It has always been my opinion that the so-called
science of economics in its current form is victim to the problem of not
being able to see the forest because of the trees. The fact that 60 percent
of 242 members of the National Association for Business Economics think that
the U.S. Federal Reserve is doing the world a favour
by maintaining non-existent interest rates is hard evidence in support
thereof. If you give something away (money) at no cost, then its value is
zero. Something is only worth what someone else is willing to pay for it. Why
oh why do our illustrious leaders fail to grasp such elementary logic?
The global economy has just OD’ed on
credit, and the Fed’s response is to make the offending intoxicant free
for all the junkies. And, to make matters worse, the Fed sees itself as its
new best customer. Even street-level drug dealers know better than to get
high on their own supply. Metaphors aside, and as increasing numbers of
unemployed, under-employed, un-housed and unpaid Americans know, the United
States is in the terminal stages of a broad systemic failure brought on by
the excesses of too much money in the system. And sadly, the patient is still
in denial.
Economics, this now more dismal than ever of sciences, fails to
reconcile the fact that the amount of capital available to the global economy
and its movers and shakers must needs by directly proportional to real demand
for actual products. Opportunity is not created by the mere manifestation of
unlimited quantities of counterfeit zero-cost capital. The excessive amounts
of ersatz wealth created by the dot com era, the derivatives matrix, and
incomprehensibly complex mortgage securities has resulted in the present
problem of Too Much Stuff. There are too many houses, too many cars, too many
baubles and gadgets and plastic doodads manufactured in China sitting on
shelves and in lots around the world un-purchased and un-wanted because the
demand for these things is gone. Everybody’s got one or two or three,
and the population will not grow fast enough to generate sufficient demand to
consume the output of our horribly efficient industrial infrastructure.
All that is accomplished by making capital freely available to the
world who doesn’t want it or need is to confirm for even the unborn and
newly dead that the capital proffered is worth exactly its cost: zippo bippo.
The distance between the present reality and current delusion under
which these doped out leaders and their woefully befuddled economists operate
is vast in terms of required economic policy revision. Credit needs to cost,
and currency levels need to be reduced. Gambling on Wall Street with
taxpayer’s equity needs to be outlawed. The incestuous
inter-relationships among government and banking is
shockingly blatant. And criminal. Though not in our current legal system,
which is presently aiding and abetting as opposed to overseeing and
regulating.
As global citizens seeking to protect and enhance our modest wealth,
our common objective is to identify the schemes and scams perpetrated by this
government-banking organized crime group, and avoid them, since no law
enforcement is available in the absence of suitable law.
Make no mistake. We live in an age of collusion where the government
of the United States and its banking underwriters are the enemies of the
global citizenry. They prey upon us to satisfy their insatiable lust for
riches. Using their currency and credit, you are corralled into a perpetual
cycle of labour and debt in which you will die and
leave your children encumbered with the very same fate. (I’m speaking
primarily to Americans here.)
For Canadians, there will be much less pain, but pain nonetheless. Our
ratio of resources to population assures a future where if even the worst
case scenario arrives, there are plenty of caribou and salmon and lots of
land to go homesteading on. For many, the increasing destabilization of
global markets and financial systems will go unnoticed. Our conservative
financial disposition protects us from foolish short term policy
manipulation. Tacitly, we understand the larcenous nature of those who
gravitate towards business and have no illusions about the market being
capable of correcting itself. Healthy doses of strong regulation prevent the
inundation of court rooms with large scale frauds.
The news is full of warnings about Canadian housing bubbles in 30-odd
markets across the country. Since we sell large portions of everything we
make to the United States, who’s buying
interest is evaporating steadily, we may soon be in the company of misery
with our U.S. brethren. My own brother is woefully trying to keep his
once-flourishing turn-of-the-century home restoration and reselling business
alive. Its not looking too
good in Portland – or anywhere else on main street America these days.
In the U.K., poor U.S. style banking tactics have rendered the country
impotent economically without the infinite drop-breaking benefit of the
currency being the global medium of trade. Private equity funds liquidating,
house prices falling, unemployment rising, all mirror images of what’s
happening in the United States without the bloated deficits of regional
governments. Will the deflationary effects of inflation extinguish what
flicker of recovery exists in the dark economic night upon the edge of which
perches the British empire?
And Germany, now the juggernaut of growth and foundation of financial
strength upon which the future of the whole Eurozone
rests. Can it continue to carry the weight and drive the growth of this
increasingly fragile trading block?
For 2011, there is no sign of slowing for the default mechanism of
quantitative easing. The only question is, at what point will this junkie
overdose terminally?
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James West
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