by mannfm11 » Sat Jun 16, 2012 2:09 pm
Looks like we have reached the point they reached in Viet Nam, where they had to destroy the village to save it. These outfits in Europe are broke. So are most of the other governments around the world. Their aim is clearly to systematically destroy the debt rather than solve it in bankruptcy. In doing so, they also will destroy the purchasing power of most involved, to save the fortunes of the political classes. The entire problem is being attacked backwards. Norhing has changed in 150 years, save for the gimicks put in place to save the bankers from being hung from light poles and called to account. Deposit insurance, in the end, must be paid by those with deposits, while in the meantime, the bankers, who went broke, continue to get their slice of the pie. A proportional deflation, followed by stimulus would have worked better than holding the status quo by stimulus, which will make problems worse and the collapse worse. Clearing debt through a proportional reduction of both sides of the balance sheet is the only long term workable solution. True recapitalization can only come from the credit side of the balance sheet of banks. The current tact is to pretend the debits are good.
Looks like we have reached the point they reached in Viet Nam, where they had to destroy the village to save it. These outfits in Europe are broke. So are most of the other governments around the world. Their aim is clearly to systematically destroy the debt rather than solve it in bankruptcy. In doing so, they also will destroy the purchasing power of most involved, to save the fortunes of the political classes. The entire problem is being attacked backwards. Norhing has changed in 150 years, save for the gimicks put in place to save the bankers from being hung from light poles and called to account. Deposit insurance, in the end, must be paid by those with deposits, while in the meantime, the bankers, who went broke, continue to get their slice of the pie. A proportional deflation, followed by stimulus would have worked better than holding the status quo by stimulus, which will make problems worse and the collapse worse. Clearing debt through a proportional reduction of both sides of the balance sheet is the only long term workable solution. True recapitalization can only come from the credit side of the balance sheet of banks. The current tact is to pretend the debits are good.