T Nation

Three Strikes


It's really that simple:

"I was having a conversation over drinks with a friend, a lifelong Republican, big Wall Street legal brain (but now retired), sometime generous contributor to party funds, normally good-natured and mild-mannered. We weren�??t even talking politics. The topic was the current woes of the poor old dollar.

Suddenly, with uncharacteristic anger, my drinking buddy said something like this: �??The federal government�??s main functions are to maintain a stable currency, keep us out of unnecessary foreign entanglements and wars, and patrol the coasts and borders. That�??s three strikes on George Bush, [blasphemous expletive]! The man�??s been a total [sexual expletive] disaster. What the [blasphemous expletive] [sexual expletive] hell was I thinking of, voting for this [cognitive-function expletive]?"

Via National Review's John Derbyshire, who's about as conservative as you can get.



He makes valid points. Unfortunately, the Bush model of the Republican party has attracted a lot (most?) of the Republican base, and those who aren't going along with him will probably not vote for any of the current Top-3 in 2008. It will probably translate into a Republican loss next year.


Everybody keeps bitching and moaning about the devalued dollar. Other than traveling abroad, I fail to see the big deal. I think this is good for the economy. American goods become cheaper over over seas and foreign products become more expensive here. Hence, balancing of the trade and inevitably the dollar will rise. If I were going to a foreign land, I hate the exchange rate, but I am staying put for now, so I cool.


No. That isn't the way it is going to work. Our goods will still be more expensive than foreign goods in foreign countries because of tariffs, etc. In order to have a positive trade balance we have to actually produce our own goods. I am not sure if you are aware that we mostly produce raw materials but not many consumer goods.

We basically provide the materials to skilled labor to build our stuff and they sell it back to us cheaply. Because demand will be lowered due to rising prices production will be lowered and there will be no goods going to foreign markets. Too much inflation will kill what is left of American production.

Make no mistake, the only faction that profits from inflation is Wall Street. As interest rates are lowered to clear out excess cash it creates a bubble in investment. The dollar is further devalued because there is now very cheap, large quantities of money in circulation.

Investors and traders may see a good return due to the volatile nature of stocks but people who cannot afford to invest lose the purchasing power of their money -- that is, consumer goods get more expensive. This is a moral problem of the highest order. This is what is meant by "the rich get richer and the poor get poorer."

As someone who has to travels quite a bit I am not very happy with the dollar right now.


I would think the executive branch has the least effect on the dollar's value - Congress and the Fed have more to do with that.

There are a lot of things to dislike about Bush, but I don't think the dollar's value can rest with the President.


Whose administration's policies ensure irresponsible spending?

Hint: it isn't solely credit-card debt that is devaluing the dollar.


According to Ludwig von Mises and his followers, the boom-bust cycle is not inherent in the free market, but is rather caused by the government's interference in the credit markets, specifically its manipulation of interest rates. The government causes the boom period when it injects new credit into the system (pushing down rates), and then the unsustainable, non-economic investment projects put into motion necessitate a bust at some future date...



In which sub-branch of government must spending bills originate? If the president had a line-item veto, there might be more blame for him.


Not that I don't agree.... but what was that sign that was on Truman's desk when he was President?


Ever heard of "Give 'em hell Harry!"?

Scroll down and read the section on the fall campaigning.


Haha. Good stuff. I am fond of Truman.

But either way, the buck stops there, my man.


I guess we'll see. It is what it is right now.
I say the bare basics of economics will win out. The Chinese purposely devalue the yen for this reason. Hence I say the weak dollar is fine, but I have no plan to cross the border at the moment. If I did, I'd be pissed.
Watch for the chinese to further weaken the yen to stay competitive.


How do the Chinese devalue the Yen? Awesome trick if they do that by the way.


Yuan, Yen same difference. Well not, but still. How about 'their version of money'.


It is even better.

It is the "renmimbi", written "yuan", spoken "kuai".



Like I said "their version of money".


I'm fairly sure ol' Harry never took ownership of what Congress did...


He's still responsible at the end of the day for approving the budget.


This is the problem: without the line-item veto, the president can either sign the entire spending bill, or veto the entire spending bill. Throughout the Bush presidency, Congress gave Bush the spending he asked for, and then piled extra crap on top of it - and not an insignificant amount of extra crap, either.

So, to the extent that the president can be faulted for not vetoing the whole thing - and there is a case to be made that he should have - that's his responsibility. But relatively speaking, the origination of the spending, and the profligacy of the same, are Congress' issue.


Which was controlled by Republicans for six of the eight years. Just as long as you don't forget that.