5.25.09
Happy Memorial Day! With having 2 grandfathers and my father all serving in war time military service, I am especially grateful to have not lost any of them in those wars. I read an article last week about Memorial Day celebrations in Newton, MA where they moved the parade up a week. I am not sure why but one of the parade organizers said “Newton moved its parade forward a week from Memorial Day weekend in order to placate all the residents who have to open up their summer homes” on Memorial Day Weekend (see article HERE).
If that really were the tenor of that town, then they should be ashamed of themselves – however, I am not sure why I said that because if that were the reason and they really took those actions because of that reason, then they likely feel no shame about moving the parade. Nonetheless, I appreciate the efforts of all those who served who had mountains more courage and fortitude than I’ll ever have.
Losing an Economic Battle at Home
It would probably hurt the veterans to know though, that all they fought for is now being destroyed bit by bit, silently, by suited men in Washington who are eroding the integrity of our nation’s currency. After World War II, it was agreed that the US dollar would be the world’s reserve currency as our nation was considered the most stable, with resources and bullion (gold) to back our currency and give the rest of the world confidence that we would backstop any problems with paper money and trade (see here for Wikipedia’s outline of the Bretton Woods Agreement).
Now we print money with abandon and use the trust that the world put in us to our advantage by printing our way out of our financial problems (a technique that NO OTHER nation could get away with on this scale due to its inflationary dangers. In fact, what we are doing is on such a large scale of danger, some of our most important trading partners are VOCALLY questioning whether the dollar should continue to be the world’s reserve currency and are eagerly looking for alternatives (such as China’s direct currency deal with their major trading partner Brazil).
As much as the aforementioned ‘suits” in Washington like to tell us there is no inflation problem and that they could fix one if it arises, they can not hide what we see with our own eyes. Remember that in 2007-2008 oil prices rose dramatically AFTER the Fed began to lower interest rates close to zero, thereby causing the dollar to FALL (meaning it took more dollars to buy a barrel of foreign oil). We are seeing gas prices rise again now and just yesterday, in a neighborhood sushi place in the Inner Richmond section of San Francisco called “Funeya,” where they had $2 “sushi boat,” the prices rose in the last month to $2.15 per item (if you don’t know what a ‘Sushi Boat” is you’ll have to go see it for yourself – in Brookline, MA, “Fugakyu” restaurant has something similar in their front room where varieties of sushi are paraded in front of you in little floating boats that travel around the bar – you pick up what you want).
Not much you say – That 15 cent rise in price? Well 15 cents may not seem much but it is 7.5%! And you better hope everything else you pay for (heat, gas for your car, groceries, fertilizer, property tax, apartment rents, etc) doesn’t rise 7.5% per year. Otherwise, over the next 10 years, Americans will get to know a much lower standard of living.
The coming inflation problem will most certainly hurt those on a fixed income (retirees of which many are veterans) the most. And sadly, politicians are listening as some academics from some of the best institutions in the US such as Harvard, think that things like 6% inflation is GOOD for the US. Yeah as long as Harvard gives him at least a 6% annual cost of living adjustment.
Chris Grande
