Thursday, August 2, 2012

deflation, war debunked

DEFLATION, WAR DEBUNKED
Today, let’s try to talk rationally about how deflation and world war will never happen.  I know that a lot of people who seem much smarter than I claim otherwise, but I think rather than suffering from stupidity they simply lack a proper paranoid mindset.  Well, I think they are also looking at the wrong history, but that can almost be excused.  Deflation.  Forget that throughout our countries history inflation has always solved any applicable political problem.  The Continental was toilet paper in a few years after the Revolution.  Greenbacks for the Union during the War Of Northern Yankee Scum Aggression would have been worthless scrape but the leadership after the conflict was actually smart enough to retire them ( my sneaking suspicion was that the north colonized the south and stripped the wealth to pay off the war, but since slavery was introduced after the fact as justification, and today anyone who hates Obammy or the Yankees during the “Civil War” is branded as a racist, nobody seems to be in an all fired hurry to talk about what actually happened back then ).  The South of course inflated their currency so badly and so quickly it was total crap way before the end of the war.  Even under the supposed gold stand, FDR ( that crippled cunt who bent over to take it up the ass from the bankers, smiling the whole time and screaming, “I’m your bitch.  I’m your bad, dirty bitch” ) inflated the money supply by a good 40% overnight as he illegally confiscated privately held gold.
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Forget all that and you are still left with that nagging question of “How?”.  How do we get deflation?  In the First Great Depression, the recent mechanization of the farms, plus the stimulus from feeding Europe during WWI leading to overproduction, both led to too much food being produced.  Food prices went down.  Oil was just being heavily put into use, and as the US was the leading oil producer globally, we had an embarrassment of a glut with the stuff.  And the Depression, putting a damper on consumption, acted to provide our energy surplus.  So, the two main ingredients in  consumer prices, food and energy, were lowered in price.  I think there had also been a glut in immigrants pushing down wages, but I might be off on my timeline on that one.  Today, in case you skipped reading 90% of my articles the last month, we are entering a paradigm changer as the worlds breadbasket of last result enters into a historical drought.  No matter what happens, it ain’t gonna be food surpluses.  And in case you were asleep for forty years,  we are running out of oil.  Add, shake or stir, and there will be no downward pressure on food or energy. 
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Another wishful thinking rumor being pushed by Pollyanna dope smokers is that to save the economy we will go back to waging a global war to put a life back into the economy.  We can’t even win a small scale guerilla war in an oil country ( WWII percentage of population in military, almost ten percent.  Today, one third of one percent.  Almost no boots on the ground, and all financing to fight is borrowed money ).  But this should convince you, lest you harbor an illusion that if only we had a draft and a political will we could win any war.  We simply don’t have the material to fight a war like we used to.  In WWII, we had most of the oil and most of the metal ore.  And one half the population.  And still, there had to be massive rationing and conservation to get the amount we needed for waging war.  We had 100% of our oil, today we import 70%.  And then we use some of that oil to replace metal with plastic since our steel supply is severely constrained.  How are you going to fight a conventional war without enough oil and steel?  Vietnam was our last conventional war.  We had topped out at about 10 million barrels a day of oil ( today, we pump about five million, that includes Alaska and Gulf and frac oil ).  Peak Oil is Peak Mechanized War.  We are still mostly mechanized in our war fighting, but it is also mostly obsolete equipment.  And we do a lot less of it ( far less tanks, ships, etc. ). 
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World War Two was quite simply The Oil War.  Coal had mostly been used to that time and oil was the new up and coming fuel.  The war was not about the treaty punishing Germany or anyone caring too much that China was occupied.  It was a mad scramble to control oil, and hence the victorious military and economic super power ( Germany never had a choice.  It had to occupy the Soviet oil and grain regions to achieve dominance.  Barbosa was not a blunder as much as a necessary gamble ).  The US won, not because of our oil, food and ore surplus, certainly not because we had brilliant leaders ( most of those leading us in WWII had been involved in the suppression of the WWI veteran protests, to give you a perspective on their moral standing ), but mainly because we allowed the Soviets to be our cannon fodder.  They soaked up the German war machine.  Proof?  We “allowed” them to co-rule with us after the war.  In reality, we couldn’t defeat our equal in resources ( who had terrain and weather on their side ), so we ceded half the globe to them.  In short, we barely won that one, with much better supplies than we have today.
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War saving us is a fantasy.  Deflation saving our bank account is a fantasy.  Reality will suck much worse.
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A short note on my forecast that the world would end on my first child support free paycheck.  Sure, I was wrong.  But since then my oh so wonderful wife has gone to the hospital enough that I’m now paying half my old support amount in doctor bills.  The Fates still have a wonderful sense of humor.
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3 comments:

  1. Wars do not make countries wealthy unless the country is able to keep the war off their own soil, and they have allies who do most of the fighting. This was true of the British in the Napoleonic Wars, and the U.S. in World War 2. World War 2 had the added advantage of destroying most of our competitors factories. We may have been wealthier, but I doubt the world as a whole did better because of the war.

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  2. Hope the Missus is okay, Jim. W is a major part of my "Occupy/Distract The Wifey, Whist I Wander The Desert" plans.

    Is the weather cooling off, yet?

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  3. Yes the Yankees were scum during the Civil War. Yes, the Southerners were scum too. Now it is time to let it go and move on, hopefully in this century, since it hasn't happened in the last or the century before.

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