California has so degraded itself into a laughably leftist socialist
commie-think nightmare that it has, as all socialist commie-think countries
always do, finally bankrupted itself. As Margaret Thatcher, erstwhile UK prime
minister, once said, "The problem with socialism is that you eventually run out
of other people’s money." Hahaha! Exactly!
And now California has run out of money! Exactly!
Now, to demonstrate their complete worthlessness as thinking, rational beings,
California has decided that it will not cut expenses overmuch, but will pay for
things not with money, but with IOUs! Hahaha! IOUs! Hahahaha!
There is Something Beyond Surreal (SMS) about all this, and it's
that very farcical stupidity that explains why hyperventilating conspiracy
theorists like me come up with the weird conspiracy theories that we do; it is
just too damned weird to be real!
I mean, the fiat currency of the USA has been so abused by over-issuance that
it has lost about 96% of its purchasing power since the loathsome Federal
Reserve took over in 1913, and is now about to be reprised by California
issuing another paper money! Hahaha! Paper money everywhere! The state with two
fiat currencies! Hahaha!
This may have something to do with how California has seen a precipitous drop
in tax revenues, which in turn may have something to do with the Labor
Department releasing its Metropolitan Area Employment report which shows that
"In May, 112 metropolitan areas reported jobless rates of at least 10.0%,"
which I admit does not have much to do with California until we get to the part
where El Centro, California, "recorded the highest unemployment rate, 26.8%,"
and "Among the 15 areas with job-less rates of at least 15.0%, seven were
located in California."
This is, as Margaret Thatcher said, because Californians have run out of money
to support everyone who ever walked up with their hand out looking for a free
lunch, and the wealthy people in California are leaving the state to keep from
having everything they have taxed away. Bummer!
Actually, California is a beautiful place unfortunately populated by leftist
idiots, and as such is but a pale microcosm of the Whole Freaking Country
(WFC), and as a result, as Bill Bonner here at The Daily Reckoning said,
"America's position relative to the rest of the world is weak and in decline.
She is not a creditor; she is a debtor. She is not a low-cost competitor; she
is a high-cost competitor. She no longer has a free and flexible economy; she
has one freighted with central planners, regulators and busybodies."
California is not the only one hurting, as Byron King of Outstanding
Investments writes that everybody has taken a whack to the wallet, as "There's
no disputing the extraordinary shock to household wealth in the US. From
mid-2007 to March 2009, according to the Federal Reserve, household net worth
plunged $14 trillion, or 21.5%."
A fifth! A fifth of everything we thought we had is gone!
In fact, most of the losses were recent, as "Just during the second half of
2008, household net worth plummeted nearly $8 trillion - with an eye-popping
$4.9 trillion dip in the fourth quarter."
Wow! No wonder people are being laid off! No wonder spending is down! No wonder
we are screwed!
Richard Daughty is general partner and COO for Smith Consultant Group,
serving the financial and medical communities, and the editor of The Mogambo
Guru economic newsletter - an avocational exercise to heap disrespect on those
who desperately deserve it.
(Republished with permission from
The Daily Reckoning. Copyright 2009, The Daily Reckoning.)
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