Dominique Strauss-Kahn: We Could See Rising Social and Political Instability Within Nations, Even War

smartknowledgeu's picture

In a recent article in the UK Telegraph:

 

Dominique
Strauss-Kahn, the IMF's chief, said the economic rebound across the world is
built on unstable foundations, with many rich nations still strapped in job
slumps while the rising powers of China, India and Brazil already facing the
threat of overheating. "It is not the recovery we wanted. It is a recovery
beset by tensions and strain, which could even sow the seeds of the next
crisis," he said. "Global
unemployment remains at record highs, with widening income inequality adding to
social strains," he said, citing turmoil in North Africa as a prelude to
what may happen as 400m youths join the workforce over the next decade.
"We could see rising social and political instability within nations –
even war," he said.

 


The
IMF has published a paper entitled
Inequality,
Leverage and Crisis arguing that the extreme gap between rich and poor –
with echoes of the US in the late 1920s – was an underlying cause of the Great
Recession from 2008-2009. The
paper, by the Fund's modelling unit, warned of "disastrous
consequences" for the world economy unless workers regain their
"bargaining power" against rentiers. It suggests radical changes to
the tax system and debt relief for workers.

 

In a veiled warning to China and other countries holding down their currencies
for commercial advantage, the IMF chief said "exchange-rate adjustment
should not be resisted". Nor should capital controls be imposed to stop
the inflow of funds.


Pointing out the obvious is fine (widening income inequality, rising social and political instability), Mr. Strauss-Kahn, but how about making amends to those that are suffering and those that will suffer these "inequalities" because of the reckless deceit and fraud that global and Central Bankers have committed for the past several decades? And calling for China and other countries to stop manipulating their currencies while granting a "get out of prison" card to the largest currency manipulator offender and destabilizing global economy influence of them all, the US Federal Reserve, is, in my opinion, neither an adequate or viable solution, or even a helpful suggestion. Stay tuned, because within the next month or so, I'll be posting my own solutions regarding how people can take the power back from immoral and fraudulent bankers, and along the way, exposing some huge banker-disseminated myths that have somehow morphed into truths today.

 

 

About the author: JS Kim is the Managing Director and Founder of SmartKnowledgeU, a fiercely independent investment research, education, and consulting firm with the mission of helping Main Street avoid and beat the fraud of Wall Street.

 

 

 

 

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stevenmitchell's picture

Continuing the pattern of economic stability that ensues from "free markets" has been the agenda of a number of key central banks for nearly 30 years. It has been the objective of central banks to increase leverage and decentralize "central banking" from a stratified and balanced purview. And yes, as you argue, destructive myths have been perpetuated by many of these bankers. A significant key to stabilizing the economies of the world is to remove the relationships of private bankers from the policy implementations of government oversight and regulation. Unfortunately, for the world, the policymakers of the last 30 years have been the same private bankers, who possess a different set of personal incentives from those who are interested in maintaining social and economic stability as a global, regional and national policy. A wall needs to be established between those who set and influence the rules and those who play the game.

stevenmitchell's picture

Continuing the pattern of economic stability that ensues from "free markets" has been the agenda of a number of key central banks for nearly 30 years. It has been the objective of central banks to increase leverage and decentralize "central banking" from a stratified and balanced purview. And yes, as you argue, destructive myths have been perpetuated by many of these bankers. A significant key to stabilizing the economies of the world is to remove the relationships of private bankers from the policy implementations of government oversight and regulation. Unfortunately, for the world, the policymakers of the last 30 years have been the same private bankers, who possess a different set of personal incentives from those who are interested in maintaining social and economic stability as a global, regional and national policy. A wall needs to be established between those who set and influence the rules and those who play the game.

gold_tracker's picture

Guns, food reserves, fuel reserves, and gold. Stock up. The ride ain't over.

Odd Ball's picture

You mean financial collapse, social disillusionment and hyper-inflation can lead to war?  Bummer man...

Cpl Hicks's picture

JSKim,

"how about making amends to those that are suffering and those that will suffer these "inequalities" because of the reckless deceit and fraud that global and Central Bankers have committed for the past several decades"

So that would be just about everybody except the crowd at Davos and the gated communities of the plutocrats, right? Hey, we could get the UN to set up a new fund to redistribute the wealth! Pass the hat around the UAE, the Caribbean enclaves and the Upper East Side. Know what, they would probably let the Swiss administer it like they did with the 1930-1940's era bank accounts of the European jews.

freedmon's picture

This guy is such an asshole. Of course he sees instability coming, the IMF has been hoping for that, if not outright causing it. That means they get to provide "protection" to countries, which means removing their capital controls and allowing them to be looted by corporate interests.

Make no mistake, he's not stupid. He's very smart, and he's very dangerous.

ElvisDog's picture

citing turmoil in North Africa as a prelude to what may happen as 400m youths join the workforce over the next decade

I got news (well, maybe not news to some), there ain't gonna be 400m new jobs created in the next decade in North Africa and the rest of the developed world.

ak_khanna's picture

We are in times of privatizing the profits and socializing losses for those who are well connected to the governments and the law makers.

 

There is a widespread awareness and resentment brewing over this issue amongst the citizens of the countries engaging in bailouts. The majority of the population sees their own financial conditions deteriorating whereas the bankers and financial institutions thriving with bonuses and getting away with fraud and manipulation. This frustration is going to burst into the streets of these countries and the governments will have a very difficult time trying to convince its citizens that somehow this is going to benefit the country as a whole in the long run.

http://www.marketoracle.co.uk/Article24581.html

lynnybee's picture

I listen to a lot of MAX KEISER.   He calls the I.M.F. corrupt & bankrupt & they are criminal terrorists, creating economic mayhem. 

http://www.youtube.com/watch?v=nQFHgcFlrlw

Atomizer's picture

IMF Chief Acknowledges Errors During Asian Financial Crisis

Strauss-Kahn said the IMF did some things right but "we also did things wrong, and we have to accept this." He said the fund has "learned a lot from this crisis."

falak pema's picture

yes, as Benbarnification to the word...culture...

SheepDog-One's picture

Worsening conditions? Cant be, obviously the IMF has never read any Harry Wanger posts.

Bubbles...bubbles everywhere's picture

Obviously, Harry Wanger is a top notch businessman in the interior design industry and way ahead of the curve than the head of the IMF.

bronzie's picture

"Harry Wanger is a top notch businessman in the interior design industry"

I thought his business was in "consumer discretionary" - ie, online porn

Careless Whisper's picture

IMF gives new meaning to the word vulture.

 

Cathartes Aura's picture

just for the record, Vultures mainly eat carcass, dead animals - their systems are developed to deal with the bacteria/toxins of rotting carcass, thus sparing painful deaths to other scavengers. . . the name "cathartes aura" means "golden purifier". . .

 

Vultures eat death, they aren't predators, even if they hasten the death of ill or injured creatures.  I'd call the IMF sociopaths, there really is no equivalent in bird/animal world that describes the rampant destruction of man.

Flakmeister's picture

  Here is the dart board, take a pick as to who is next:

http://www.businessinsider.com/governments-food-price-inflation-2011-1# Pakistan is, shall we say, disconcerting...
RockyRacoon's picture

And those Pakistanis are armed -- not talking rocks here.  I'm just sayin'.

Mercury's picture

Well if nothing else this kind of thing should put to rest the notion that greed is a primary motivator of human actions.

Clearly envy is #1.

Obviously there are a lot of structural economic problems worth addressing - that's all we ever talk about around here - but you can't actually die from "inequality" all by itself.    And I think you'll find that the "rentier class" is more often than not the government, not the financial oligarchs.

falak pema's picture

DSK a French socialist with an acknowledged expertise in market economy slant, now in the IMF hot seat, could be ejected if he doesn't kowtow to Wall Street and FED, who employ him. But knows that China and emerging markets have economic trump cards. How do you save your job with those who appoint you when at the same time they pour oil on the fire through QE and currency war? Go sell Higher Yuan to China is one route. It will help stop world wide inflation. But it wreaks China's catch-up momentum. Can they buy that, the political top knobs in cahoots with their entrepreneurs, architects of hyper growth? Looks like a tall order...But workable if Euro-Brasil-Chinese-Japanese coalition to calm down currency war from US generated QE. Then the finger will point to Benbarnification...which is now planning QE3...just when every body else says stop the money print slack!!...It'll all come back to Wall Street in the end..DSK only has a few aces to play...It's the FED which is fireman and arsonist in this mad world! Mustapha Mond can't sell fiscal discipline to Congress...The great debt divide like the Grand canyon looms out ahead...DSK Jump! Back to France you go! Run for president against Sarkozy...

topcallingtroll's picture

I am counting on some continued free gifts from the jap/china/brazil and thirdworldersforthehegemon axis. Russia has been trying to light the fuse. China has been threatening to give russia the matches (hints of wrecking our current precious metals cease fire). Russia has nothing to lose because they are still not integrated into the world economy. But china is plugged into the borg sufficiently that they need to really consider carefully what they say and.do.

patience...'s picture

Plugged in for now. Just wait and see how fast they "unplug" when they believe they have a self-sustaining economy.

destiny's picture

F**** NO, We don't want no DSK as President nor do we want sarkozy !! These guys should run for another country......(Israel?).   They've done enough harm as it is.

Cash_is_Trash's picture

Until Tahrir comes to D.C., NYC, L.A. and most major cities in the United States, we will continue to have wasteful politicians that ignore the will of the people.

These motherfuckers have caused nothing but war, economic problems and social strife.

Dems and Reps: You're days are accounted for..

Ralphie's picture

Fuckin' word up! We're ALL Egyptians today!

Sathington Willougby's picture

Rolling power outages have arrived in Texas.  Thanks you fucking central planning dicks.

Oppressive pieces of shit.

Ralphie's picture

Yes they have - and with no warning last night.

Incompetent fucking boobs. I'm ZeroHedging on my iPad because I'm afraid to fire up my computer!

dick cheneys ghost's picture

mark faber says Pakistan is next. calls uncle ben a "liar

 

http://nakedempire.wordpress.com/

SheepDog-One's picture

the power of The Bernanks prining press is obviously not what it was in 2009...serious downward spiral is upon us when Guys like Faber is out calling Ben a liar.

Quintus's picture

DS-K is a fuckwit, like virtually all of his peer group.  They seem to have latched onto this idea that the EU and ECB are the only things standing between us and another World War.  

I guess when you're trying to sell an idea as crappy as EU dictatorship from Brussels to the people of Europe, most of whom have no wish for 'Ever closer union', you have a problem on your hands pointing out any real benefits the EU system has produced.  So you have to make some up.

This idea they are trying to put out that it is because of the EU that we have not had a repeat of WWI and WWII totally ignores the fact that the primary reason for this is the NATO alliance.

Still, even during the Irish referendum on Lisbon, we heard the Brussels scumbags repeatedly threaten that voting against their wishes and not agreeing to make them our masters and overlords would certainly plunge Europe back into internecine war between the countries of Europe.

nobita's picture

Couldn't agree with you more. Only way to improve on your post is to post this legend clip of Nigel Farange.

 http://www.youtube.com/watch?v=2gm9q8uabTs&feature=related

Tic tock's picture

China knows full well that the US empire is predicated on eating too much of the H'ors d'ouvres and that they will be full by the time the main course arrives.

gwar5's picture

F*ck this asshole. Why are these guys always 6 months to a year behind everything if they're so smart?

I hope they're not the ones in charge of predicting ELEs -- extinction level events.

whatz that smell's picture

women and children first, bitchez!

Salinger's picture

In a veiled warning to China ...the IMF chief said "exchange-rate adjustment should not be resisted"

 

China to Strauss Kahn ???????

destiny's picture

That man is very smart and......very very mad !

quote

'The Money Is The Medicine' ... These are important times for humanity. The crisis has forced everyone to see many things from a new perspective. Now the IMF is preparing for its annual meeting on Oct. 8. Can it live up to expectations, and can it police the new global economic order and keep global banks in check? "You have to imagine the IMF as a doctor," says Dominique Strauss-Kahn, the 61-year-old director of the International Monetary Fund. "The money is the medicine. But the countries -- the patients -- have to change their habits if they want to recover. It doesn't work any other way." He smiles benevolently as he says these things, his eyes disappearing behind small cushions of wrinkled skin.

Money is not medicine of course. The IMF, with its history of reducing middle classes around the world to ruin, is nothing like a doctor. After reading it, if one still believes in such a thing as freedom in the world, one wants to take a long bath. There is a brutal deliberateness about the language (assuming the translation is accurate), which must be calculated. From the next paragraphs:

 

http://www.thedailybell.com/1425/IMF-Article-Predicts-New-World-Order.html

gwar5's picture

"Resistance is futile" -- Strauss-Khan