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The most interesting part of a George Soros treatise on the EU crisis is its brief preamble in...
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Sunday, September 9, 2012, 8:18 AM ETThe most interesting part of a George Soros treatise on the EU crisis is its brief preamble in which the author says the world has changed since he penned the essay. Merkel's siding with Draghi over the Bundesbank's Weidmann on the subject of bond purchases was a "game-changing event," writes Soros. Taking full advantage, Draghi has "promised unlimited purchases" of troubled nations' sovereign debt. "The continued survival of the euro is assured."
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keeping adding debts with no ability to pay it back just delay the bankruptcy.
unfortunately, has often been war.
then war
Your calm logic probably passed way over the head of most of the usual reactionaries.
Soros can now disingenuously claim (he has now said both) the euro will survive and the euro will fail. Anyone following him has been left in the wake of this about face. Merkel supports BOTH Weidmann and Draghi, leaving it all to the German Supreme court to decide (she's a politician...what does anybody expect). Soros calling her Draghi support a game changer is less than honest.
While I am a Soros fan, knowing the truth is more than just listening to "expert" opinions it seems.
Draghi's non Jackson hole speech comes as close as possible to putting responsibility on financial institutions, and while he promises to protect Germany, he is clear that coupled with euro supervision of member country budgets, national or community controls will be applied to europe's out of control banksters, and those of the us as well.
Merkel can go along with her rich burghers and protect the elite feeding frenzy, risk hyperinflation but protect global mercantilism, or she can protect the euro citizens from supra national financial institutions bidding the euro debt rates to the point of strangulation.
"To make matters worse the Bundesbank remains committed to an outmoded monetary doctrine that is deeply rooted in German history. Following World War I, Germany had a traumatic experience with inflation; consequently it recognizes only inflation as a threat to stability and ignores deflation, which is the real threat today."
He goes on to say:
"That is, when too many heavily indebted governments are reducing their budget deficits at the same time, their economies shrink so that the debt burden as a percentage of GDP actually increases. Monetary authorities worldwide recognize the danger. Federal Reserve Chairman Ben Bernanke, Bank of England Governor Mervyn King, and even Bank of Japan Governor Masaaki Shirakawa have all engaged in unconventional monetary measures to avoid a deflationary debt trap."
How does the whole world inflating their currency at the same time help anyone? Inflation primarily hurts the middle class and the poor with increased prices for necessities like food and gas which are excluded from cost of living increases and trail by years. This simply takes more money from the consumer who drives the economy and continues the downward spiral. It increases the obligations of government to provide a safety net for increasing masses of unemployed with decreasing revenues.
Unless a solution is found that will give consumers jobs and money to spend we will continue on this death spiral. People who have no money or jobs do not pay taxes now, inflation will only create more of them who are dependent on government for survival.
Since the signing of the Maastericht Treaty, it seems that to varying degrees that European members have found a way to work their way around the rules-- yet the rules were put in place fir very good reason.
This applies as well to the ECB's decision to essentially finance its member states and its institutions. In reality, the ECB risks doing the dirty work for all the coward politicians-- as funding a growing debt burden is really easy to do if you have the power of an unlimited printing press.
Does this path sound familiar to most of you Americans.
I think Soros is (again) very cleverly talking his own book... and I'm sure that "book" includes lots of precious metals and essential commodities.
My hope is that the German constitutional court puts and end to this madness... and forces the issue to a referendum. I doubt that is likely to happen, though.
It is a fraud and if practised be anyone other than the central bank would be prosecuted as such. It is counterfeit money printed up to avoid paying legal debts by dead beat debtors who can not face up to the fact that they are broke and either can't or won't do the honourable thing and pay 'in like kind' or file for Chapter 11 bankruptcy protection from their creditors and submit to court appointed regulators to restructure and supervise their affairs until the are once more solvent.
We have corporations in the U.S. who have access to U.S. markets, legal system, military protection but who ship all the jobs to other countries, hide their profits and assets from taxation in off shore accounts and demand subsidies and other favourable treatment from U.S. taxpayers. We should restructure our tax laws and tell these corporations and wealthy individuals to bring it home and pay your fair share for services provided or find another home base.
The worst of it is that they always have the same solution. Inflation! Have you no honour. Have you no shame. Inflation hits the middle-class and the poor with higher prices for the basic necessities of shelter, food and energy from which they can not escape.
It is often said that 1% of the population controls 95% of the wealth of this country and 95% of the rest of the population must make do with with the 5% left over. That's a recipe for the Arab Spring coming to the EU and the U.S. next as the world degenerates to a 'Mad Max' scenario.
Do we really expect China and the rest of the world to stand by and watch in helpless fear as we inflate away what we owe them? What would we do? Threaten to pay them off and never borrow from them again?
Geez! When did we lose our way?
Need I say more?