Archive for May, 2012

Still No Plan In Euroland

Wednesday, May 30th, 2012

As Spanish banks go bust, and Greece continues its slow march to the drachma, what is the ECB doing?

Absolutely nothing!

There seems to be little understanding about what the stakes are.

Put simply, unless the ECB is willing to act as lender of last resort, ramp up Eurobonds, guarantee bank deposits (and possibly impose capital controls), and raise the inflation target to at least 5%, there is no chance whatever that the Euro will survive.

A continent wide depression is now on the cards, and with it will come yet another financial crisis for the global economy.

The cowardice and lying by Euroland leaders, in particular Chancellor Merkel (certainly the worst German leader since Hitler), is breathtaking.

Gorilla says: “There will be revolution if there is no resolution!”


Nobody’s Going To War For Syria (Part 69)

Wednesday, May 30th, 2012

The Russians won’t have it, the Chinese won’t have it, and the US has zero interest in it!

Syria’s more or less a larger version of Lebanon: how’s that worked out over the past 50 years or so?

As in Libya, it’s unfathomable why we can’t hire somebody on the inside of the regime to shoot Assad and his brother, then declare victory.

Hard to believe the regime’s top people can’t see the handwriting on the wall.

Gorilla says: “Double standards are what national interests are all about!”


Charles Taylor 50, Pat Robertson 0

Wednesday, May 30th, 2012

One was rightly convicted by the International Criminal Court for genocide, the other helped to finance that gencocide and remains unfortunately at large.

Gorilla says: “When the United States refuses to be bound by minimal international standards, it becomes a country without standards!”


The Confidence Fairy Lives On The Fiscal Cliff

Thursday, May 24th, 2012

Yes, David Cameron, you’re destroying your country!

Yes, EU, you’re still not serious at all about solving your competitiveness problem!

No, Washington, raising taxes to 1990s levels will not destroy the economy and will in fact lower the deficits everyone says are a dire threat!

Having a jobs program will do even more, but apparently no one on either side of the Atlantic can be bothered!

Gorilla says: “So much stupidity in the service of pig ignorance is not exactly confidence building!”


Yet Another EU Summit

Wednesday, May 23rd, 2012

From the draft communique, appearing soon at a market crash near you:

“Vital can, kick can, vital can, kick can, French suck, Germans suck!”


Official: G-8 Agrees To Continue Stupid Policies

Saturday, May 19th, 2012

At a time of low economic demand, you cannot continue to cut government spending and expect any sort of economic growth.

But this lesson still awaits learning by the G-8 summiteers, who insist that destroying their economies further is the only way to go.

And our President joins in with his own form of stupidity: “All of us are absolutely committed to making sure that both growth and stability, and fiscal consolidation, are part of an overall package in order to achieve the kind of prosperity for our citizens we all are looking for.”

What’s needed right now is big-time stimulus, much higher inflation, and a commitment by world leaders to continue this approach until the disastrous levels of unemployment are brought down.

Gorilla says: “Deficits and debt don’t matter at all, and will matter even less when more people have jobs!”


Shorter White Birth Story

Thursday, May 17th, 2012

This is not in fact news, as Native Americans remember only too well.


More Misery In America

Thursday, May 17th, 2012

Unemployment claims: back to 370K, the economy’s not growing fast enough, of course!

Meanwhile, the Fed continues to do absolutely nothing. Having no credibility whatever on unemployment is apparently less important than having credibility on non-existent inflation.

What’s needed is what’s never offered: a very large scale stimulus (at least $2 trillion) that focuses solely on hiring the unemployed.

Gorilla says: “Long past time to turn the Fed district hqs into job centers!”


Vaya Con Capital

Thursday, May 17th, 2012

The outflows continue, the capital controls are coming!

In Spain, recession plus 25% unemployment plus busted banks plus 7% borrowing costs (very soon) equals total disaster.

In Frankfurt and Berlin, the neighbors have achieved beggar status.

And there’s absolutely no sign that anyone in power understands that Euroland is more or less finished, absent the end of cretinous, amoral policymaking.

Gorilla says: “Please, let’s be beastly to the Germans!”


A Billion Here, Now A Billion There

Wednesday, May 16th, 2012

In Greece, that’s real money fleeing…

At this point, leaving the Euro is Greece’s only viable solution, given that the country’s German paymasters would rather see the country destroyed than have to admit lying continually to their own voters.

Unfortunately for Greece, leaving will make things much more difficult in the short-term. A drachma devaluation of roughly 50% is needed to make the economy more competitive. The banking system will be destroyed, with no prospect of financing from anywhere for at least a decade. Unemployment and social upheaval will increase. Civil war is not out of the question.

Once Greek leaves, it’s very likely that Portugal, Spain, and Ireland will follow quickly. Bond yields in those countries are unsustainable, as is the utterly stupid pursuit of austerity at a time of vast unemployment. It’s not out of the question that Italy and France will also be forced to leave Euroland.

How to put out the fire? The ECB must become the lender of last resort for all sovereign debt, the Northern Europeans need to engage in big-time stimulus to promote consumption, and a higher inflation rate must be maintained to bring make competition more competitive within Euroland.

Gorilla says: “It’s back to 1939: Germany torching a whole continent in pursuit of a morally bankrupt, confident dream!”