"I write to discover what I think."
May-June issue "Good Old Days."
and the Missus celebrate our 72nd anniversary this summer. One of our
hobbies is to watch the rise of general prices and compare them to the
prices of the day we galloped out of a northern Baptist Church and
drove to Maine for a two week honeymoon.
Post-war price inflation was already showing up at the grocery store.
For as long as we could remember a loaf of sliced bread cost nine or
ten cents, but by 1948 the price had shot up to fourteen cents.
experienced eleven economic recessions in our years as man and wife,
and hit by price inflation in all but two of our married yeara - 1949
and 1955. We did not expect to be alive when the general economy
went haywire and slipped into a bona fide depression, but we seem to be
headed quickly in that direction after the world-wide onset of the
We are not particularly upset about a depression coming to clean out
the deadwood because we grew up as kids in the depressionary era of the
1930s. From a child's perspective it was not that awful. We were
thrilled to be finally able to raise $5.00 of our very own money to buy
a much used balloon tire bicycle and paint it blue. We were eight
years old. Prior to that we did a heck of a lot of walking!
Here's something to bear in mind: In 1948 we were carrying real
90 percent silver coins in our pockets and the paper currency was still
officially redeemable in lawful money. Although Americans had not been
able to own physical gold coins or bars since 1933 the dollar was still
tied to gold at the rate of $35.00 per troy ounce.
Two weeks before our 23rd anniversary the dollar was disconnected from
any backing by anything of instrinsic value thereby allowing it to be
created by government fiat. Supporters of the Constitutional mandate
concerning the minting of money were quick to point out "They can
create all the currency they want with the printing press or computer
key strokes. But they can't print
To "V" or not to "V". . .
We think the economy is more apt to go to "L".
Harvard economists are predicting the economy will not snap out of its
lethargy by election day. They think we're in for a "U shaped" recovery with no specific
guess on how long the bottom of the letter U will
persist. It could be bathtub
Our guess, as we mentioned recently, is the recovery will be L shaped with the lower part
of the letter stretching for a consierable length of time.
Internet is jammed with amateur and professional economics bloggers who
believe they have the brainpower to predict how the U.S. and global
economy will unfold in the near future. All agree the virus scare
set the economy back to such an extent the federal government is having
to run multi-trillion dollar deficits in order to put some air under
the wings of a suddenlyweak economy. The leading liberal in
the U.S. House of Representatives believes another $3 trillion should
be pumped into the domestic economy to keep it going, although
Nancy Pelosi appears to have no understanding of what eventually
happens to economic systems that are based on the creation of dollars
from nothing (borrowed from the future on the promise of
repayment with dollars of less purchasing power).
White House staff have no choice but to hope for a v shaped recovery. That is, a sharp dip...which has already happened....and a relatively quick return to re-employment and recovery. It is difficult to run a presidential election campaign when the economy is in tatters - as Herbert Hoover discovered in 1932.
The U shaped recovery features a sharp dip, which we have, a flat spot for a while, and then a recovery thanks to a money flood from the government.
Then there's the W. This really is two Vs hooked together. Sharp drop, quick recovery, another dip when reality sinks in, and the a return to happy-ever-after.
We think the L shaped prospect is more realistic. It feature the steep drop, which we have just experienced, then a flat period that drags on until the average citizen realizes no individual or nation can build solid wealth through constantly borrowing more than one takes in. The sages through the ages were right. You cannot constantly live beyond your means without one day going broke.
Cycle of Democracy
"A democracy cannot exist as a permanent form of government. It can only exist until the voters discover they can vote themselves largess from the public treasury.
"From that moment on, the majority always votes for the candidates promising them the most benefits from the public treasury, with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.
"The average age of the world's greatest civilizations has been 200 years. These nations have progressed through this sequence:
"From bondage to spiritual faith;
from spiritual faith to great courage;
from courage to liberty;
from liberty to abundance;
from abundance to selfishness;
from selfishness to apathy;
from apathy to dependence;
from dependency back again into bondage."
Dr. Alexander Tytler, a Scot professor, wrote a scholarly tome, from which this concept comes, called "The Athenian Republic" which was published shortly before the thirteen American colonies gained independence from Britain. "Google" him to learn more.
In publishing a handout on the "Cycle" in 1994 I noted that the national debt had reached a staggering $4.5 trillion dollars. By October 1, 2007, it had soared to $9.06 trillion!. Barely one year later (Oct. 17, '08) it was $10.3 trillion!! . By May,2020, tjhe debt exceeded $25 trillion with prospects of several trillion more! s . Our forebears thought of debt as slavery. They would be shocked at what their descendants have done. - - John Wrisley.
Note: We are aware of the selfless efforts of a Georgia attorney to disprove the "Cycle." He says he painstakingly researched everything Professor Tytler wrote and cannot find the above sequence. He does, however, observe that in Tytler's extensive writings on the nature of democracies through the ages the general trends are as the Cycle sequence states. ~JW
Compliments of www.wrisley.com