What's Wrong with This Picture?

I had a moment to pause during this afternoon's cleaning, garbage, laundry and dinner cooking chores.  I had the TV tuned to National Geographic Channel, and the featured story was of the world's MOST dangerous weapon, capable of annihilating entire continents.  The trident Nuclear submarine - USS Kentucky.  60,000hp (that's 45MW - or by some standards a city of ~45,000 people), 170 crew, 24 nuclear warheads, EACH more than 80x as powerful as the bomb dropped on Hiroshima.  MK-48 torpedos adorn its sides, the latest of torpedo technology.  And all for around 2 Billion USD (I'm not certain the year of those dollars - the ship was launched in 1990 and makes Bangor, Washington home).  Doesn't really seem like a whole lot.  Capacity to totally annihilate a good portion of earth as we know it?





There has been substantive talk of late about where and what the next moves will be in the less than stellar economic performance of the United States and Europe, and the implications.  Broad and detailed discussions of deflation or inflation, and if so then what.  Will gold survive deflation?  What is valuable during those times?  Land and food production?  Ag sector has taken an interesting turn from what forecasts had been at season's start in the Northern Hemisphere.  You could even say that the Ag commodities had caught fire, but that would just be a cruel joke.  More recently, there has been increased energy and time devoted to QE2 or whatever next round of stimulus might gain as its moniker.  I've lost count of the global tally toward 'fixing' the systemic challenges these markets have endured for the last several years.  I do recall when things started to really fall apart in October '08 including TARP and everything that came before and after that.  My take away was that the US wouldn't let this turn into some lengthy drawn out process.  NoSiree, it would be dealt with appropriately and adequately so growth can continue once again.  There were estimates at the time that this 'problem' might need as much as 2or 3 Trillion USD!  A ghastly thought from my perspective.  Well I believe we have surpassed that mark by a rather considerable and significant sum, and NOW QE2?  After Europe made their All-In Bet, the Trillion Euros.  How much wealth has been erased from the highs of 2007?  Tens of Trillions of USD.


So we can build global destruction for $2B, AND have a finger on the trigger to make it a conscious and deliberate choice.  OR we can spend (and/or destroy) tens upon tens of Trillions of USD (asset value) and have absolutely no predictability of the benefits - so far all we can say is we're treading water, but I would say losing ground.  There is a millstone around the globe's neck.  It is this per ponderous appetite for growth at all cost, and the never settled only rolled over debt growth that comes with it.  A look at annual global GDP growth from 2003 to the present can be largely accounted for by debt growth - an issue of significant debate as well.  My view?  The credit-debt-value relationship remains broken and needs to be resolved.  Last week it was written that corporations are in worse shape now on their balance sheets than at the height of the crisis almost two years ago.  As some have said, muddle through, zig and zag with lots of volatility.  Or maybe some seminal event with be the tipping point.  As it is now, lots of conflicting and divergent signals.  Watch and Learn.