The Domino Effect

View from Europe is interesting...Here in Germany the big rage is to fly to New York city for a weekend of shopping because the exchange rate is so good....But, the Germans are paying close attention to the US economy..The US is the country that buys more German produced goods than anyone else...Also the inflation here in Germany is slowly gathering steam and on the verge of getting out of hand...As an American living and working here the loss of value to the dollar is killing me...My appartment rent has now increased to the point that it is over $1500.oo dollars a month, all based on the exchange rate...Gas has increased to the point that it is around 9.00 a gallon and goes up regularly..Milk went up .20 a liter in one week...It is to the point that we are returning to the states this summer...My current job is going away(Base Realignment) so we are moving...Hopefully I get moved and situated before the bottom drops out.....LnE

I've been talking to my sister who lives in a subdivision with covenants. They are not allowed to grow a graden, other than flowers, so she and BIL are putting up a privacy fence and plowing up the back yard. She didn't realize how bad the situation really is. I think she does now.

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Sometimes the last minute is the best one.

I have a freind who is so "polyannaish" that it assounds me. She thinks this is going away by this summer, and everything will be hunky dory! OMG, I cannot beleive it. Right now I am listening to ABC's Good Morning America, and it sounds like more banks are in trouble, so how can she be so in lala land? I guess she needs to think that way so she does not have to face the depression comming on. I think she and others just CANNOT face it. That is what I think is going on. It is denial, a psycological maladaptation in an attempt to handle the coming depression.

In fairness to the people that haven't clued in yet, I don't think the mainstream media, or the politicians and business elites, have been at all honest. I read primarily blogs, as they're much more honest about what's going on.

In the above, alan greenspan also claims that he has no responsiblity for all the current problems, because it's impossible to see it ahead of time.

--sgl

this is part of the problem liars like this .
take the advice of CNBC,s top market man the one and only Jim Cramer, who stated at the beginning of last week and I quote directly
“No,No,No Don’t move your money from Bear, that is being silly, don’t be silly, Bear Stearns is fine, Bear Stearns is not in trouble”.

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"Those who hammer their guns into plowshares will plow for those who do not."
Thomas Jefferson

If you view the economy and the role of the Fed the way Greenspan does then he is correct. He sees it as a locomotive and the Fed Chairman as the conductor who either heats up or cools down the boiler, applies more steam or reduces the steam. He does not control what goes on the train or what is taken off. That is Greenspan's view of the Fed - added or subtracting cash and controlling the interest rate.

So, if you view it that way, blaming Greenspan for today's problem is like blaming the conductor who retired 2 years ago for the train wreck that happened today because the retired conductor did not predict the accident.

Personally, I think the Fed should also have a long-term, strategic vision for the economy and rise above current "wisdom" that only looks at the next 2 financial quarters. I would hope that the central bank would be a proactive body and not purely reactive, but alas, my wants are not reality. Heck, I also think they should be elected officials, but what do I know...