I Stand With The Jews

I stand with the Jews.  Screw the Muslims and their enablers, the political left and the paleoconservatives.

The world has become suffused in evil, but I will never give in to evil, no matter how popular it becomes with the sheeple.

Yesterday I got into a fight with Thomas E. Woods Jr. (in an online forum), and I told him off for his paleoconservative B.S.  He was angry because a website called The Washington Free Beacon (who represents the omnipresent "neo-cons") ran an article about Rand Paul deleting from his website a list of paleo anti-Israel propaganda posing as a "student reading list."  Woods was incensed that anyone could doubt that Israel secretly runs America's foreign policy.  (No doubt this is explained in "The Protocols of the Elders of Zion.")

Imagine those sneaky Jews, trying to influence America just so those Jews can continue to draw breath. The nerve!  Just because they are surrounded by the world's most violent and hateful religious fanatics.  How selfish!  If the Israelis would just allow themselves to be murdered by Muslims, peace would descend on the world like manna from heaven, all of our disputes with the Islamic world would fade away, and anti-semites like the paleoconservatives could join their fellow Jew-haters in celebration, ululating and passing out sweet treats in the streets of "Palestine."

There is much value in the writings of various paleo authors, like Thomas E Woods, Jr (and I have previously included one of his sites in my link list, quoted him, and recommended some of his books), Lew Rockwell, Pat Buchanan and others.  However, what truths they purvey are rendered less credible by their antisemitism and apologia for Muslim violence.  Come to think of it, their support for the "911 was an Inside Job" kooks also reveals the paleos to be a fringe group unlikely to ever attain a serious position in American politics.

More Proof That the Democrats Ruined the Economy

Jim Yardley at American Thinker gives more details on the Democrat melt-down of 2008, including a graph of real estate prices.  Yardley explains how the subprime mortgage fiasco, which was forced on banks and morgage companies, and the graph shows the resulting spike in home prices that resulted.  Yardley writes:

Claims of racial discrimination were frequently aimed at banks in the mid-1990s by community activists who, through judicial actions or by producing demonstrations by irate citizens, embarrassed banks into lowering their lending requirements to the point where, in common parlance, banks began issuing "sub-prime" mortgages. In an effort to both protect the financial integrity of local community banks and provide access to enormous amounts of cash for mortgages, Congress instructed Fannie Mae and Freddie Mac to purchase such mortgages from the original lender, returning the original lender to his original state of liquidity.

Fannie and Freddie then offered institutions such as Lehman Brothers and other major Wall Street firms a chance to "bundle" these mortgages and sell derivative securities, with their value basis predicated on such bundles.

More about the Democrat-engineered meltdown can be read in Mark Levin's book, "Liberty and Tyranny" and in Thomas E. Wood's book, "Meltdown."

The meltdown not only wrecked the economy, it provided the duplicitous mass media and the Democratic Party an opportunity to benefit from their own misdeeds.  The bubble burst in the last few months of George Bush's presidency.  In an extraordinary display of bad faith, the Democrats then blamed the meltdown on a lack of governmental oversight, the machinations of Wall Street and the Republican policies of George W. Bush.

Read Yardley's article:  So Obama Inherited a Mess, Did He? From Whom?

"Meltdown" by Thomas Woods - My Thoughts

I finished Thomas Woods' book "Meltdown" yesterday and in the process became a believer in Austrian economics. Austrian economics are economic principles advanced by such notable thinkers as F.A. Hayek and Murray Rothbard. Hayek is best known for his book "The Road to Serfdom"; I have ordered that book and will read it next week.

Austrian economics advances the premise that it is government controlled money and credit that causes the business boom and bust cycle. The Federal Reserve is the most guilty agent in this phenomenon. In the free market, credit is just another commodity that is subject to supply and demand and interest rates should be left to float as dictated by market forces. It is when the Fed screws with those interest rates that things start to go wrong. Artificially depressed interest rates send erroneous signals though the ecomomy, resulting in bad decisions by businesses that in the long run come back to smack them in the kisser.

That's because low interest rates, in a free market, indicate more savings by the private sector, resulting in more money to lend by banks. In periods of naturally low interest rates, businesses undertake long-term projects that would not be feasible when interest rates are high. However, artificially low interest rates, as set by the Fed, cause businesses to undertake these projects without a sufficient savings pool to borrow from, resulting in aborted projects and wasted resources when the rates suddenly increase. That's because you can artificially lower the rates for a time, but not indefinitely.
Think of it as pressing a lid down over a boiling pot to prevent the steam from escaping. The pressure will build until it is no longer containable, resulting in a sudden and dramatic explosion. Artificial stimulation of the economy is like that -- repressing market forces now only results in sudden and more dramatic shifts down the line. That's why all such attempts at "stimulus" and "bail outs" have backfired in the past, e.g. in the Great Depression and more recently in Japan. Bail-outs make things worse.

Woods examines various depressions and recessions of the past and describes the money/credit problems that caused them. His explanations are clear and easy to follow, are logical and make sense. Further, he supports his analysis with facts from history that are highly analogous to today.

The solution to a crisis like we have now is to leave it alone and let the market sort it all out. That will result in the fastest route to recovery. Woods shows how the depression of 1921 (which preceded the Great Depression by eight years) was left alone -- there was no government intervention at all. The result was that the depression of '21 soon righted itself and prosperity returned quickly.

FDR's interventions into the Great Depression of 1929 was very damaging to the recovery. Two economists at UCLA conducted an extensive study of the Great Depression and concluded that FDR's intervention actually prolonged the Great Depression by six or seven years. So much for "stimulus" and bail-outs.

In similar fashion, the bail-out now underway will make the economy worse, by simply delaying the efforts of the market to end unprofitable businesses and reallocate their resources to more productive sectors of the economy. Further, it will saddle future generations with onerous amounts of debt, and for no good purpose: the bail-outs will fail because they make no economic sense whatsoever.

Woods argues, convincingly in my opinion, that we should return to a monetary system based on gold and silver. This will prevent the government from screwing with the money supply to steal our purchasing power through inflation, which is nothing more than an insidious form of taxation.

He also argues that the Federal Reserve should be abolished. I also agree to that, as the Fed causes the boom and bust cycle by manipulating the interest rates. It was a major factor in the current recession we are in today.

"Meltdown" is a lesson in sound economics. It isn't an ideological screed, putting forth bromides that are based on mere theory, faith or partisanship. It is a serious look at how government interacts with the economy in damaging ways and the steps and policies that are needed to restore the economy to health.

Two Great Books for Americans: "Meltdown" and "Liberty and Tyranny"

I'm reading two great books simultaneously. It's tricky, but that's why I have two eyes and two hands.

One of those books is "Meltdown" by Thomas E. Woods, Jr. It's an explanation of the causes of the current financial crisis and why the bailout will make things worse. Woods writes an easy to follow, logical analysis and supports it with facts and examples. The federal government caused the financial crisis by insisting that mortgage companies and banks loan money to poor credit risks based on their ethnicity rather than their ability to repay loans. Fannie Mae and Freddie Mac further compounded the problem by buying the subprime mortgages from the mortgage companies and banks so the latter could make even more subprime loans. Fannie and Freddie then securitized the subprime loans and sold the mortgage-backed securities to investors, i.e. banks and pension funds.

George Bush did his share of the damage by initiating lending based on "no down payment" so that even more citizens could buy “the American dream.” Note: bad ideas by Republicans aren’t any better than bad ideas by Democrats and are just as damaging. That’s why we Republicans need to elect conservatives, not liberal or “moderate” big-government Republicans like George Bush or John McCain.

Finally, the Federal Reserve Bank (the Fed) exacerbated the problem by keeping the interest rate artificially low. Easy credit for one ethnic group soon spread to everyone, and home buying proliferated, fueled by speculation and the belief that the price of homes would continue to rise indefinitely. All of this activity drove the prices ever higher.

When interest rates again began to rise, payments on adjustable rate mortgages also rose and many owners couldn’t make the payments and home loan defaults began to soar. This put a lot of houses back on the market, and an increase in supply generally causes a decrease in price. Soon, thousands of mortgages were collateralized by homes worth less on the market than what was owed on the mortgages. Many people, particularly those with nothing to lose (the no down payment folks) just walked away.

The result of this was a major chain reaction throughout the economy: banks and other lenders failed because payments on their loans stopped coming in; AIG failed because it had insured many of these mortgages and too many of them defaulted all at once, overwhelming AIG’s ability to pay. Thousands of pension funds that were heavily invested in mortgage backed securities lost value, debilitating many people's 401K's.

The major lesson that should be learned (but won’t be learned) is that the government needs to keep its big rotten hands out of the economy. Forcing private industry to finance bad loans and artificially deflating the interest rate was terribly damaging to the economy. The bailout addresses none of these problems and will make the recession longer and deeper. Things will get worse for some time to come. Hope you are ready for hard times.

The second book, "Liberty and Tyranny" by Mark Levin, is a best seller that is going viral and is selling out everywhere. I am only a third of the way through the book so can't fully opine on its contents just yet. Here's my impression so far: Levin describes the country America was intended to be, how the three branches of government were supposed to work, and how the Constitution has been eroded over time. Leftists, or as he calls them, Statists, have slowly but steadily shifted power away from the states to the federal government. Just reading it raises my ire.

So I will spend the lovely spring weather this weekend nursing a cigar in the backyard while I absorb the wisdom of these two authors.

Oh, I almost forgot, check out Robert Ringer's latest articles (follow the link in the left sidebar) on the rise of fascism in the 1930's and its parallels to today. Carol at No Sheeples Here blog also has a great post on this same subject.

Obama is looking more like a brownshirt every day and is following a similar path to absolute power as did leading fascists before him.