Alan Greenspan and the Effects of "Creating More"

Junior Mogambo Ranger (JMR) Phil S. sent me a link to an article in The Economist titled “Let’s Get Fiscal,” which is an obvious reference to the song “Let’s get physical,” which is not about, as I originally thought, how you should be holding a lot of physical gold and silver before you start investing in the paper world of ETFs.

The subhead was “Effective tax rates,” with the teaser, “Which government takes the biggest bite out of an income of $100,000?”

“Hmm!” I think to myself. “Government taxes compared to government taxes? Hahaha! Well, I hear a lot of reports that tax evasion in many places around the world is rampant, and in some places it is a matter of historical pride. Therefore a lot of income for many people is, effectively, tax-free.

“This means that one guy being taxed at 100% and 99 people evading taxes would result in an effective tax rate of 1%! Hahaha!”

Well, The Economist magazine did not like my little statistical joke, and without ever mentioning it, or me, again, reports that they have an opinion from somebody with more gravitas than a paranoid lunatic gold-bug hiding in the closet under the stairs, wearing nothing but some ratty underwear and a shoulder-holster “packing heavy heat” while relentlessly hammering out on his computer a stream of weird, disjointed diatribes of outrage about the idiots in Congress turning America into a welfare-state and making vague threats against the foul Federal Reserve for creating too, too, too much money for too, too, too long, a monetary sin for which they must be punished for having unleashed the devouring demon of inflation in prices, releasing the misery and suffering of inflation from the Hellhole Of Things You Don’t Want Unleashed (HOTYDWU), which, for the record, is as bad as it sounds.

The guy responsible for all of this suffering and misery is, of course, Alan Greenspan, the lunatic former chairman of the Federal Reserve who personally created all the excess money for all the years that produced the bubbles in stocks, in bonds, in houses, in derivatives and in the cancerous size of a gargantuan deficit-spending government.

And since Greenspan is an old man now, if we are going to wreak vengeance upon him for the inflationary bust that is unfolding all around us, so that all future chairmen of the Federal Reserve will remember with a shudder the fate of those who foster crazy monetary booms and allow the money supply to rise to produce inflation in prices, we had better do it soon.

If not, we will be whacking on a dead guy which loses something in the “lesson” department when video footage could show Greenspan begging for his life and saying how he is sorry for having created so much money, that created so much consumption, that created so much new debt, that created so much new deficit-spending government, which produced so much more government, which created so many new people now dependent upon government, which created the “need” for more taxes and more deficit-spending, which was accommodated by the creation of more money by the Federal Reserve and the demonic Alan Greenspan, turning government deficit-spending and Federal Reserve over-creation of money into a hellish, poisonous brew that will combine, like a tornado inside a hurricane inside a tsunami during an earthquake caused by getting smashed with a huge killer-asteroid, to produce horrific inflation in prices.

Well, The Economist magazine did not like THAT little diatribe of mine, either, even though I included some terrific explanatory photographs, one of which is me being adorable and photogenic, as usual, while shooting two AR-15s, one in each hand, on full-auto with extended clips containing explosive bullets that catch fire when they hit something, and then whatever they hit catches on fire, too, which, in this case, is a couple of bales of hay with Alan Greenspan’s picture, as a target, stuck to one of them, and the wide, expansive area behind the bales of hay is where my missed shots set everything on fire.

Off in the distance you can see deer and other wildlife running for their lives, adding another other ugly metaphor to this nasty Alan Greenspan and the Federal Reserve thing.

I had carefully cropped out of the photograph the guy, apparently a farmer, whose land and hay bales these were, and who was a real moron who could not seem to understand why I am trespassing on his land or why everything is on fire, which I had to patiently explain, over and over, is crucial to the allegory of the widespread, ruinous, cancerous, catastrophic destruction that Alan Greenspan has caused with his continual, relentless, senseless creation of excess money, from the time he took over the Fed in 1987 to when he “retired” in 2006.

The farmer never understood what I was talking about, and the whole thing turned out to be a bummer for us both. If he had bought gold, silver and oil like I told him, he would have been OK, but he was probably too busy trying to put out his barn, which was also on fire.

But don’t you make that mistake! With monsters like Alan Greenspan, and now Ben Bernanke, in control of inflationary monetary policy, buy gold, silver and oil! It’s the right thing to do, it is the only thing to do, and it is so easy that you gotta say, “Whee! This investing stuff is easy!”

The Mogambo Guru
for The Daily Reckoning

The Daily Reckoning