan Greenspan.
Hank Paulson
- This multi-millionaire, former CEO of Goldman Sachs, will go down in history as the most pompous Treasury Secretary in the history of the United States.
- He isn’t the CEO of the United States. Harvard MBAs have already done enough damage to this country because they think they are smarter than the rest of us. They are not. They are responsible for this mess. It is time they leave the scene of the crime.
George Bush
- George’s administration will be another for the history books. This administration will surely be considered one of the worst in U.S. history. He entered office with budget surpluses and leaves office after saddling future generations with $4 trillion more debt and the promise of much more.
- He can retire to his Texas ranch, write his memoirs for $10 million, and make speeches at Neo-con conventions for $1 million a shot, knowing that the average hard working American is on the hook for $10.6 trillion of debt. I hope he enjoys his retirement. Millions of Americans will not enjoy theirs.
My final thought comes from a real working class American who emailed me this week with the suggestion for a bumper sticker.
"Imagine, who would Jesus give a trillion dollars to? The money lenders or the poor, homeless (and about to be homeless)."
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