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Trying To Maintain A Positive Outlook, But…

Bloomberg News is reporting that with the current bailout of Citibank, the US Government has now pledged $7.76 Trillion, or $24,000 per Citizen of the USA, or 1/2 of last year's GDP to bail out the credit crisis. This is more than the previous amount reported a few days ago because it includes the new Citi money plus the contingent liabilities the government is assuming.

Ack! I'm dying here…

To put it another way, these numbers are so big that it is more than double the cost of the following things (as adjusted for inflation, no less) from our history:

Marshall Plan: Cost: $12.7 billion, Inflation Adjusted Cost: $115.3 billion
Louisiana Purchase: Cost: $15 million, Inflation Adjusted Cost: $217 billion
Race to the Moon: Cost: $36.4 billion, Inflation Adjusted Cost: $237 billion
S&L Crisis: Cost: $153 billion, Inflation Adjusted Cost: $256 billion
Korean War: Cost: $54 billion, Inflation Adjusted Cost: $454 billion
The New Deal: Cost: $32 billion (Est), Inflation Adjusted Cost: $500 billion (Est)
Invasion of Iraq: Cost: $551b, Inflation Adjusted Cost: $597 billion
Vietnam War: Cost: $111 billion, Inflation Adjusted Cost: $698 billion
NASA: Cost: $416.7 billion, Inflation Adjusted Cost: $851.2 billion

TOTAL: $3.92 trillion

I think I am losing my mind.

The only way to equal the costs pledged so far is to add in:

World War II – Original Cost: $288 billion, Inflation Adjusted Cost: $3.6 trillion

After adding in WWII, we are still short by several Billion inflation adjusted dollars. And, we haven't even gotten to the cost of the stimulus that the new administration will implement.

The government printing presses are in hyper-drive mode…at some point in the not-too-distant future (months, not years, in my opinion) the reflation process gets traction and it will be like that big ball that chases Indiana Jones in Raiders of the Lost Arc…gold and commodity investments will be our friend once again.

Mark

(credit for the source information goes to Barry Ritholtz, Jim Bianco, and Bloomberg News)