One dictionary defined the phrase “smoke and mirrors” as trickery or deception used often in a political context. The same dictionary said this expression alludes to the performances of stage conjurers who use actual smoke and mirrors to deceive the audience. The figurative use refers to the obscuring or embellishing of the truth that is employed by spin doctors to deceive the general public.
Never has the use of “smoke and mirrors” been more obvious than on NBC’s Meet the Press this past Sunday. In response to the downgrading of America’s credit rating by S&P last week, the Administration sent its hired spin doctors to the popular news show to politically trick the public into thinking there has been no wrong-doing by the Federal Government and their actions handling the national debt and budget.
Alan Greenspan, the former Federal Reserve Chairman and now an Obama spin doctor, told Meet the Press the United States could rule out a chance of a U.S. default because of its ability to print money. “What I think the S&P thing did was to hit a nerve that there’s something basically bad going on, and it’s hit the self-esteem of the United States, the psyche,” said Greenspan.
Greenspan claimed the plight of the investors is more about the euro zone thean the United States. “The United States was actually doing relatively well, sluggish but going forward until Italy ran into trouble. That destabilized the European system, and the crisis re-emerged. Europe is very critical of the United States…we have a fourth of our experts there, but more importantly, significant proportion of the foreign affiliate profits, in fact half of U.S. corporations, are in Europe.”
Austan Goolsbee, the chairman of the White House’s council of economic advisers and another Obama spin doctor, struck out at S&P on Meet the Press too. He attacked the S&P’s math claiming the credit rating agency had gotten the rating wrong. Goolsbee exclaimed, “Well, the basic case is they made a $2 trillion math error and forgot to check their work.” He also commented on comments made by Warren Buffet claimaing that if they had a AAAA, he would put U.S. Treasury credit instruments in AAAA status.
This is nothing more than smoke and mirrors. Greenspan, the washed up former Chairman who admittedly made errors before the banking crisis of 2007, doesn’t explain what will happen to the U.S. economy if the government begins to print money. Instead, he tries to divert America’s problem to Europe’s financial woes.
Addressing the printing money at will, a simple fifth grade math student will tell you our budget will not withstand an increase in interest past 10 percent and still be able to afford the interest on the national debt.
Historically, when the U.S. has printed more money, the value of the dollar drops, and when the value of the dollar drops, interest rates have risen. In contrast, the Voo Doo economics presented by the Chairman is nothing more than smoke and mirrors.
Warren Buffet may be a financial wizard in playing the stock market, but he still loses money from time to time. He can be wrong, so can the ratings companies.
How can we solve our finacial crisis? Practicing sound financial economics is a start. The U.S. needs to reduce spending and return to sound economic principles. When a government or individual borrows more money than they can pay, it is bankrupt. It is disingenuous to ask the American public to believe by printing money at random we will always be able to pay our loans.
If you are facing a financial crisis like the U.S. Government, it may be time to contact a bankruptcy lawyer. If you need from the stress of debt and you live in or around the metropolitan area of Detroit, Michigan, contact us at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area who will answer your bankruptcy questions.
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