BRETTON WOODS
And yet Joe Biden is telling us to prepare for the worst. Newsom is launching a mandatory lockdown. New York, Michigan, Nevada are all engaging in similar behavior... and they think stimulus checks are the answer?! I’m all for the government helping people in times of need. I understand the president’s sentiment when he demands the $2,000 checks and questions wasteful spending on foreign projects... However, where is the money coming from? American families know the dangers of debt. They know it’s a recipe for disaster to spend more than you make. And American families understand that they’re supposed to budget for the future... so why can’t the U.S. government do so ? Because it doesn’t have to... You see, we’re the world’s reserve currency, which is a double-edged sword at times. On the one hand, it’s great because it means that no matter how bad things get, everything is priced in dollars, and as
The Gold Room After years of being closed, the Mount Washington Hotel got a huge investment and was outfitted once again for grand summers (this time complete with air conditioning) and even snowy winters (heat was installed!). It reopened in 2011... and I began a yearly pilgrimage back to the live-free-or-die state. This year was my first New Year’s holiday that I wasn’t at the Grand Dame of New Hampshire hotels. Every winter, I like to visit the hotel and go skiing with my family... And every year, I take my kids inside the Gold Room, which, yes, is appropriately adored all in gold. I explain to them what the gold standard was, and the part their mother’s home state played in helping to reorganize the world economy in those challenging days of 1944. “Could it happen again?” I wonder as I run through the story. “Maybe,” I think. In fact, sometimes as I watch the printing presses roar on... and the Fed injects more liquidity, and Congress offers more handouts... I wonder whether a little Bretton Woods financial discipline tied to something meaningful might really do America some good. Perhaps the Tea Party will one day see a resurgence... a Bretton Woods 2.0 kind of moment. In the meantime, let’s all hope the spending and an economic revival goes according to plan.
such... the rest of the world will keep buying dollars for the foreseeable future. The downside is that demand – that massive demand for dollars – gives us a very false sense of protection. It enables us to continue amassing more and more and more debt (nearly $28 trillion, at present).
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January 2021
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