United States Heading towards a Depression?

In the article of Alexander Nobles entitled: “United States Heading towards a Depression? Inflation”, everybody who is involved with finance worries that the U. S. Economy is routing towards a downturn. Some really fear that the United States is heading towards, not a just a downturn or recession, but rather a depression. The scariest thing is that it could actually be bad than that of the 1930s. Audacious words, except America is headed for an economic hard fall that no individual is prepared for. With the coming of election 2008, which is in full force, the candidates attempt to address the principal issues facing America.

Immigration is the largest issue on the side of the Republican side and Independents. Whereas immigration may help a depression happen earlier, it is not even close to the ground. Democrats however view health care as their most imperative issue. If a depression takes place and nationalized health care was proper stature, the depression would just get bad as it can be. The root of the problem is the government. Their endeavors at healing it are naught more than placing a small band aid on a big wide open wound. The problem this analogy is that it aids the problem for a few weeks but in reality makes the problem worse in due course.

Instead of anticipating this, the Government has allowed this wound to get big and is now infected and out of control. The only real cause of this downward spiral is inflation, and to which, the Government is the one responsible for it. The country’s paper dollars are backed by nothing except the assurance that the United States of America is the most powerful and strongest country in the world. The dollar is actually in equal value to nothing but merely just paper and ink. The U. S. Dollar has turned into almost worthless on the world economy. For the record, it is the first time in history that the U.S. Dollar is worth less than the worth of the Canadian dollar.

The Canadian Dollar was worth $1. 09 U. S in November of this 2007. If this is not considered as the biggest indication of America’s economic problems, then what seems to be the cause? In 2002 gasoline was an at an average of $1. 40, still low by today’s standards compared in 1962 that the average cost per gallon was only 25 cents USD but adjusted for inflation gas was actually cheaper in 2002 than in 1962. The national debt has already gone beyond 9. 1 trillion U. S. Dollars. To whom do Americans owe this money?

The country even owes $3,991,754,006,234. 96 to other countries, and the country itself owes $5,180,516,146,138. 48 to itself. Given that the Government needs more money they will simply print as much as they want. They Government simply markets bonds to foreign countries whenever they think they had to. What might will happen when China comes to retrieve its money? The USD was backed by something of value at its creation and that lasted all the way until Franklin D. Roosevelt took the Country off of the gold standard. By printing money at will, he was able to bring the Country out of the depression.

It is quite ironic when you think that that the government producing this money will really be put the country into such depression. The only factual way to solve the problem of inflation and put the economy back on track would to be the reality of going back to the gold standard. But of course, the government will not do this. They will not just renounce their power that they presently benefit from. In its place the Federal Government elevates and lowers interest rates at will. This does not really solve the problem; it rather produces a larger one. Lowering and raising the interest rate helps for a short period of time.

People are getting tire with this game that the Government is playing, a game that actually only takes people’s power away. Prices are the criteria use to judge the value of dollar. Two reasons are behind the rise in prices. First is that the demand for something is greater than its supply. The other is that there are just too many dollars, with more and more pumped into the economy every day. That is for the reason that the supply would be much greater than the demand. The more there is of something, the less valuable it is. The same is true with the dollar. The more dollars out in circulation, the less valuable they become.