Two days of accelerating global sell off and the learned fools are once again falling over themselves to give us the benefit of their wisdom. I heard a BBC Radio Four interview with one monumental tool, Jonathan Portes, who is the Director of an independent think tank called the National Institute of Social and Economic Research. Which for all I know it might be a beacon of enlightenment but I what I heard this man say left me feeling that we were not living in the same reality.
What he said, with great emphasis and learned confidence was that western governments could and no doubt would take the ‘swift and decisive’ actions needed to stop any major banks collapsing. Hands over your wallets boys, we all know what swift and decisive actions he’s talking about.When asked if governments might not be in fit shape to take such actions again he replied,
“Well frankly they have no choice, they cannot allow the financial system, it is far better to incur temporary liabilities and if necessary to use the power that we have through our central banks to ensure that there is liquidity in the system. It’s a far better to do that than do the opposite….”
‘We cannot allow the financial system’ … All fall to your knees and pray for the health of our mighty and benevolent ‘financial system,’ Save the system! It’s like listening to recordings from the Soviet Union of the brainwashed party faithful slobbering and weeping over Comrade Stalin’s declining health and death. Save our dear leader. Only he can lead us.”
Our present experts remind me strongly of the Soviet era. There is only one truth and all must accept it. Evidence is not just ignored, the true believers can’t actually see it at all. Their minds simply cannot register what does not fit with the party truth. And so I doubt Mr Portes felt any cognitive dissonance, no little niggle of questioning, when he said, “… it is far better to incur temporary liabilities…”
Correct me if I’m wrong here Mr Portes, but would those be temporary like the ones we ‘incured temporarily’ back in 2008 AND STILL HAVE? Do you mean temporary like that? Temporary to the tune of over a trillion (in this country alone) in public liabilities tied up with and pledged to the banking system? Is that the sort of liability you mean. Or do you mean having to keep interest rates at near 0% for three years with no ability to raise it even though inflation is picking up and therefore every single person in this nation who has savings or a pension is thus losing money because inflation is robbing them of spending power?
None of those awkward little details were mentioned. I wonder if they’re not even part of his world. His world is still fixed around the party truth that it was all a question of liquidity. Use the Central banks to ensure liquidity. Meaning – borrow or print it I don’t care which , just give it to the banks like last time. Don’t ask why, if it was just liquidity, all the trillion pumped in globally have not, in three solid years of unswervingly following his policy advice, NOT solved the crisis or fixed the banks? No, don’t even think it.
Instead he went on to say,
“You remember we didn’t have the ATM’s running out of money, we didn’t have big banks actually collapsing in September , October 2008….”
Now I know strictly speaking AIG was not a bank but an insurer, but Lehmans? Was this the heat of the moment on radio knowing you are having to say fatuous things to defend an intellectually bankrupt position or was he just not there? Is he perhaps not there, or not all there anyway, even now?
They took decisive action and all was saved, that was his line. Has this man been lost in space for the last three years? He was actually trying to suggest that back in 2008 actions were taken and everything was saved and what is happening now is somehow not connected to any of what was done then? This man is chairman of a financial think tank?
I have the feeling we will be hearing a lot more of this sort of blatant attempt to erase recent history and put in its place an official version of events.
Their version is that all the right steps were taken in ’08 and disaster was averted. And what is happening now is in no way connected to those events or any actions taken since but is the result of improvident governments spending too much and workers in Europe not being ‘flexible’ enough.
The other version, which will never be allowed on the radio or Television or given any oxygen of publicity or open debate, is that what is happening now is the direct, inevitable and completely foreseen consequence of national governments helping private banks to transfer their losses on to the public purse in every major western economy and to continue to hide and not write down even greater losses.
The propaganda tools of fear and threat (ATM’s will stop working) if we don’t bail out the bank again, and again and again if necessary, are being wheeled back on on to the streets. We will hear lots more about how bailing out the banks and the financial system was the only possible action because “They had no choice.”
We do have a choice. We can fling this cretin and his like in the Thames tied to a large rock inscribed with the words, “They had no choice.”
Who Killed Economic Growth?
Short and to the point.
Golem,
I think one of those empty ATMs that he is on about would be a much more apt device to weigh on his being 😉
I'm looking at market watch every day the last week and I just can't help but smile a little as it all falls to bits, I don't think they will buy a way out of this one, I know it's going to hurt us all but at the end of the day it needs to happen, who knows, maybe along the way a few of those Merchant Bankers might not be able to handle the stress of living like the rest of us and do the world a favour,
I'm away for popcorn while I can still afford it !
Get me some while your out would you. I'll put the kettle on.
@ cynicalHighlander
Nice link, I've met Richard Heinberg a few times & he's right of course.
To modify a well used phrase…'It's the debt, stupid!' & the unsustainable use of resorces.
I really get Golem's anger too. It's like these mainstream economists inhabit some parallel universe, or maybe they are just some kind alien robots, stuck in a neo liberal wanker program loop.
Getting very serious now looking at the financial markets news & Italy. Could the crash be imminent?
We need to focus what resources we have, labour & energy, away from non essential consumer junk into infrastructure that de-carbonises the economy. Do it now, on a 'war' footing, and with as much global co-ordination as possible.
positivemoney.org (and MMT economics) provides the monetary & fiscal framework to do this.
F*&k knows if any of the braindead politicos or churnalists can cop on.
Look who else is sticking an oar in: it's Gordon 'We're gonna need a bigger bailout' Brown.
Stuffing the banks full of taxpayer cash and 'radical capital product and labor market reforms' in order to generate the growth to pay for it. That's the ticket, Gordy!
Like Golem, the mainstream propaganda is getting my blood boiling again.
I feel another post coming along…..
P.S. cynicalHighlander
Cheers for the Heinberg link. His book "The Party's Over" is excellent. Check out gregor.us too, plus the recent interview with Nate Hagens on ChrisMartenson.com. Dwindling black gold holds the secret to our growth woes.
"I have the feeling we will be hearing a lot more of this sort of blatant attempt to erase recent history and put in its place an official version of events."
The reason why Mr Portes can get away with saying things like that is the quality of our financial journalist on MSM is of a poodle kind, especially the BBC!
Blink,
welcome. YOu're right about many if the MSM financial journalists. they have been 'embedded' – isn't that the phrase? Like a tick feeding on its host.