Posts Tagged ‘AC Futures’

It turns out Obamacare–which expanded government benefits dramatically to the uninsured–will not save money, as Obama promised quite unbelievably a few months ago:

Did you see the new reports last week that – once again, big surprise – Obamacare is not going to lower our deficits as promised? Medicare’s chief actuary says it will add $311 billion to health care costs over the next 10 years. That doesn’t include the Congressional Budget Office projections that our premiums will be going up too.

Sure, President Barack Obama did look right into the TV cameras and pledge to you that his plan wouldn’t raise deficits “not by a single nickel.” And yes, members of Congress echoed that claim when they threw their support in too.

Just six weeks later and we’re already finding out Washington had the math all wrong.

Gee, who could have seen that coming? Other than the millions of Tea Party protesters, that is. Oh, and the 66 percent of Americans who told pollsters before the bill even passed that they knew it would bust the budget.

I can’t say I’m shocked.  Since this thing takes a while to ramp up, perhaps it will be significantly defanged or turned over in November.  It’s hard to say.  Of course many other enormous, structural problems remain with the welfare/entitlement state, and the lack of new wealth creation (and the destruction of the temporary enabler of credit) portends a rough decade.  I feel like I’m living in the 70s.  Yet somehow everybody seems to be able to scrape together the dough for a fancy new cell phone every other year.  These are contrary indicators.  Well, I guess disposable income shoots right up when you quit paying your mortgage!

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In the recent past, economic dislocation led to a flight to quality and Euro/Yen/Foreign problems led to dollar rallies.  The recent Greek crisis, however, has led to a huge gold rally.  The dollar is anemic.  And why?  Well, (a) the federal reserve is secretly and not so secretly helping out Europe to prevent a domino effect and (b) America shares all the same structural defects that have hurt Greece:  overly generous social programs, too much debt, a decline in productivity and manufacturing, and lower skills and work ethic across the board.  So, as a consequence, while the Euro has dropped to about $1.26, Gold has skyrocketed to $1240 this week.

Gold is the last refuge of wealth as paper wealth disappears.  The fact that so much smart money is headed that way is the most worrisome development of recent times.

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