EDF in france is 87% owned by the state.

EDF Network in southern england was sold recently for 5Bn to 'whoever' in HongKong .

frog2

That's got us all thinking.

Well I don't know enough about the details or the workings to make such a bold statement. I was trying to suggest something more tentative, that when the "securitization" of a nation state no longer lies in the hands of that nation state, the old-style notion of governments acting in "national interest" becomes sidelined : "national interest" these days is what a country pays on its debts. Several things seem to follow from this. You can say them better than I.

I read something about securitization before replying to you. I was struck by this neologism " The most common bullet structure is called the soft bullet, meaning that the final bullet payment is not guaranteed on the expected maturity date".
Ah…soft bullets…lessen the impact….keep 'em strung out for as long as possible.

I would also like to point to the increased foreign ownership of state industries – in france, the EDF is now owned by a Hong Kong based Chinese consortium. National football teams are made of the best players money can buy on the international market. It would be ineteresting to know how much of UK property / large – medium business is ultimately owned by non UK holdings.

I don't mean any of this in a nationalistic sense…but it struck me reading your recent posts that it is difficult to talk meaningfully about governments being able to tackle the debt loop if nation states are pooling their assets and acting as security for each others' debts.
What power does an individual government have to address the problems you describe if the bulk of a nations assets are foreign owned ?

Soft bullets : great for shooting yourself in the foot.

agreed on all counts. I used the phrase 'running out of money' as a lazy short hand. I should have said, running out of the money they had so far created or borrowed' or some such long hand.

It's the appauling thing about it all isn't it? That all the nations have the means and wealth not only to rectify the situation but also to set their people to productive work again – BUT only if the vast suffocating quicksand of debt is cleared away first. And that is the one thing they will not do.

The issue is one of priorities. American can marshal its vast resources to make banks whole on their gamblings & maintain its empire, or to employ its citizens, stimulate demand, and get its economy rolling again.

One point of contention — to say we're running out of money is to accept the austerity proponents' terms of debate — that we have a big pile of cash that's going to run out soon so everything must be cut. But we're not on the gold standard anymore. A (sovereign) country's wealth is in its productive capacity, not its pile of gold.

So we don't need to borrow to spend. QE2 is essentially creating billions of dollars out of thin air (without resorting to bond sales,) and to no productive purpose, as no one in their right mind would borrow money these days. Instead of QE2, the govt should create billions of dollars out of thin air & use it to employ people.

We have vast un-used resources (15%+ unemployment) which, if put to work in pursuit of public purpose will spur demand. Anything that does not address the lack of demand in the economy is not going to help us (regular folks.)

As you said, QE2 will not address deflation/effect inflation. Inflation comes with too much demand for too few goods/services. We have too *little* demand now, so the prospect of inflation from any amount of spending from any govt source is zero. The real result of QE2 will be speculative attacks on developing countries' economies, as the only other source of profit/income these days is low-yielding govt securities.

wish I'd been there. Let me know what you make of the book. Good or bad I'd be keen to her your thoughts.

I'm cheered by the student protests in Whitehall today – looks like us Brits have a voice after all. It just needed the impetuosity of youth to wake it up. From the mouths of babes…

Looking forward to getting my hands on The Debt Generation too.

does that make any sense?

All in all its a mess of unimaginable proportions. It will fail domestically and create untold enmity internationally. QEII is redrawing the balance of power, breaking old alliances and creating the conditions for new ones. A pivotal moment in American history if you ask me.