The Great Recession, the Great Depression or the Great Inflationary Depression of the 2010’s

I think most of our politicians and most Americans are living under some false delusion that the “yes we can” Candy Man is going to fix the economy. Before you eat too much of his sugar you might read about why that cannot happen.

This first article will have nice graphs and explanations why this is not an ordinary recession. It is my own view that it will lead into a conventional great depression unless we take the path of a  long term inflationary depression.

Think not? Read this article that gives 30 reason why there will be a great depression by early next decade. Having said that, If our government can do anything to prevent a depression they will. They are not likely to allow the nation to go into a deflationary spiral. They will just dump money fresh off the printing presses out of helicopters first.

Of course doing that pisses off people in other nations that hold trillions of our dollars that they actually had to trade for their own goods and services. With more dollars being printed you will have more dollars chasing the same amount of goods and services in the world which means that the prices of everything bought in dollars will be bid up, making the buying power of all the dollars that they hold buy less. So they will either get angry and dump the dollars at a loss or demand much higher interest rates to take the risk of holding them while they lose value. I believe this is economics 101 although it seems to me that those that are running our government probably took the pass/fail version of the course and only showed up for the multiple guess tests.

Anyway, higher prices on goods and services always means higher inflation and that means a higher cost of living for everyone. Also higher interest rates on servicing the national debt means government will have less money and they will have to borrow even more money or print more money causing an inflationary spiral. The article on this link will explain why government most likely will choose the path of inflation rather than let the country go into a classic depression.

I suppose you know that historically government has always shut down inflation by raising interest rates higher and higher until less people can afford to borrow. That does work, but it is very bad for business and for those who want to buy houses, cars and other items they usually finance. Since it would cost more to borrow, businesses would tend to not expand and some would go out of business and unemployment would rise. Only when there are less dollars to buy those goods and services will prices and interest rates actually start to come down. That is the way they have been managing our economy since world war II.

The crises now is that the interest rate controls that they used to keep our economy deflating or inflating over the past 60 years will not work this time because we are now at the start of a deep recession and interest rates are already as low as they can go. They cannot lower rates below zero or they would be giving money away. Government is now borrowing money and spending it like a drunken sailor and still the economy continues to tank. The only thing left for government to do to avoid a deflationary spiral is to give away money. That will put the government further in debt. The Candy Man has said he has no problem giving out trillions of dollars in the next two years to get the economy going again. Problem is, The Candy Man will come in office with the national debt at about $12 trillion. The sugar he will hand out from the national debt candy machine will put the nation $15 trillion in debt within two years. So, by 2011 the national debt will have increased 50 percent.

But as I already said, keeping the printing presses running will make the dollar worth less to those that hold them. Not only that, they will want higher returns to take the risk to hold them because the interest on our $15 trillion debt will be so large that they will fear, with good reason, that we will default on the payments. They certainly will demand more control over how we spend money in this nation and we will lose much sovereignty. The present economic crises is already lossing our soverignty as this link describes. It is amazing how one elitist controlled Texan can all by himself give away our nation to the European globalists.

But, getting back to the depression scenario, higher interest rates by the Federal reserve always brings national slow downs but since we will be coming out of the worst recession since the Great depression in two years and real unemployment will be running greater than 15 percent the government could not allow us to go back into recession. If they did it will turn into a 1930’s type great depression and civil breakdown. So they will keep printing more money creating an inflationary spiral better known as hyperinflation or an inflationary depression.

We saw that take place in Germany prior to world war II. It brought about the rise of Hitler. We saw it in Argentina more recently, and it is now taking place in Zimbabwe. That is most likely our future, but there is a small chance that government will instead cut spending and raise taxes significantly to pay our debt and then we will just be in great depression II but that will probably be worse than great depression I. If that should happen besides the civil unrest we will have to default on our debts, pull all our troops home from everywhere, and become a isolated nation or at least a nation that lost its sovereignty.

In any case, because of massive national debt and entitlement debt there is no way out of this one and whether we go into a great depression or hyperinflation the results for most Americans will be very similar. Living standards in the U.S. will be reduced to that of Mexico. Perhaps even worse, if we get in foreign conflicts or have great civil unrest and martial law. If that happens you will see a national draft, and rationing of everything.

This is not a pretty picture of the near future for the USA, but to be informed and to prepare for it is better than living in delusion. The “yes we can” Candy Man slogans will not be able to deliver us from what we cannot fix without great individual and personal sacrifice. it would be better to save the possive thinking “yes we can” slogans for those that will take part in the next revolution.