Trouble in Toyland part 2

Seems I wasn’t to off the mark on my initial prediction on China’s economy. My only fault was my own doubt and not saying it was going to happen sooner. My alarm came from a sweeping layoff across the mainland (remember they have Hong Kong now) of China. Recognizing that those affected would be mainly the middle class. You know….the middle class….the people who’s shoulders we are putting the government securities bailout, Banking bailout, and the automotive bail on! Those people….

Watching the news today, CSPAN or CNN or Market watch or whatever was on while I play my videos games during my vacation, was talking about a major recession in China. The central planners seem to be scrambling to figure out a solution. See, their economy is closely tied their own exports AND how well the plan. Well a lot of their planning comes from buying American debt. Debt that until now was paying interest and was rock solid. Now I could say that their understanding of economics and proper fiscal planning is more than what it used to be, that of a high school loaning money to a friend. Problem is that we are not much better.

Our monetary policy is an absolute joke. Only 50 or 60 years ago, a father (typically) could support a wife, 2 kids, a car, investment fund, and a house on just one job. Now it takes two parents working 40 hours maybe even a third job, massive debt, day care, student loans, etc, etc. The connection between that last statement and the monetary policy is that our buying power of our dollar is weak. Very weak and it gets weaker by the day. We print money, we in debt ourselves to others (China, Germany, etc), issue treasury notes, and the litany of capital raising methods continue. All to pay for the program OUR OWN central planners have put forth.

Writing something to close this verbal vomit escapes me at the moment. I do want to note that when given the means to manage our own economy we did quite well. With the pervasive government we and China has today we are seeing a back lash of poor planning happening at the same time the government failed to enforce laws that protected people from having their own rights violated.

This economic recession is not failed economics, its failed government

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