Your House Is On Fire – And Mine Is Catching…Thanks


Well At Least Its Not Worth As Much Nowadays...


The Dow dropped 376 points today because Europe’s socialist chickens are coming home to roost…and they’re on fire…and now they’re flocking into our house’s rafters.  Thanks!   Note to every liberal and sympathizer out there –  Socialism does not work!  It kills innovation.  It kills entrepreneurship.  It kills your tax base.  Regulations created to control every aspect of the market and society because you are your brother’s keeper and the government doesn’t trust you to take care of yourself is a proud European tradition.   Taxing the hell out of the productive parts of society and then subsidizing the rest of a country’s lazy work force with cradle to grave societal care is a failure and another European tradition.  Just look at Greece, Spain, and Portugal.  Their economies suck for a reason.  The people expect: 

 A) Luxurious bonuses, B) short work-weeks, C) guaranteed & cushy government sector employment (you think its bad here?), D) health-care as a right, and my personal favorite: 

E) Government checks when you’re a young and able-bodied, yet unemployed person.  Those clowns have no reason or motivation to find employment.  The government gives them a check to pay for rent, food, and smokes for doing nothing, so why work and be taxed to the hilt? 

F) Did I leave anything out?…oh yeah, and you resent America to this day despite us bailing your sorry ass out of not one, but two world wars and then enacting the Marshall Plan afterwards.  Don’t know what the Marshall Plan is?  Look it up here. 

  So, various parts of Europe subscribe to my broad swipe to greater (Greece) or lesser (Germany) degrees.  The problem is, they are all tied together with one currency that is not beholden to one government and its central banks to control.  The fiscal policy of the EuroZone is basically like the old adage of having too many chefs in the kitchen – it doesn’t work out well because there is a lot of squabbling and no consensus.  Germany’s ban on naked short selling without consulting its EuroZone neighbors is a perfect example and the impetus to this bad day on Wall Street. 

  So now that everyone knows that no matter what, you are only delaying the inevitable default of Greece’s debt.  European banks from the larger countries like France and Germany will lose money because they’ve invested it in Greece.  US banks in turn, have invested in Germany and France, and they as counterparties will lose money.  That fear is what is driving our stock markets down. 

    Don’t get me wrong…our economy is not nearly as strong or sound as people make you think.  We have 9.9% official unemployment; with real unemployment that includes discouraged workers to be something like 17.6% the last time I heard it.  You have a 13 year record low of mortgage applications after the $8,000 tax credit.  Its going to get worse because we stole future sales in the months ahead so people could get that free money!  You see and hear the pundits on the TV saying that the economy is improving, but look around you…do you really feel like it is?  Big surprise! it isn’t that great.  Our economy is still in the toilet.  It’s not on fire any more, but it easily could be if something like the collapse of the Euro happens. 

   What you are seeing is a market correction and it could be big and painful.  The stock market, whose increases fuels all of this false optimism is finally being smacked down by something painful like the potential collapse of the EuroZone.  That makes everyone go back to the overpriced nature of our stock market and look at the fundamentals.  They do not support where we are and the brokers know it…that is why they are selling.  They are making their money off of the irrational rise the stock market had been on.   It is psychology and now that the optimism isn’t there to prop up the false highs.  It now has the potential to go down and most likely well below the actual lows if it does.  Markets overreact.   It is the same phenomena that lets people think in 2007  that housing prices will go up forever or in 2001 tech stocks will go up forever.  

Good luck and good riddance.  If you think that being the smartest kid in a room full of dumb kids is good, then take a good, hard look in the mirror.  The administration’s sympathy towards market intervention and socialism is simply Europe-light.  All the debt we are accruing is exactly like what the Greeks have done.  If you think we won’t default on our debt because we can somehow control our spending, then you’re kidding yourself.   It may not happen today or next year, but it will happen.  The course we are on is unsustainable and no one, not even the mainstream Republicans have a real answer.  It takes the Ron Pauls of the world to come up with real solutions and he is considered on the fringe.  Well, that is what it’s going to take kids.  The problem has now become that bad. 

    The end game is simple.  The US will be the last one to go down if we don’t change course, but when it does go down for the count, the world economy will go with us.  China still needs us worse than we need them.  Look at the recent evidence from 2008 if you don’t believe me.  Now look at the ripples Greece has created.  What happens when you can’t run to the ‘safety and stability’ of the US because it’s finally and truly is on fire? 

Those aren’t chickens coming home to roost, they are ostriches. 

– G.S.


5 Responses to Your House Is On Fire – And Mine Is Catching…Thanks

  1. Melissa Ruggles says:

    It should be noted that not all of the European countries have the same extent of social policies as found in Greece, Spain, etc., particularly in Greece….these are some of the things that must change in that country.

    • gadsdensnake says:

      Absolutely. Greece is the worst of the worst. Lying about its debt levels, unwillingness to accept austerity measures, inability to function without corruption, rampant tax evasion…and all while many citizens expect more for less. There is no free lunch. That is the lesson that everyone needs to learn!

  2. Melissa Ruggles says:

    Also the cushy sector gov’t employment is due to the terrible corruption in Greece! 🙂

  3. […] even a year ago, I wrote this article among others.  It was about the Greek Debt Crisis and how Europe wasn’t solving its […]

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