Its all kicking off folks. As the mass media controlled by politics and wealthy media moguls continues to hide the truth from the people; they are increasingly unable to explain the events that are occuring in Europe.
Next to fail. France!
The markets (from whom France has borrowed all its money) are raising rates for French bonds - basically where Italy was 3 months ago.
Herbert Hoover’s Memoirs are available free online. He opens Chapter 7
concerning the Sovereign Debt Crisis of 1931 explaining:
“In the spring of 1931, just as we had begun to entertain well founded hopes that we were on the way out of the depression, our latent fears of Europe were realized in a gigantic explosion which shook the whole foundations of the world's economic, political, and social structure. At last the malign forces arising from economic consequences of the war, the Versailles Treaty, the postwar military alliances with their double prewar armament, their frantic public works programs to meet unemployment, their unbalanced budgets and the inflations, all tore their systems asunder.”
Chapter 7, pg 61
http://www.ecommcode.com/hoover/ebooks/browse.cfm
[Source: Thanks to Armstrongeconomics.com]
Is Austerity the answer? Not really. Its a vicious circle. By making your population lose confidence they will "try" less. This will lower productivity and entrepreneurship and therefore decrease tax returns which will mean France will find itself in a debt spiral. The rules of mathematics don't change.
How long before our entire consumerist and housing based economies comes to a screeching halt and we revert back to productive assets? Those engineers, farmers and content producers who have been sidelined by banking wealth for the last 20 years will finally have their day in the sun!
How do we fix this mess? Well, we need to have massive bank right downs and let banks fail. People with their money in bank accounts won't lose anything but everyone who lent cheap money without assessing risks properly will go bust - that's how capitalism should work! Its been poisoned by bankers who have supported politicians election campaigns! They have systematically lied to everyone to retain power, wealth and influence. To stop countries going bust we need innovation and education, lets reduce defence spending and increase energy innovation and education spending (we have enough nukes in the world for defence!). We can all see that asset prices are too high! What kind of society do we want to live in? One in which wealthy people continue to take more and more for less risk or where we reward for new and innovative ideas which benefit all of society not the chosen few?
As I've said in my previous posts - this will all end badly. Remember make your own decisions after you listen to everyone, use the facts and understand them yourself. That is the key to breaking this cycle.
Update: 20.1.2011: France lost its AAA rating in Jan 2012 - the IMF, ECB, FED continue to enable European countries to sell debt in the securities market. Without insolvent institutions with no need for profit and loss propping up the false economy the periphery countries in Europe would have failed. This cannot last forever. Something has to be allowed to fail!
Update 31.05.2012: The world is in turmoil. Sarkozy lost the election in France and Spain is on the verge of "total emergency". Amazingly the central banks are keeping it all together. This can't last.
Update 11.10.2012: Well, the central banks went "all in". The Federal Reserve promised to print $40bn per month forever and the ECB said it would buy any Eurozone country bonds if they asked for help. Does this look like a system that runs without intervention? What is the difference between this and Russian/Chinese communism. The ECB/Fed now decide what you will buy who will pay you and what you will pay for items as market prices. Sounds like central planning to me. Its never worked.
Update 27.02.13: Well the UK just lost its AAA rating....the dominoes are falling one by one. How long before Germany decides they are better off without the drag of Italy, Spain and France?
Update 30.08.2013: France attempting to distract the public by starting a war with Syria and replacing the UK as America's poodle. Nothing has changed economically for France they are barely surviving and any minor economic instability will signal a return to crisis mode for them.
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