Guns, Butter, Gold, and Oil: California Default to Set the Stage for a Frightening New Reality

It isn't often that I read something so depressing (read: real) that I am suddenly overwhelmed with the panicked thought that we are undeniably destined for a chaotic plunge into the financial abyss with little hope of ever crawling out. I know this seems strange to you considering, well, what I do here day in and day out, but stick with me here, I'm going somewhere with this.

The reality is bleak. And I do try to stay true to the reality of our great financial unraveling (while stitching some LOLZ through the pattern, of course) without getting too absorbed in the pure hopelessness of it. Panic, anxiety, and fear over where we are headed is useless - it will not stop where we are going and will only serve to torture its bearer with a feeling of impending doom. As much as I know that we are headed in this direction, I try not to get too caught up in those particulars. Laugh at it, pick away at the ridiculous regime, and hope to God someone among the Economic Demolition Team stands up and says enough is enough. What more can you do?

I digress. Bill over at Mortgaged Future (one of my favorite blogs, btw, so if you aren't already skeezing on MF, you should really get on that...) managed the impossible today and scared the living shit out of me. Is that even possible? Apparently so.

The post which pushed me over the edge, California’s Crash Omen of Nation’s Future, may be found here. It goes without saying that this is a recommended read.

I have been watching California's fall from grace from the inside, of course, as a resident of the 2nd most expensive city in the country rent-wise (which also happens to be an overpriced third world toilet overrun with hipsters, homeless, and hookers) since the tech bubble blew up in the early 2000s. So I know. I know all too well. And frighteningly enough, California is setting a precedent which will lead us further into completely and total insolvency as a country. Just sayin.

Go read Bill's post. But take away this little nugget of wisdom:

The Future Reality

The President and Treasury Secretary say what they have to say. The reality is that the present course of unlimited credit expansion, quantitative easing, bailouts and massive deficit spending will continue in an attempt to re-inflate asset values and stimulate spending. The Government will not accept alternatives that they view as being worse - deflation and a collapsing economy with civil unrest. California will be bailed out like everyone else.

The course of action for long term wealth accumulation under the present circumstances seems obvious. Avoid an over concentration in paper assets (debt) that can be produced by governments in infinite quantity at zero cost. Diversify into assets backed by 1) real services or goods that there will always be a demand for and 2) natural resources such as commodities, oil and gold.


Jr Deputy Accountant

Some say he’s half man half fish, others say he’s more of a seventy/thirty split. Either way he’s a fishy bastard.


notsoingenue said...

the hipsters homeless, indeed. I laugh at those who ask me about the "hippies"
Oh you mean the hipster kids in their urban outfitters/American Apparel T-dyed shirts or boho clothes? That is close we come to "hippies"
We have to try and laugh about this or indeed I would be choking someone on one of my stockings.

There is a fine line, my friend. I think I have the art of hipsterism down. At least I HOPE I do.

I shouldn't be able to get away with the nerdy fake glasses, that's pushing it. Oh well.

Hang the hipsters!