THEATRE OF THE ABSURD

Most of the time people call this building “the US Capitol”.

Today, many characterize it as The Theatre of the Absurd, or The Kabuki Theatre.

Why?

Because, in its hallowed halls, members of the Senate and of Congress are presently behaving as if they were performing at Montreal’s Just for Laughs Festival.

I am a Canadian with no ax to grind. Like everyone around the world, though, I watch, perplexed, as the globe’s most powerful nation clumsily stumbles toward shooting itself in the foot by destroying its AAA Credit Rating, thereby probably precipitating yet another world economic crisis of unimaginable proportion.

Don’t the ‘wise’ US legislators realize that they have already undermined the power of the US Dollar to the point where oil-producing countries have begun not to accept payment for their products in US Currency, that the Russians, the Europeans and the Chinese are in the process of creating a “currency” based on a basket composed of a mixture of Euros, Rubles and Yuans or some other mix designed to replace the US Dollar as the currency of international debt settlement?

Don’t misunderstand me. I’m not suggesting that the fur will suddenly hit the fan on August 2. The US will not default on its obligations on that date, whether or not the Bill to raise the debt limit becomes law. The Americans will muddle through for a month or even two, but, if the legislators don’t address DEFICIT REDUCTION then…watch out … gold will double in its value vis-à-vis the US Dollar (may be to as high as US $3,000 per ounce), Mr. Chavez and his Middle Eastern colleagues will stop accepting US Dollars in payment for petroleum products, gas will cost US $8 a gallon at the pump, and interest rates will rise sharply thereby stifling world-wide any meaningful economic recovery.

In summary, unless US legislators come to their senses and start acting responsibly SOON the US’s economy (supposedly the strongest in the world) will start resembling that of Greece.

You might well ask what qualifies me to make such a sweeping series of predictions. My answer is: ‘been there done that’.

I was there when gold was US $35 per ounce and silver $7 (the year I became a Chartered Accountant after having graduated from McGill University with a Major in Economics.)

I was there when the Hunt Brothers drove up the price of silver to US $48 an ounce almost overnight.

I was a Bankruptcy Trustee, liquidating banks in the Cayman Islands when the 1973/74 world-wide liquidity crisis impacted on the planet’s economies thereby ruining a number of large banks.

I spent over a decade chasing after money launderers in the Western Hemisphere.

I watched with alarm the shenanigans of Wall Street Merchant Bankers whose cavalier approach to leveraging precipitated the last crisis and I was happy to be living in a country – Canada – where banks were more strictly regulated than in the US.

I am now watching the US Treasury trying to lift the US out of the economic hole in which it finds itself by printing more and more money to pay for entitlements with little regard to whether or not the country’s economy can afford them.

As a consequence, I am now also witnessing the decline in value of the US Dollar vis-à-vis gold AND THE CANADIAN AND AUSTRALIAN DOLLARS.

And last, but not least, I am watching in amazement the upward trend in EMIGRATION of US citizens to Canada in the North and Belize (and other similar ‘safe’ havens) to the South.

Let’s face it, one does not have to be a genius to start, after having connected the dots, worrying about what is happening in the good old US of A.