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The Fall of the Empire

July 14th, 2008

The BBC has an article regarding Fannie Mae and Freddie Mac. While this article’s slant is ridiculous at best, it does paint a great picture of what happens when governments artificially create a market. The US government artificially created a market of lower (than commercial banks can offer) interest rate mortgages, artificially inflating the mortgage market. Fast foward 70 years, and Fannie Mae and Freddie Mac, both government-backed (that is pronounced taxpayer-backed) organizations have 5 trillion dollars in debt that is guaranteed by the US government. That is $5,000,000,000,000! The national debt (which does not include this debt, which is ridiculous) is $9 trillion.

Lets summarize:

  • the government artificially created a market of mortgages under the guise of the American Dream
  • the government manipulated interest rates creating the balloon
  • the government manipulated interest rates busting the balloon
  • now US taxpayers must guarantee $5 trillion dollars of terrible debt at the point of a gun

That is $5,000,000,000,000 / 300,000,000 US citizens = just under $17,000 per citizen.

When empires are held up by artificial flying buttresses, eventually the load will come crashing down. These socialistic burdens have grown tremendously large. If we don’t do something about it, they will come crashing down, hurting more people than 9/11, and we did it to ourselves. I see the cracks, do you? Only the rich will survive. The poor, the middle class, will pay for these atrocities. Are you ready to pay YOUR debt?

US Attempts crack down on oil speculators

June 18th, 2008

The BBC News has a post regarding how Government Regulation will help keep oil prices down. It then goes on to describe how the US economy is “inextricably linked to the viability of its air transportation system.” That’s liberal speak for every US citizen needs (not wants) things delivered by air, including travelers and bananas.  But wait a minute… Do we need to travel by air? Oh… that’s right! we bombed all interstate roads yesterday. What was I thinking? Do we need goods by air? I forgot that if I did not get my next-day bananas, that my cancer would come back the following day and kill me immediately.

If this is not special interest group pandering, I don’t know what is.  While lower prices might be nice (a luxury), they are not a necessity.  I like how they say that additional government regulation will create more transparency. That is as funny as the movie, Dumb and Dumber, except that that statement is Dumbest. If someone could find a government agency, that kept prices down (after including the tax payer’s cost) in a legitimate manner, I will buy you a car.

The only true way to reduce the cost of gas is to:

  • reduce the demand for gasoline – walk, run, carpool, take the bus
  • increase the supply of gasoline – no, corn-based ethanol is not a viable replacement. Oil Shale in Colorado is (tell the hippies to get out of the way).
  • reduce the taxes imposed on gasoline, which ranges between 25-75 cents per gallon.
  • reduce government regulation of oil industry – This will allow new companies to enter the market with new innovative ways of drilling, processing, and delivering oil at a lower price. It will also lower taxes.

If you think speculators are driving up the price of gas, perhaps you should get in on that action.