The Party's Over

An excellent piece by Mr. Peter Schiff of Euro Pacific Capital

http://www.europac.net/externalframeset.asp?from=home&id=14274

There is very little doubt in my mind that this is where we are headed.

I wonder what it will look like this year without all that free-flowing credit.

Has anyone else noticed that store shelves are only partially stocked lately and it isn't because of a run on the products?

Maybe my son will get one PS3 game, but that's it. I'm also telling everyone, pls don't buy us anything.

I'll make some stuff and go to craft shows for the rest.

I haven't bought mall presents for 30 years.

isn't going to fix anything.

The only real long-term economic fix is for us to once again become a largely self-sufficient nation. That means reducing and eliminating the trade deficit and that means that manufacturing must be rebuilt which means that infrastructure must be rebuilt to support the manufacturing base. All of this will require a change in attitudes. Toys can't be the measure of value and success. Brand names cannot be the measure of quality. And dirty jobs have to be viewed with as much respect as any white collar job. It is true, after all, that many plumbers earn more in a week shoveling sh*t than most white collar phone bank workers earn in a month. Anything short of this combination is a temporary band aid solution at best.

From what I've seen many Americans do not have the will - political or personal - to do what is required of them.

I've never understood the American infatuation with consumerism. Then again, i'm not a materialist.

If our system thrived on saving rather than spending, we wouldn't be in the current predicament. Why use credit when you can use debit?

others have been making the same point for years, it's just that now it's happening. And, he hasn't mentioned the crucial problem of the 5% of the world's population being in the US but using 20% of the world's resources-- a situation that eventually becomes intolerable and the world will insist on more of a balance there. Or our excessive spending on the military...

But, you'll notice he's got a book to sell. Maybe he takes a broader view in the book.

they made sense.

...on the economy, and I haven't found anyone who spells it out
more succinctly than Schiff.

Did anyone else see his debate with Laffer on Kudlow and Company?
Schiff called our current situation--months ago. Laffer, now a regular
commentator on Fox News, tried to demonize Schiff. Clearly, the powerbrokers
on the right have been trying to hide the truth from the lower 90 percent, for
a long, long time.

I am wondering when the shineola hits the fan? When does this credit bubble
burst? When does our bad behavior catch up with us?

So many people are hyperfocused on the stock market, practically declaring that
the nightmare is over today--because the Dow rallied. I'm glad the market went
up. However, the crash that will happen--as consumers curtail and even completely
stop--buying everything with rented dollars--has absolutely nothing to do with
the daily stock market numbers.

Watching the confetti throwers who assume that our economic problems are over, due
to the stock market surging--is like watching people get excited about shiny pinstripes
on a car that's been completely trashed in a head-on collision.