Welcome to Weimar. Wheelbarrow Required.
Thursday, December 18, 2008 3:44 PM
Starry-eyed Obama groupies in the mainstream media have been gushing since the election that the second Kennedy Camelot, or the second FDR New Deal has arrived. Nostalgia for the twentieth century may well be called for, but an item in yesterday's New York Times suggests that what we may really be in for is the second Weimar Republic.
The Kaiser who ruled Germany before World War One abdicated in 1918. In November of that year, a new German Republic was announced twice in one day by competing political parties, one more left-wing than the other. During the chaotic times of 1919-1923, workers went on strike, and to pay them off, the government started printing money. The legendary Weimar hyperinflation had begun. Germans had to bring cash in wheelbarrows to pay for groceries at the corner store.
What does this have to do with us, now? This: "The Fed bluntly announced that it would print as much money as necessary to revive the frozen credit markets and fight what is shaping up as the nation’s worst economic downturn since World War II." Read it yourself.
The hyperinflation was spectacular. In neighboring Hungary, this banknote was printed, setting a world record. The note was worth 100 million billion Pengos, a pengo being a Hungarian unit of currency. (The B stood for "Billion.") By late 1923, the Weimar Republic of Germany was issuing fifty-million Mark banknotes and postage stamps with a face value of fifty billion Mark.
A famous economist of the time declared, "The inflationism of the currency systems of Europe has proceeded to extraordinary lengths. The various belligerent Governments, unable, or too timid or too short-sighted to secure from loans or taxes the resources they required, have printed notes for the balance."
That economist, by the way, was John Maynard Keynes, an advocate of massive government intervention in order to "save" the economy, and who is being touted as an economic savior by Obama groupies. In 1965, when Lyndon Baines Johnson was president, Time Magazine wrote, "We are all Keynesians Now." The blog economicpolicyjournal.com, published by Robert Wenzel since 2003, is overtly critical of the neo-Keynesianism of the Obama economic team, members of whom are termed "oligarchs."
Is it time to order a wheelbarrow now? Amazon has one for around a hundred bucks. If you don't order one now, keep a sharp eye on the price. When it hits $150 for the same barrow, maybe it's time. And, perish forbid, if it hits $1000, you'll be very glad if you bought the $99 model and used it to carry gold bricks to the place you bury your "underground" bank account.
And, oh yes, Christmas is coming. A wheelbarrow might be an excellent gift for your dear ones.