An Economic Disaster In The Making

Below is an excerpt from article in CFP by Klaus Rohrich’s explanation of Cap ‘N’ Trade.

Here’s how carbon offsets work: a company that emits carbon into the atmosphere as a by-product of its business transactions will be allocated a certain number of annual “free” carbon credits by the government. That company will be audited annually and if it were discovered that the emissions exceeded the allocation, then the company would have to purchase carbon credits (currently proposed to be valued at $40.00/ton USD) to cover the excess. If the company emitted less than allocated, it could sell its unused carbon credits on the open market for the same price.

The central driver of this new bubble will be various carbon exchanges, such as the Chicago Climate Exchange (CCX), the European Climate Exchange (ECX) as well as others. Entities with carbon offsets to sell will sell them on these exchanges, which in turn will sell them to companies that have run over their allocation. The justification of this scheme is that it needs to be done in the interest of lowering so-called greenhouse gases, such as carbon, in the atmosphere. But anyone conducting even the most cursory research will quickly come to realize that trading in carbon offsets will achieve no such thing.

What it will do is to significantly contribute to the growth of intrusive government bureaucracy and raise the worldwide price of virtually everything from agricultural products to zoo tickets. It will also enable liberals, Democrats and the Eurocartel to feel better about their own carbon emissions, knowing that with every carbon emission sin that is committed an offset indulgence may be purchased. It’s particularly sweet, if like Maurice Strong, one of the most rabid proponents of climate alarmism, you happen to own shares in the Chicago Climate Exchange. Or Like Al Gore, for whom climate alarmism has substantially contributed to his $100+ million growth in net worth, since losing the Presidency to George Bush in 2000.

The government has created a commodity out of thin air (pun intended). I agree with Klaus that the government is creating a bubble that when it burst will have greater impact on our economy than the dot com and housing bubbles combined.

Unjustified price hikes of the last bubbles caused economic disaster. Dot com companies were losing millions yet their stock value kept rising until investors came to their senses. Then the crash ruined many investors, even ones that were no in the dot com markets.

Huge spike in real estate prices, caused in part by imprudent lending practice, were unsustainable. These spikes continued until home ownership became unachievable for most of Americans and those that did manage to buy at super inflated prices could not continue to make the payments.

In both cases values were grossly exaggerated and people were paying for more vacuum than substance. In the case of carbon credits it is all vacuum. It is conceivable that one might have millions of dollars of vacuum. This market has to fail and take with it our economy.

If you think that Cap ‘N’ Trade is good, let me know. I will start a bag-less bag-of-air company and issue stock at $300.00 a share. You can spend a lot of money to own nothing and watch the value of your stock balloon way above your original investment until people stop buying the stock. You will have huge paper profits that can’t buy you anything.

In his article Klaus continues; This bubble is essentially driven by the Democrats and the Obama White House in collusion with the UN, having made a commitment to enact Draconian eco-legislation that will feature carbon offsets at its core.

If Cap ‘N’’ Trade is enacted, I see the dollar being devalued way below other currencies and Americans in poverty.

A change in the congress is imperative now and the administration in the next presidential election if we are to save America. With the dedication of our founders we must vet new candidates, select the right ones, and work hard to elect them. To replace the elite ruling class now in control of our country we all have to make special effort and yes sacrifices.

Donate what ever you can, work the phone banks, talk to your neighbors and associates, and walk precincts for your choice to govern this country.