Y’know, it’s the math.

Obama hisself doesn’t do math. And the Geithner/Bernanke/Goldman axis doesn’t publicize their numbers. Neither do Pelosi or Reid have the foggiest idea what they are doing.

It’s the math.

I’ve been wondering about the US trade deficit for twenty years.

I was right.

HOW CAN THIS TRADE DEFICIT NOT BE KILLING US? I kept asking. I never got an answer. It wasn’t in the text books.

But there was a thirst for US dollars all around the world. Trillions in treasury dept. Trillions more in CDOs. The US played ponzi scheme with the world – and with itself.

So the double whammy. The flow is now stopping, AND we have to find a way to pay back several trillions in debt, both treasury and CDO.

No easy task, no matter who is president.

We have already SPENT these trillions. We built an economy that expects more of those kinds of trillions to keep flowing. But they have now stopped – well, not quite entirely, but almost. The CDOs failed before the treasuries, but of course those will go next, have already gone, except for the fed buying treasuries to the tune of $1t over the last year.

Much of Obama’s budget is propping up the economy built on ponzi money.

I don’t know what the economy will look like without it.

But let me cut to the chase. I’ve stopped reading the financial press the last few months, but was talking to a real estate agent. He’s talking about how there are many people now in default on their loans – that is, not paying, but not yet officially in default. Banks would rather lose their payments than admit the problem and reschedule the loans according to the government programs. So, TONS of bad loans are not even on the books.

And I know why.

The Geithner/Bernanke plan is to ignite “moderate” inflation while (somehow) keeping interest rates from rising correspondingly. This will monetize the real estate debt – and perhaps the treasury debt, too. BUT INFLATION HAS FAILED TO IGNITE! Again, the textbooks are failing us.

Anyway, much of Obama’s budget is certainly meant to fuel inflation, just like that moron Krugman keeps wailing for.

So, what about this plan to inflate and monetize the debt? Well, at the trillion dollar levels, it’s like roasting your marshmallows over a couple of chunks of plutonium, “just move them a little closer, we need just a little more heat”.

God bless us one and all.