There is an old saying that great empires are built on credit. But there is an old corollary that too much of a good thing sometimes turns bad.
Reporter asked Reggie Jackson one time which pitcher he feared the most and he replied Nolan Ryan. The response was but since your greatest success was hitting homers off fastball pitches, why fear Ryan. His reply was “I like ice cream, but I don’t want someone feeding it to me with a steam shovel.”
Holland, the seafaring master of the seas collapsed in the 17th century because of excessive credit used to purchase foolish assets, tulip bulbs. The British empire began to wither in the early 20th century after becoming less productive than Germany and using credit to bridge the difference. Up to then the Bank of England, their central bank, used proper management to help create the phrase “Britannia rules the waves.”
Now comes Uncle Sammy creating mounds of debt being used to purchase all types of non-productive assets. Our national debt now exceeds $37 trillion and rises each day. When questioned officials utter some of the most dangerous words possible, “this time it is different.”
