Stacy Summary: Okay, I have eyewitness deflation report for you. A rather posh restaurant only 50 yards from our apartment has had a fixed lunch menu for 4 years now set at 25 euros. This included three courses and a glass of wine and the place was always packed (it’s not exactly an enormous restaurant). A few months ago, it was no longer so packed and the set menu price was cut to 16 euros. Today, they cut the price to 14 euros, which is amazing for Paris. That’s the price normally seen in a restaurant catering to students or a bit lower end of the market. The set menu still includes three courses and a glass of wine.
  |
 |
![[Most Recent Quotes from www.kitco.com]](http://www.weblinks247.com/indexes/idx24_usd_en_2.gif)
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/silver/t24_ag_en_usoz_2.gif)
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/gold/t24_au_en_usoz_2.gif)
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/platinum/t24_pt_en_usoz_2.gif)
So the eyes witnessed, but what did the stomach and colon think of this gastric churning event ?
Any evidence of cheaper ingredients or is the restaurant on a loss-leader ?
@ptah – good question; we did eat there once at the 25 euro menu and it was okay, but not worth 25 euros I thought; the wine, however, was exceptional, so I am assuming that they may be cutting back on the quality of the wine they serve which could probably save them quite a bit
By that reckoning, Ireland has alot more to deflate. Here in Killarney, €10 will get you a 1 course lunch – it was €12. you can forget your glass of wine, thats about another €6!
@Danny – I bet! I was in Dublin last year for two days . . . it was SO much more expensive than Paris; and as I was on the outskirts of the city, we had pub lunches and dinners and they were mostly crappy but about 30% to 40% more expensive than in Paris; so deflation was needed big time there
Stacy sounds like they are hanging by their fingernails.
It’s starting, I mean in a way where it will no longer be hidden how bad things are and going to be.
Where I live, the province of Ontario Canada, is taking a shit kicking.
My husband has a small business that depends more on the US market than CA, and it doesn’t look good.
I’m 58 years old and trying to stay calm, it’s hard since I’m aware of the level of criminality and lunacy that has taken over most governments.
Stacy
Did you know that French women think they are fattest in Euroland (In fact they are thinest)……..British women think they the thinest & in fact they are the fattest!
Mike
@Stacy
Is it possible to have deflation and inflation at the same time?? We have deflation, we’re seeing it in prices, but we also know that QE is occurring meaning inflation….. is this called stagflation??
Maybe this is the reason the inflation/deflation debate is constantly raging? ‘cos they’re both happening simultaneously?
They cut back on the wine !! they cannot be real French… these agent provocateurs will be lynched. I naively assumed they would cut the pomme frites to about 50% normal length.
@Mike2liverpool – yes, I saw that study; it’s true from my experience living in both places as well; I remember first moving to London in 94 and working in an office with this slightly overweight woman who wore a halter top to the office in the summer; I remember think wow, she seems really confident despite the rolls of fat on her exposed stomach but it really didn’t seem to bother her, she didn’t seem at all self-conscious . . . and while she might die earlier from the bad health, she was clearly less mentally troubled than some otherwise thinner healthier people I know
Here is an excellent piece written by a former chief economist of the IMF. Basically saying we need to get rid of the oligarchs. It’s long but well worth reading.
http://www.theatlantic.com/doc/200905/imf-advice
“The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time…..
………… The second problem the U.S. faces—the power of the oligarchy—is just as important as the immediate crisis of lending. And the advice from the IMF on this front would again be simple: break the oligarchy.
Lets all short French wine!
(Godzilla roars in the distance)
Stacy
One of the shocking things i saw over the last few years was Tatoos. Personaly i can’t stand them, can’t fathom WHY in gods name people do it.
However, i noticed a fashon for tatoos across the small of the back on women. 1st it was girls in their teens & early 20′s………but suddenly i saw women 40 upwards doing it…………..well it might cool on a fit teen…….but on a over weight, “High milage” (lots of drugs/smoking/sex/drink/party) type female……………it just made her look like she was in total de-nile over her build/age.
Mike
@ sharon,
Interesting article, especially for the comparison of ‘public-private partnership’ with ‘crony capitalism’, and the analysis of the US, a developed neo-liberal economy, in similar terms to non-western kleptocracies governed by oligarchs.
I’m not so sure about the characterisation of the IMF as a force for meaningful reform aimed at ‘breaking the financial oligarchy that is blocking essential reform’. I thought they tended to ally themselves to the local oligarchs (e.g. as beneficiaries of forced privatisations) and focus on squeezing more from the local peasants and workers (via taxation, cuts in public services etc).
It looks like South Florida is on the heels of somethin – perhaps evidenced by the sale of a home by VP of Goldman Sachs:
http://southflorida.blockshopper.com/news/story/1800026499-Goldman_Sachs_VP_sells_Miami_Beach_5BD_for_2_235M/
Isn’t it ironic, that the very institutions that keep on harping on about “sustainability” are the only segments in economics that are false (unsustainable).
But it’s still refreshing to hear Gorgon give us sound advice
(Bless him)
India TAXES GOLD
http://www.bloomberg.com/apps/news?pid=20601091&sid=auq8d2Kodx5w
Mike
@Stacy
It sounds like the FDA is getting in on the Oligarch scheme…
http://adage.com/article?article_id=137705
Imagine “watering down” medication to require “government/insurance healthcare” intervention to pay 10x’s more than OTC prices for the same medication!!!!!
Ridiculous!
Oh Lordy! This carpenter is now confused.
Inflation and deflation are desciptors that describe the availability of money in a system, right?
Falling prices are a PRODUCT of deflation, and not deflation, right?
Or can we say, falling prices are a sign that there IS deflation in the money?
Or do we just say prices are going down, therefore deflation?
My head hurts.
@Liverpool Mike
RE: Tattoos…
I have tattoos to mark special events in my life…
I intend to get more…
it’s just a form of personal art…
I believe women get them in the small of their backs to indicate they are SEXUALLY INTERESTED…
again, though, since they tend to expose that part of their body, it is also a piece of art you can look at…
No different than War-paint and jewelry, really…
RE: Wine…
How much is wine in France?
In Italy, the price per GLASS in the bars has gone up (in the winter, a glass cost about 2+ Euros… which was a 20-30% increase)
But if you go to the Cantina (where they make the wine) the prices actually went DOWN
I remember paying 1.20 Euro per liter a couple years ago,
and this winter, I was paying 0.90 for basic staples (Merlot, Pinot Grigio) and 1.10 for the newer breeds (Malbech, Cabernet-Franc)…
I’ll be curious to see what the prices are this winter…
RE: US Dollar’s Hegemonic Death-knell
I’m looking forward to the introduction of the SDR as the new reserve currency…
The more I think about it, the fairer it seems…
Considering GLOBAL TRADE was once based on DENARII, (which was actually a standard silver coin) which in and of itself has no NATIONALISTIC ties…
And it appears FRANCE has gotten on board with that thought now, too…
This will also inevitably help the American restructuring, even though it will be painful (and possibly violent)…
Perhaps the US Gov’t will start printing intra-national currency (ala Lincoln) to fund the rebuilding of manufacturing within their Nation…
I hear JP Whorgan, Shittibank, and Bank of Amerika are going to be accepting California IOU’s for the next couple weeks…
so don’t delay, cash them in TODAY!!!
HMMMM, Wall Street to trade California IOUs. Words just cannot adequately describe this.
http://www.ft.com/cms/s/0/01d98e08-69a9-11de-bc9f-00144feabdc0.html?nclick_check=1
So I bought into the easy credit of the US, I was asleep at the wheel and dug myself into a lifetime of debt. I can service that debt now, but the remaining years of my life will find it hard to remove this self-created burden.
Now that I know this money was loaned to me after never existing in the first place and unerstanding to whom this usery is being paid, I wonder if I should just stop paying and go into Chapter 7 and leave them holding the bag. I wish to never enter this usery phase of the oligarchs again, so I could care less about the mark of the beast credit score.
Or should I be a good serf and continue to pay my obligations while I continue my path of servitude? Any thoughts?
I think Price deflation = falling prices due to lack of support in the market. That’s what I’m seeing everywhere I go – 75-90% off at most stores.
Then again, most of the crap on sale was made in China and is of inferior quality and of no real use to anyone.
@giuseppe – I can’t believe how inexpensive the wine is in Italy! And, in my opinion, much better than the wine in France. Oh god, I’m going to get in trouble for that . . .
Not to worry. The wine in California is far better than the wine in Italy and France put together…
And the wine in Australia, in regards to bulk wine sold in tanks and not bottles, is the best of the best…
There. I said it.
the restaurant food tax rate went down lately from 19.6% to 5.5%
@Eeee – you are right! I totally forgot about that and I wonder why the French didn’t make a bigger deal of it! How strange that it was such a quiet affair! LOL
Any takers?
Mike Morgan Slays Goldman Sachs
by Mike Morgan | Friday, July 03, 2009 in Breakup Goldman Sachs, GS – Lawsuit, Lloyd Blankfein |
.
YES, we WON. Lord Blankfein and his Band of Merry Thugs blinked, and we sliced their heads off. Here is a link to the Stipulation Goldman Sachs recently signed in response to my Complaint against Goldman Sachs, after they sent me one of their bully-bully threatening letters. True knuckheads that think they can bully anyone. Well . . . they bullied Bush, and they’re bullying Obama and his Gang of Goofballs, but I hate the bad guys . . . and Mike Morgan never backs down.
Click Here to view the Stipulation document filed in the United States District Court. Basically, Goldman Sachs put their slimy tail between their legs and slinked off to the stench and rot of their den of deceit, debauchery and licentousness.
Mike Morgan v. Goldman Sachs . . . David v. Goliath . . . David 1 – Goldman Sachs 0
http://www.morganfl.org/assets/mikesblog/Stipulation_and_Dismissal.pdf
Obviously, I can’t stand what Goldman Sachs has done to America, and that they own or control just about every politician at the Federal and State levels. Even when these politicians are not outright in the pocket of Goldman Sachs, the clout of Goliath influences they way our politicians act and vote.
Most of you know I had a heart attack and quadruple bypass surgery at the end of May. I am six weeks out of surgery, and I have been back to work since week two! But certainly not at the level I was prior to the surgery. In fact, I have had to eliminate work on non-client related matters like this website. I will continue to manage and focus on client investments and active trading for clients. That’s a full-time job and then some. I will also continue to manage my Florida real estate team working with Buyers and Sellers. And lastly, I will be turning over much of the day-to-day operations of my Internet Marketing Company, m3 Interactive, to David, our Director of Operations.
What’s Next? I can never return to the level of work I was doing prior to my bypass surgery. It is physically impossible, and I want to retain some form of life for myself and my friends. So I am going to offer to turn over this website to a person or group of people that are interested in managing it. We have received emails from hundreds of potential volunteers, but what is truly needed is one or more people that want to manage the site and the volunteers.
If we don’t find a person or group to manage the site, I will do what I can to put together an internal team, but it is not a priority so it might be a few months.
If you’re interested, please email me [email protected]
http://www.goldmansachs666.com
Well here in sunny South Africa prices continue to march higher for now. Several of the best restaurants here in Durbs have put up prices recently by around 30%
Not really a drinker xmas and birthdays being the exception…..but Im guessing your all talkin cheap stuff….otherwise should I bid above or below $22.000 the next time I purchase a Château Latour -Vintage 1945…..dang! why should the bankers puke all the good stuff Im bidding £23.000….
@s.klein
Respect…..Good Luck….didn’t know about your medical problems…best wishes…get well soon.
I saw a pretty girl once with the words “A lifetime spend neatly tied” tattooed on the small of her back. That’s way too much info for a tat’ methinks.
@ harry_w………………yes, you’re right, IMF is hardly a force for good but it’s an interesting analysis from someone who should know.
@ tikipalm………….you should look into the readings of Mary Croft who has managed to get away with paying any debt whatsoever: something to do with the US/UK being a corporation that issues a bond to each citizen following registration of birth. The bond holds a value which can be exchanged for debt owed to the state. As for debts owed to banks, etc. there is a loophole based on the contract not providing full disclosure and also there’s some cock up that means if you know what you’re doing you can get away with it. I can’t remember all the details but if you read her stuff you’ll get what you need. I’m doing something similar here in the UK whereby I should get many thousands of pounds back from the bank that provided my mortgage, not because they did something that I wasn’t aware of but simply because the law says I can. Hope this helps.
Here’s a fun one for y’all:
Russian immigrant in New Jersey held on charges of stealing top-secret computer trading codes from . . . Goldman Sachs?!
http://blogs.reuters.com/commentaries/2009/07/05/a-goldman-trading-scandal/
Love read website!
Speaking or Goldman Sachs please comment on this:
http://blogs.reuters.com/commentaries/2009/07/05/a-goldman-trading-scandal/ or http://zerohedge.blogspot.com/2009/07/is-case-of-quant-trading-industrial.html
@Sharon
Thanks for the insight. I will look into that accordingly.
Citi raises card rates on millions: Citigroup has sharply increased interest rates on up to 15m US credit card a.. http://tinyurl.com/lldmfz
Credit card losses hit record 10.4%: Losses on US credit cards hit a record 10.44 per cent in June, squeezing http://tinyurl.com/n6nn2y
Credit Card Defaults At Record Highs But Worst Is Yet To Come http://tinyurl.com/qgy9ee
I heard Max on the Alex Jones radio show on Sunday and he was great. They are good together.
LOL–MIke Liverpool “High milage” women with lower-back tattoos. Dunno about UK, but in US those are called “tramp stamps.”
“When the music’s over, turn out the lights…”
Emerging Markets’ Global Equity Share Hits Record; China Tops $3 Trillion
http://www.bloomberg.com/apps/news?pid=20601087&sid=azwnKzoDDKZo
Nigeria Runs Out of Crude Oil
http://www.africanews.com/site/Nigeria_runs_out_of_crude/list_messages/25802
Stripping Naked to Improve Company Morale!
http://www.telegraph.co.uk/news/newstopics/howaboutthat/5718984/Staff-strip-naked-to-improve-morale.html
:- ) @ Nancy!
Yep. My fiance was talking to a young female student of his a few years back and she was talking about getting a tattoo . . . mentioned to him that she was going to get it on her lower back. When he told her that those are called “tramp stamps,” she changed her mind right away.
Governments Grab Unused Gift Cards
http://online.wsj.com/article/SB124605742408663533.html#project=GIFT_MAP_0906&articleTabs=inter
In regards to the disconnect between Obama and Biden, here is a link to the text of the Obama 4th of July speech 2009:
http://www.obama-mamas.com/blog/?p=303
Where Biden was talking economy and promising that the stimulus already voted in would save us, Obama neither mentioned the stimulus nor the job losses. Obama’s rhetoric indicates that Team Obama will remain ‘clear-eyed’ in the quest for a “new America” (written according to the precepts of Team Obama of course) in regards to health care, education, and cap and trade economics. He said this about future jobs:
“build schools that prepare every child in America to outcompete any worker in the world.”
WORKERS?
and this about individual choice:
“Meeting these extraordinary challenges will require an extraordinary effort on the part of every American. And that is an effort we cannot defer any longer.”
Will REQUIRE? Who is to require the great sacrifice of we Americans after the robbery of our productivity by the bankers so our children can look forward to being workers???
I think the answer is rhetorical.
@Guiseppi:
” I’m looking forward to the introduction of the SDR as the new reserve currency…
The more I think about it, the fairer it seems…”
Right. Ownership of the proletariat by BIS will make Goldman Sachs shenanigans look like girl scout hijinks in new knee socks.
More from 4th speech:
“No more talk. No more delay. Health care reform must happen this year.”
Will they force the health care program like they forced the banker bailout?
Derivatives Risk caused acute liquidity shortages for Dutch social building cooperative societies as they got surprised by the rapid rate decline (Google translation from Dutch) http://tinyurl.com/njmo42
I have a friend who is a Mason and he is working on his MBA. He tells me that Greenspan said there was no way to for see any of the current events. No way? And that he (Greenspan) had 50 PhD.’s at his disposal none of whom could have forecast or predicted the current economic mess.
Holy shit, I only have 2 years of college coming out of a GED and I have enough sense to see the insanity of bail outs and the deliberate bankrupting of a nation!
It doesn’t take a PhD to know that when you take a glass of wine and dilute it with water you end up with a worthless glass of diluted wine flavored water. If they flood the market with dollars the same effect will be realized the diluting of the dollar which will have the effect of destroying any capitol wealth that an individual may have created through savings.
The state of Wyoming has one of the largest surpluses out of any other state in the US. The Federal Gov. owes Wyoming $500 million dollars and has yet to pay out the debt, yet they offer “stimulus money” Wyoming is a good example of a saver who will suffer at the hands of the speculators.
@baggadonutti
Where I live, in Monza, near Milan, Italy, a nice glass of Italian red wine costs from euro 4,5 upwards (seated or standing) at my local “bar”. At supermarket chain Esselunga – prices for a bottle of prosecco start at euro 5,00 – a bottle of spumante starts at between euro 3,00 and 4,00.
Boston Tea Party = Start of the Revolution over an 8.8% tax on Tea!!! (2 Shillings and 6 Pence per Pound value of tea) Blood was shed, lives were lost, but the revolution was successful in pulling the shackles of King George from the Colonies.
Fast forward to today and the American People are shackled by the following –
Accounts Receivable Tax
Building Permit Tax
Capital Gains Tax
CDL license Tax
Cigarette Tax
Corporate Income Tax
Court Fines (indirect taxes)
Dog License Tax
Federal Income Tax
Federal Unemployment Tax (FUTA)
Fishing License Tax
Food License Tax
Fuel permit tax
Gasoline Tax (42 cents per gallon)
Hunting License Tax
Inheritance Tax Interest expense (tax on the money)
Inventory tax IRS Interest Charges (tax on top of tax)
IRS Penalties (tax on top of tax)
Liquor Tax
Local Income Tax
Luxury Taxes
Marriage License Tax
Medicare Tax
Property Tax
Real Estate Tax
Septic Permit Tax
Service Charge Taxes
Social Security Tax
Road Usage Taxes (Truckers)
Sales Taxes
Recreational Vehicle Tax
Road Toll Booth Taxes
School Tax
State Income Tax
State Unemployment Tax (SUTA)
Telephone federal excise tax
Telephone federal universal service fee tax
Telephone federal, state and
local surcharge taxes
Telephone minimum usage surcharge tax
Telephone recurring and non-recurring charges tax
Telephone state and local tax
Telephone usage charge tax
Toll Bridge Taxes
Toll Tunnel Taxes
Traffic Fines (indirect taxation)
Trailer Registration Tax
Utility Taxes
Vehicle License Registration Tax
Vehicle Sales Tax
Watercraft Registration Tax
Well Permit Tax
Workers Compensation Tax
But now, we just stuff our faces more, gossip about celebrities, watch the idiot box, and wait for the next election. Disgusting.
The Continental Congress of 2009 is over-due.
Don’t forget the inflation tax created by the Federal Reserve Bank Oligarchy.
India Doubles Import Taxes on Bullion to Raise Cash
http://www.bloomberg.com/apps/news?pid=20601080&sid=auq8d2Kodx5w
… ” July 6 (Bloomberg) — India, the world’s biggest consumer of bullion, doubled import taxes on gold and silver as the government sought to raise funds to spend on roads and supply food grain to the poor at below market rates. “…
@Danny,
I saw one analyst predicting both inflation and deflation.
(It was a few months ago…perhaps it was on Mish’s site)
Inflation for staples: food, commodities you really need, and deflation for everything else like plasma TV’s Chinese imports, etc… and probably wages too.
It sad because I buy the former and not the latter. We should be de-incentivizing the purchase of overseas crap, not the reverse.
@ Tim Gandee
don’t forget the myriad of taxes (state, city, intra stae….) added to the telephone bill and cell phone bills. It is insanity! I read some years ago about a telephone tax that came out, like 70 myears ago and that had since been abolished (or something like that) yet the con men were still charging the tax!!! Free money will draw the crooks like flies. Like Bonnie and Clyde. “Clyde, why did you do it? Why did you rob the banks Clyde?”
“”cause thats where the money is!”
Perhaps the same could be said of the Federal Reserve and the Government
“Why did you do it? Why did you bilk the wealth out of the American people???”
‘Ole Benny “’cause thats where the money was!”
India price fixing grain.
Tim Gandee wrote: Gasoline Tax (42 cents per gallon)
I have to pay $ 1,12 per Liter in Tax/fee ($ 4,23 per gallon)
Today the Liter price for Gasoline on the local petrol station was 12,65 NOK or $ 1,94 per Liter ($ 7,33 per gallon)
@ Frances Snoot
I thought the BIS were already the “Capo dei Capi” of central banks?
it seems to me having the IMF’s SDR won’t change the picture…
What I want to see is how the SDR will actually be calculated…
If it winds up just being based on the 4 currencies that it is currently calculated by (USD, EUR, JPY, GBP), then it won’t solve anything…
Granted, I am not considering the MORAL aspect of the IMF,
I’m just trying to look at the situation from an Alien’s POV…
The BIG Subjective Picture, if you will…
@Palantíri
And yet Americans will defend the IRS, while our Founding Fathers risked life and limb over an 8.8% tax. 2012 is coming and the “lifting of the veil” is progressing before our eyes, but it just cannot seem to happen quick enough for me. I believe that the force of the light workers will indeed prevail over the dark forces of the banking oligarchy, but unfortunately a great amount of suffering looks like it will indeed have to take place to wake the rest from their slumber.
It is tough being awake while the myriad of people in my country and state still walk about in their coma. I have shaken as many people as I can about the false left/right paradigm, the baking rule of our government, and the fact that “our repeated Petitions have been answered only by repeated injury.”
Our government has, over the past 200 years, become the “Prince whose character is thus marked by every act which may define a Tyrant” and are “unfit to be the ruler of a free people.”
The problem is that the America public, at least a vast majority of them, still believe themselves to be a free people and not the slaves that they, and I, indeed are.
@Guiseppe:
Yes, BIS is cremede la, but no, the system will be entirely different. I worry about the access to capital, and also access to resources. If you want to know about sdr implemetation, read Zhou’s essay:
http://www.pbc.gov.cn/english/detail.asp?col=6500&id=178
It is Bretton Woods through one administrator, not each individual country administrating Bretton Woods along the lines of prosperity protocol for their country (with the IMF of course destroying individual sovereignities like ducks at a carnival, one by one)
I don’t know about Europe, but here in America the resource access is being constrained by the state: water, produce, animals, grains-all under code restriction. Codex Alimentarius is set to kick in this December here in US. That and the ‘new financial regulatory’ rules (see BIS regulates investment vehicles)…it will NOT be just a question of the end of dollar or US military hegemony. The new order is about a hierarchy of control and power.
I understand that the UN/IMF/BIS system is fully functioning: the Beast has not gotten up and walked independently yet. It is being birthed this year. That is why Obama is so insistent on getting US on track for health plan this year. There are deadlines…
I don’t believe we understand fully what all this means. The media is stirring up confusion and division according to the plan. But I am sure that it means an end to individual prosperity and choice. Either that or one hell of a fight and the underdog wins. Or nobody wins because nobody is left living…
re On the Edge
On the Edge is such an excellent show. I think you have found a really great platform to build the arguments and analysis to assist our collective understanding of this economic-financial-power problem.
I hope to see this show more developed. It is hard hitting and smart. This is a “product-solution” that I need. Even if an “Alex Jones” is a 100% correct that medium lacks the constructive elements to build an awareness of the issues–It is not concrete enough. I need to know what the problem is that I can communicate it to others with specificity and what I need to do personally to generate the ideas to protect myself and what I can do collectively to make myself useful to others.
Thanks for the show.
@Guiseppe:
I understand (I think) your subjective point of view, seeing as the whole world writhes under dollar hegemony, trade imbalances, and rank US imperialism. Can you imagine, though, that there are those HERE that believe it is a good thing for US citizens to go with SDR implementation and the full basket scenerio? How are Americans to get medication when the dollar devalues? (China is main producer of US meds) We are import dependent and the government is set to devalue the dollar and weaken our export industry (cap and trade, GM fiasco) which leaves a weak currency and exports of the arms and military ventures which are being sold over here as covenant Christian principals!
http://www.haaretz.co.il/hasen/spages/1092672.html
The citizens need to stand up and make their own currency choice and get rid of the tyranny and jokers in government. (See Obama joking it up with Russian diplomats…)
Hey Max, Stacy and viewers!before everyone congratulates themselves on prophesising the collapse of the world’s debt based banking system,we should all read again 2 books by Michael Rowbotham.”Goodbye America!Globalisation,debt and the dollar empire” and “The Grip of Death”.
Why?well in the best tradition of truth, justice and the american …oops i mean british way, rowbotham spells out exactly what has come to fruition!The obsession with never ending economic growth underpinned with ever expanding fractional reserve bank deposit debt!!can only lead to one inevitable conclusion a threat to human liberty!!Mandatory reading for all!
Strangely Keynesians and Austrian shools of economics fail to address the primary cause for this financial mess, the actual failure for banks to actually loan the interest into circulation as well as the principal.Something the likes of Peter Schiff et al.. never address in all their diatribes!
Let me know what you think viewers!
Dont believe the shit that all is milk and honey here in Oz, im in the painting trade and havent had work for 4 weeks.In 15 years of self employment that’s never happened!Green shoots roll on!!pigs arse.
Review again the absurdity of Business School Boffins and their “Excess Saving” justification for Western dissipation on the saving ethos of newly industrialising nations.
What homes did these B School boffins emerge from? Where is everyday
common sense, the recognition of long-term horizons, and a smidgen of morality?
By their reasoning if I drink too much at your party it’s surely because friend L abhors alcohol , If I eat too much at your party it’s surely because friend M, barely feeds herself, and naturally, the profligate, Because-Im-Worth-It, spouse of Harry Hogwash-Hedgefund, ascribes her extravagant expenditure on the excess saving of her mother in law.
Don’t Miss AN ARTICLE PENNED June 2005! http://www.slate.com/id/2121017/
Savings Glut
The self-serving explanation for America’s bad habits.
By Daniel Gross
Posted Thursday, June 16, 2005, at 3:56 PM ET
——————————————————————————–
Why are there imbalances in the global economy? Until recently, conventional economic wisdom has held that the U.S. has a huge trade deficit, a gaping current account deficit, and large federal budget deficits because Americans consume too much and save very little. Newly emerging conventional wisdom takes the opposite view. The problem in today’s global economy is that the rest of the world, in particular people in Asia, consume too little and save way too much.
Signs of this meme can be seen all over. The lead article in today’s Wall Street Journal speaks of a global housing boom spurred by a “saving glut.” An op-ed in today’s Financial Times by Ricardo Hausmann of Harvard notes that “excessive savings are at the root of the imbalance in China.” Elsewhere, the FT applauds a tentative sign that the Japanese—”who control the world’s largest pool of savings,” some $1.28 trillion—are showing signs of spending and investing more.
The savings-glut meme, which could soon become an important part of our monetary policy, has emerged from economists’ efforts to come to grips with what Federal Reserve Chairman Alan Greenspan has labeled “the conundrum.” In a speech to a conference in China last week, Greenspan offered an uncharacteristically concise précis. Given the pace of growth in the U.S., the current account and budget deficits, and the sharp spikes in short-term interest rates, long-term interest rates should be higher. But they’ve fallen—in the U.S., Europe, and even in developing economies.
Ben Bernanke, the Princeton economist and former Federal Reserve Governor who was approved yesterday by the Senate to head the Council of Economic Advisers (and who is the odds-on favorite to replace Greenspan next year), has come up with an explanation that he first articulated in a speech in March: There’s a “global saving glut.” Bernanke identified two main sources. First, there are the rich industrialized countries with graying populations and slow growth, where people need to save more for retirement and yet can’t find attractive domestic investment opportunities (think Old Europe and Japan). A bigger and more powerful source of excess savings, however, is found in newly industrializing countries like China. As Bernanke notes, in the past decade the developing world has metamorphosed “from a net user to a net supplier of funds to international capital markets.”
China, and other countries in Asia and Latin America, responded to the financial crises of the 1990s by putting controls on capital flows, building up reserves of foreign currency, and encouraging more savings. Add in a rise in oil prices (which sends cash to the developing world) and the stock market bust of 2000 (which made people reluctant to put cash to work in equities), and that’s a lot of money sloshing around the developing world. Because the U.S. is such a comparatively attractive place to invest—even after the NASDAQ meltdown—a lot of that capital has found its way to America. By running large budget and current account deficits, then, the U.S. acts like a sponge, soaking up the world’s excess savings and providing it with a decent return.
In April, Columbia University Professor Richard Clarida, the former assistant treasury secretary and a candidate to be a Federal Reserve Governor, advanced the meme by arguing that our twin deficits are an example of good global citizenship. When there’s more savings relative to investment, he wrote in the Wall Street Journal (here’s the link, but a subscription is required), “not only will real interest rates be driven down, but some country or group of countries must run current-account deficits to absorb the excess saving.”
In other words, as Martin Wolf, the FT’s chief economics correspondent, noted in a big saving-glut takeout (subscription also required) earlier this week, the U.S. is doing the world a favor. “In a global economy with no global government, the most important regional power—the US—has been following the Keynesian recommendation by offsetting excess desired savings elsewhere.”
On his blog, economist Brad Setser raises some interesting questions about Bernanke’s argument. More curious is what Bernanke—and other saving-glut champions—want us to conclude. He diplomatically noted that, “in locating the principal causes of the U.S. current account deficit outside the country’s borders, I am not making a value judgment about the behavior of either U.S. or foreign residents or their governments.” But of course he is. Bernanke tells us not to worry so much about the federal budget deficit—reducing it won’t affect interest rates significantly. Meanwhile, foreigners should “ease borrowing constraints, to spur domestic consumption.” The subtext of the meme is that Asians have to become big spenders and little savers like the British and Americans.
The savings-glut meme changes the terms of the conversation about global imbalances. It’s not our fault that we rely on foreigners to fund our desire to spend in excess of our resources. Au contraire. Our extreme consumption and failure to save become something of a virtue. Somebody has to keep the world’s factories humming and absorb all the products made in Japan, China, and elsewhere. And until the rest of the world becomes More Like Us in its consuming habits, the imbalances are likely to persist.
The savings glut may be an accurate and subtle take on the world’s economic imbalances. But less subtly, it minimizes the impact of the potentially destructive monetary and fiscal policies pursued by the U.S. over the last five years. It also lays the responsibility for change squarely on the backs of foreigners and makes a virtue out of what appear to be our own failings. No wonder Bernanke is so popular at the White House.
Daniel Gross is the Moneybox columnist for Slate and the business columnist for Newsweek. You can e-mail him at [email protected] and follow him on Twitter. His latest book, Dumb Money: How Our Greatest Financial Minds Bankrupted the Nation, has just been published in paperback.