Class Warfare Being Stoked

Today our own Star Tribune in Minneapolis had an article that first appeared a few days ago in the New York Times.  It is written by David Stockman who served in President Reagan's Budget Office.

The article is good news and bad news. 

The good news is that some VERY SERIOUS FINANCIAL topics are finally being discussed in some very large papers...and Lord knows we need to acknowledge problems before we have any hope of fixing the problems.

The bad news is that this country may be about to come apart in a way that few of us could have imagined 5 years ago.

Now pay attention to these paragraphs;

But for decades now, the central banks of the world have been giving policymakers a false signal that sovereign debt is cheap and limitless. Functioning like monetary roach motels, central banks have become a place where Treasury bonds go in but never come out — thereby causing bond prices to be far higher and interest yields much lower than would obtain in a market that wasn’t rigged.


Indeed, the Fed and currency-pegging central banks in East Asia and the Persian Gulf have absorbed nearly all of Uncle Sam’s multitrillion-dollar spree of debt issuance. Moreover, about $4.6 trillion, or more than half of all debt held by the public, is now sequestered in central banks — paid for with printing-press money.

Ouch!!  That's the Ponzi scheme we have been warning about that the U.S. system is running!

And he ends with this chilling statement;

In the real world, however, the global bond market is already rumbling — and around the corner, a fiscal conflagration surely lies.



See it here; http://www.nytimes.com/2011/04/24/opinion/24stockman.html?pagewanted=2&_r=1

Thy kingdom come, they will be done, on earth as it is in heaven.  Lord please give us the faith needed to survive the conflagration that is surely coming.