We Galactic Observers Stationed On This Planet (Mogambo Guru)

[Tace]

Richard Daughty, the angriest guy in economics -- World News Trust

November 7, 2006 -- Oddly enough, I felt that things were "back to normal" when I saw that the Federal Reserve increased Total Fed Credit by $2.6 billion last week. This TFC is the magical fount from which spews (like vomit, if I may use a disgusting but highly-appropriate metaphor) regular increases of credit available to banks, created from literally nothing, at the literal touch of a button, and that new credit in the banks becomes more money when (and if) it is borrowed.

Therefore, the Fed is back to creating more money, always more and more money, at lower and lower interest rates. Which means, unfortunately, higher and higher prices, as creating exponentially-increasing levels of money and credit (the only way to exponentially-increase the levels of money in the economy) is the only way that such an insane economic system as ours can function.

As a Mogambo Classic Example (MCE), suppose you borrow a hundred dollars at 5 percent interest. You know that you have to pay it back in full, plus the interest, for a total of $105. In short, you pay back more than you borrowed. So where does the money to pay the interest come from? Simple: It has to be created by someone else borrowing money, and you hope, somehow, to end up with it! Hahahaha! See where I am going with this?

And sure enough, now these new guys have the same problem (they owe more than they borrowed), which will be solved (as nothing begets more insanity and stupidity than the temporary success of insanity and stupidity) by enticing somebody else to borrow some money, creating more money! Hahahaha! And creating more inflation in prices the whole freaking way, too!

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