2 October 2008 - 15:18Market Commentary 9/2/08

Just got off the phone with the congressman’s office again and changed the mind of an intern at least. The part about the bailout that really gets me is that more Treasury’s will be issued to cover the cost of our deficit spending government. More than Likely it will be the Federal Reserve buying them so they can earn interest on the losses they just transferred to the government. This seems especially plausible because China says it’s lost it appetite for U.S. treasuries and who else would buy them? Loaning money to a country already over $10 Trillion in the hole doesn’t make lots of sense otherwise. Unless you know you can extract that massive amount of money from the citizens through oppressive taxation or want to see the government collapse because of fiscal irresponsibility like every democracy in the past has. who knows it could be both in this case, since I am sure the Federal Reserve doesn’t mind the interest it earns on treasuries it holds. Interest that is being paid through the Federal Income Tax. Suppose it can’t hurt to call my congressman again….