"We shmll not grow wiser before we learn that much that we have done was very foolish." ~F.A. Hayek
December `10th, 2013
Since the missus is celebrating a birthday today we've been rummaging around fiscal data from the year of her birth to see how it compares to 2013. For one thing we discovered the U.S. had run budget SURPLUSES for an entire decade but fell into budget deficits the year following her birth. It never ran another surplus until the year she graduated from high school.
Also, the public debt was measured in billions of dollars, not trillions. In the year of her birth the public debt was $16.931 billion.
Life expectancy at the time she was born was nearly 59 years for women...about 56 years for males. We kid her about living on "borrowed time."
A loaf of bread in the year of milady's birth cost 9¢. An average year's salary was $1,970.00, and a new house cost, on average, $7,145.00. Needless to say the dollar had a great deal more purchasing power then than it does today. The mint price of gold at the time was $20.67 per troy ounce. Believe it or not, penicillin - although it had been identified the year before - had not come into general use.
Let's be grateful we live in a century in which DENTISTRY has progressed to a high tech state and is readily available. Such was not the case throughout human history. As late as the early eighteenth century, for there were no false teeth, or gold crowns, or dental fillings. Whenever an aching tooth became too much to bear it was extracted by a doctor using a pair of mechanic's pliers.
U.S. President George Washington, like many of his day, suffered from bad teeth. He had a set of artificial teeth made which historians say was cumbersome, not very attractive, and probably painful. Ladies of that era often concealed their bad teeth behind fans and avoided smiling. (This may account to some extent for all those grim faced portraits!)
We read the other day that the Rogue Economist has declared that 1/ Interest rates will go up, 2/ our monetary system will fall apart, and 3/ the great American Empire will go the way of all empires.
That's not as shocking as it appears at first glance. Besides, neither the Rogue Economist or anyone else can predict precisely when these events will come to pass.
Should we take them seriously?
First of all...interest rates are artificially suppressed. There is no way that suppression can continue indefinitely without dreadful consequences.
Secondly, since the founding of the Federal Reserve 100 years ago this month, the purchasing power of the U.S. dollar has been driven down from $1.00 to 4¢. Before it reaches zero it will give way to another monetary system - probably with the basic money unit still called "dollar." Throughout history irredeemable fiat currencies have always been cast aside.
Third, all the great empires of the world have come to grief and the United States cannot be an exception. It has already achieved the dubious status as the biggest debtor nation on the planet and it's contrary to the laws of nature to support a world wide governmental superstructure by constantly borrowing massive amounts of money.
What's the exact timetable for all this? No one knows. Besides keeping a sharp eye on trends there's not much one can do.
BRYAN, Texas - Holiday cheer in Texas has become even sweeter thanks to a giant gingerbread house that has broken a world record for confectionary construction.
Coming in at 35.8 million calories and covering an area of 2,520 square feet, or nearly the size of a tennis court, the 21-foot high gingerbread house in Bryan, Texas, 90 miles northwest of Houston, has been declared the biggest ever by Guinness World Records.
The house, with an edible exterior mounted over a wooden frame, was built by the Traditions Club near Texas A&M University to help raise money for a trauma center at the regional St. Joseph's Hospital.
(Gives new meaning to the expression, "Hey, c'mon over to our house for a bite!")\