Archive for August, 2011

Krugman is crazy

August 25, 2011 Leave a comment

OK, I didn’t fall for the Google+ account of PK by some imposter, where the fake PK commented that he wished the earthquake had caused more damage to create more economic stimulus.

However PK DID say that digging holes and filling them in would be economically productive in a slump.  He equated this with digging for gold and putting it in the vaults of the central bank which Keynes stupidly argued was equally useless.

What he doesn’t say is that the central banks in the US and Europe and Australia STOLE the gold from its citizens and it SHOULD serve as money and circulate in the economy as a useful good were it not for the coercive legal tender laws we live under.



They are only kidding themselves now…

August 23, 2011 Leave a comment

Get this:

The major US banks are baulking at agreeing to a settlement over BLATANT AND MASSIVE MORTGAGE FRAUD unless they get an exemption from State prosecution over CDS fraud and unconscionable loan issuance.

So…  the government first grants MASSIVE bailouts for the banks when they are in trouble, then asks for the money back because of illegality.  But if they get into trouble again because of the payouts, the government will give them BACK the money secured through prosecutions because they are too big to fail.

Just who is kidding whom here?

Why not just bail them out for less and not worry about the prosecutions (set off the claims) or let them even go bust as punishment for the fraud?  Why the merry go round?

Who the Hell do they think they are fooling?

Categories: Miscellaneous Musings

Let’s work this out

August 18, 2011 Leave a comment

Everyone is everywhere on the economy and the correct policy prescriptions.

The mainstream assessment is here.  I would call it the Paul Krugman assessment.

There’s low aggregate demand.  Poor spending.  A recession.  So government should spend big to compensate.  And interest rates should be zero to encourage spending.

Problems with this view of the world:

1. Debt is already massive, both public and private.  More borrowing will bring everyone to the brink of disaster.  We need a “buffer” – savings – not more borrowings that will further erode personal and public balance sheets, making the next “shock” even more disastrous.

2. Government cannot allocate investment and spending appropriately.  If people don’t want to spend, there’s a reason.  They are bust.  We need  – NEED – a recession to purge the malinvestments.  Why is the government fighting this process?

3. The cause of the problem – debt and spending – cannot logically be the source of the solution.  It’s logically impossible.

So what are the real solutions?

Well, first, there are none.  At least not easy ones.

The real solution is higher interest rates, massive public sector layoffs, and a reduction in spending for at least two years.  That would cause massive pain.  The stockmarket would be down 60%.  Think about that.  60%.  It’s not going to happen.  At least whilst the current democractic system is in place.

Call it the Iceland solution.

Commentators are trashing the half-assed solutions of Germany and Ireland and Greece and other “austerity” countries.  This is bullshit.  They are not austerity countries because their banks have been saved.  They are no different from Britain and the US.

The only country that has taken a knife to the debt problem is Iceland.  How are they doing?  OK, actually.  But no mainstream commentator mentions them because they want to create a false dichotomy: “Look at how bad Ireland is doing!  That’s where austerity gets you!  The US isn’t so bad in comparison” [PLEASE IGNORE TRILLION DOLLAR BANK BAILOUTS IN ALL THESE COUNTRIES, PLEASE IGNORE ICELAND AND PLEASE IGNORE CHINA]

So what WILL happen, given Iceland is not politically possible in the corrupt West?

Japan will happen.  The central planners will tinker.  Zero interest rates.  Billions in wasted government projects leading to nowhere.  But combined with that will be the spectre of massive currency wars and a grab for gold.

What do you do?  What would you have done if you were in Japan in 1991?  Sold everything and moved to a country that had high interest rates or a cheap exchange rate.  Australia.  Indonesia.  Singapore.  Brazil.  Anywhere.

What do you do now? 

Invest in gold and silver.  Buy a farm if you can.  Buy a gun if you can’t.  And leave for a small island or a “backward” country that speaks the same language as you.  Because when the government doesn’t work, everything falls down and there’s no one to pick people up except for additional zeros in everyone’s bank account.

Paul Krugman calls for more London riots as a way of stimulating the economy!

August 16, 2011 Leave a comment

Finally, someone “gets it”!

Paul Krugman calls for more war and more violence and more rioting as a way of stimulating the economy and employing “idle” resources…

He’s a Keynesian genius!

Keynesian Stimulus

August 15, 2011 Leave a comment

Look at the “stimulus” plan taking place in London!  Expect economic growth in England to go through the roof!  This is fantastic news!  Why isn’t everyone celebrating?

“Control coinage and the courts, and the rabble can have the rest”

August 15, 2011 Leave a comment

From Frank Hubert’s Dune.

Ain’t it true.

Happy Anniversary

August 15, 2011 Leave a comment