My Blog List

Saturday, July 30, 2011


Let's get some definitions-


Noun: An agreement or a settlement of a dispute that is reached by each side making concessions.
Verb: Settle a dispute by mutual concession.
Sounds about right.

We have been hearing the Democrats and their press corps - ad nauseam - hammering the Tea Party members of Congress to compromise on the debt limit.  It's for the good of the country.  It's for the good of the world.  It's for the good of THE CHILDREN!

Lumped into that ad nauseam crowd are the old-school Republicans like John McCain who liken the Tea Partiers with trolls and hobbits.  Really?  One reason I could never make it in politics is that I would have called out "Bought and Paid" McCain.  I would have publicly told that corrupt SOB to shut his pie hole.

"Hey, John.  Compromise is what you've done your entire career.  Look what that's done to your bank balance and what it's done to the country.  You're rich, we're toast.  Thanks, but your input is no longer required or desired.  Now STFU."

How about this -


1. A fundamental truth or proposition that serves as the foundation for a system of belief or behavior or for a chain of reasoning.
2. A rule or belief governing one's personal behavior.
It seems that very few in either house of Congress understand principle.  They understand re-election.  They understand corruption.  They understand compromise.  But principle?  Not so much.

The screeching press won't get off the compromise bandwagon.  Principle is secondary to getting the deal done.  They just can't understand why these Tea Partiers are such sticks in the mud.  Principle is irrelevant.

If the Republicans had two brain cells to rub between them, they'd be hammering the Dems on compromise vs principle.

"Hey Senator Harry.  Here's some compromise for you.  You compromise and do away with the Department of Education, most of the EPA, the NLRB, and the NEA, and we'll compromise and and give you a 1 year debt limit increase.  Koom-bye-yah, baby!

"Oh, and Harry - you go first.  Once we see them being dismantled, we'll give you the debt limit increase.  You see, we've been fooled before into giving up our half first, and somehow, your half never comes to pass.  Not this time, cupcake."

Of course, it's not really about compromise.  It's about protecting turf, paying off constituencies, growing government, and continuing down this path to national destruction.  The idea of compromise is the hammer and the weak spine of the Republicans is the anvil.

Save compromise for the little stuff.  The kind of pizza you're going to order.  The color of the accent wall when painting your house.  You don't compromise when principle is involved.

"Anytime we want to borrow, it's going to cost us more."  Regardless of the TV or radio station I listen to, or blog, website or periodical I read, this seems to be the mantra.

Really?  Why's that?  Yes, if the government wants to borrow more money, then those NEW borrowings will be more expensive.  But the interest payments of currently outstanding debt is already locked.  If we don't borrow more as a country, we have no worries.  Problem solved.

And can someone out there explain to me how the credit rating of the US will affect me wanting to get a car loan or home loan?  Seriously, if someone can explain why this would affect consumer credit costs, I honestly want to hear it.  MY credit rating and loan demand determines the rate I pay, not the credit rating of the US.

The only way the government actions affect my loan rates is the artificially manipulated rates charged to banks by the Federal Reserve Bank.  The INDEPENDENT Federal Reserve loosens or tightens credit, NOT the Treasury Department.  They expand or contract the money supply as they see fit.  What the Treasury Department does is irrelevant.

If the federal government has to shut down, say, HUD, and gets out of the "Anyone who wants a home can get one" business, this will result in even MORE homes being available for sale, pushing prices and loan rates down, saving buyers money.  Supply and demand.

If the government stops subsidizing behavior, the market will set the proper price, usually lower.  In cases like ethanol/corn subsidies, the market would say, "Uhm, that ethanol crap is not as efficient as gasoline.  Without nanny subsidies, it is not cost-effective to run in my car.  No thanks."  The ethanol market would evaporate overnight.

And what would happen to the price of all that formerly subsidized corn?  It would drop like a rock.

Johnny cakes, anyone?!

Now, if I were a bettin' man, if Barry doesn't get his way, I'd bet he'll instruct "independent" Bernanke and the Fed to tighten credit and raise rates.  Gotta punish them thar Tea Party bastards.  He'll run on the, "I Told You So" plank of the Democrat platform.

ABC news and their affiliates are all running with teasers of, "X days until default". 

Lord, give me strength.  I'll say it again:  Default is a choice.  If King Barry decides to not pay the interest and principal payments, that's his CHOICE.  Same goes with Social Security, Medicare, etc.  Barry gets to decide how the pie is sliced.  If he wants to choose to not pay granny, or China and instead keeps the entire federal government intact - and all of those dues paying union workers - so be it.

Why isn't the press pointing this out?

Oh.  Never mind.

Copyright 2011 Bison Risk Management Associates. All rights reserved. Please note that in addition to owning Bison Risk Management, Chief Instructor is also a partner in a precious metals business. You are encouraged to repost this information so long as it is credited to Bison Risk Management Associates.


Joseph said...

Keep the BP down Chief :)

I have my days as well but now work on using current events and the situation of our country as intel to determine how to better prepare my family for the future. As I was discussing with my teens the other day, they can use what is coming as an opportunity or sit with most of the crowd and talk about the good old days while eating their .gov cheese, beer and bread.

Our country is much more constrained for entrepreneurs than it used to be however it still offers opportunity as you well know with your recent store opening.

Our only hope is that the system suffers irreparable collapse and good people are there to rebuild it and send our trashy elites to another country to corrupt.

All the best

Chief Instructor said...

Joseph, lol, the morning yoga helps with the BP!

Yep, use the bumblings of our "leaders" as indications of what direction to take - usually the opposite direction.

I've noted in the past that I'm vehemently opposed to what our Big Government is doing, but there is virtually nothing I as an individual can do to change it. So I adapt. For instance, if they're going to devalue the dollar, I'm doing things that benefit from those actions. They (or the locals) will be raising taxes, so I polish my barter and negotiating skills so I can buy from individuals and not businesses.

Your point about entrepreneurship is well taken. Licensed, above-board businesses. I see this underground biz growing every month. More and more "pickers" hit the flea markets, garage sales, Craigslist, etc., buying stuff and selling some of it to "above board" businesses like mine.

Sharpen your skills NOW, because the economy - at the very best - is going to stay horribly depressed, for years, if not a decade. I think it will crash, but TPTB are doing their best to keep the corpse on life support. We all need to use this time - as they are - to build skills, wealth and contact to thrive during the coming times.

Joseph said...

I think it will crash, but TPTB are doing their best to keep the corpse on life support.
The corpse is dead but doesn't know it any good movie of the genre just remember, shoot it in the head!