For three years it has suited leaders across Europe to disguise Europe’s banking problems and, citing the blatant profligacy of Greece, they have defined the European problem as simply a public sector debt problem.Right so far, hey, maybe this won't be so bad. Oops! Spoke too soon:
And it has suited Europe’s leaders to call for austerity (and if that fails, more austerity) and forget how the inflexibility of the euro is itself dampening prospects for growth, keeping unemployment unacceptably high and weakening Europe’s competitive position in the world today. (my emphasis)Easy translation: Because Germany is reluctant to let the ECB put the printing press on high, this is the source of all economic problems in the Euro zone.
When I attended the first ever meeting ever of the euro group of leaders in October 2008 there was astonishment when I reported that Europe’s banks had bought half America’s subprime mortgages and there was incredulity when I said that European banks were far more at risk than U.S. banks because they were far more highly leveraged. Since 2008, as American banks have tackled their toxic assets, they have written off 4 percent of their loans and raised the equivalent of another 4% in new equity. But Euro area banks have written off just 1 percent of their loans, and have raised their capital base by only 0.7%, leaving them highly vulnerable even before their exposure to sovereign debt has become a central issue.Well gee Mr. Prime Minister, maybe bailing out the banks wasn't such a grand idea after all, now was it? If only you had listened to the economic school of thought that predicted the crisis rather than the one that called for the creation of a housing bubble to begin with.
Of course in 2008, governments could fund the rescue of indebted banks..Yeah and I could buy a new car right now but that doesn't mean its the surest course to pursue.
in 2011, indebted governments are finding that more difficult.So the banks, acting under the assumption they would be bailed out come hell or high water, accumulated too much risk, were bailed out, and are now repeating the process over again? Shocking!
It is thus clear that the 400 billion euro rescue fund, the European stability find (sic), is wholly inadequate to address this profound failure across the European financial system, and that without a mechanism for fiscal coordination the euro cannot easily survive. A few days ago, U.S. Treasury Secretary Tim Geithner said that “the critical imperative is to ensure that the governments and the financial systems under pressure have access to a more powerful financial backstop.”Another easy translation: In lieu of the EFSF not having enough firepower to bail out the banks again, I am going to take the advice of the U.S. Treasury Secretary who failed to address the housing bubble in the U.S. while running the most powerful private bank in the world that dictates U.S. monetary policy (the NY Fed), has presided over three years of mass unemployment, and who can't even do his own taxes correctly. Yeah, sounds like a good plan. With Turbo Tax Timmy at the helm, what could possibly go wrong?
Here comes the coup de grĂ¢ce:
I know of all the doubts about a new but temporary role for the ECB, but it is unlikely that any other organization has the resources for quick action. But the IMF should back them up, funding their contribution through loans from the oil states and China. It may now be impossible to avoid hundreds of billions in bank deleveraging and liquidations, but a coordinated approach with the support of the internationally community could provide the breathing space for what matters–the reform of the euro.So not only should the citizens of the Euro zone experience a massive devaluation of their currency to save the banks, China and the Middle East (the oil rich, dictator-run ones) should also be forced to participate. C'mon Gordon! Be a man and just say it like it is!
But wait! Brown isn't totally lost with this surprising acknowledgement of reality:
But every country I know, from America to China, is trying to export its way out of trouble — and logically this strategy cannot work.Once again, I spoke too soon:
Only 40 percent of manufactured goods and even less investment may come from Europe and America, but they still consume 55 percent of the world’s goods and services. So today there is a precarious balance between producers and consumers. The West is the world’s majority consumer but not the world’s majority producer–and the rest of the world is the majority producer but not the majority consumer, so the West and the rest depend on each other. Ten years ago the West, then the world’s majority producer and consumer, could drive the world economy on its own. Ten years from now Asia may be able to do likewise. But for the moment at least, East and West either rise together or falter together.....too many fallacies wrapped up in one incoherent but simplistic paragraph. Not only does Brown fall into the same mercantilist, Keynesian loving crap that has brought down the world economic system, he now thinks Asia will be the continent of tomorrow. I guess the looming China property bubble and soon-to-come collapse that will make the American housing bubble look like a hiccup isn't on his radar. Sure, Asia will undoubtedly prosper after this occurs but it may take a while to put the pieces back together. If you need any more proof of the total disconnect from a decent society in China, watch this with extreme caution as it's incredibly heartbreaking. If this doesn't make you flinch or bring a sickening feeling in your stomach, than I don't know what will.
To sum things up, Brown ends with the same "coordinated solution between all international parties" babble that politicians love to spew:
By coordinated action, the G20 can push back on protectionist policies and give people confidence that the world economy can grow sustainably. None of this avoids the painful decisions that arise from the deleveraging by the banks, nor can they be a substitute for tough debt reduction plans. But if China increases consumption, and Asia opens its markets; and if America and Europe spend on infrastructure, (not least because Asia is out-building, out-investing and, perhaps soon, out-educating the West) then we can create a self reinforcing cycle of growth. Indeed if China were confident its export markets would not collapse and if the West were confident it could export more, then the world economy would move forward again. With inflation still relatively low, the time is right for a G20 growth and employment pact. It is not only the way forward for Europe but the right path for the whole world.Yes yes, if only China would stop devaluing its currency at the benefit of its export market, than America and Europe could do the same as the underwear factories would magically flock back to the Western world. How Brown is even taken seriously any more is beyond me. The dude is a joke. It's like George W. Bush trying to lecture the world on how to run the economy; better yet its like Alan Greenspan. Oh wait, Greenspan still does unfortunately.
I can't believe I missed this a few days ago (I just heard about it from this great Lew Rockwell interview with Brian Wilson) it turns out that not only did Obama kill Muslim cleric Awlaki illegally, he got his 16 year old son too. Via Glenn Greenwald, who despite being a lefty has taken a very hard and respectable stance on Obama's disgusting skirt of granting due process and civil liberties:
Two weeks after the U.S. killed American citizen Anwar Awlaki with a drone strike in Yemen — far from any battlefield and with no due process — it did the same to his 16-year-old son, Abdulrahman al-Awlaki, ending the teenager’s life on Friday along with his 17-year-old cousin and seven other people. News reports, based on government sources, originally claimed that Awlaki’s son was 21 years old and an Al Qaeda fighter (needless to say, as Terrorist often means: “anyone killed by the U.S.”), but a birth certificate published by The Washington Post proved that he was born only 16 years ago in Denver. As The New Yorker‘s Amy Davidson wrote: “Looking at his birth certificate, one wonders what those assertions say either about the the quality of the government’s evidence — or the honesty of its claims — and about our own capacity for self-deception.”Pardon the language but holy shit, does this man have no moral bounds when it comes to demonstrating the supremacy of our imperialistic foreign policy? It was a 16 year old boy eating barbeque with his friends for God's sake! Where the hell is the evidence that he was strapping his groin up with explosives to take out a commercial airliner? Remember this?
Boy where did all the hope, change, and excitement for good government go?
One should always be reminded of one of my favorite poems by pastor Martin Niemoller in these types of situations:
First they came for the communists,I wanna end on a note of complete narcissism and just mention that within the past two weeks, I have had 7 articles published. They are as follows:
and I didn't speak out because I wasn't a communist.
Then they came for the trade unionists,
and I didn't speak out because I wasn't a trade unionist.
Then they came for the Jews,
and I didn't speak out because I wasn't a Jew.
Then they came for me
and there was no one left to speak out for me.
"Rethinking the Gold Bubble" which appeared at the Ludwig von Mises Institute on 10/20/2011
"Where Google Gets Its Power" which appeared at the Ludwig von Mises Institute on 10/12/2011
"Occupy Wall Street- They're Only Playing the Blame Game" which appeared in the Middletown Press and Journal on 10/19/2011
"Why Ron Paul is Dominating" which appeared at LewRockwell.com on 10/14/2011
"More Lies from the Lying Class" which appeared at the Montana Policy Institute on 10/17/2011
"Trade Wars Exacerbate Recessions" which appeared on the American Thinker on 10/12/2011
"A New Boogeyman for America" which appeared at Zerohedge.com 10/12/2011Obviously I expect women and employers to be calling in mass numbers.
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