Posts Tagged ‘political expediency’

Absurdity, hypocrisy, expediency; a random selection from the daily press…

December 10, 2010

Angela Merkel wants to reassert the supremacy of politics over the economy.

http://www.bundesregierung.de/nn_6562/Content/EN/Artikel/2010/05/2010-05-06-wdr-forum__en.html

For all intents and purposes, politicians have abdicated their sovereignty to the banks the minute they accepted and imposed on society debt based fiat money. Ms. Merkel wishing to regain her independence from the banks shows that Ms. Merkely either does not understand fiat money and the the inherent implications or she is paying lip service to the electorate. What is certain is that it is much too late to reassert primacy over the banks because the only politicians that can act without official and abundant funding are generally considered rebels or terrorists. Failing that, main stream politicians need the banks more than the banks need them.

EU to curb big bonuses

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8192733/Europe-set-to-link-banking-bonuses-to-basic-salaries.html

Once again, a political dog & pony show. Bank bonuses would not be a problem in the first place if our “leaders” didn’t pump banks full of public money. Banks are full of public money because in a debt based fiat monetary system, banks are the last and only pillar that sustains the entire socio/economic/political construct. Till we don’t have the balls to tell the banks to shove it, politicians will forever be beholden to the banks.

I will add articles as I come across them.

Hot on the heels of their US counterparts, EU politicians are falling over each other to propose “ingenious” approaches to “solve” the crisis.

E-Bonds would end the crisis

http://www.ft.com/cms/s/0/540d41c2-009f-11e0-aa29-00144feab49a,dwp_uuid=bd2f85d2-8e90-11db-a7b2-0000779e2340.html#axzz17JJTBvsQ

The plan consists in asking all European countries to pitch into an emergency fund and underwriting it with an E-Bond that would be given AAA investment rating. By means of parsing this for you, here is how this is supposed to work. “All European countries” means all of them including those that are already officially bankrupt as well as those that are tottering on the edge of official bankruptcy (because though officially Italy or France may not be bankrupt for examaple, simple arithmetic compounded by the cross holdings of their national banks say they are). Thus, a country like Greece that already now has no money to fund any of its needs would have to stump up and throw some money into the pot even though, and this is the hilarious part, it will subsequently withdraw multiples of what it has contributed to the fund in the first place. And without mentioning that to contribute to the fund, Greece would have to increase its debt burden thus making it even more difficult to climb out of the hole Greek politicians have dug for the country. And without mentioning that by increasing the national debt, Greece would suffer a further credit rating downgrade thus not only increasing its borrowing costs but in one fell swoop finding itself as a low investment grade member of a rescue fund that has been rated as top notch investment grade. The notion of slapping lipstick on pigs comes to mind. AND by the way, this is exactly the strategy that has already proved to be lethal for the system when sundry mortgages where packaged into investment vehicles that were subsequently and arbitrarily awarded AAA investment grade rating and that are now causing the crisis that Mr Junker intends to solve by doing exactly the same thing that caused the crisis in the first place.

This is the best explanation ever of why there never has been nor ever will be scarcity of politicians anywhere in the world. Playing politics allows one to take utter and blissful leave of one’s senses. It’s got to be better than drugs as nobody would go into politics otherwise. The only thing I can think of that approaches this insanity is New York city’s pension fund borrowing money from the New York city’s pension fund to…. wait for it… contribute to the New York city pension fund (Robbing Peter to Pay… Peter).

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Iran is a threat to peace

November 12, 2010

Hat tip to poster “Ellix” on VOY forums

Something is not confirmed till government officially denies it

October 15, 2010

My favorite theme. Check out any of these prior posts…

https://guidoromero.wordpress.com/2010/01/31/something-is-not-confirmed-till-government-denies-it-greece/

https://guidoromero.wordpress.com/2010/05/03/a-study-in-hypocrisy-and-political-expediency/

https://guidoromero.wordpress.com/2010/05/05/something-is-not-confirmed-till-government-denies-it-spain/

Obviously having learned nothing from Almunia and his histrionics, today we have none other than the Prime Minister of Spain declaring:

Euro Debt Crisis is Over

http://online.wsj.com/article/SB10001424052748704129204575506182829904198.html

Now, I can understand how politicians can never learn from their and other politicians’ mistakes past and present. Politics is inherently and by necessity expedient and manipulative in nature so politicians do and say what they do and say.

What I have a harder time understanding is how presumably “informed” media agents, media companies, professionals and, indeed, members of the public can so regularly not see political statements for what they are.

Once again. As I did with Almunia whom, incidentally, has disappeared from the public scene, I will gladly take the other side of this bet. Sovereign credit spreads as well as fiscal revenue trends say this is easy money. So easy in fact, it could qualify as hustling.

 

The temperature is rising…

September 14, 2010

Nothing new to readers of this blog…

http://www.telegraph.co.uk/news/newstopics/politics/8001113/Cuts-will-bring-civil-unrest-says-police-leader.html

And then we have this from the man that not only single-handedly made the fiscal situation worse but the very man that blackmailed congress by painting an outcome of fire and brimstone if they did not approve the $700Billion he was asking for…

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8000696/US-risks-losing-superpower-status-unless-it-tackles-the-deficit-Henry-Paulson-warns.html

And from my favorite fiat money piñata…

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8000561/IMF-fears-social-explosion-from-world-jobs-crisis.html

… and although in this article it is not him speaking, we know he endorses the idea set forth by “Mr Blanchard called for extra monetary stimulus as the first line of defence if “downside risks to growth materialise”, but said authorities should not rule out another fiscal boost, despite debt worries. “If fiscal stimulus helps avoid structural unemployment, it may actually pay for itself,” he said.

I know I keep going over the same ground over and over again. But that’s because main stream politicians and economists drone-on about the same thing over and over again. Everybody and their cousin wants stimulus of one variety or another.

As far as I am concerned, I just wonder why nobody that matters has noticed that this time around doing more of the same may actually be counterproductive. Every single field of human endeavor is subject to the study of efficiency. Whether in science or agriculture or engineering, efficiency is a key parameter that is sliced, diced, studied and evaluated at all levels. So why shouldn’t the same degree of scrutiny apply to the monetary system? Why is it that main stream politicians and economists cannot see that money too conforms to parameters of efficiency?

In 100 hundred years since a select number of banks imposed our modern monetary system, the efficiency of money has been steadily declining. Today, in the absence of new markets or new currencies that could be absorbed in the US$ monetary system, creating and spending more money no longer gets us the desired result. The metrics are there and are available for anyone that wants to see:

http://research.stlouisfed.org/fred2/series/MULT

Graph: M1 Money Multiplier

http://www.swarmusa.com/vb4/content.php/282-THE-Most-Important-Chart-of-the-CENTURY

http://www.swarmusa.com/vb4/attachment.php?attachmentid=116&d=1269115914

At a time when just about every single sovereign nation has spent all the money they have plus all the money they don’t have and will not have for decades to come, simple arithmetic says that we should try another tack.

But of course. In a democracy, spending cuts are politically untenable. Particularly when governments have played fast and loose with public finances for decades so that today larcenous and criminal strategies are necessary just to maintain the appearance of normality:

http://www.zerohedge.com/article/us-debt-deficit-difference-hits-fresh-record-treasury-continues-issue-50-more-debt-needed-fu

Today, the US Treasury department disclosed that its August deficit was a slightly better than expected $90.5 billion, compared to $103.6 billion in the year prior. What received less fanfare was that the comparable increase in debt in the month of August 2010 was $212 billion, compared to $143.6 billion a year earlier. In other words, more than twice the the deficit had to be issued in the month of August.

So, what do you think our politicians will do this time around?

You know what I think: 2013/2015 latest…

Prepare accordingly.

Chairman of Joint Chiefs of Staff Says National Debt Biggest Threat to National Security

August 29, 2010

With thanks to Zero Hedge

http://www.zerohedge.com/article/chairman-joint-chiefs-staff-says-national-debt-biggest-threat-national-security

And that is exactly the reason we are about to be plunged into a war of global proportions.

To be clear, the past 100 years of monetary policy instigated and abetted by a select group banks is a deliberate mechanism predicated on the constant expansion of debt. As this policy inherently conforms to the law of diminishing returns there is a mathematical point past which more debt no longer can produce enough nominal revenue to service the debt. Ergo; we are technically bankrupt. That is, we can create more money but the traditional mechanism that is supposed to inject this new money in the economy is broken and no longer generates the economic activity required to feed state tax revenue thus by extension Federal revenue declines too.

Initial inevitable response is the following (again, with great thanks to Zero Hedge):

http://www.zerohedge.com/article/us-government-matches-every-dollar-tax-revenue-dollar-new-debt

Excerpt:

  • Total net debt issued since September 2008: $3,351 billion (from $10.025TR to $13.376TR)
  • Gross tax receipts since September 2008: $3,185 billion. Note this is not net of refunds. Should one exclude the $660 billion in refunds issued over the same period, the net contribution by taxpayers is just over $2.5 trillion, meaning that the value of each dollar of debt issued is a quarter greater than each dollar in taxpayer revenues.
  • This number would be somewhat offset by Corporate tax revenues, which over the same period amount to $440 billion gross and $230 billion net of corporate tax refunds.

Our governments are trapped. The choices are few and well defined and other than a war of aggression, all other choices are politically unpalatable at home in the ostensibly “civilized” West.

In accounting terms, what needs to occur is an immediate reduction of government expenditure and an immediate and drastic reduction in new debt issuance. Particularly in the USA, military expenditure must be drastically cut. Remember here that the USA’s military budget is larger than the military budgets of all developed nations combined. But cutting military budgets alone won’t do the trick particularly in Europe. Furthermore, since governments in the West have liberally helped themselves from social security funds that were ostensibly set aside for society (when governments borrow from social security these sums do not show in national debt statistics) this means that a very large chunk of social expenditure too needs to be curtailed. But as evidenced by Greece and soon by other Western civilized and developed countries, society does not take well to having their handouts taken away particularly when, in the particular case of pension contributions, these funds were supposed to have been set aside.

Revolution in the West now moving into the ralm of the probable?

August 26, 2010

… and it is not me saying so…

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/7964328/Fresh-flight-to-Swiss-franc-as-Europes-bond-strains-return.html

Excerpts with comments (emphasis added):

No country in the developed world apart form Japan has ever seen 10-year yields drop below 1pc. Rates remained significantly higher during the two great depressions of the 1870s and the 1930s.

The above just highlights the unprecedented nature of this crisis as well as the unprecedented nature of government futile, if not populist and criminal, intervention that punishes the many to reward the few.

Morgan Stanley said investors are taking a risk buying sovereign bonds at this level, arguing that debt-to-GDP ratios in the developed world greatly understate the true liabilities and aging costs that threat public finances. “It’s not whether governments will default, but how, and vis-a-vis whom,” said Arnaud Mares in a client report.

And for the piece de resistance:

Mr Mares said most Western states are in “deep negative equity” and cannot hope to pay their debts. Bondholders have so far been “fully sheltered from loss” through the crisis but this is politically untenable. The rest of society will not suffer austerity for ever to pay the coupons.

The next phase of the crisis will see revenge by all those who have already taken a big hit, or expect to do so: whether under water on their mortgages, unemployed, dependent on health support, or state employees. Democracy will have its way.

Next stop: a world war. Just because it does pay to riot –

http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100007444/it-pays-to-riot-in-europe/

The great unwashed cannot be asked to understand how and why a state can be and is out of money. The great unwashed that live in the West are oblivious to the fact that the one single dynamic that shapes their lives has been imposed unilaterally by government; that is the monetary system. The great unwashed cannot fathom how the social promises that government made over the past century are but a necessary byproduct of the monetary system. The great unwashed certainly cannot understand that a fiat monetary system is limited mathematically. Heck! Professionals in the banking and finance industry don’t understand that either so why should anyone else.

This is as close to the End Times as we’ll ever get folks.

Institutionalized gangster government

July 6, 2010

Via Pajamasmedia.com

http://pajamasmedia.com/blog/institutionalized-gangster-government/?singlepage=true

With the establishment press asleep and the blogosphere still in its investigative reporting infancy, imagine what we can’t see, and won’t see. Mark Levin raised the warning flag about this over a year ago:

Do you know how much of this must be going on in the shadows, with the banks and the financial systems? What must be going on with one business after another, threatening them, warning them, punishing them?

Now imagine what the statists in government can accomplish to further their agenda and stifle dissent in their arbitrary and largely unappealable rulings on what is and isn’t a “grandfathered” employer health care plan; what is or isn’t acceptable executive pay; and now, with the imminent passage of what Investors Business Daily called “financial deform,” which “financial services” firms, no matter how currently healthy, should be taken over for taking on too much “risk.”

UK Gov saying they want to pull out of Afghanistan…

May 22, 2010

… the key here is the typical and politically expedient use of “as soon as possible”. Though withdrawal would indeed be the reasonable thing to do, if history is any guide, the UK are not about to do anything at all; certainly not pull out of Afghanistan. The West will eventually pull out of Afghanistan once the situation there becomes militarily untenable and the number of casualties amongst Western troops becomes politically untenable at home. Till then, the UK, the EU and the USA will blunder on and, despite occasional attempts at soft intervention, Western strategy will become gradually more lethal, more destructive but more detached thus less accurate inflicting devastating losses on the civilian population and the environment.

The thing is that with everything that is happening at home, the West can ill afford greater numbers of casualties that are necessary if the country is to be “pacified” because pacification can only come about with boots on the ground. And considering Afghanistan’s size and topography, nothing short of a good million troops might do. In the absence of boots on the ground, the West must rely on air power and missiles… hence the tolerance for collateral damage must necessarily increase.

Of course, in the event of a global conflict and in the event the conflict should start or be extended to that part of the world, then increasing boots on the ground won’t really be a problem. But till then, the West will stay the course and only pack it in once the current puppet regime is discredited, overthrown and/or casualties amongst Western troops create a political backlash at home.

As absurdities go… (colonialism)

May 22, 2010

As I read today’s edition of The Telegraph, I am reminded yet again of the absurdity, the hypocrisy and the contradictions inherent in the life of a nation state. Ergo, the absurdity of the raison d’etat.

Apparently there is a controversial Algerian film being shown at the Cannes film festival that, predictably, presents the Algerian view of the war of independence against France. What the Algerians view as war of independence, the French view as terrorism hence the controversy.

The French case is interesting in that it is the last attempt of a Western power to perpetrate and perpetuate an archaic (primitive) form of foreign policy that WWII should have put to rest for good.

In a tragically ironic turn of events, here is a people whom having endured a brief period of Nazi occupation, fight to “liberate” their country and, the minute the Nazis march out of their borders, they find nothing better to do than to turn around and invade Algeria???? But wait, not content with having marched into Algeria in the mid 40s these guys double down and march into Indochina in 1947 (Viet Nam). That’s 1947 folks not two years after the official end of WWII… two years folks… not two decades or two centuries… two years; 24 months…

If this does not elicit a What The Fuck Were They Thinking moment, I don’t know what can.

And I am sure the French have a million reasons they can offer for having done what they did. But how can the irony be lost on them when at a time that they were still sobbing and sniveling about the nasty Nazis, they were already plotting on doing to others exactly what the Nazis were doing to them???

http://www.telegraph.co.uk/culture/film/cannes-film-festival/7751088/Cheryl-Cole-braves-protesters-at-Cannes.html

Right-wing politicians have accused [movie director] Bouchareb of distorting history in his emotionally-charged account of two Algerian brothers who are driven from their home by the French and grow up to fight in mainland France for the Algerian National Liberation Front (FLN).”

Marijuana prices tumbling

May 19, 2010

http://www.nbcbayarea.com/news/local-beat/Pot-Growers-Troubled-by-Falling-Prices-jw-93964829.html

Longtime Humboldt resident Charley Custer tells National Public Radio that back in the early days of President Ronald Reagan‘s “War on Drugs,” locally grown marijuana was selling for as much as $5,000 a pound.

Now, pot farming is going mainstream. Legal distribution through medical marijuana dispensaries and a ballot initiative in November offering to make recreational use legal are creating a legitimate commodity. A flood of supply means prices have dropped considerably.

The only effective way to fight anything illegal is to legalize it and tax it. Human trafficking could similarly be brought under control by legalizing prostitution and brothels. Legalizing drugs and prostitution not only would clean up the trade thus cleaning up entire neighborhoods, but it would also take away the profit incentive that drives the criminal element.

But of course. The above presumes that government doesn’t actually have anything to gain from ,say, the drug trade… which begs the question why should opium production in Afghanistan have more than doubled since the invasion of Western troops…. things that make you go “hmmm!!”. If you are not going “hmmm!” then you need to read up on your history.