Bob Woodward Inadvertently Confirms Our Coming Economic Apocalypse

American Thinker ^ | 09/10/2012 | Monty Pelerin

[SeekAndFind]

Bob Woodward has yet another book coming out, and the consummate Washington insider provides us with a glimpse of what's in it. In doing so, he inadvertently confirms what so many internet pundits have been warning about -- an economic catastrophe of unimaginable proportions.

In the article in the Washington Post, Woodward describes the debt-ceiling confrontation between Congress and the President. It is likely that Mr. Woodward or most other political types do not recognize the admissions contained within the article. For these people, politics is a game of winners and losers. That is where the drama and excitement is.

For these folks, economics is a sideshow. To them, economics is to politics like the Toledo Mud Hens are to the New York Yankees. If the Mud Hens send someone to the majors, then these people consider how it might affect the Yankees' chances of winning the World Series. It is Woodward's fascination with the interplay of politics and politicians that dominates his article. The title of the article evidences this Beltway fixation:

Inside story of Obama's struggle to keep Congress from controlling outcome of debt ceiling crisis. The real story is missed. That is the admission of the hopeless condition of the US economy.

Anyone concerned with the impending economic collapse will find Woodward's account fascinating, although not for the reasons he intended. He stumbled into truth, important truth, and seems to have missed it entirely. What follows is an excerpt from the article with the italics added by me:

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Another possible outcome, Geithner said, was perhaps worse. "Suppose we have an auction and no one shows up?"

The cascading impact would be unknowable.

[rbg81]

Well, one entity WOULD show up at the auction: The FED. It would buy USTs with $$ conjured out of thin air, but it would buy them all the same. Of course, if that happened, then everyone would know the Emperor has no clothes and it would just be a matter of time.

[ComputerGuy]

...Federal Reserve, the counterfeiter of last resort...

Good post.

[bert]

There is another, a more likely possibility. The Woodward piece will be evidence that the successor was set up to fail by an administration that bluffed it’s way through the last year(s).

Any body who knows anything knows the next two years are going to be very difficult for the next president. The one who knows this best is the one who has no clue as to how to solve the problems........ The One himself

[vanilla swirl]

“Any body who knows anything knows the next two years are going to be very difficult for the next president.”

Another reason I’m not so hot to elect Mittens.
There will be a collapse sooner or later, whoever is in office will be blamed. Of course if it happens to Obama it will be Bush’s fault.

[Sgt_Schultze]

What he does know, and what he does plan to do is more of the same ... spending $400,000+ per ($28,000 per year) job “saved” or created.

[ZOOKER]

How come nobody ever thought of this before?

When you're broke, unemployed, and can't pay your bills, here's an easy fix: raise your debt ceiling and borrow what you need.

Of course you have to find someone willing to loan you the money. It's not like you can print your own...

[MrB]

When it all comes crashing down, ya gotta ask yourself one question...

who do you want in charge at that time and what do you think they’ll do in reaction to an economic crash.

Ya gotta choice - a dyed in the wool Marxist who hates America,
or some wall street business guy.

Sure, with the latter, some private individuals are going to capitalize on the situation and come out VERY VERY rich.
But with the former, we’d end up being slaves to the Marxist state.

[StAnDeliver]

"The Woodward piece will be evidence that the successor was set up to fail by an administration that bluffed it’s way through the last year(s). Any body who knows anything knows the next two years are going to be very difficult for the next president."

It's either the fiscal cliff, or hyperinflation. Bobo could do the Zimbabwe Paper Shuffle all too well...

[MrB]

There’s a youtube video of a guy going to his banker and asking to get his debt ceiling raised.
He uses the same numbers as the fedgov, minus several zeros, to bring it into perspective.

I can’t find it right off, maybe someone else can.

[Lorianne]

None of the people vying for president (both now and in the primaries) had the guts to tell the American people the truth. The only one who came even remotely close was Ron Paul and even he sugar-coated it. Paul Ryan came close but then has backed away.

I’m to the point of asking myself why any sane person would even want to be president or vp in the next couple of years? What are they going to get out of presiding over such a mess? It can’t be the glory of fixing it if it is unfixable ... so what else are they doing it for?

[MrB]

Raise My Debt Ceiling

[blam]

"I’m to the point of asking myself why any sane person would even want to be president or vp in the next couple of years? What are they going to get out of presiding over such a mess? It can’t be the glory of fixing it if it is unfixable ... so what else are they doing it for?"

Good for you. I asked that and other similar questions myself.

One question I have for myself that goes unanswered is:

If things are going to get as bad as I suspect, why aren't I doing more to prepare?

Rush said today that if Obama is re-elected that the world economy could collapse in as little as eighteen months.

I think it will collapse no matter who is elected...it's just a matter of when, IMO.

[familyop]

"Another possible outcome, Geithner said, was perhaps worse. 'Suppose we have an auction and no one shows up?'

The cascading impact would be unknowable."

Not really. The fun will have already started by then. Bond yields will go up because of the risk, making the pensioned herd very happy (propaganda from investment managers/advisers). Increasing interest rates, contagious, will spread to the rest of the system. Bonds prices--that is, bonds--will collapse. The various levels of government will lay large numbers of employees off.

Meanwhile, with such higher interest rates, government-linked business will shut down more rapidly. From there, the whole economy will collapse.

Won't it be wonderful? The creepy, ruling political/regulator class--down for the count! For lack of valuable, real revenues, we will see properly small government at all levels, no false accusations from NIMBYs, no HOA queens, no malicious gossips, no environmentalists, no animal worshipers,...

So really--why all the negativity? ;-)

[tanknetter]

There is another, a more likely possibility. The Woodward piece will be evidence that the successor was set up to fail by an administration that bluffed it’s way through the last year(s).

Here's a scenario that's been on my mind that last couple/few days.

Obama loses in the November. The Dems retain the requisite number of seats in the US Senate to filibuster at whim. Mittens is largely helpless to do anything substantive to really fix the situation and the economic slide continues.

In 2014 the Dems retake both the Senate and House and the situation further snowballs.

Then in 2016 Obama, riding in on an "I told you so Tsunami", becomes the second President in US history to win a second but non-consecutive term (Grover Cleveland is the other) ... and is perfectly positioned to finish what he's been starting these past four years.

[bert]

That is scary.....really scary.

Romney and the Republicans have two years. If there is not improvement by ‘14 and there is a Democratic House and/or Senate, it will be all over.

Unless there is real blood spilled on the senate floor and Democrat obstructionists are allowed to prevail, change will be difficult. The liberals must be literally beaten into submission. The pain must be real and must be intense.

[EBH]

When Rush and the major pundits start talking about a ‘collapse’ it is noteworthy. I heard him yesterday too. And my thought was Rush doesn't say this kind of stuff...maybe to debunk it, but not ‘warning’ about it.

I think a caller said 18 months, it will be much sooner than that if 0bama is re-elected or if Mitt fails to issue repeals on all 0bama’s EO’s.

Mitt's promised to repeal stuff...0bamacare included. If he doesn't or congress continues to get hogtied it is over. Mitt will need to act like Donald Trump and dictate for the first 2 years our fiscal policy...if he doesn't collapse is a certainty. If he does...he just might help us navigate the hurricane. But...never thought I'd say this...it will take a strong hand, like a dictator, to reign in the government.

I think that is the difference between 0bama and Romney. They both will need to play dictator, the question is what each will preside as dictator over....private sector or government.

[Cringing Negativism Network]

You have hit on a truth, though not mentioned the reason:

America is in a very unsustainable position: We buy a (bunch) of imports. Billions.

That is a terrible thing. Sure a couple Americans have set this up so they make money on it, but primarily it’s a scam.

America needs to MAKE things. We must break this prospect of imports.

It will destroy America. We need to make things.

Series. It’s something nobody mentions.

Nobody.