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Flying Lessons

(or, how I learned to love the fiscal cliff and stop worrying…)


When you walk to the edge of all the light you have

and take that first step into the darkness of the unknown,

you must believe that one of two things will happen:


There will be something solid for you to stand upon,
 or, you will be taught how to fly…

© Patrick Overton

The Leaning Tree, 1975

Rebuilding the Front Porch of America, 1997

So, like many Americans, this whole “fiscal cliff” issue has been on my mind.  It’s sort of nice to be able to watch it from afar.  The Kiwi press is not as obsessed with the issue as is the American media (when the media isn’t focused on gun violence in America).  But, since I’m well connected to the internet, the fiscal cliff is still in my face.

There are a lot of pundits out there giving their opinions, and I feel like giving mine – what the heck, eh?

My basic position here is that we all should just let this go, relax and enjoy the political theater in Washington.  No matter how much we common folk complain, it’s not going to make a difference.  The politicians are taking their signals from their “values,” their lobbyists and Wall Street.  Unfortunately, we can’t ignore Washington and hope that it and this problem will go away.  Let them do their thing (which is???) and enjoy your holidays.

First, I fully expect that we’re going over the fiscal cliff.  The folks in Washington will not be able to come to a compromise before January 1st.   Prior to going over the fiscal cliff, the poker players in Washington will be quite happy to stand firm in their positions, as well as play fast and loose with everyone else’s retirement savings.  Each party will remain entrenched in its positions and that’s where we’ll be on the morning of January 1st.  Happy New Year!

After January 1st, those folks in Congress will come to their senses.   When the stock market starts to tank, our elected leaders will begin to accommodate each other’s positions.  Why?  They may be highly principled people there, but they’re also greedy.  When our members of Congress see their portfolios start to head down the hole, they’ll start to have second thoughts about compromising.

Now, here’s an interesting possible twist.  If we head over the fiscal cliff, as I expect, a lot of people will be panicking the last few days of 2012 and start to sell stocks as the stock market is heading downhill as they try to save their money in a savings account or something similar, while also using other trading strategies to produce more money.  The smart and patient people (vultures) in Wall Street will swoop in and gladly take those cheaper stocks – and then sit back and wait for the market to come back up once compromise is achieved.   My suggestion, if you’d care to consider it, is to just hold tight.  Yes, your portfolio will decline for a few days and then come back up, just like it always does.  But hey, I’m not a certified financial analyst…

Sorry, but too much of this whole situation is just political theater and posturing.  Yes, there are some very serious, significant ramifications of the decisions that are to be made, but when most of the discussion in the media is about a few of the incendiary, marginal issues, the real meaty issues get lost…

After the New Year and some kind of “patch” is put into place, there will be continuing theater as the politicians continue the fiscal circus discussions and try to create their “grand bargain.”  So, we’re just in the current “scene” of the fiscal/political theater.  Sorry to be so forlorn (we all have our Eeyore sides…) about this situation, but I’ve been watching the same show for the past several years…

Now, if you really want to learn and be able to contribute something constructive to the discussions with your friends, here are some suggestions.  For example, EconomistMom.com, Diane Lim, has some very interesting, intelligent and deep discussions on these various issues.   I’ve subscribed to her blog for about a year and find the information that she provides to be very refreshing, mature and, I believe, politically neutral.  The difficulty that you’ll have with EconomistMom’s writings is that you’ll actually have to read, consider and think about them, rather than just react to the pablum that the mainstream media feed you in their thirty second sound bites.

And, here’s another piece that I just came upon.  Brown vs. Gray – no this isn’t a legal decision, but a discussion about our government’s financing of social programs for younger and older people…

In the mean time, learn how to “fly” and look beyond the histrionics in Washington.  Yes, their decisions are consequential, but there’s not a whole lot that we can do about it until they’re ready to have some meaningful discussions.   Be prepared to meaningfully contribute.

More importantly, enjoy your friends and family these holidays – this is where your true treasure lies, in the love of others.  Do something nice for a stranger – random acts of kindness…

Remember, in a democracy, we get the government that we deserve, not the one that we really want…  And, economics is not just the study of money and how it flows in our society; it’s also the study of our emotional responses to money and these societal flows…  🙂

Happy Holidays everyone! It’s already Christmas here and the kids have opened their presents…

46 S. EnZed signing off (and, going for a hike!)

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