Thoughts from Across the Atlantic

Posted: Oct 09, 2012 12:01 AM
Thoughts from Across the Atlantic
Well, it's always a clarifying thing to be out of the country, but while in Europe recently and getting US news through a Euro/global filter. Things have also taken what looks like a decisive turn. Almost all the elements of impending disaster are in place.

The Fed, seemingly following the path of the ECB, announces QE3 just after the Euros commit to unlimited backing of EU debtor nations. Easy money is here to stay on both sides of the Atlantic. In London they are taking measures to rival Singapore as a reminbi center. Don't get this news in the US - too busy running down stories of unimaginable triviality - but whenever I'm outside the US I hear financial stories about the Chinese currency positioning to be a rival reserve currency. The seeds of our coming economic repositioning, and financial diminution, are being put in place. Of course, BHO can't be blamed for not taking the straightforward moves to counter this - perish the thought. I'm sure it's GWB's fault somehow (of course someone needs to explain to me how a housing bubble a couple decades in the making - even Wikipedia's explanation, look up "US housing bubble," is reasonably accurate - is all his fault). Please note that during QE1, western funds flowed to China at a rate of $2B/day. With our new easing, the Chinese will not have to stimulate themselves - they'll use our funds. We debase our currency....and they preserve theirs. Same story....different day.

It also looks like BHO's convention bounce - built on red meat and radicalism for those at the convention, and seeming moderation in prime time - has calcified. The Euros all want BHO: they're tired of US power and recognize a fellow social democrat who will further burden the US with an unsustainable welfare state and Leftist policies that will ensure low growth for a decade.

Look at what's in store: the fiscal cliff, a further risk of downgrade, a radicalizing Mid east (the cries of the Israelis warning about Iran are being ignored) and we seem bent on keeping the kind of leadership that will ensure a non, or tepid, response (from behind of course) to ALL these issues. Don't bother us, can't tend to the global economy or our strategic challenges...we're too busy burdening business with new taxes and regulations and adding to our transfer payments so an ever-expanding number of people are dependent on an under performing central government. Ah, the land of the dependent and the home of the indebted (has a 'nice' ring to it and certainly has the virtue of accuracy).

You want to see the future of the US: come to Europe. Over here they're broke, but they've accepted it. I guess we'll get used to mediocrity as well.

Ordinarily, I'd hold out some hope for the debates, but by then I think we'll be out of undecided voters. I had not thought it possible for BHO to be re-elected. By any objective and historical standard (or even by standards he layed out earlier in his term) he manifestly doesn't deserve it, but we seemed poised to walk into the fire pit. What we are about to do makes no sense and constitutes an economic death wish. You Dems please enjoy the election night party as smiles will be in short supply soon enough.