(column from 1998)
There were four blind men who were taken to the zoo. During their journey in the zoo they came upon an elephant. Their guide had left them and could not give a description of the animal. They decided to feel it and tell the others what is was like..
The first felt the side and said it was a large vertical surface. The second had the tail and gave an appropriate description. Number three had the trunk and said it resembled a firehouse. And the last had the ear and said it had wings.
Each was correct in his analysis, but none of the three could see the entire animal so they were all wrong.
Their problem reminds any analyst of the current financial problem.
Each is looking at a different part of the situation and not the entire problem.
We have the four blind men – Secretary of the Treasury, House of Representatives, Senate and Federal Reserve Chairman. Each has his own solution which may solve part of the economy, but not the whole problem. Each solution seems to make the one proposing it look like a genius.
Unless the entire problem is addressed it will only get worse. Almost without exception they all agree that more taxpayer money will solve any problem. Spending OPM (Other Peoples Money) has always been their strong point. Taxpayers never have any say in how their money is stolen. Oops, contributed. We can’t offend any of these august “experts”.
The very ones who caused the problem have taken it upon themselves to solve it. Doesn’t sound right, does it? We, the voters, put these people in charge and now we must suffer the consequences. Next time, think before voting.
What can we do with this elephant? Is there a solution that can be described that will solve it? The blame game is not going to help. All voterscan do is watch and let their representatives know how they feel by writing to them. The “experts” do not seem to be expert enough. They are all fumbling about each with an incomplete “fix”.
History has shown a regular repeat of recessions (bad ones we call depressions). When left alone the pain is sharp, but not terminal. When the government steps in to “help” it prolongs the agony over a longer period of time.
The current bear market and unemployment will get worse. As our “experts” continue to “fix” it will temporarily relieve the suffering in some sectors only to return again. The best “solution” is no solution at all. Let the economy go down. Yes unemployment will rise. This time the whole world will go with us. In a year or 2 the US will be back on track again. If not, remember the history lesson of 1929 that took more than 15 years to recover and that was done with a world war. We sure don’t need that kind of solution.
If you have a solution or suggestion the best that can be done is to write regularly to your Washington representatives. It might help. It can’t hurt.
You may receive Al Thomas’ investment letter at no charge for 3 months on the web site www.mutualfundmagic.com Never lose money in the stock market again. His book “IF IT DOESN’T GO UP, DON’T BUY IT!” has become a classic because its principles apply to all market at all times.
Copyright 2008. All rights reserved.