The True Burden

We have a rapidly growing problem in America that is far larger than the public debt.

Whatever the Federal, state or local governments might owe, that’s their problem.  The source of their funds to satisfy their debts relies almost entirely on the wealth of the household that they tax (be it household income or assets).  Therefore, the ultimate review of our nation’s viability must be about how healthy the household is.  In my view, the survival of everything else rests on the survival of the household.

So I look at it as a sort of end-game process, if you will.  When we are younger, we work.  That subsidizes being alive in that time.  But ultimately, the wealth we accumulate along that way must be adequate to fund that end-game – the years that we no longer work.  So the following is my methodology for how I look at that (it's a little dense, but if you can get through the next couple-few paragraphs, you'll do fine).

I look at the US household’s true burden as a function of how much A) net financial wealth we have as a multiple of B) an expected adjusted disposable income stream it must ultimately subsidize.

A – Net financial wealth. Total financial assets, less total liabilities.  Total financial assets are all deposits, money market instruments; credit market instruments (e.g. treasury securities, savings bonds, municipals, corporates, mortgage notes, agencies, etc.); stocks and mutual fund shares; life insurance and pension fund reserves; and equity in noncorporate businesses (e.g. the net worth of the shop mom and pop own).  It’s basically everything a household owns, other than the house, the car, your comic book collection… assets that can be readily liquidated.  Total liabilities for the household are mostly the mortgage.  [All of this data can be found in the Federal Reserve’s Flow of Funds report, table L.100.]

B – Expected adjusted disposable income.  Our quality of life during our retirement years is going to be financially dependent on whether it can maintain the income we had grown accustomed to during our working years.  So I start with disposable income (what's left after the government takes its share).  From that, I subtract Social Security disbursements.  Why?  Because we are trying to come up with a number that must be covered, that social subsidies do not.  Remember, this is now the income that is no longer there, because you aren't working anymore.  [My present shortcoming here is, I haven’t figured out how to think about Medicare payments yet, especially as health care costs are demonstrably different vis-a-vis age.  This data is from the Bureau of Economic Analysis and Treasury budget statements.]

So as I said, my barometer of the true household burden is basically A as a multiple of B.  But let me expound a bit more on B… B is the total cumulative expected shortfall in income, net of Social Security payments, during the entire period of our retirement.  [And another shortcoming here is that, I just use a flat 65, for retirement age, when clearly it is ~65-67, but I haven’t figured out how to feather that in yet.  That won't change the analysis much though.]

In 1950, there were 12 million people, or 8% of population, over the age of 65.  Today there are 41 million, or 13%, and that is expected to max out at around 20% in about 20 years from now (per a Congressional study I read).

In 1950, people died on average at age 68.  Now they die on average at age 78.  In 20 years, that will be more like ~80-81 (per that same study).

In other words, all the household wealth in existence in 1950 only had to cover three years of retirement, and for only 8% of us.  Today, our wealth now must cover 13 years of retirement, and for 13% of us.  So just because people live longer and more (baby boomers) are now retiring, that burden has increased to an effective ~7 times that of 1950.  Extrapolating out to 2030, that burden is then estimated to have become ~13 times that of 1950.

This unsustainable burden is a simple function of improved health and thus longevity.  If we want to continue social subsidies as billed, we need to raise taxes.  Otherwise we must cut subsidies, lengthen the retirement age (same thing), or just give old people a hunting knife and a sleeping bag and send them off into the woods to fend for themselves at some point.

Neither option endorsed gets anyone elected, does it?  Thus why we continue to not have that conversation.

So I think the graph (below, through Q2 2012) says it all.  In 1950, household wealth after all liabilities was enough to cover 12 years’ worth of disposable income, net of Social Security, for retirees that only lived three years past retirement.  Today, our wealth now covers only three years for retirees that live ~13 years or so past retirement.

 

Am I being unfair, because I only use net financial wealth?  OK, sell the house, have a yard sale.  It’s the same disturbing trend.  Total net wealth in 1950 covered ~20 of only three required years then, and only five of 13 required years now... 

 

[As a quick aside... notice in the charts how little the massive bubbles in the stock markets of the late 1990s and the housing markets of the mid 2000s did anything to wealth appreciation relative to this growing retirement burden.  Scary, huh?]

And here’s the worst kicker of all that… most of that wealth is owned by just a small group of people.  The top 1% population owns one-third of all our wealth.  The top 20% owns four-fifths of it.  So unless they all suddenly become lavishly charitable, redistribution will become a growing theme whether we like it or not.

Either way you slice it, we are completely upside down.  This is the real dilemma, not Federal debt rising in abruptly in recent years to $16 trillion.  The total subsidy (Social Security, Medicare, et al.) is a potential ~$40-50 trillion problem going forward.  And that’s just the subsidy that’s supposed to support our retirement years.  Which I hope you get, this entire analysis is just about the part that those effectively bankrupt systems don’t subsidize.

Basically, population and age inflation just outstripped net asset price inflation.  There simply isn’t enough pie around for everyone anymore, given a maturing population and rate of output, no matter how you cut it.  So unless we figure out a way to get back to consistent ~4-5%+  GDP growth going forward, our standard of living must decline.  Or our population.  Or our longevity.  Or all of the above.  And regardless of what redistribution we engineer.

Which means that, unless we reinvent another industrial boom (which isn’t out of the picture), this nation is headed toward some serious societal conflict in the decades to come.

All the Way

In 18 days we are (finally) going to elect a President.  (Although given the seeming tightness in the key battleground states, as well as the two parties’ self-preserving intransigence of late, I have this strange feeling we are going to be doing something along the lines of counting chads in three to five of them for a little while after.)

From an economic point of view, it doesn’t really matter to me who we (or the Supreme Court) ultimately elects our next President.  It’s all good, either way.

If the perceived pro-business Republican pretender wins, business leaders (right or wrong) will feel more comfortable.  So that theory goes, they will start deploying the massive stockpiles of cash they’ve been hoarding into long-delayed investment projects, begetting the job growth we so desperately need.

If the Democrat incumbent wins, we’ll initially have the same anemic landscape that we’ve had for the last four years.  But with one little difference.  (I heard President Clinton say this some weeks ago, and I feel he is so right…)

The publicly articulated singular goal of the Republican leadership in Congress has been to ensure that the Democratic President does not get another term.  If they fail here and he gets his second term, that goal (term limits what they are) becomes moot.  The Republicans will need a new goal.  And maybe – just maybe – they might want to consider focusing on things like averting the collapse of our full faith and credit.  Further, the Democratic President, effectively done forever more with respect to campaigning for his election, might be more amenable to dealing with that presumably now less obstinate crowd.

And as I’ve contended, the greatest drag on economic progress in the world for the past few years has been the lack of leadership in the one nation that has led the world since at least the end of World War II.

If we can believe in that scenario now, then there’s no need to wait for it.  Time to invest is now.  Don’t be afraid of Europe’s sovereign crises; of China’s house of cards.  They languish because we do not lead.  I feel that it is time for our economy to begin emerging from the depressive effects of the financial crisis, primarily because I believe that the will to remove the greatest impediment to that will finally have arrived.  Our political leadership will begin to do the hard things after this election, simply because it no longer serves their selfish interests to not.  At least maybe long enough, before the next cycle, to get us on course again.

Just the appearance of working together – even if that work moves slowly, so long as it moves – in my view will finally be enough to encourage the world.  Our economy is still by far the largest on the planet.  It is the most integrated – economically, financially, geopolitically – into every other one of note out there.  Our massive engine of consumption pulls the rest of the world along with it – up or down.

That includes Europe.  Their teetering recessions will go away if we start back up again.  With that, eventually their debt crises.  China may have recently become the second largest economy in the world, but it still relies very heavily on an export driven model.  So long as it continues to, its strength relies on the strength of those they export to – the US and Europe.  In that manner, whatever their economy’s size, they do not lead economically.  They are led.

I know it’s easy to get glum about it all, when surrounded by so much real and present negativism.  But all you have to do is look a little bit further down the road at this point, and it really doesn’t look so bad.

So take heart.  Get out there and vote for your guy, whoever that is.  And believe that it’s going to get better either way.  If anyone’s been reading my crap, they know that I have been rather jaded and cynical about all this.  So if even I can get there in my head, maybe you can too.

Let’s lead the way.

Fire Big Bird, My A**!

Let’s have a little fun with the Federal budget, to maybe get some perspective on what to cut.  First off, as of fiscal 2011 (year ended September 30, 2011), we spent $3.6 trillion… but only took in $2.3 trillion.  Hence our $1.3 trillion annual Federal budget deficit.

So if we can’t raise revenue, we need to come up with ~$1,300 billion in cost cuts.  Let’s look at some common ones thrown out there by our politicians, when they are trying to avoid giving a hard answer to a hard question (which is invariably)…

Like Governor Romney’s recent (and way over-publicized) comments about firing Big Bird.  So let’s shut down the entire Corporation for Public Broadcasting which funds among other things, PBS, NPR and the show that his Presidential debate moderator, Jim Lehrer, hosts.  And let’s get rid of those hippie-loving National Endowments for the Arts and Humanities.  Art, history and philosophy is for losers anyway.  And do we really need to keep track of what our politicians say?  They never deliver on what said.  So take out the National Archives as well.  And the world already totally loves America, right?  So get rid of the Broadcasting Board of Governors, the guys who run Voice of America and Radio Free America.  And what have those foreigners done for us lately, anyway?  So no more Peace Corps.  Further, I find museums boring.  So no more Smithsonian Institution.  Aside from looking after Indiana Jones’ ark, I have no idea what they really do anyway.

That’s a good start, right?  Sounds like we made some progress.  So where does all that chopping get us?  That has reduced our gaping $1,300 billion annual deficit too… $1,297 billion.  That’s it!  Take away, forever-more going forward, all that those institutions contribute to our culture, in exchange for barely even scratching the surface of our annual problem.  That is not a good cost-benefit plan.

OK so what about NASA?  Their total budget is $18 billion, and only $8 billion of that is actual science and exploration.  The rest of it is for stuff like babysitting our satellites.  So take out the National Science Foundation (the “NASA” of all things not in space), which is only $7 billion.  The Small Business Administration?  $6 billion.  Federal Communications Commission?  $9 billion.  The Environmental Protection Agency?  $11 billion.  Corps of Engineers?  $10 billion.  The entire Department of the Interior (mostly runs our parks and preserves and, oh yeah, regulates guys like BP)?  $14 billion.  National Oceanic and Atmospheric Administration (NOAA)?  $ 5 billion.

Take out all of those as well (which is unrealistic), and we still have a $1,217 billion problem.  Every year.  Defund all of those programs, and we have only reduced our current deficit by 6%.  So whenever you hear anyone suggest the above, you are free and clear to roll your eyes and stop listening to them.

The vast majority of our $3.6 trillion budget is some form of social subsidy, entitlement or welfare transfer payment.  Basically the cumulative result of our politicians trying to buy our votes over the years.  Perusing the budget, I added-up almost $2.4 trillion in effective hand-outs.  Two-thirds of it!  All basically mandatory, meaning can’t be cut without changing the law.  Which requires Democrats and Republicans cooperating (which I think they actually will do into the next term).  $780 billion of that was Social Security payments.  $760 billion was for Medicare and Medicaid.  (Both net of receipts from the public).  The rest is stuff like benefits for Veterans and civilian government employees, unemployment insurance, food stamps, Section 8-like housing, farm aid, etc.

I also identified ~$750 billion in expenditure related to defense and security.  That ranges from Army/Navy/Air force to FBI, DEA, ATF, Bureau of Prisons, Secret Service, Coast Guard, Capitol Police, etc.  But it excludes Veterans’ and other related benefits (they’re subsidies).

(Now this won’t add up perfectly doing it this way because of inter-agency eliminations and unallocated disbursements but…)

In fact, after combing through every single line item, I could only find about $365 billion of that $3.6 trillion that was actually for operating the government; and not some form of hand-out, or defense and security related, or the gross interest on the debt (which is now over $450 billion, even in this super-low interest rate environment, by the way), or payoffs to foreigners (which I could only find about $33 billion).

In other words, if you shut down the entire operating government unrelated to defense and security that would only reduce our annual deficit by less than one-third.

So we can raise revenue.  We can raise taxes and kick an already weak economy in the ribs.  Or we can pray or figure out how to grow the economy itself.  Income and payroll taxes in fiscal 2011 were $2.1 trillion – the vast majority of the Federal government’s $2.3 trillion revenues.  It is also 14% of GDP (national income approximates national output).  In 2006 when the economy was stronger (and with the same tax rates as 2011 basically, except for some temporary present forgiveness), those taxes were 16.7% of GDP.

So if we could strengthen the economy, get people working again like 2006, just using this simplistic and sloppy back-of-the-envelope math, that could add ~$400 billion in revenue right there without raising taxes on anyone.  Cut our debt in half (where we were just four years ago), and interest on it drops by maybe ~$100-150 billion.  Go back to a pre-“War on Terror” style of defense/security, that could save ~$100-150 billion.  And I believe there's ~$50-100 billion of Recovery Act related and/or depressed economy expenditure that would go away.

So that right there takes out maybe ~$500-700 billion.  But that still leaves a ~700 billion hole to fill.  And, PS, there is absolutely no guarantee that our economy or debts will return any time soon to pre-financial crisis levels.  The only thing left at that point is I) raise taxes (when the economy is fit) or II) cut social hand-outs – the lion’s share of the latter being Medicare/Medicaid and Social Security.  Or do both.

This is the conversation that our elected representatives need to be having with us.  (And before the elections.)  It’s going to have to come from everywhere – and that includes higher taxes on everyone, as well as cutting social subsidies promised to us over the years, but now cannot be delivered as promised.

So it might be easy to laugh at Governor Romney suggesting we fire Big Bird.  At least for Democrats.  But aside from their laughter, I don’t hear anything serious coming from the Democrats either.  That’s because they all know about the substance of the above analysis.  And they are doing everything they can to avoid having to talk to us about that.

But we’re going to have to talk about it at some point.  And I really hope we start to, before the world currency and bond markets force us to.  Because at that point, it’s too late.  So, OK... "ha ha ha, fire Big Bird..." now please let’s dust-off the Simpson-Bowles Plan and get the conversation going already.

Crossroads (re-post)

Wrote this in December 2011.  And I keep re-posting it.  Sorry.  And I know it's just my dopy opinion.  But the thrust of it underneath the opinion at least is, in my view, so terribly important to ponder, as we approach a Presidential election that perhaps now more than ever represents such a crossroad...

... Our representative democracy here in the US will now come to face an existential question. Can a representative democracy do the right thing when there are no longer any good options? Can we make the tough choices necessary to sustain the prosperity of the people, when it might come at some cost to the prosperity of the individual?

Despite its obvious imperfections along the way regarding equality for race, creed or gender, it seems to have worked reasonably well on the way up. When America has no foreign competition, because all those that would be, have literally been destroyed by fighting World War II on their own soil. When the standard of living as a result increases by leaps and bounds, year after year. When opportunity awaits the motivated, persistent, hard-working and talented who reach out for it. When all of that creates so much wealth, our politicians can promise everything to everyone – purchasing our votes with our own wealth, and as if to suggest our successes actually had anything to do with them.

But what about when that upward arc begins to flatten out? When we have real global competition for the first time? When that bleeds away our standard of living into other quarters of the world, no matter who we vote for? When there’s no more fat for politicians to carve off and sell back to us? When we now must make adjustments, sometimes hard choices; real decisions?

Suddenly it’s not so fun anymore – not necessarily being the undisputed “number one”. Suddenly it starts to feel and look a lot more like yet another aging empire. That’s when people’s true character starts to come out. When it comes down to survival, it’s suddenly every one for themselves once more; so characteristic of all heretofore societies in their last days that collapsed under their own weight.

And then the radical ideas don’t seem so radical anymore. And then the people might actually be willing to deal with the devil that they don’t know. And then revolution is in the air once more. Dangerous words – the spark of so much war, so much blood, so much suffering in the past century. So dangerous, because they speak of something so real and, from time to time, so present.

In a representative democracy, if the political leader is unwilling to give us the spinach we need instead of the ice cream we want if you will, it is because the electorate is unwilling to eat spinach – no different than a spoiled child. After all, how can even the well-intentioned politician do good, if he can’t get reelected? And what is to become of that representative democracy, when its governance must rely on the consent of the spoiled?

It prevails as every child, once spoiled, ultimately must – through discipline. There simply is no other way. Yes, we have become spoiled. I can say it, because I’m not running for public office. But whether I was or not, I would also remind us of the following…

We are a great society – I believe the greatest that can be found in the history books. But we are at a crossroads. If we want to continue to flourish with many more days to look forward to, it is up to us individually and collectively. If we want serious politicians to make the serious decisions required for further prosperity, then we the people must get serious, be disciplined, grow up.

Because, right now, we don’t have any politicians acting serious – that’s for sure. Even the ones that want to. And that is nothing more than a reflection of those who would vote for them. We are going to have to try something new now. We the people are going to have to vote for the politicians that tell us what we don't want to hear. They do exist. They're just hiding right now, because they want to keep their jobs.

Being serious means we must ask for less right now. Not because it is ignoble to strive for that great society on the hill, but because the latest generation has misspent our treasure, allegedly trying to get us there, and we have to be the responsible ones now and pay for their folly. With taking less, we will also have to give more. That is if we claim to care a lick about everything we have built, and the children who we would pass it on to.

We must remember to rely on ourselves, and ourselves alone, while at the same time be mindful to care for our sister and brother when they’re down. The sanctity of the individual – of individual achievement, expression, success, dominion – must be preserved at all costs. And part of preserving that means we must be charitable and remember to safeguard the individual sanctity of our neighbor.

Never have we been better situated to succeed in that endeavor. Because we stand at a moment in history – as the richest and most powerful nation to have ever existed on Earth – where we can learn from the lessons of all others that have tried and failed.

The only thing left we need is a little resolve and discipline. And the smallest reminder that this great nation was built by great people – was built by us – I believe is all it takes to evoke that which is already within us.

For if we don’t rise to the occasion, all we ever will have been in the annals of history, is someone else’s lesson of what not to do.

The Frightening Reserve

The Federal Reserve is our nation’s central bank.  It, unlike other central banks of the world, is a body independent from our government (although its board members and chairman are appointed by the President and ratified by Congress).  With its establishment in 1913 it has a mandate to promote price stability, full employment, low interest rates; as well as regulate the commercial banking sector.

Their tools take the form of monetary policy actions, not fiscal policy actions.  In other words, they can influence interest rates and the money supply.  But they can’t spend and raise revenue through issuing debt or levying taxes.  Only Congress and the President through the Treasury can perform those latter.

The Fed’s most commonly used tool has been traditionally influencing higher (“tightening”) or lower (“easing”) the interest rate banks pay to borrow funds.  Raising those rates chills bank lending activity, if the Fed fears that the economy may overheat and cause inflation.  Lowering those rates tends to spur lending activity, if it has slowed from fear of recession.

That’s worked pretty well for most of the past century.  Until recently.  Commencing in 2007, when it became abundantly clear that we were heading into a severe and unprecedented credit crunch, the Fed began lowering rates toward an unheard of (just pretend Japan doesn't exist) zero percent.  It has since held rates near zero for almost four years now, and yesterday indicated that it will continue to do so until at least mid-2015.

In essence, the Fed has indicated that it will keep the cost of borrowing funds for banks free, for the better part of a decade.  Most easing cycles of the post-World War II period lasted for a handful of months to maybe a year-and-a-half.  Typically, our current unprecedented level and duration of low interest rates would have caused the economy, and likely inflation, to explode long before four or seven years had passed.

But that hasn’t happened.  Growth is weak.  Jobs are recovering at the worst rate since the Great Depression.  And broader indications of consumer inflation indicate that it has been hovering in a very benign zone of ~1.5-2.5%.

The reason that hasn’t happened is because we are suffering the deflationary effects of a depression - what the Fed is trying to avert.  The cost of stuff we buy might not have declined yet by virtue of the Fed's monetary stimulus to-date, but deflation nonetheless is finding ways into the system in the form of declines in wages, for instance.

A depression is different than your typical recession.  Recessions are caused by the natural ebb and flow of the business cycle.  Depressions are protracted and deeper than typical recessions, caused by a long period of society-wide debt pay down after an over-expansion of easy credit and leverage.

They simply take a real long time to work out.  And there isn’t much anyone can do about it.  But the Fed keeps trying, as the lack of any political fortitude has neutered any further fiscal action.  On top of years-long zero interest rates, the Fed has also been making outright purchases of securities in the market place.  This is their so-called “quantitative easing” (“QE”).

So what does that do?  In essence, it places cash directly in the hands of financial institutions.  In their conventional easing process of lowering short-term interest rates, the Fed literally purchases treasury securities with very short maturities from banks and other financial institutions.  The Fed is bigger than that market (as it has unlimited purchasing power, ultimately backed by the Treasury that can print money), so its actions influence market interest rates lower.

But once it pushes rates to zero as it has, that policy becomes ineffective – the so called “liquidity trap”.  So that’s when they resort to the unconventional QE.  With QE operations, the Fed purchases treasuries with longer dated maturities for cash.  This is more potentially inflationary than their conventional method of easing for a couple reasons.

Firstly, in their conventional method, they don’t really buy those very short term securities for cash.  They purchase them in exchange for a “reserve credit” that the bank can put on its balance sheet.  Think of it as a casino chip - it has value to the casino (to the Fed, that requires banks to keep a certain amount of funds relative to deposits), but no value outside of the casino.

Until the bank actually "cashes in" that credit and uses it to make a loan to someone that wants one, the Fed has not issued cash into the money supply.  And in case you haven't noticed, banks haven't been exactly tripping over themselves to make loans nowadays.

QE is different.  It is a direct purchase for cash of securities by the Fed, with money (at this point) literally printed out of thin air by the Treasury.  It immediately and directly expands the money supply.  And since it is purchasing securities that don’t mature for years – where in conventional easing they typically purchased securities that mature in days – it effectively expands that money supply for years longer than standard easing might.

Further, the Fed isn’t just buying treasuries (notes issued by the Federal government to borrow money).  But let’s just look at that for a second.  Through QE, the Fed is borrowing money printed out of thin air from the Treasury… to buy notes issued by the Treasury to borrow money.  In other words, through the Fed (as independent as it may be) our government is lending money too itself and in that process just printing money to keep the whole nation from collapsing into a deflationary spiral.  Nice.

So they’re not just buying treasuries, as I said.  They are also buying mortgage-related securities.  Remember those things?  That caused the financial crisis?  The Fed’s buying them because no one else wants to.

Which brings me to my point.  I have maintained for three or four years now that the financial crisis never really ended; that the crisis has just moved to different quarters; that the threat and risks are still with us, just manifested in a different manner.

Today, those risks of using excessive leverage to invest heavily in risky assets are being moved off of the private sector’s balance sheets and onto the Fed’s balance sheet (as well the Federal government's as weak economic activity increases its debts from lack of adequate revenue collection).  Pre-crisis, say late-2006, the Fed’s balance sheet was roughly $900 billion of assets and liabilities (the Fed typically maintains a “matched book”, where assets equal liabilities).

At year-end 2006, the Fed’s liabilities were mostly our checkable deposits, $779 billion (a good chunk of the money supply).  Their assets were mostly treasury securities, $741 billion.

Moving forward to today (latest report is through 31 March 2012), the Fed’s balance sheet is over triple what it was – now $2.9 trillion.  It’s never been expanded anywhere near this size before in its century-long history.  Their liabilities are now about $1.1 trillion of our deposits, and now $1.5 trillion in member bank reserve credits.

So with about $2 trillion of quantified Fed activity geared toward stimulating the economy, they have increased our deposits by a mere ~$300 billion.  In essence, ~15% effectiveness, if you will.

The rest of that “stimulus” – the $1.5 trillion of reserve credits (which was a scant $19 billion in 2006) – sits on bank balance sheets across the land not being lent.  Even though those funds for lending come free for the banks.

Which is why the Fed moved on to QE.  If the banks won’t use the funds to expand the money supply, the Fed will just eliminate that “middle man” and do it directly themselves by purchasing securities outright.  So now they own $1.7 trillion treasuries (up from $741 billion) and… nearly $1 trillion in mortgage-related securities issued by… the now since failed and nationalized Fannie Mae and Freddie Mac.  Because no one else wants to touch that stuff.

So when our Fed embarks on an experiment, never before attempted to this scale, and triples the size of its balance sheet, taking on $1 trillion of instruments no one else wants (that they owned $0 of in 2006 and before because they weren't allowed to), it might cause one to regard with concern the financial health of our central bank.

And yesterday, because all this activity has produced paltry results at best, the Fed announced that they are further going to buy another $40 billion of that stuff, each month, going forward into oblivion.  With money that we are creating out of thin air.

The crisis is still here.  But instead of destroying home prices, Countrywide, Fannie Mae, Freddie Mac, AIG, Bear Stearns, Lehman Brothers, Merrill Lynch, Washington Mutual, Wachovia, IndyMac, GM, Chrysler and the European PIIGS… now it merely threatens to destroy our central bank, the dollar and with that our full faith and credit.

Oh yeah.  And then we have that "fiscal cliff" coming up in a few months too.  That's a whole 'nother story.

 Have a nice weekend.