patrick.net

@danville,

I highly recommend two small farms, excellent quality, large quantity, I am very happy with them. They are the supplier to some top-notch restaurants in the area. I waited for 5 months to get on, and it is really worth the wait.

Another one that EBGuy recommended is Full Belly Farm, I used them for a while and found them to be rather erratic in quality, some very good (excellent baby potatoes), some lousy (corns), perhaps they were not having a good season when I was on the trial program.

I guess you just need to try different CSAs to see which one you like the most.

Headset,

I give you that, right now cash is king. USD cash also only accounts for 3% of all USD money in circulation.

Here are the two possibilities of this crisis. We get through it, then the system is pumped with billions or even trillions of USD, and we will need to deal with the impact of such pumps later.

Scenario 2 is the worst, we don't survive. Then it doesn't matter either way, we are all hosed.

USD cash also only accounts for 3% of all USD money in circulation./i

Let me propose Scenario 3 - deflation with a very long recovery period. And yes, paying off a $Trillion debt during a deflationary (or very low inflation) period will be very tough. It will mean high taxes, low services, pulling troops from abroad, decreasing size of military manpower and procurement, COLA downward on Civil Service/military pensions, and even cuts in welfare. Social Security collection age may increase.

Scenario 3 won't happen, it is basically collapse.

We are unable to pay our debt off even at today's value, if USD becomes stronger, there will be absolutely no hope of ever paying it off, period.

There won't be high taxes, everyone who makes high enough income to be captured by high taxes will flee.

Scenario 3 is war.

Scenario 3 is war.

Why would deflation lead to war, while refuting our debts via printing press would not?

because by repudiating debt, we are saving most Americans while f*cking the foreign creditors, and we have the biggest guns. Now, unless we are not careful and get into hyperinflationary situation, if we just inflate 20% a year, we can solve the problem through a consistent yet not run-away inflation.

If we do not repudiate debt, we are f*cking most Americans, and that usually doesn't bode well for our existing political structure. Expect Hitler to rise in America.

We are unable to pay our debt off even at today’s value, if USD becomes stronger, there will be absolutely no hope of ever paying it off, period.

It would not have to be paid all the way off. We have had a debt for quite some time. Deficit spending would have to be capped, and the debt would have to be paid down.

HeadSet,

We can cut spending? That is a political fantasy I will never see in my lifetime.

In fact, during depression, ALL governments increase spending to absorb the unemployed labor force. Fiscal stimulus is the last resort, and war is the most powerful way of fiscal stimulus!

From the government's point view, be it the US government or Chinese government or whatever kind of political structure, their ultimate goal is not to manage inflation or deflation, but to maintain employment to sustain social stability. Without social stability, there's no government, and the government is concerned with its own survival above everything else.

This is the period that deficit has to go UP, not down.
- Boomers, the largest block of voters, will vote away their medicare and SS?
- Unemployed (more time on hand to vote and to be politically active) will vote away social safety net?
- Lower-skilled will vote away infrastructure plans to increase employment?

In the end, the tax burden will fall on a smaller and smaller portion of the population, who happen to be the most mobile population who can expat themselves out of the country. Japan has savings to go through 16 years of deflation, news for us, we don't have savings. Japan went through deflation when the entire world was prospering, we will be stuck in a worldwide depression. Deflation simply doesn't work.

if we just inflate 20% a year, we can solve the problem through a consistent yet not run-away inflation.

Ouch!! 20%? Just bring back Jimmy Carter as a write in candidate.

I do not think we can>/i> inflate at 20%. I do not think we can even prevent deflation. If my perception is true, then OO and TOS see a revolution.

Deflation simply doesn’t work.

Deflation is never a choice. It happens despite all governments efforts to prevent it.

Peter P Says:
October 11th, 2008 at 1:48 pm
From Kitco:
"Malcolm, you do not believe in that, do you? If gold had gone up, they would have said:
“Gold and silver soared Friday after Wall Street posted another big loss and forced investors to seek precious metals as a safe haven.” "

Actually that is what they said the day before as it did go up because of the normal knee jerk reaction to buy gold in any uncertainty even when the pressures are the other way. I'm definitely not saying that Kitco headlines are consistent, or the authority, I just picked that one because like you pointed out, the trend changed in the exact way that I had said it would a day or two before because during deflation gold is a burden. It ties up money that could be used to buy something useful. If X gold buys Y stock and Y drops in price you won't leave your money in X because the same amount now buys more Y.

C&R Crap & Rectal

I see a middle area similar to the Argentina collapse. If things got REAL bad, I would still show up to work unpaid. It is not to be nice or out of the goodness of my heart. Simple answer is self preservation. I could almost count on my family and me being fed. As long as I have a warm place to sleep and a full belly, I could tolerate a lot of shit.

It happened to the Russians and Argentineans that did vital jobs for the country. Many of the businesses in Argentina had the owners flee the country and the workers still showed up to work. They took over the company and made it a collective ownership between the employees. It was nothing more than a Communist scheme on a micro level. Later when the owners tried to take it back, the courts sided with the people.

TOB,

This is an interesting line of discussion. Let's not hijack it with snide comments.

Unless, of course, your shot at OO was inside ribbing banter among friends and I missed the joke.

HeadSet Says:
October 11th, 2008 at 5:27 pm
Quotes someone
"We are unable to pay our debt off even at today’s value, if USD becomes stronger, there will be absolutely no hope of ever paying it off, period."
Answers
"It would not have to be paid all the way off. We have had a debt for quite some time. Deficit spending would have to be capped, and the debt would have to be paid down."

Inflation helps debtors. You guys are right on! That is why the government is doing all that it can to stop this slide. Stronger dollar = lower tax revenues, means all this debt is even heavier, and a stronger dollar means it is harder to borrow more because your assets are worth less. Thanks.

If we do not repudiate debt, we are f*cking most Americans, and that usually doesn’t bode well for our existing political structure. Expect Hitler to rise in America.

Interesting that you mentioned Hitler. Hitler came to power in a period of hyperinflation, not deflation.

Inflation helps debtors. You guys are right on! That is why the government is doing all that it can to stop this slide.

Of course gov wants to stop the slide. My point is that thier efforts are futile. The only way the gov could have prevented the meltdown would have been to tighten credit on the way up. Only preventing the rise would have prevented the fall.

If there is one thing I am finding refreshing is that people are recognizing lower prices mean a stronger dollar. It is amusing to see government typically saying higher prices are bad for the economy now scrambling to fight deflation. No wonder half of the people walking around are confused, it makes my head spin too.

Headset, I'm in complete agreement with you.

It is amazing what a one week drop of 18% does to the level of dscourse on this blog.

I thought the same thing, the number of posts is higher than I've seen it for a long time. Funny how people come here for a reality check.

Hyperinflation or deflation, Hitler will rise. Such a figure rises because people are concerned about the country as a going concern.

20% inflation is very bearable, especially for a country like the US with plenty of food supply. Nobody can force hyperinflation upon the US.

What china had before the communist take-over was hyperinflation. Hyperinflation in modern history only happened in two countries, Weimar Republic, and Republic of China 1948.

Lesson 1, don't name your country Republic of whatever, a bad sign.

Ironically this thread caught my attention because I've been telling myself that things will always work out in the end, but this time I see a slight but real chance that the wheels could come off. I don't think it would take very much for riots and some real upheaval. Other great societies have fallen in the past, and I'm sure that when they were falling they were in denial.

It was funny, a couple of days ago the market had lost whatever it had and the girl on the financial news was saying, "look this happened before and the market lost half its value, we're not even close to that" then over the last couple of days we've come pretty close, definitely we're on track to. LOL

Malcolm,

The mantra is "High prices are bad, unless it is houses or stocks. "

After all, anyone who is anyone already owns both, and you don't want thier net worth to fall, do you?

Cash Savers aren't anyone. They just privatize thier interest profits while socializing any losses through FDIC. Didn't pay no moneymen commissions, neither. It would be shame to see them buy a newly cheap house and not contribute half their earnings to debt service.

That sums it up. I'll use that because you're right and I can see how renters here feel bitter because the government does only seem to talk to the homeowners and the stockholders. They are a protected class, and I'm not saying that is always a bad thing, I think as people advance they should own their homes and invest in a long term sustainable way, but even I am disgusted at this reverse class warfare. I am completely disenfranchised.

Headset appears to have had a personal revelation that inflation favors debtors, meanwhile I said this at the beginning of this thread

That inflation favors debtors is hardly profound. That is a universal known and has been commented on for years by myself, Malcolm, RandyH, justme, DinOr, and many others.

I presume that next you will take credit (at the beginning of some thread, no doubt) for pointing out that solar cells usually don't work at night.

OO says : Hyperinflation or deflation, Hitler will rise. Such a figure rises because people are concerned about the country as a going concern.

I will choose to live in poverty than live under hitler.
The only problem is that most people won't think like me.
You statement could well be true.

Hey TOB : why are you so obsession with India ?

Hey TOB : why are you so obsessed with India ?

I will choose to live in poverty than live under hitler.

You can have both, you know.

There is no way our Gubberment will allow deflation.
They will try to pump as much money as they could possibly do.
The only problem is that , money pumping doesn't work when people stop believing in spending and start believing in savings.
Its like the last 10 minutes of matrix movie when neo stops believing in the B.S

The only comments are related to the illegals coming over here and being responsible for everything bad that happens.

snmr,

This sentence:
There is no way our Gubberment will allow deflation.

Is completely refuted by your next sentence:
They will try to pump as much money as they could possibly do.
The only problem is that , money pumping doesn’t work when people stop believing in spending and start believing in savings.

You sound a bit like MiSH:
Well the Fed can print, but the Fed cannot spend. In addition, the Fed cannot give money away, nor would the Fed even if it could. Finally, the Fed cannot force banks to lend or businesses or consumers to borrow.

No gov wants deflation. But doggone it, it happens anyway.

The real purpose of the Fed is to keep wages low.

I read that the savings rate was way up.

Not really going to get into that old debate, they can't be all good or all bad. I have a problem with someone breaking the law to show up but when businesses want to hire them and the quota is set to 0, I don't see how it can be a surprise that they show up. It is also a national security threat to have people just coming and going but we can extend that discussion since we are mentioning Nazis. No I'm not an advocate for illegal aliens but I'm not going to demonize someone who comes here out of desperation either. More of that reverse class warfare I was just talking about, I find it distasteful.

Let's suppose the gov cranks up the printing press and pays off the $2.7 trillion owed to foreign investors.

Did that $2.7 trillion in new money make up for the $trillions lost in the stock and housing meltdown?

Let's just have the gov print a few $trillion more. Who are they going to give it to? Give each household a $1 million stimulus payment?

I'd also remind you that not all illegals are Latins. I've made some Mexican friends in my years in California but in general I don't care much for them. They are dirty, don't think twice about littering, I hate their crap music, they don't take care of business, they won't maintain anything of theirs so they are always breaking down and causing traffic jams. Their life experiences make them somewhat 'stupid' like not knowing that you can't safely cross a busy freeway. They destroy neighborhoods they live in because they don't understand the same norms of decency, like having a green yard, not having 8 cars in front of the house. All those stereotypes I find are generally true, but I just live my life as quietly as I can and if people aren't bothering me I tend to let things slide.

The Original Bankster Says:
October 11th, 2008 at 7:18 pm
"Malcolm, judging by your link there I assume you are of the Bay Area Haight-Ashbury hippie pedigree. This herd has thinned out in the past 8 years for sure."

You'd be way off. I've visited SF three times, I am from the East Coast and have lived in San Diego for 18 years. I have become very interested in environmental sustainability, not for political reasons or because I have something against capitalism, just because I find it is the right way to live.

That link is now outdated as I am just a limited partner in that company. The page and the feel are not really reflections on my personality. The founder of the company is an old cowboy from S Dakota.

TOB wrote :

The stock market in india does not represent Indian economy because India is primarily private.Company financing by going IPO is still not that mature in india and only accounts for a small number.
India is still largely a savings based economy - Good for them.
Thats one reason India survived most global financial disruptions pretty well. A precipetous drop in stock market is like a storm in US but like a fart in India.The only guys who are worried, are the hedge fund managers in US and other international fund managers.Vast majority of people in india don't believe in investing in equities. They just don't trust the company management, thier reportings and management integrity.This is primarily due to lack of regulation and enforcements in finacial markets or for that matter in general in the country.
One more thing , Rupee value is falling like a rock because all the investors in US are pulling dollars like crazy to cover thier asses here.
This is not good for us as it would hasten outsourcing. On top of it, we have bad economy here, which would force companies to oursource more, just like it happened in 2001-2005.
Ofcourse, all this would happen only if we survive the collapse.

In any case, we should worry more about US and less about other countries, unless it affects us negatively.