Dispatches from Extreme Economics
Should we start looking for weapons of mass destruction again? "Remember all that pooh-poohing when the gulf states were talking about their own currency? About how silly that would be? That it would never happen? Yeah well, sort of looks like it might." (Link to underlying article.)
Such a development would be terrible for the U.S. Right now, the gulf states accept the American dollar as a means of settling accounts, hence those dollars have a lot of value in the petroleum markets. If the dollar loses that exclusive status, its value in those markets drops. If it eventually loses settling value altogether, its value in those markets becomes no more valuable than any other currency.
Keep in mind: Money is psychological. It has value because people value it. Everyone knows the world is grumbling about the U.S. dollar and its preferred status as the world's reserve currency, but no one has taken concrete steps to move away from it. If this gulf currency comes into existence, that could be the first concrete step, which could lead to a domino effect, which would mean those trillions of dollars in the world could pour back into the United States . . . in the form of redemptions. And how would they redeem those dollars? By buying our stuff: Our land (try to hunt quail in Kansas these days; you'll learn that the Chinese have bought a lot of the good hunting land already), businesses, landmarks, radio stations, Pamela Anderson's implants. It's the comeuppance of a trade imbalance. We've avoided it due to the dollar's reserve currency, but if that reserve currency ends, decades of trade imbalances could roar in and bite us . . . very, very hard.
BTW.
Let's Go! There's Better Kumbaya Over There!
And the pastor is so much wittier at that First Church of Hip Hop and Hand Holding!
A quarter of American adults say they sometimes attend religious services of a faith other than their own. That according to a new Pew poll that also finds a third of Americans sometimes attending religious services at more than one place, accounting for about half of the churchgoing public.
Link.
Also of interest at the same site:
Nearly half of Americans report having had a "religious or mystical experience," more than twice as many who said so in a 1962 Gallup survey. Even 3 in 10 Americans unaffiliated with a particular religious tradition report having had such an experience–more than the number of religious people who reported religious or mystical experiences in the 1960s.
But they didn't have Megan Fox photographs in 1962. Are we really comparing apples to apples?
Now on the Clock
The United States: Debt clock.
A friend of mine asked me recently why a large national debt could lead to massive inflation. I explained that we simply cannot repay the amounts we borrowed. If our creditors start demanding repayment (instead of redeeming), our response will be: "You want your money? Fine, here's your *$#!@ing money!" Then I cranked my arm vigorously in small circles like I was cranking a press.
Default or massive inflation. One is going to happen, barring a small miracle. I keep thinking we might find a way to extract oil efficiently from shale rock, thereby turning eastern Montana into the next Saudi Arabia. I ain't holding my breath, but could you imagine the rest of the world's reaction? They'd be like "[Whap--hand slapping forehead]. I can't freakin' believe they freakin' dodged that freakin' bullet!"
