September 15, 2011
Addicted to Debt
We are addicted to debt. We live in a make-believe world, pretending that there are no consequences to living beyond our means. We have become a nation of borrowers instead of savers; a nation of debtors instead of creditors. This addiction has resulted in the erosion of our cultural life. Just as with alcoholism, the addiction to debt has significantly undermined the stability of our families, our spirituality and peace of mind. Our government encourages this addiction by telling its citizens to spend, borrow, and buy lottery tickets. The recent financial crises demonstrate that this debt binge must end.
During the past three decades, our government’s solution to each financial crisis has been to create more debt by lowering interest rates, and to increase the ease and availability of money. Because previous interventions have generally stabilized financials markets, our political and financial leaders believe that this same prescription is the answer. Unfortunately, we have now arrived at a point where the creation of incremental debt is no longer producing the desired effect on our already heavily indebted nation. We need to address this “tsunami” of debt or spiral into financial chaos.
The current deleveraging process is painful, but this withdrawal is necessary in order to achieve true economic health. Our belief that debt is a cure-all elixir must end. We have deluded ourselves into believing that easy money is the solution to every hiccup in asset prices. Our national income simply cannot sustain current and future debt in the financial system (see attached charts). Unlike Alice in Wonderland, this is not just a bad dream from which we will one day wake-up without real life consequences.
Respectfully yours,
Editor@EmersonLetter.com
September 1, 2011
A World of Debt & the Death of Self-Reliance
We are swimming in a World of Debt. We all know the numbers: a $1.5 trillion government deficit, $14.3 trillion of Public US debt, and somewhere in the vicinity of $50+ trillion in future “entitlement” bills.
The volatility and uncertainty that we have been experiencing in recent years, is just a product of running our personal, corporate and governmental affairs with little or no common sense, and without any consideration for the future.
The abdication of ethical and moral responsibilities by individuals, corporations and politicians over recent years, has reached such a state that we are now living in an Orwellian nightmare. We no longer follow our own ideas and instincts, but rather rely on a biased media, and a corrupt and incompetent government. Unfortunately, both the media and government are controlled by a morally devoid corporatist state.
The death of Self-Reliance has resulted in the fact that we now live in a make believe world of Big Brother and Doublethink.
Why this has happened, and how we can rescue ourselves from this illness will be more fully explored in future Emerson Letters.
Respectfully yours,
Editor@EmersonLetter.com
