steve from virginia
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QE is the recycling of credit, no new money is created.
Central banks cannot create currency. Only the government with private credit in hand from finance by way of central banks can create currency. In America in 2012 only the private sector creates new money as it and it alone can make unsecured loans. That this is true is self-evident: the central banks can lend but only upon collateral, otherwise they cannot be central banks, that is, lenders of last resort.
That the government can issue currency without taking liabilities: this is not a loan but truly fiat issue. The last time the US issued fiat was during 1933 (and I am not sure about it because the narratives aren’t clear). Gold-silver specie systems are also fiat money system. The US and the rest of the world use debt-money systems. In such a system the government borrows from private finance offering collateral to produce currency. Outside of the loans private finance make to government (to produce currency) the private sector produces all other money and credit.
The reason the Federal reserve was created in the first place is because under the gold standard of the time there was insufficient money to quell panics as was discovered during the ‘Bankers’ Panic of 1907′.
When there are money panics the desire among holders of assets to sell them at any price to gain currency. If this is done in the market when all are selling at once there is no bid, the asset price plunges. The central bank will take the asset at face value (perhaps with a small haircut) when the market will not, always presenting a bid for it. In general, the bids themselves will convince others either to not sell into the (malfunctioning) marketplace or to swap instead with the central bank.
All of the Fed’s transactions have been of this type for instance: swap of asset to Fed for credit at par or small haircut. The only complaints are some swaps appear to be open-ended.
If the Fed was to ‘print money’ it would be extending leveraged or unsecured loans. By doing so it would discount collateral which is the opposite of what the central bank seeks to do during a panic. It would convince asset holders to seek a better offers in the defective marketplace. In other words, the central bank would be just another commercial bank (or depositor) that makes unsecured loans. Without a reserve bank there would be continuing bank runs as depositors who are unsecured lenders would seek more security elsewhere. This is underway in the EU as the ECB (and Target 2) have APPEARED to make unsecured loans.
This is also why the ECBs efforts have had little traction w. regard to the re-liquifying EU banks. At the same time, they haven’t created any new money/credit. They (including the ECB) have taken on impaired assets in exchange for credit. After forty years of non-stop credit expansion there is no limit to the amount of impaired assets the central bank can take on in exchange for fresh credit: € 50 trillion or more. There is no need for the central bank to do more.
Central banks cannot print oil or jobs, they cannot move interest rates (money worth is set continually at gas pumps) they can do very little. They do not print money.
Governments can and do print money and have done so: they also execute people, initiate wars, steal persons’ property, etc.
It is a common trope that ‘central banks print money’: they extend credit against collateral. Fed swapping for Treasuries or other securities, is lending against against these as collateral with credit being applied to reserve accounts @ the Fed.
People who claim central banks print money are simply peak oil deniers as they have no argument to make regarding peak oil, making central banks as scapegoats. Bernanke himself has said repeatedly that the Fed does not create new money within or without quantitative easing. I suspect he knows something about his business, like a carpenter knows something about hammers and nails.
I can’t foresee what is going to happen with currencies: it’s completely non-linear. The European problem is outside the euro, by the time the Europeans themselves figure out what they’ve done to themselves they will have been bled white.
For shits-and-giggles check out John Ward’s site. He’s English so he gets the time advantage, he’s as caustic as Ilargi w/ some excellent insights.
Where to begin?
What is at issue? Easy as pie: banks were bailed out with many trillions of dollars in taxpayer funds (which they won’t pay back, they’ll just come back for more) without any scrutiny to speak of.
Bernanke and Geithner at best (yeah, right!) just “hoped” they would lend again, but they never made it a condition of the bailouts. What we find now is what I have repeatedly been saying for years now: The banks are far too deep in debt, even after the bailouts, to revive lending even to “healthy buyers”. The entire bailout circus has been a scam, since the money was handed out to banks without looking at how much debt they really have on their books.
Sorry, I disagree. The problem has never been gross exposure (only in the EU where there is no lender of last resort) rather the absence of remunerative enterprises to lend to/borrow. Waste doesn’t pay any more.
It never did but the costs are much higher now w/ + $100 petrol.
Taxpayers aren’t on the hook for anything. All funds are borrowed from finance … to be lent to finance. Any shortfalls are borrowed from finance and lent back. Taxpayers are irrelevant. (In EU, the system is demanding exogenous funds while rationing endogenous funds, WTF?)
The pressure to lend is also endogenous: finance institutions are no different from hat stores which must sell hats to stay in business. Zero- lending and finance firms fail. The only ‘bankable’ enterprises remaining in our great world are pyramid schemes that do not require resources.
Credit was handed to banks because the consequences of not handing credit were more costly than otherwise.
So where do Ben B.S. Bernanke’s deliberate “failures” show up? Have a look, I’ll try and paint you a picture. First, here’s Caroline Baum for Bloomberg:
Government’s Snake Oil Won’t Cure Jobs Ailment
Operating under the assumption that more stimulus will create more jobs, the Fed reduced its benchmark interest rate to 0 to 0.25 percent, pledged to keep it there at least through the end of 2014 and engaged in multiple rounds of bond buying to lower long-term interest rates. The Fed rationalized its stance, well after the crisis and recession had passed, as necessary to fulfill its full-employment mandate.
This is reflexive non-analysis from Bloomberg: The establishment began lending at very reduced rates during money panics at the beginning of the 20th century to reduce funding costs to firms bankrupted by high funding costs. There never was a connection between funding costs for firms and employment other than the obvious: a failed firm has no labor force.
Bernanke sez low rates will reduce unemployment? Why not? What he does is irrelevant, so is what he says. Meanwhile, the central bank does what it can. What is the alternative?
You don’t want to know.
Bonnie Kavoussi for Huffington Post:
Half Of Recent College Graduates Lack Full-Time Job, Study Says
Of all those who have graduated college since 2006, only 51 percent have a full-time job, according to a Rutgers University study released Thursday. Eleven percent are unemployed or not working at all.
More ‘blame it on the Fed’. The problem is increased automation in the search for labor productivity, output/man hour. Why the surprise? This hunt has been underway since the industrial revolution. Even China is inserting robots into its assembly lines: this works until the ‘juice’ runs out and it becomes cheaper to higher carbon-based robots again. Automation + population explosion = unemployment.
Which takes Ben by surprise, he’d like you to believe. Glenn Somerville for Reuters:
Bernanke: even worthy borrowers can’t get mortgages
Banks have become so restrictive in making mortgages that many worthy home buyers are being frozen out of the U.S. housing market, and lending practices are not likely to loosen any time soon, Federal Reserve Chairman Ben Bernanke said on Thursday.
Analysts don’t read: if unemployed cannot find jobs, that leaves the robots to buy houses. Good grief.
Last week William D. Cohan tried valiantly to cut through this sort of crap for Bloomberg:
U.S. Perfecting Formula for Budget Failure
Erskine Bowles, a true Southern gentleman and co-chairman of President Barack Obama’s erstwhile budget-deficit commission, came to New York City from his home in North Carolina the other night to talk sense about the nation’s perilous fiscal condition.
“I think today we face the most predictable economic crisis in history,” he told an audience on April 24 at the Council on Foreign Relations — an audience that might actually be able to help do something about the problem. “Fortunately, I think it’s also the most avoidable. I think it’s clear, if you do simple arithmetic, that the fiscal path that the nation is on is simply not sustainable.”
Hard to say who created more crap, Cohen or Bowles.
Here’s a bit of (crap) from Harry Wilson at the Telegraph.
Companies must raise £28 trillion ($45 trillion) to finance ‘wall’ of debt
Businesses will need to secure as much as £28.5 trillion to refinance old borrowings and fund new spending, raising major questions over the ability of the world economy to avoid a recession, according to a report from Standard & Poor’s.
They borrowed it before, why would they have problems borrowing again?
British banks have dramatically reduced the size of their balance sheets in the past three years, as well as tripling the amount of capital they hold against potential losses. However, these moves have led to a shrinkage in the amount of credit available to businesses and soaked up some of the investor demand for new debt.
Anthony Peters at SwissInvest said it was likely there would “not be enough money” available in the coming years for companies to refinance and raise the amount of new debt required. “There is not enough money on planet Earth to fund it all. We are living on borrowed money and there is no way of avoiding that,” he said.
This is simply wrong. Businesses that require hundreds of billion$$ of whatever don’t borrow from banks. They borrow on the money-market and the repo, longer-termed debt- and commercial paper markets. There is no limit to how much debt finance can issue as it can monetize what it has already issued.
Is this debt costly? Relatively: finance debts can either be repudiated or rolled. There is an implied risk/cost in either/both. The debt ‘issue’ is only problem within a broader context: what activities that debt enables and whether claims the debts represent can be perfected. These are the real problems within finance, not the size of the debts or that there are debts.
– Wanna get rid of debts? Get rid of all industries. Go back to a craft/workshop/distributed economy and debts are unnecessary. What is a craft economy? I dunno, go out and figure it out for yourself! (You will have to, nobody knows how.)
– Failure in the EU is simply a matter of policy: finance for its own reasons (fuel theft) is refusing to lend to individual EU nations. The outcome is bankruptcy as no one will lend in finance’s place.
– US government is NOT at all constrained by debt. It can simply issue currency and retire debts both public and private at will. That it does not do so is a matter of policy choice. See ‘Abe Lincoln’ and ‘greenbacks’.
– If the US Treasury issues fiat currency and that is used to retire existing debts, there is no increase in currency in circulation (and no inflation): both the debt and the currency are extinguished at the same time. See ‘Irving Fisher’ and ‘debt deflation’.
– The Federal Reserve does not create new money, it and other central banks are collateral constrained. All transactions between banks and the Fed are loans to or from the central bank. Collateral is taken at a premium (haircut) in exchange for funds from the central bank: no collateral, no loans. The Fed does not ‘print money’: it cannot and remain a central bank as doing so would discount collateral, it could not function as a lender of last resort.
– The US does not have ‘too much debt’. Rather, the costs of our wonderful waste-based economy cannot be met by its operation. The central activity of the modern world — driving a car — does not pay the driver, neither does driving a car meet the cost of the car itself. The aggregated costs involved with hundreds of millions of cars and all that goes with them — the factories, the shipping, the highways and real estate, the energy production and militaries, the insurance/loss mitigation as well as the undocumented waste-carrying costs — all of these expenses have been met for a hundred years plus- with debt.
Not any more: the cost of fuel added to the cost of the aggregate debt taken on to finance the waste of that fuel have become too expensive.
Without examining the mechanism that drives the creation of trillions of dollars, euros, yen and other currencies worth of debt, the process becomes a mystery.
There is no mystery! We waste and we revel in it because it can be monetized and because it appears to give us power in the form of fetishes. In the real world of 2012 our fetishes bankrupt us: our conveniences bankrupt us, our comforts bankrupt us our security blankets bankrupt us.
Credit/debt is an abstraction: what is real is the inability of the real world to provide for all that make demands upon it. Erskine Bowles doesn’t have a clue.
I couldn’t do it. I just couldn’t. Just say no to Trivium
I sat through a 4 hour baseball game yesterday (our guys won) and those plastic seats just took it out of me, the desire to read line after line after line of argument in favor of something, probably more automobiles and automobile waste.
The bottom line in America is always the car. It is the axle around which the entire stupid enterprise rotates. Anything that might restrict the hegemony of the car over every aspect of citizens’ lives is a threat. Climate change: it might add a few bucks to the price of a gallon of gas. That gigantic pickup truck might more worthless than it is now. Horrors! We cannot have that!
That American way is so flimsy that only lies and cowardice can keep it afloat. The approach is to take responsibility, to meet challenges and take necessary steps. This requires something other than rhetorical sleight of hand: simple courage.
Sorry, none of that here, just business-y gutlessness.
Some Americans aren’t interested in responsibility they want others to make the problems go away by sweeping them under the rug. Some of the lies are more subtle, they are word games that seek to evade responsibility, what is bizarre is anyone would do so for others’ benefits at the expense of their grandchildren.
If you assume every nation has balance-of-payment issues …
Which nation would not have balance of payment issues? Not the thrifty Swiss or oil-endowed Norwegians, nor the middlemen-par-excellence Singaporeans. Nobody has enough money! The need-for-money ‘pull’ requires a counterbalancing ‘push’ of some kind. If there are materials to sell they will be sold. Crude is $110 today. Tomorrow it will be ??? Why take a chance when money is needed now: a bird in the hand.
Conclusion: assuming balance of payment issues across the board is reasonable. It also holds to reason that oil states are pumping what they have. Not only is export demand increasing but the higher rate of returns-on-exports enables increasing consumption within the oil states themselves.
Crude extraction rates (on the market) exceeded demand to the greatest degree within mature markets in 1998: $11.xx per barrel. Today, the price is 10x the eleven bucks and the only way to pay is to borrow and borrow some more. The fact of the borrowing speaks for itself. There is insufficient cash flow within so-called ‘modern’ resource-waste economies to support bringing new petroleum to market.
The world cannot afford to borrow any more, what’s left is outright theft and competitive demand-destruction (of the other guys).
Where does this leave China? First of all, China and the EU are the top-tier ‘other guys’, the low hanging fruit. Both depend to large degree on external capital: flows can be manipulated to unhinge capital structures. An increasingly hard-appearing dollar creates preference for that currency within China which in turn amplifies inflation. China is likely to ‘go with the flow’ and add RMB credit to its economy: inflation is less disruptive than a ‘money shortage’ caused by hoarding scarce yuan.
The issue is what China can export at lowest cost to the US: cheap plastic crap or its petroleum demand? Not a hard question to answer from an American standpoint.
Austerity is here to stay: it is energy- rather than policy related. Unremarked is there is no way for those countries/peoples who have fallen off the cliff to climb back. When energy use in defaulted countries is reduced to zero it will remain at zero … essentially forever. The next step for Greece is Somalia. A few steps down the road for Germany … is Somalia. Neither of these countries has domestic petroleum resources. Greece cannot re-export some of its consumption in value-added forms. German can (high-priced autos) but the form this consumption takes represents energy competition for Germany.
If Germany ‘wins’ the energy competition it bankrupts its customers bankrupting itself in the process. If Germany loses the energy competition it is Greece … then Somalia.
The foundational problem is unavailable energy. When Egypt or Greece and the EU fail, their consumption is exported to countries with more credit. What is happening in the EU is the same as when Walmart opens a store outside of your town: all the smaller businesses fail. Countries with organic credit such as the US and China are Walmarts. They can import fuel demand from countries without organic credit — such as the EU countries — or from countries with less credit such as Japan. In order for countries to climb back up the energy cliff one or more of the credit kingpins must sacrifice some of their demand and re-export it back to the ‘losers’.
When France fails and its fuel demand is exported to the US, the gas prices at the pump here will decline. Nobody in the US will voluntarily pay higher gas prices so that French can waste ‘our’ gas driving aimlessly in circles.
The credit component to our problem is considerable but if credit issues were to vanish by magic the energy constraints would remain and they would — as the are currently — strangulate economic activity.
Of course, resource depletion is like a leaky bucket: the leak can be stoppered but what has leaked already cannot be retrieved and put back in. Unfortunately, the establishment insists that more holes be punched into the bucket so that it will leak faster, as it did when the bucket was full. Utter nonsense.
There are other ways to defeat the system and accelerate its ongoing demise:
– Get out of debt by any means necessary including walking away from it. Don’t take on new debt, either unless you are prepared to be hounded to the ends of this earth.
– Throw away the TV.
– Get rid of the car. This is the hardest but also the most necessary/inevitable. The worldwide petroleum regime is unraveling. When the shortages appear — shortages are apparent now in various parts of the world — your car will be worthless. Keep in mind that shortages that occur because fuel cannot be afforded will be permanent. (Forever permanent.)
– Eat well and drink in moderation. If you do so you can escape another means of institutionalization. When you are dependent on a system to stay alive and comfortable you surrender the ability to demand changes to the system.
All of these are ‘good enough’. The system depends upon everyone spending wildly, money they don’t have for goods they don’t need. If more acted abstemiously: no unnecessary consumption, no TV, no car, no debt … the current regime would collapse, this is the well known ‘paradox of thrift’.
What many don’t appreciate is that the Great Depression was an all-out class war between the plutocracy of the time — the “malefactors of great wealth” as Roosevelt called them — and the little people. The only tool the little people had was their willingness to hold money and not spend it. Doing so gave money worth at the same time this worth was removed from the grasp of the plutocracy. The citizens did not win outright: the plutocrats were saved by Roosevelt and John Maynard Keynes. But enough of a victory was gained to give notice to the masters of the universe that the lowest orders have the power to destroy them.
RE: you have to go over to Skeptical Science and make your climate change arguments there:
https://www.skepticalscience.com/
It’s a blog much like this one. Let me know how it turns out.
Leaving out volcanoes and asteroids, that we die and are compelled by Christ to eat too much, the rest of our problems are human problems and thus easily solved because we created the problems in the first place. For instance, if the public decided to be nuclear-free, the world would be nuclear free (it would take about 200 years to become so).
Another more topical problem re- this article is the declining willingness to lend/borrow. This is because what is offered for repayment has no value.
The lending/borrowing process has stripped the world of value, what has been gained in return is transitory/abstract money wealth for a handful of robbers. We voluntarily submit to the robbers because we are afraid of violence that the robbers threaten us with. This isn’t using resources to unman us, it is using the absence of resources to threaten us with more absence.
Left undisturbed the current regime will continue to unwind: fewer will lend because there is no value to obtain in the future. Nobody borrows or is able to do so because there is no net-present value: no returns to offset borrowing costs (even with negative real interest rates).
Value simply does not exist within a mature waste-based economy. Value here is capital. We not only destroy capital we have already destroyed too much capital.
Left to its own devices the credit will be stripped out of the entire industrial system which will stop working (as it requires a constant debt subsidy). That leaves the hairless monkeys with penises-in-hand and 440 conveniently located nuclear reactors boarded over with plywood making ominous ticking noises …
We have to come up with values rather than ‘money’. This is easy but antithetical to the current business approach. I suspect executions of high-level robbers would help the process of creating/discovering new values along …
Hard to imagine any economist being clueless as the writer suggests. Check out Steve Waldman, Scott Sumner, Steve Keen, Randall Wray, Axel Leijonhufvud, Mike Konczal, James Galbraith, Umair Haque and find out what real economists have to say. Even Krugman acknowledges limits, the Austrians are all limits whose prescriptions would not allow the kinds of exponential economic growth that has taken place on monetary terms.
Thanks, straw men are not necessary, economics is hard enough as it is. Daly does not have a policy structure as his economics (and others) assume productive industries which in reality do not exist. Basically, all ‘growth’ assumptions are false because growth propelling agents cannot exist without continual credit subsidies.
Moving right along, the assumption that conserving agents have a competitive disadvantage is also false (and does not conform to easily observable current conditions). Non-productive enterprises waste successfully because they have created (by stealth) a credit monopoly.
The biggest problem facing the world longer-term is not growth (which is kaput, btw) but the 440 nuclear power reactors. The operational lifespan for these items is far longer than any human institutions to date. Their investment requirements are also higher than other industrial establishments. How to deal with the reactors will require social restructuring (which explains the denial).
All of our problems are human problems. They are all easy to solve (except the reactors and these are non-problematic ex-humans). We have to decide to solve them.
It’s never going to end, ‘things’ will never get ‘better’. Regardless of what people want or politicians promise. There will be no more middle class, no more mechanized progress. Ever.
Greece might get worse: it might become Egypt or Syria … or Kosovo: nobody will come to rescue it this time.
When that big gas gauge in the sky points to ‘E’ there is nothing left. Greece is becoming car-free the hard way. What is taking place is conservation by other means. The other means really are a hard school.
Greece’s economy is collapsing. It will continue until Greece ceases to be ‘modern’. It will live within its resource budget at that point the Greek state will be sustainable.
That is what that word means, by the way …
Hmmm … interesting the masses (of analysts) are becoming frustrated by the lack of imagination on the part of administrators. At the same time, there isn’t much administrators are willing do without the masses having to (horrors!) give up something.
There are many reasons why the Titanic is the perfect metaphor for our times: the enterprise was (and is) gigantic, hubristic and overdone. The managers were (and are) greedy and stupid, the end had (has) the quest for the ultimate in luxury and decadence blowing up in everyone’s faces.
Reformers could re-imagine the Titanic today: load a giant cruise ship with entrepreneurs, bankers, auto company executives; innovators, politicians and hedge fund managers and send it out with Captain Jack Sparrow looking for an ice field. Sorry, five life boats. If no ice is to be found after a day or two (climate change) the Navy can fire a missile into the ship and the Iranians can be blamed. Any ‘complications’ and the lawyers would be loaded onto a giant cruise ship … etc.
Fixing what’s wrong with America is remarkably easy, if you put your mind to it.
Half the refining capacity on the populous US east coast is set to disappear
Soon enough, half the refining capacity on the populous Chinese, Indian, Brazilian, South Asian and other coasts will also disappear. The world imported the glamorous waste-based economy from the US, it is foolish to believe the rest of the world can succeed dodging thermodynamics when the mighty Americans are unable to do so.
Oil refiners have been failing for years, so are now the auto manufacturers. We live conservation by other means, by the credit-hollowing out of economies. The EU is in the process of becoming car-free. Next up is UK, then Japan and ultimately the US.
Refiners lose money because their own return on the use of petroleum isn’t profitable. Drivers have lost money from the get-go! They never made money, ever! Only a small fraction of the world’s drivers has ever earned a penny by actually driving. The rest have had to borrow to drive; motorists x billion$ = systemic bankruptcy.
We humans discovered fuel before we knew what best to do with it.
As for a speculative support for high prices: each market has specs on one side or the other of any given trade. Gold and silver traders accuse ‘spec shorts’ of manipulation.
History suggests that the market has been flooded with crude to keep prices low. Fuel has been a ‘loss-leader’ for cars, highways, houses and towers, military goods, finance insurance and other ‘investments’. Extraction companies profit by booking reserves which convert to shares which are the purpose of drilling. Companies lose money at the wellhead while making fortunes on Wall Street. Look to the shale gas industry which follows the same model.
Today: the flows are diminished, wellhead prices have to be high due to an absence of ‘easy’ crude anywhere in the world: vaunted Bakken wells produce an average of 84 barrels per day. These are stripper wells.
Otherwise, the deflation model holds: peak demand is real. The oil we can access is worth more than what wasting it returns.
That’s a tough dynamic to live with … and we won’t. We are all Greeks now.
Neither the Fed nor any other central bank ‘prints money’. They simply don’t it’s impossible.
Central banks make loans/offer credit. In our debt-money system the central banks accept government collateral in exchange for loans that are turned into currency by the government. The government — any government — can ‘print money’.
If they were smart governments would ‘print money’ and retire some of this monstrous debt. “Inflation!” cry the gold bugs. Not so, any currency directed toward debt retirement would be extinguished along with the debt.
“Repudiation” cries the banker! How true: yet the creation of currency to retire debt is no different from the creation of debts in the first place. Both creations emerge from ledger entries: printed money to retire printed debts. See ‘Abraham Lincoln’ and ‘greenbacks’.
Central banks are collateral constrained. Central banks cannot be central banks and offer unsecured credit: the whole point of central banking is the validation of collateral when necessary (during bank runs and money-panics).
Central banks can lend against defective collateral but cannot lend against no collateral at all.
Inflation is the increase in the supply of money: commercial banks and finance increase the money supply by lending into existence what credit is needed to line the pockets of ‘entrepreneurs’ (thieves) and ‘innovators’ (racketeers).
Private interests can issue private currencies (within limitations) and during the US ‘free banking’ era did so. Collateral for these private currencies (bank notes) was gold and silver specie or government debt instruments. What banks offer today is debt. The purchasing power of debt in markets is same as currency: the cost to the system is much higher.
In debt money systems there are two theories regarding the management of the money supply: by strictly controlling the quantity of money in the economy (Monetarism) or by controlling the rate at which money is made available relative to some ‘natural rate’ (Taylor Rule Adjustments). The former approach does not work b/c the quantity of money within the economy at any given time is ‘undetermined’. The latter fails because there is little demand for funds at any rate because there is little system returns on investments (ROI).
The cost of money in the US is determined by the actions of millions of motorists who trade every day US dollars for a valuable physical good on demand. Because the dollar’s worth is determined by the petroleum trade the US Fed is largely irrelevant.
The Fed cannot ’cause inflation’ because it cannot unilaterally expand the money supply. The Fed’s (or others’) balance sheets expand because other, private ‘sheets’ contract. What the Fed can provide is moral hazard with its limitations. The outcome of moral hazard is to encourage private lending (speculation in assets with private credit).
Hyperinflation/hyperdeflation are both the arbitrage between two currencies in competitive circulation: one sells the currency he or she holds at any price to gain the currency one needs.
What is measured by the process is increased/diminished worth of seigniorage.
Spanish drank the ‘American Dream’ Kool-Aid and bankrupted itself buying Good German luxury cars and building biodegradable tract housing along with highways on which to drive in circles.
More bankruptcy: Spain went deep into debt to buy millions of barrels of crude oil which was burned for zero return. Trillions of euros were borrowed and spent and what is there to show for them? Smog and used cars, some abandoned ‘developments’ and a sense of futility.
Progress has always had an Alice in Wonderland quality of a trip down the rathole but there are real consequences. Greece was pushed down the chute and now it is Spain’s turn. Every barrel of oil Spain does not burn in the future is a barrel that can be burned by Good Germans, instead.
Worst thing is there is absolutely nothing the Spanish can do to escape their fate of ‘conservation by other means’. Best thing is there is nothing the rest of the world can do to escape Spain’s fate.
It’s just *evil* isn’t it? Most don’t get that it is **impossible** to pay off this debt because the “have nots” can only use the money that the “haves” possess in order to pay these debts – and the “haves” aren’t gonna let the “have nots” have access to the bulk of the money.
The only reason the have-nots have ANY money at all is to give form to the money idea.
It is just like the only reason for there to be taxes is to give legitimacy to the money idea. Needless to say, those who have little money pay the taxes.
A: The consequences are horrendous. If you could make the world rich by having all the central banks print unlimited money, then we have been making a mistake for the last several thousand years of human history.
Stockman is wrong: You can make a handful rich by having the banks print limited money and giving this handful access to it, giving the rest the obligation to repay.
This has indeed been the strategy for hundreds of years.
What’s most interesting about our cave-artist is that 30,000 years ago there were rhinoceros in France. This was during a glacial period in Europe at the time.
There are also images of lions, hyenas and bears along with bones.
To see lions or hyenas in Europe now one would have to go to the zoo.
Somebody/some thing is going to enslave what, again? You’ve got to be kidding me.
Paper tiger, paper authority, what the Viets called ‘pitiful helpless giant’.
The West is already enslaved to its machines, what is underway is the liberation from machines whether we like it or not.
