Tuesday, 14 February 2012
We'll All Pull Together
With President Obama of the USA meeting Vice President Xi Jinping of China today to discuss matters of mutual interest, such as mutual political survival, it was a case of the bust now shaking hands with the bust future. The figures for the US Debt it seems will reach levels beyond the reach of mere mathematics.
In the meantime China is discovering that property markets and banks do not always go well together, especially if too much credit is flung around and too much fiat currency is pumped out to keep the show on the road. China may discover that it needs all the wealth it has built up recently.
If that is the case it will have less to lend and less to buy into financially embarrassed European countries. The UK has displayed its solidarity with Europe with the ratings agencies looking doubtful about its immediate prospects. Quite what this will lead to is not certain. But it is unlikely to be good news.
In Spain a village where the inhabitants were backward and mistrusting they have brought out the old pesetas they kept out of distaste of a new currency. Now they look almost at the cutting edge of monetary thinking and theory.
I recall Portugal in the mid 1970’s, months after the collapse of the regime of Salazar and his successors. It was a desperately poor country with extensive hardship. Will the Euro crisis now lead to a collapse of constitutional government and a reversion to the more traditional authoritarianism? Bring back the yoked oxen.
Don’t mention all those wars, civil and other wise in progress. The amount of explosives, ammunition and general hardware in use should at least give a much needed boost to the armaments industry. It may account for all the flying visits by UK politicians to here and there putting in a word for our chaps.
One historian, his name forgotten, my apologies, has come up with a theory that if one is looking to see where trouble has occurred in history there is very often present a surplus of young men without any employment or prospects.
If at the same time for religious or demographic reasons they are not matched by an equivalent number of unattached ladies available for company and to give favours then the men tend to get out of hand. They do not necessarily need much excuse either political or religious but one or both come in very handy to justify all the mayhem.
To complicate our thinking there are those pointing out that it is not so much money that matters but energy, its sources and uses. Money is simply a means to an end and that can only be achieved in the modern world by the ability to buy or the possession of energy.
If you are muddled then so am I, but what is frightening is that we may be a lot less muddled than all those people in the capitals and financial markets telling us what to do and why.
Luckily, I still have a few pesetas left from long ago, hasta la vista!