Lest We Forget
November 4th, 2009
Those who forget the mistakes of the past are destined to repeat them. I know I would much rather learn from the mistakes of others than to make them myself, but most people want to make their own mistakes. To each his own, I guess.
It seems we always forget the past. It’s not like we don’t know it. But for one reason or another, we just don’t remember it. Perhaps we choose to forget. I don’t really know.
We do this often in matters of faith and the Bible warns us about it. “We must pay careful attention, therefore, to what we have heard, so that we do not drift away” (Hebrews 2:1). I see some in the church today making the mistakes of the past. They are drifting and act as if they are not.
Events of the past are thought to be one of a kind events; that is, they will not happen again. No one thought the stock market would collapse–or housing prices either. I heard some wise words when housing prices collapsed: “Any trend that is unsustainable is unsustainable.” You don’t have to have an M.B.A in finance or economics to know that simple fact, but notice how many experts didn’t know it until the financial collapse of last year.
I have given up on getting any interest on my savings. I get less than one percent. I don’t know exactly how much it is because when its that low, it doesn’t matter. My money just sits there. A recent announcement from the Board of Governors of the Federal Reserve System says the Fed will keep “exceptionally low levels of the federal funds rate for an extended period.” So, I guess rates won’t be going up.
Our government is creating billions of dollars out of thin air to finance an unprecedented increase in the deficit, but still no inflation and no higher rates. I can get a mortgage rate for a little over 4% with no points right now. I am not in a hurry because it’s been that way for a while already. It seems there is no chance they will go back to those unheard of levels of over 8% when I first moved to Las Vegas in 1999. Just think, that’s twice what it is now! I am glad we’ll never see that again–right? But wait, did you know that between 1979 and 1985 you could not get a mortgage below 12%!!! Rates were that high for six years! A 30-year mortgage in 1981 was 18.5%. The prime rate was 20.5% then; it is 3.25% today.
Right now we are doing the same things they did then when inflation eventually got to 13.6%. It is 1.5% now. That’s what they say, but I can’t tell there is any inflation. In fact, most people think prices are falling on most things and I agree.
Experts at the Fed and elsewhere say they can stop inflation if it starts back up by just raising the rates a little. So, in the meantime, we can print more money. Some believe inflation is not coming back. They say the threat is deflation. What I think is that people have forgotten the past.
J B Myers
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