Tuesday, September 18, 2007


Internet access, thankfully, is far less abundant for me this week than snow-capped peaks and yellow-gold aspen leaves (they turn in clusters, because their roots connect them). But via a crackly car radio, I caught the news about the Fed's rate cut today and immediately recalled this passage from Adam Fergusson's When Money Dies:
Most of them clung to the mark, the currency they knew and believed in, long after the eleventh hour had come round for the umpteenth time. Most had no choice; but all were encouraged or bemused by the Reichsbank's creed of "Mark gleich Mark" -- paper or gold, a mark is a mark is a mark. If prices went up, people demanded not a stable purchasing power for the marks they had, but more marks to buy what they needed. More marks were printed, and more, and more.
Fascinating times, to say the very least. More when I get back next week.


Blogger Matt said...

Far from being fascinating, it is a sad time. The dollar will again fall against foreign currencies. Gold and oil will rise because they are fixed to the dollar. People outside the USA will not feel the pinch but we will.

Soon, and probably sooner than you think, the Chinese will be having their products made here because labor will be cheaper here than in China.

The Fed decided to go on with the charade. Savers would be punished, spenders would be encouraged. Buy. buy and buy to keep this enormous Ponzi schemed going. But even Ponzi came a cropper one day.

9/18/2007 8:41 PM  
Anonymous Anonymous said...

matt, i understand your sentiments. But almost all that you've posted is factually wrong.

CR is correct re inflation and what it bodes for the stock market. Welcome DOW 14.5K

9/19/2007 7:53 AM  
Anonymous Anonymous said...

The Canadian dollar is close to parity (right now it's at .9845). Most of my money is tied up in my house, so I can't do much about that. How can I move my money market to a Euro denomiation account?

9/19/2007 10:07 AM  
Anonymous Anonymous said...

Hope I'm not just overwhelming your blog with my comments, but here's yet another related issue you might comment on...

Paulson Urges Congress to Lift the Debt Ceiling

Treasury Secretary Henry Paulson told Congress on Wednesday that the federal government will hit the current debt ceiling on Oct. 1. He urged quick action to increase the limit, saying it was essential to protect the "full faith and credit" of the country, especially at a time of financial market turmoil.
The current debt limit is $8.965 trillion. Unless Congress votes to raise that ceiling, the country would be unable to borrow more money to keep the government operating and to pay debt obligations coming due.
...The Senate Finance Committee earlier this month approved increasing the limit on the national debt to $9.82 trillion. That boost of $850 billion would be the fifth increase in the government's borrowing limit since President Bush took office in 2001.

...[Thomas' comment]... Hey, if those Bush Tax Cuts are working so well on that Laffer Curve, howcome we have to keep urgently raising the U.S. debt limit? Gee, from listening to the White House, I thought that Bush's wise fiscal policies had already gotten rid of the entire debt.

Falling dollar plus massive debts equals... average everyday consumers eventually get it in the shorts. Just as their ARMs are doing exactly the same thing to them.

9/19/2007 12:13 PM  
Blogger Spider said...

I'm hoping TCR that you're reading Greenspan's book and will comment on it some time in the future. As others have posted, I really like when you do a economically focused post. I learn a lot from them. Likewise I really appreciate how to you write about sometimes complex topics in a very approachable style.


9/19/2007 1:52 PM  
Anonymous Anonymous said...

To hell with all the stupid talk. Those without gold are morons or goverment educated robots. Gold is screaming up to $740/ounce today. What is the government going to do this time around? The confidence scheme that the US economy has been running on is on shaky ground. Hell the MSM is starting to sound like me. LOL.

The bigger the collapse the better. People need to lose faith in their political leaders if we are ever to break out of this mess.

I predict tough times ahead. They might be able to keep the lid on it ahwile longer...but eventually it is coming off. Something has to and will give.

9/20/2007 1:15 PM  
Anonymous Anonymous said...

Come back to the blog, CR -- and life.

9/20/2007 4:59 PM  
Anonymous Anonymous said...

You can buy CD's denominated in other curracies at Everbank.
Here'e the link:

9/24/2007 3:54 PM  
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