A point of light has emerged from the US Treasury as to how they decided on the figure of $700 billion for the bailout plan. This was not decided on any "data points," apparently, that is, no one sat down and figured out what might be a reasonable price to pay for all that toxic mortgage backed debt. Instead, they simply said "Think of a really big number,” which $700 billion certainly is, roughly equal to spending a million dollars every day from the birth of Christ until now, ($732 billion.)
America's internal and external debt exceeds $60 trillion, over 400% of the country's annual GDP of a bit over $14 trillion.
At last count the amount borrowed by the US government between 2000 and 2008 at $1.35 trillion is greater that the amount borrowed by the US government between 1776 and 2000 at $1.25 trillion.
According to figures released in the quarterly review of the Bank for International Settlements (pp A103) in September the total notional amount of outstanding derivatives in all categories rose 15% to a mindboggling $596 TRILLION as of December 2007.
Arithmetic is as unforgiving as the desert or the ice sheet. Plato was right. Check Jack London’s story “To light a fire.”
The cockles of the heart warm to the Pathans, with air strikes called down on their wedding parties by red haired twerps, even of lofty parentage. Why exactly we’re there for some guy who left with no forwarding address is a question too obvious to have loomed yet, but at least the Pakistanis are firing back. The Hindu Kush is about the last place on earth I’d choose to fight in and the Pathans the very last people I’d want to be fighting. Read your Kipling. The Pathans haven’t changed; they’ve just acquired a lot more to take revenge for.
Republicans calling the Three Stooges bailout plan “a historic swindle of the taxpayer” leaves me without a lot to add. I’d always point to the US reneging on its promise to remove the North Koreans from the Sponsors of Terrorism list, resulting in the NK’s rebuilding the nuclear plant they’d demolished, as the true root of the problem, destroying what was a lonely looking but genuine triumph of diplomacy. Bad faith is not a foundation for anything except extreme caution, and perhaps sterner measures, in dealing with serial scam artists. The financial mess is the same translated into money.
I’m always fascinated by the fact that you can buy a Klashnikov and ammo for about $10 almost anywhere in Africa, but you can’t get a decent meal for ten times that amount within a day’s travel. Is that our future I’m looking at?
Meanwhile, China, which does nothing by halves, has taken off all of this week to celebrate Chinese national day, a period of rest and relaxation after recent efforts. Stockmarkets are closed, and so no hints of future action can be gained from there. About a quarter of humanity is celebrating Eid Ul-Fitri, the feast at the end of Ramadan. Eid mubarak. Happy Feast.
Some elements of the bail out plan are quite sensible. AIG is an enormous insurance company with business all over the world, and working one’s way through all their divisions and selling them off to other insurance companies should produce a healthy dollop of capital. It is, of course, the equivalent of selling the family silver but the Brits have been doing that for years. The BBC even has a long running program where you can watch people auctioning off their treasures to buy a video camera.
On the other hand, the revelation by Mr. Nuri Al-Maliki, prime minister of Iraq, that in recent negotiations with the Americans on the end date for the completed withdrawal of all US forces from Iraq, the US pushed hard to move this end date backward, i.e., from 2010 to 2011, by a full year “because of domestic political considerations in the US,” marks a new honest low. Just how much “blood and treasure,” American and Iraqi, those domestic considerations in the US would consume over a full year is clearly not a priority consideration.
Ignore the Puritans reaching for your guilt buttons. The adulterous lovers drift on the winds of their passions in Limbo, the threshold of Hell, but are not involved in this.
“We are going” says Mr. Dante Alighieri, of Florence, Italy “down into the suffering city, among the lost people, who cry for the second death eternally.”
The “second death” does not come, of course. “After the first death there is no other.”