"It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."

Henry Ford

July 17th,  2019
(Caveat Emptor)

News and opinion from all over the political universe.  Much of it to be taken with several grains of salt.


Email: Wrisley.com


   Curmudgeon's       Archive.      

Who Supports Whom?

Magical Money
Posterity's Debt To Me

  Honest Money
From Riches to Rags
Fiddler's Broken Wrist
Jack-lantern Wealth
Chance of Gold Confiscation

Poobahs of Positivism

Blood In the Streets

America Descending
Just Plain Stealing  ?
A thing to fear
Heavenly Sex
What Fools, We Mortals
Unvarnished Truth


“It's about time we lowered the temperature all across the board. All of us ought to contribute to a better level of discourse.”
- Sen. Mitch McConnell
   Amen to that!

    It's really sad to see and hear public discouse descend to the level it has, thanks to advances in technology.  Now that everyman can broadcast snap judgements and shallow opinions via the social media - and, in turn, be picked up by the so-called "legitimate press" -  common sense and moderate language have flown out the window.  A short review of public comments that follow commentaries and reports on many web sites seem to indicate that people are not generally well versed in the use of the English language and are also prompted to interject as many obscenities as they can. 

    Is this all just free speech carried to greater efficiency in the 21st century,  or is it an indicator of a long-running decline of public self-censorship?  And does it matter? 

    We think it does.  Senator Mitch McConnell calls for "a better level of discourse."  We ought to encourage it.  At the moment the only prohibition that remains intact is the admonition that the word "fire!" ought not be yelled in a crowded theater.

Refining Self Service at the Grocery Store.
We hesitate to whine, but we really don't like it!

    When we were young working at a neighborhood grocery store, we did all the running.  A customer would stand at the wooden counter and either hand us a list of items or tell us verbally what they wanted.  A pound of hamburger?  No problem.  We'd hustle into the meat cooler and grind it on the spot.  It never occurred to us or Mr. Bilson that there may be some danger to a junior high school kid using grinders and slicers.

     Once the order was compiled Mr. B. would show up to jot all the prices in a column on a paper bag.  He could add almost as fast as a machine.  And very accurate, too.  We bagged the articles and helped carry them to the patron's car.  We cannot remember ever receiving a tip.  It was part of the service.

      This old fashioned small town grocery store had no cash register, but it did have a cash drawer under the counter.  In those days clerks seldom required a piece of machinery to calculate how to make change. 

       In larger towns self-service grocery shopping was popular.  One roamed the store with wheeled baskets.  Since WW2 customers grew accustomed to pushing carts around grocery stores and then steering to the check-out line.  Someone joked, "They've got the customers doing all the work.  One of these days you'll have to scan your items and pay through some kind of automatic teller machine (ATM)."
        Well, it has happened.  We got a thorough lesson this morning.  Our nearby Food Lion was using only the self-checkout installations early in the day.  Granted, there were several employees nearby to assist those of us who couldn't figure out how to operate these gizmos. 

         The chief reason we shop at Food Lion is that we don't have a car.  That's because we don't have a license to drive one - - and woulen't even try even if we possessed a license.  Our eyesight is in terrible shape and negotiating uneven sidewalks and tricky traffic is enough strain to require our total attention.  We dislike having to deal with the details of checking out our groceries. 

         The whole process was slow and awkward.  We had trouble finding the bar codes on many items and fumbled the bagging of items.  And then there were bananas.  Had to call in help on that.  Also needed help on figuring out instructions on how to pay.  The total was $30.72 and we chose to sacrifice a $50 bill.  The machine snatched the bill out of our hand as soon as we found the input slot.  The machine buzzed, spat out some change and then a sequence of small bills to complete the transaction.  We hung the two bags of grub on our walking stick and flung the whole rig over our left shoulder. Then we hoofed it home.

         Making checking out a self-service is a clever move on the part of Food Lion.  They can trim the need for check out clerks as customers become more used to their do-it-yourself obligations.  Now, if the owners can afford enough robots to handle most of the stock maintenance the entire operation might be run by a manager and a half-dozen assistants.  More automation, steadily rising prices, plus a base of compliant customers ought to give profits a healthy boost! 

Our relative was "disinvited" from Trump's Suimmit on Social Media last week.

    "I’m back from my whirlwind trip to our nation’s capital. As my supporters know, I was invited to visit the White House to join my peers, otherwise known as ‘influencers’ on the Internet and discuss the ongoing and increased censorship of conservative voices.

     "Then I got censored from the summit on censorship."  BEN GARRISON GOES TO WASHINGTON.

     The ADL mistakenly assumes our nephew is anti-Semitic because of his drawings involving the Rothschild banking family and billionaire George Soros.  We have never known Ben in the last 62 years to exhibit hatred against Jews.  It's true he can be extremely critical of the Federal Reserve and misleading aspects of the banking industry, but he does not aim his critical arrows at a person because of whether he/she/they attend synagogues, temples, cathedrals, churches, or any other meeting places devoted to religion. 

       Political Correctness and hyper-sensivity among socio/political organizations are quickly muzzling public expression.  In some respects the expectations drawn in the novel "1984" have already occurred.  This is not at all what the Founders had in mind when they drew up a U.S. Constitution in 1787. 

"Some $13 trillion of debt securities world-wide are priced to deliver a yield of less than zero."
 There’s been nothing like it in 4,000 years of recorded interest-rate history.
    A precise legal definition of the dollar is hard to come by. James Grant brought the subject up in the Friday Wall Street Journal opinion page.

   His piece supports the nomination of Judy Shelton to the Federal Reserve Board. She has often written of advantages that accrue when a nation's monetary unit is defined in actual weights of wealth - such as precious metals. Modern economists howl in anguish at the idea of restoring redeemability of the dollar. At present the dollar can be exchanged for wealth but is not, in itself, wealth. It's an IOU.   

    "So what?" you ask. "As long as the Fed can print up more dollars we'll always have enough money to go around."

     That's the general impression. The fact the Fed can order bales of paper money from the government printer and create additional electronic dollars with just some taps on keyboards is a convenient way to inflate the money supply. But that leads to trouble as loose money floods the economy and drives up the general price level.

      It's far easier to create fiat currency out of thin air than to be forced to dig through tons of earth searching for elusive specks of gold, but it's gold's scarcity, beauty, and durability that has made it the most trusted money over the past five  millennia. The famous banker, J.P. Morgan, wasn't kidding when he said "Gold is money. Nothing else." Ask a politican the difference between a $50 Federal Reserve note (a legal tender) and a $50 U.S. gold coin (also a legal tender) and you'll understand why such confusion reigns. Jim Grant is trying to shed light on the subject. ABANDON THE PhD RULE

Nerves are taut in Washington over hundreds of issues.  Reviving Congressional debate about the public debt ceiling is only one of them.
   Our sanity goes wobbly if we try to absorb the highlights of all the "news of the day." So much of it is based on  assumption, politicfal bias, misinformation and misunderstanding that a fellow can waste an entire day following it all.  After a while the mind boggles and one stops paying attention to the nitwit commentators who imagine their conclusions are the only "correct ones." 

    When our boredom meter starts to go off the scale we turn to our favorite subject;  weights and measures.

     Imagine the social chaos that would ensue if we could not rely on 60 seconds constituting a minute or that 16 ounces always weigh an avoirdupois pound. What a calamity it would cause if the length of a  mile was increased or shortened from time to time. That's why Congress was given Constitutional authority to controlthe standards of weights and measures.  (Article 1 Section 8.) In the same paragraph Congress was also given the power to regulate the value of money, which was defined as a particular weight of metal.  However, the definition of money was drastically changed through the years (although the Constitution was never amended to reflect that change, and people began to accept paper IOUs as money. Today digital records of currency also pass electronically as "money."  The confusion will one day straighten itself out but no one knows how or when.  A lot of guessing goes on about this question, however. 
     Confusion also surrounds the question of federal borrowing.  The authority to borrow money on the credit of the United States is specifically awarded to Congress.  And, boy, does that body BORROW. It installed a borrowing ceiling several years ago but has wrestled withu it ever since because of soaring borrowing needs and the declining value of the dollar.  If the issue of re-stablishing a debt ceiling is not met very, very soon some federal agencies will run out of funds by September 30th, 20219. The popular press seems not to have noticed because of bigger distractions such as climate change, immigration at the southern border, the Epstein scandal, et al.


   "Central bankers around the world are admitting that low interest rates can't sustain real growth." -- George Melloan

   Aha! All our life we have heard that monetary policy by the powerful central banks was the "engine of economic growth."  Now that notion is being revealed as the myth that it is. Mr.Melloan reports  that the myth is falling apart and central banks are running out of ammo. His main point is that low interest rates stimulate borrowing but that isn't the same as actual economic GROWTH. 

    Small wonder, says Melloan, that Democrat candidates like Senetors Warren and Sanders debt is no problem and and more government "freebies" can be simply financed by mere borrowing. (The public debt is now over $22 trillion.)

     Speaking of which, the federal government may run into trouble by September in paying its bills. It's assumed Congress wil raise the debt ceiling in September so borrowing can increasse on October 1st. But at the moment it looks like several federal agencies may run out of money by the end of September.  Stay tuned!

The Democratic promises of the 1932 campaign were not kept.

    An honest look at the Democrat political campaign of 1932 clearly shows the Democrats may have deliberately misled the voters.  Here are the first three planks of the Democratic Party platform of 1932:

    "We advocate:
     1. An immediate and drastic reduction of governmental expenditures by abolishing useless commissions and offices, consolidating departments and bureaus and eliminating extravgance, to accomplish a saving of not less than 25 percent of the cost of Federal government.
     2. Maintenance of the national credit by a Federal budget annually balanced.
     3. A sound currency to be maintained at all hazards."
      Upon taking office in 1933 President Roosevelt threw the campaign promises overboard and steered the Ship of State sharply to the political left. To this day there is a general impression that the New Deal was the best thing that ever happened to the USA. Whereas the people were once responsible for the government under which they lived we saw the government assume responsibility for the people. The world's largest welfare state was born.



We and the Missus have experienced 11 economic recessions since we were married. We may face the 12th in 2020.

   For more than one hundred years the Federal Reserve has been trying to smooth out those economic slowdowns that used to be called panics or depressions, but now are daintily called "slowdowns" or "recessions."  So far the Fed has not found the key to perpetual prosperity.  This fact may be gnawing at President Trump whose chances for re-election depend greatly on the condition of the domestic economy.  If a recession is in the wings it needs to stay there until after the election of November, 2020.

   Professor Harvey says,  "From the 1960s [the yield curve inversion] has been reliable in terms of foretelling a recession, and also it has not given any false signals yet."

   The Yield Curve Inversion refers to the point at which long-term interest rates are paying out less than short-term rates. It occurred at the end of June. 

   No wonder trump is putting pressure on Fed chief Jerome Powell.  The last thing Trump wants is an economic slowdown in the runup to the 2020 election.  If such a slump occured he'd be in the same spot Herbert Hoover was in 1932  - running for re-election in an economic depression.  That set the stage for the overwhelming victory of Franklin Roosevelt and the advent of the New Deal, which put the United States on the road to a quasi-socialist scheme of governance. 

    Notice that the left wing of the Democratic Party has swung even further toward Socialism and it appears to be attracting a considerable number of voters. 

  Historical note: Prior to the Civil War the US got along with national debt of about $90 million (1862)  By 1867 the federal government was almost $3 billion in debt.  It stayed under $2 billion
from 1883 until 1917.  By 1919 the debt had climbed to more than $25 billion!  (War is costly.) These borrowed billions helped make the 192OS "roar."  But the financial bubbles burst in the autumn of 1929 creating a wretched presidency for Herbert Hoover, who took office in March, 1929.

     Franklin Roosevelt overwhelmed Hoover in the 1932 election , called in the people's gold in 1933 and promptly devalued the U.S. dollar in terms of gold - which Americans would not be allowed to possess again for more than forty years.  Borrowing continued to rise in the 1930s and the economic depression persisted. By the time the nation got into World War Two its annual deficit was nearly $50 billion.  But the borrowing went into overdrive when war dragged on. The federal debt had piled up to $259 billion by 1945...122.75 percent of GDP.

     There were a few years in which the national government ran budget surpluses, but the debt pile grew until it reached $995 billion in 1981.  Converted into millions that's 995 thousand million. Still quite a lot of money - - even today. 

             The debt pile began to be measured in trillions in 1982. By 1995 the accumulated debt was $4.9 trillion! 

      Politicians have chosen to ignore the debt accumlation. The Treasury Department says it is presently about $23 trillion, but we must wait until after next year's election before our Congressional representatives will admit it may be a Sword of Damocles and something ought to be done about it. The main objective is to make voters happy....and voters have no wish to cough up the thousands of dollars per capita to pay down the towering national debt.

      So - what happens? Can't the debt be declared null and void and just disappear? No - not without wrecking the lives of all those investors in the US and around the world who have invested in all those IOUs in the belief government will make good on its word to redeem them.


Social Security: The Political Third Rail
     "There are scores and scores of millions who depend on things remaining the way they are. Like the 50%-plus of Americans who are net recipients of benefits from the State… the 60 million on Social Security… the 66 million on Medicaid… the 50 million on food stamps… the many millions on hundreds of other programs… the 23 million government employees and most of their families."  The Deep State
We admit to feeling a sense of guilt from living partially out of the pockets of strangers. But the New Deal's Social Security system and the Great Society's Medicare and other government benfits were set up that way. We have been receiving Social Security funds for 20 years. After adjusting for inflation we got back every dime of FICA taxes we and our employers paid into the system since we began our working career in the 1940s.

   The deal was this: If we and our spouse died early that was that. We would not get our money back. If we lived long lives we'd get it all back in a tad less than seven years and begin living out of the pockets of current FICA tax payers.
    But a voice in the back row insists "Wait! There's plenty of money in the Social Security
Trust Fund."
     So politicians keep reminding us. We forget, though, that the Trust Fund will be running low on money only 14 years from now. Also overlooked is the fact that the fund's cash has long since been spent by Congress and government securities (notes and bonds) have been deposited to replace that money. Increasing amounts of securities will have to be converted to cash in order to meet future Social Security expenses. 

    Putting millions of people into the habit of living out of stranger's pockets is a socialist plan that must eventually founder in bankruptcy.


Gold and silver are not  "investments."  They are chiefly a store of wealth - - insurance, if you will, against the
decline of the dollar.  To illustrate how the dollar parity has declined against gold we offer this price comparison.  When we and the Missus were married the official exchange rate was $1.00 = 1/35th of a troy ounce of gold.  Today it is:  $1.00 =  1/1,336th of a troy ounce

                                    A U.S. citizen was not permitted to hold monetary gold when we were wed in 1948, but the dollar was officially backed by gold at $35 to the ounce and could be redeemed in that amount to foreign traders.  However, under the terms of the famous Bretton Woods meeting in New Hampshire three years earlier the dollar became the basic money unit in which much of world trade was done.  Oil and other important commodities were priced in U.S. dollars. 

                                     The U.S. quit redeeming dollars in gold to foreigners in August, 1971 which demolished the Bretton Woods agreement.  The dollar is technically a fiat money unit backed by none of history's most popular monetary metals.   The Constitution prohibits this practice, but its provision for sound money was tossed aside forty eight years ago and we are all now happily afloat on a sea of debt-based currency whose future purchasing power is not known. (Although plenty of commentators make their living making dire predictions about it.) 

                                     If you paid $400 an ounce for gold some years ago.....that is, you paid $1 for 1/400th of an ounce of gold.....you may feel quite smug about the fact that people are now paying lots more dollars for that ounce of precious metal.  But upon exmination you will discover that in terms of its parity against common goods, such as food and medical care, it has remained quite the same.  Moreover, the precious metals do not yield interest.  They are good, though, at maintaining wealth across long periods of time