Just out of curiosity, and I fully admit to not knowing the answer, why is it that Fannie Mae and Freddie Mac get a pass on being leveraged at 127 to 1 on low quality mortgages and Thornburg Mortgage (TMA) got hammered by all this subprime mess? I lost 97% of my investment on that. It is okay because the information I made the decision on was good information. I have no complaints with either the loss nor the source of the info. If I am reading write, someone wanted cash and TMA was in the best position to provide it until they ran them into the ground. (JP Morgan? Their name KEEPS coming up in interesting places.)

See, I have no way to go to China. I am stuck. All my chips are in this CF called the American economy and I need to know what to do because unless I win the lotto, I am here for the duration. I read about farmland in Argentina and Ecuador being cheap, then I read about those Chinese bastards going down there and buying it all up. Do I sound a wee bit bitter? Probably more so in print than in actuality, but my confusion is sincere. I am mostly mad because I cannot do it, too, and do it NOW.

I am taking on no new debt. I am buying no new toys. I am paying down my debts to zero because I want no one with a claim on my income. Yadda yadda yadda. Sorry about that. Lots of folks in my position.

Why did TMA’s underwriting rules not protect them, why is FM and FrMc different and what can a normal working Joe do to prevent what little he has from being soaked away by inflation and bad faith on the part of banks and government besides buying gold and silver and taking on no debt?

Why does the government worry about consumer confidence as defined by buying on credit rather than encouraging them to save up money and increase their own personal capital? The more I read, the more confused I get and the crazier this shellgame I live in looks.

Why is deflation so bad? If housing prices drop, I will be dancing in the streets because I can afford one. Liquidity for the world’s economy being dependent on how much I borrow against my house to by the old lady a new set of earrings is insane to me.

I earn more than most engineers and feel like I am a pauper. I would never have imagined I make as many dollars as I do now as a kid and never would have believed it would amount to so little.

Please forgive my lengthy post. It just seems that everytime I think I know what is going on, I find that the rules have changed and that I still don’t have a plan because I do not have good intel. Thanks in advance for your patience.

I added the necessity of energy to the game. In addition to a the stacks of money equally distributed I gave everyone a stack of black poker chips to represent oil. Just as in life each player received a dissimilar amount, and I gave Will, the youngest, the most chips. We soon began referring to him as Saudi Arabia.

The rules were simple, each turn around the board required the “burning” of one chip. We tossed the chip into a bone pile… no recycling. If a player ran out of chips he could bid for another chip, buying from whichever player succumbed to the offer.

I ran out first because I had given myself the fewest chips. (call me Uncle Sam) Without an oil chip I could not continue to play and was soon trading hotels and property to the players with oil just to stay in the game, but I was the first casualty, in spite of the fact that I had played well and been lucky, holding one of the two priciest monopolies with a full set of hotels.

Who do you suppose the winner was? Yep… and he pretty well owned the board when it was over.

* Net it will increase the global supply of oil, and the US is part of the globe which will decrease prices from what they would be without the added drilling. This is a fundamental fact of economics.

* Whether the US exports or uses the oil internally, it will help the trade deficit.

* If there is a war, it will be easier to sustain our energy supply if it is in our country even if it means diverting oil from our trading partners. This will also strengthen our position in the world.

The US needs a total energy solution and this is only one piece. Our economy and national security depend on this.

On a similar issue, profits from exploration and energy development should not be taxes at all, but energy consumption (gas tax) should be taxed. This will discourage usage and encourage development. Ross Perot had it correct!