Friday, June 12, 2009

Over-Supply Side Economics

I think that what we are seeing is not just the bursting of the housing bubble, but the bursting of the entire supply-side economics paradigm, by a couple of generations of Capitalists who thought that they were infallible, in good part because of their "victories" in WW2 and the Cold War and were riding a wave of ASSUMED success.

The presumption of success had momentum and affected the business culture to the point that credit and equity flowed freely and foolishly.

Now, reality is setting in. Over-supply side economics cutting its own throat by paying no attention to how their worldwide dominance of financing low wage Capitalism, a race to the bottom for the working class, was undermining effective demand for their over-supply of low quality, of marginal utility junk. The over-extension of credit "helped" for awhile, at least until all the overly materialistic fools had filled their over-priced luxury and common-place homes with a plethora of unnecessary toys, including those gas gluttonous opulent ostentations in their driveways. Then the bills came due and the over-supply economy was so over-supplied and credit so maxed out that it ceased to be able to grease the wheel of the assumed insatiable wants economy.

The price of gasoline and other fossil fuel products contributed in helping to weaken effective demand for what would have to be seen as an impossible continuation of mindless commerce.

In order to sustain wealth, people have to produce items of value. Other than the computer industry, it's all been speculation, more speculation, more speculation, more speculation, fueled by greed and accelerated by foolish arrogance.

Mike Morin

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