It is time to write this. I keep hearing and reading that some economic prognosticators are wondering if the markets and the economy have "hit the bottom." It makes me wonder what they have been drinking or smoking.

1. This is the first time in our history where the administration has spent three trillion dollars on a war and cut taxes at the same time. Your taxes probably didn't qualify, though. The cuts were not for anyone earning under $150,000. I don't believe anyone in my email address book earns above that. I certainly don't.

But it is the three trillion figure that scares the Hell out of me. That's the total cost so far since the invasion of Iraq, five years ago this month, in expenditures for the war, resupply of equipment, loans and giveaways to the "defeated" country (remember "Mission Accomplished?"), and the interest paid on the debt it is taking to "pay" for those costs.

Three trillion dollars have gone down a rat hole that was supposed to be part of the "war on terror" but had no link, tie or connection to the events of September 11, 2001. That is $3,000,000,000.00 folks. That is money the nation didn't have in the first place. The government had to borrow most of it from foreign interests who bought bonds, notes and T-Bills, and we pay them interest on those loans.

All of it will have to be paid back some day.

Who loaned the U.S. the cash? Look at who buys the bonds: China, Saudi Arabia, Kuwait, Qatar, Abu Dhabi, etc. etc., or anyone with piles of dollars we have spent on their goods or their oil. They are fast becoming our landlords.

In order to support the war, and to keep the loans coming, we have to pay a larger and larger portion of federal revenues (taxes) each year to pay the interest. Five years ago the percentage of the federal budget in interest we had to pay on federal obligations (bonds, notes and T-Bills) was close to thirty percent. It is now fast approaching forty percent.

This is called "deficit spending." It is when we spend more money than we take in. Everyone does it, especially the U.S. government. The idea is that it's O.K., because we won't have to repay the loans - our children and grandchildren will do it, and they will be able to do it with cheaper dollars.

That was the old way of thinking, the tired old economics of the sixties, seventies and eighties. In the 1990's we actually had three years of budget surplus, but that changed with the advent of the G. W. Bush administration.

2. The dollar is the new Peso. I remember in the nineties that Mexico devalued their currency several times. You had to be careful not to exchange too much US cash when you visited that place, because the following morning it might only be worth half what it was the day before! This devaluation has happened to the US dollar, without official government authority. Less than two years ago the Canadian dollar was only worth about 75 cents. Today it is near to or slightly more than a US dollar in value. The Euro was worth $1.30 about a year and a half ago. Today it is approaching $1.60.

One of the many reasons the price of gasoline and other petroleum products are so high is the decline in the purchasing power of the greenback dollar. That decline is because of the volume of dollars on the world market today... and the volume of dollars out there are the result of lopsided trade deficits (How much did you buy that was made in China last month?), exorbitant budget deficits (See Item #1 above), and a government that believes in printing money faster than it earns it (Again, Item #1).

Another reason we are giving blood at the gas pump: We are believers now in a "world economy," where everyone is participating on the same level playing field when it comes to buying and selling. That is partly true. We have agreed to export our manufacturing jobs to allow other countries to increase their standards of living (at considerable cost to our own.) We have participated in the charade of being the world's only superpower, therefore declaring ourselves the savior and protector of the oil-rich Gulf countries (whose own military expenditures are negligible.) And worst of all, we have acceded to the corrupt policies of the Oil Cartel.

OPEC has not increased supply/production of crude oil in years, although world demand has nearly double since 2000. This has assured the price of oil would climb. It has worked. They have no intention of increasing production, even though the price of energy has kick-started a recession here. (Recessions always begin here. Europe and Asia will soon follow.)

Cartels are illegal in the United States. Federal law forbids cartels and price-fixing, and it forbids the government from doing business with cartels, yet we do business daily with one of the world's most powerful cartels: OPEC. Recently the President of the United States traveled to Saudi Arabia to beg the oil producers to increase production. What did they tell him?

"Sorry, Infidel. No way! Look at all the money we're making."

I hope the next President of the US responds, "Hey, we've been holding your coat for too long while you picked our pockets, so we are bringing our protective forces - all the airplanes, rockets, ships and troops - back where they belong. You're on your own! Goodbye and good luck!"

We've been the cops of the world for far too long, and what has it got us?

3. The economy is so complex nobody has a handle on how it will work in the year to come. I have some ideas, based on watching it and suffering it for so long.

First, the economy is no where near a "bottom." The recent disasters on Wall Street and particularly in the mortgage industry are just the point of what is going to become a bloody spear. Bear Stearns was just one of the brokerage and bankers on the street that will fall or be absorbed by other stronger firms. Since the 1930's and the SEC Acts, there have been no major new regulatory laws brought to bear on how the investment community conducts its business. The results are frequently visible. The Savings & Loan debacle of the 1980's and 90's, the electric utility deregulation scandal that was much greater than the portion that made the evening news (Enron) - and now the subprime mortgage crisis.

Just take a look at the losers in each of these debacles... who lost? Was is the big investors? Hell no, it wasn't. In each case it was a person, family or small business who took the loss. The government rushes to bail out Wall Street firms and big banking interests, but do they ever come to the aid of the working stiffs? Have they stopped corporations from cutting and eliminating hard-earned pension funds? No!

If you believe the six-hundred or twelve-hundred dollars you are going to get in May, June or July will solve your financial crisis, think again. Your gasoline bill increase this year will be twice that amount. But $150,000,000.00 for saving Bear Stearns is nothing! After all, it's only YOUR tax money at work.

This is about a "bottom." There is more bad news coming. Inflation is climbing at a catastrophic rate. Right now the rate is increasing so fast you can't keep up at either the gas pump or the supermarket. Some staples have tripled and others have quadrupled. I measure the personal effect of inflation on how much I spend each time I hit the market for certain goods. Cat food, for instance, has increased by 25 percent. Dairy by 30 to 40 percent.. Flour has more than tripled. Forget beef, chicken or fish. The inflationary push of energy costs (it has to be refrigerated and shipped) have put all of that beyond my ability to pay. I have become a sudden vegetarian.

The next Wall Street debacle will come within the next month. I believe it will either be Goldman Sachs or Merrill Lynch. Trust our government to bail them out, too. Who will pay?

You will, We will.

4. When you get your $600 or $1200 check in May, June or July from the government, don't invest it in the US stock markets. The bottom is far away. Put it in your pocket and don't even trust your god-damned bank to keep it safe. (Maybe invest it in Chinese securities... the world's next BIG economy?)

5. Don't listen to Jim Cramer (he is consistently wrong), the CNBC or Bloomberg TV brokers or the frigging Federal Reserve (what a bunch of White House hand-puppets they have become!). Wait until the election gives us a new president with an entirely new agenda for America. There is a lot to be fixed after the last seven to eight years. It can be fixed, but it will take time and patience.

6. Look at the state of the nation, the economy and your own standard of living since 2000 when you are standing in the voting booth.