Friday, September 19, 2008

The United (Socialist) states of America

Okay. Capitalism and 'free market economy' are officially dead as of today. 

President Bush and Treasury Secretary Poulson announced a plan 'that would cost hundreds of billions of dollars' to shore up the ailing US financial system. This was necessiated by the fall of Lehman and Merril Lynch and the resulting loss of faith in the system by investors. The US Federal Reserve had to pump 85 billion dollars earlier into AIG, the world's largest insurer, to keep it afloat.

Where is this extra money going to come from? Of course by printing more of it and increasing the money supply. And what else does that lead to if not increased inflation?

In a true free market economy, sick entities would be allowed to die a natural death and others would learn from their mistakes and avoid the route to disaster. But with government handout programs like this, you can be sure that if you are big enough, you will come to no harm, no matter what you do.

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