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October 11, 2008 
People like to bandy about that the Eskimos have a hundred words for snow. Presumably Colombians have as many to describe cocaine. Certainly the money-users of the world have come up with as many names for money as there are for the most popular illicit substances. People call money a lot of things — bread, cash, moolah, scratch, dead presidents. But the names that people have been using to describe the dollar recently are more like expletives of the financial sort.
Americans are being asked to take more of an interest in our currency. European bankers urge our bankers to get us to be better world citizens, and earn a somewhat larger fraction of what we spend. Are we being urged to be more productive, and sell more goods and services to the rest of the world? If so, perhaps some rethinking is in order, because it’s hard to imagine how America could do more to drive the world economy, and if it’s going to continue in the same vein, the world probably can’t afford any more of this economic stimulus.
The Bush doctrine has thrown industrial production worldwide into overdrive by literally blowing up high-tech equipment in the desert, when we’re not driving Humvees and trucks around the dunes using up gas and diesel, driving up the worldwide price of oil. Sales of armaments are increasing worldwide, and now that the proliferation barn door has been left open, the costly search to track and recover wayward fissionable material that might be utilized to set off unauthorized nuclear strikes is on. What with peace breaking out in Palestine, perhaps the Israelis can get busy selling, rather than deploying, missiles, bombs, and other munitions. This worldwide, high-tech, heavy-metal, rocking out comes at some cost. Sun Tzu said “It takes five pounds of food to deliver one pound of food to soldiers in the field.” The ratio in Iraq is without doubt more like a thousand-to-one, if you think about how cheap it would have been to leave all those young people back in America and feed ‘em Big Macs right in their home town. Commodity prices are rising worldwide, as always rise in wartime, and Uncle Sam’s current wars incredibly wasteful. Killing is expensive, especially when the victims are being killed individually, one carload at a time, as in Iraq.
High tech has heard the word that terrorism is the new cold war, giving a mammoth boost to biometric technology that will give us — more expensive driver’s licenses! SAIC, the San Diego foundation for the preservation of defense industry power and influence in technology, has wasted $180 Million trying to make a computer system for the FBI. I could have told them they’d never pull it off because a computer system can’t run on booze and bullshit. Information sellers like ChoicePoint and Lexis-Nexis are also bringing the economics of the information economy more clearly into focus. We’ve even given a boost to the drug industry by insulating the world’s largest pharmaceutical market from competition under the guise of a “senior prescription drug plan.”
Meanwhile, the magical production of money from the housing market by a succession of refinances driven by the lowest interest rates in U.S. history, and the sale of a new truck to every fool smart enough to know that zero percent interest means what it says, has just about run out of room to expand. The constraints on that expansion are felt whenever the amount of money America borrows drops perilously close to equal to or less than the total amount of money America owes to other countries. Whenever that happens, the dollar drops in value, unless there are compensating factors moving it in the other direction.
Of course, I say the dollar drops in value, but with respect to Chinese money, this is not true. China has declared that its currency, the Rnimbi, shall trade against the USD at a fixed rate. How friendly this is. Our friend China is willing to insist that, even though the European Central Bank, the Swiss, the Japanese, the Canadians, etcetera, all have dropped their valuations of the dollar, our money is worth as much to them as ever. Incredible resilience the Chinese show! American politicians call them godless communists and all manner of horrendous ethnic slurs, and only grudgingly admit them to the World Trade Organization, and interfere with all of their efforts to buy high tech weapons from Israel and South Africa and Eurpoean nations. In return, they lend us all the money we are willing to spend on flat screens, hard drives, cell phones, athletic shoes, and all manner of other treasures. Why? Because nobody else, besides the Japanese, of whom there are appallingly few, and even fewer reproducing, can figure out how to use these gadgets!
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