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Submitted by Peak Theory Research
Weekly Peak: Austerity versus Stimulus by the Buck, Euro, and Pound (pdf)
C'mon. Austerity never works. Printing is cheap and easy. Even an Economics PHd can do it. Just ask Time Magazines Man-O-the-Year. Once you scrap those carriers, just buy some choppers. Hell, the only thing you have left of your empire anyway, is the Channel.
1938 Time Magazine Man of the Year: Adolph Hitler.
You are forgetting Gibraltar and the Falklands!
Austerity worked for the Canadians...
this isnt just an economic issue, its a moral issue. doing whats right vs. doing what feels good. us plan will not work and we will pay double in the end. doubling down on failure while the fawning MSM support it and soros pumps in millions to pervert our society
Abstract please. Anyone?
Sure. There are two pages of text, but stretched out by quite a few pretty pictures.
Does that help ... or is it still too long for you?
Now, now i-dog. You promised you wouldn't bite anyone anymore after that last time and only growl menacingly and maybe show some fangs. At worst, you said you would pee on their legs.
Down i-dog, down. :>)
Anyone notice a growing trend? The rest of the world is at least beginning to see the end of the line and they realize that maybe, just maybe, it's time to switch gears and take some medicine. Whether this medicine will be effective is doubtful but that's not important, just that battle lines are being drawn. The USA, the Ponzi King, is dead set against any medicine other than the liquid kind and will continue to move forward at breakneck speed.
This is setting up the playing/killing field for a conversation dominating two-sided argument that will crowd out all other discussion (at least in the MSM) of alternatives to both approaches. This is how the public meme is distorted and controlled. Control the questions/subjects for discussion and you control the answers/direction. When people begin to lose faith in the public myth and illusion, time to polarize the people into separate camps and encourage them to pull out battle axes and swords and cleave away at each other.
We've always been at war with EastAsia. Propaganda and psyops 101
Everyone will get what the deserve soon Cog. The big thing about delaying things till the election is very short sighted, what about for the next 5 years. forgetaboutit.
The people who run the FED and our government have always been anglophiles. We have protected the wealth of Britain since WWI as well as their investments overseas. We have transferred wealth through currency management to protect the pound as well.
What if this is nothing more than the final rape of our wealth before the ratbastards take their winnings and leave, only to laugh about how we "won" the revolution?
Is no one else suspicious of why all of Europe is practicing austerity and we are spending like drunken sailors? This is coordinated monetary policy?
Coordinated to deceive and transfer any and all wealth possible.
Finally, a winner!
Based upon your post I assume you understand the huge influence Germany had, and still has, over the British?
I own a BMW car and motor bike...and I keep my gold in the boot (trunk for non-English speakers...)
Visigoths v Celts? Seapower v Landpower? Smith, Ricardo, Keynes v Marx? Hitler v Churchill?
Influence yes, "over" the British-no. We have a tendency to underestimate the parasitic capabilities of the British. Their ability to insinuate themselves within power structures and then work the levers behind the scenes.
While the Germans are master producers and very hard workers coupled with a frugal personality; their tendency towards authoritarian ruling structures inhibits their abilities in managing global relations. Thus, they are only a player when they come out in force.
There is a reason Rothchild left the comfort of his german gold bunker and spread his children across the capitals of Europe. The best reserved for England and the famous buying of the english stock market after Wellington's victory.
There is a reason english economic theory has been predominant over superior french and austrian constructs. They play from the shadows and do it better than almost everyone.
"Their ability to insinuate themselves within power structures and then work the levers behind the scenes"
Yeah they taught Goldmans a thing or two...
Ummm...they ARE Goldmans. Check the names: Morgan, Baruch, Cohen, etc.
So I assume you understand that the Queen is of German descent and that the name of the royal "house" was changed to hide the German ancestry? And that those German genes have infested Britain (not just royal blood, but all of the British upper class) for hundreds of years?
Yes, but that does not change the results of hundreds of years of history. I look at results. To think people in those stations actually have loyalty to a nation is the very definition of cognitive dissonance.
CD, the US has a little wiggle room to allow Helicopter Ben to continue his money drops. As for Europe, they have come to the realization they are near the end. The debt is at such a quantity it is impossible to accumulate more.
The question is when will the US reach that point?
I don't believe for a second that Greece, Ireland, Spain and Portugal will actually do anthing "austere" - they will just cook the books as always and the EU will nodd approvingly as always - hell "recovery" sort-of implies back to "Business As Usual"!
No, Ireland has a pretty impressive track record of imposing austerity. Not in a just or particularly well-thought-out fashion, of course, but serious austerity nonetheless. Don't get me wrong, this time there's every likelihood that the adjustments will be a day late and a euro short - but nonetheless there will be ugly cuts and tax rises before any capitulation.
Drapier is right here - we have a false conservative catholic idea about money - our petty elite are prepared to do what it takes to satisfy whatever papacey is in charge of the place.
riots coming to Britain?
Austerity is impossible in a debt based system - Ireland cannot increase credit creation so the monetarist solution of the thatcherite years is out , it cannot do keynesian stimulus because it is locked out of the gov bond markets.
It cannot default on anything but token gestures.
Meanwhile with static or declining credit its interest on debt created during the credit boom is going exponential as it always does.
Under these conditions it is mathematically certain that the economy will implode unless the ECB creates high powered money by stealth to keep it going which seems to have happened to a limited extent.
The ECB stood over the massive increase in credit aggregates that enriched its banking clients and is now raping the populace from any savings that accumulated during the credit boom so that it can make its client banks solvent again - meanwhile production and consumption in the periphery is collapsing to protect the core from collapse.
They seem prepared to destroy the periphery to sustain their banks and host countries.
Ireland , Iberia and Greece are battlefields with some action penetrating to the core in France.
Their battle to sustain a artifical price of the Euro against Gold is being lost - time to go to plan B.
Austerity is impossible in a debt based system.
Austerity is impossible in a debt based system.
You're smart man, Dork.
It's beyond ironic. The US, home to the Tea Party, has the central bank that will not stop creating money and the government that will not stop spending it. Europe, home to routine riots over the smallest threat to government transferred wealth - cutting government jobs, cutting deficits, and defending their savers.
I didnt read the whole scribd article but there is discussion of the need for more QE as per telegraph story today.
Austerity and printing combo bitches!
The outcome of QE might not be so obvious....
"how about Bernanke simply muses that the US might consider selling some of its physical gold reserves? Gold would drop like the proverbial, almost certainly taking other commodities with it, meanwhile the $ would soar, reducing all those unpleasant emerging market tensions and reducing the price of gasoline to boot. Oh and John Paulson would get hosed (which would be nice)"
would certainly turn things on their head.
Won't happen. Why?
- Nobody is really sure if the USA has any Gold left to sell.
- China, Russia, India, (etc...) and individual investors everywhere would lap it up pretty quickly. Sure, there would be a dip in the price, but just a temporary one.
- A strong US$ would instantly cripple exports, and therefore stop whatever muddling recovery there is dead in its tracks.
- The price of oil is going to keep on rising, no matter what (Peak Oil, anyone?) and will only dip temporarily as well.
- Ben Bernanke does not care about John Paulson.
What if everyone goes to gold and the CB's decide to just sell it all? What if they already have undercover of paper sales and leverage? All fiats are the only legal tender. The only way to spend gold would be to challenge the whole government system.
I hold PM's, but just thought I would toss in the early halloween house of horrors alternative...
The oligarchs like only gold (and your assets). Your [physical] PM investments are quite safe. Buy more.
The Euro masters are prepared to do a Volcker on Gold - back in the early 80s Volcker created artificially high interest rate to break down Gold - they succeeded even though the money supply never stopped increasing.
How did this succeed - well there was a Huge capital base in America at that time - the high interest rate policey effectively ran down this productive capacity and expressed this in interest on dollar debt.
The Euro is still a artificially strong currency and it will attempt to confirm it virility by attempting to destroy the periphery and eventually the core and extract its capital.
As many parts of Europe have a much more advanced capital base then America now, this could sustain the Gold value of the Euro for a decade or more.
The dollar on the other hand is toast as its host country has no longer the capital resources to sustain a artificially strong debt currency.
But first the Euro must administer a hammer blow to the weaker and maybe stronger countrys of the euro zone.
Will the populace of these countries realise what the ECB is planning - France maybe but not Ireland and Iberia.
France is Europes only hope......... same as it ever was I guess.
P.S. No a hammer blow would be incorrect - I was trying to be overly dramatic - it must administer the poison slowly for the plan to work - if things unravel quickly it could lose control of events.The Trichet vs Axel argument is effectively about which weapon to use - a slow poison or something kinetic and blunt.
My dear "Dork of Cork", the scenario that you depict is, of course, a possibility, BUT...
You have to remember the extent of the rot at the heart of the world's financial system: if something like the foreclosure scandal in the United States finally explodes for good, US banks will lose billions, if not trillions of US$. Through the mechanism of CDS, these losses will soon be transferred to Euopean banks, such as the major French and German banks that loaded up on CDS.
In other words, the system is rotten. Rotten, and not just that but it is also so imbricated the final crash will probably come sooner rather than later. And once the system crashes, there won't be any stopping the price of Gold. Ask the German investors who are reportedly buying any physical Gold they can get their hands on...
The Euro, as much as it pains me, is, after all, a fiat currency. Its days are numbered.
All good points and I'm sure you're right...... unfortunately.
In some ways I think we'd like to think that there was something more to the Plan than smokin' printing presses but then nothing ought to surprise us anymore.
One thing however, is for sure and for certain and that is that risk of markets being in any way disappointed or underwhelmed is most definitely not priced in here and that is a considerable concern.
i have some questions about gold investing.
if USD bubble bursts and the price of gold in USD skyrockets, what will happen
to gold price in EUR?
I am asking since USD is basically on its records but euro price is quite
far from it.
Is gold still the right investment for europeans?
Short answer: Yes.
Longer answer: if foreclosure-gate in the US goes through, the US financial system will finally kill the american "zombie banks". When the zombie banks die, they will take the European financial system down with them. Faced with this, the ECB will have no choice but to launch its own QE mk2 program
Either that, or Greece/Ireland/Spain/etc... will go bust once and for all, and the ECB will have no choice but to start its own QE mk2 program.
Of course, both are possible at the same time, in which case... etc...
So, Euro QE mk2 is probably coming, no matter what, so Gold is a good idea in any case.
Make of that what you will.
I would suggest you consider the "value" of your currency. It is a fiat currency and therefore is "backed by the full faith and credit of the ECB". Meaning, it is backed by nothing at all.
In this way, you must consider the other components of your economy. Are you producing goods and services equal to amount of M3 creation? If not, you should be experiencing inflation from currency debasement. If so, then gold or silver are a hedge against this devaluation- not an investment, but a different way to store and protect your wealth.
Next, are there other instruments that are outperforming gold and silver with similar levels of risk? If so, these should be your choices.
Gold is the investment for anyone experiencing the loss of wealth through currency debasement where other options retain too much risk versus their reward. Regardless of euro, dollar, yen or other currency.
Stimulus is always the easier choice. It puts off the hard work of grown ups till tomorrow. By then new people will have to fix it. This is how we have ended up where we are now. No one takes on the hard work of entitlements and bloated ineffective government as it is now. The Fed just lets the music play a little longer so we can enjoy the party a little while more.
FINALLY ZEROHEDGE IS WRITING ABOUT THE UK. How could you forget about the most indebted nation in the world ? GBP is way overvalued and needs to be hammered into abyss !
Adam Posen? Is that you?
I Know you are going to love this fellow Zero hedgers......
Listening to Irish state radio now and they are reporting reports that the Industrial corporation Siemans have offered to give Ireland credit to install water meters to tax the population so that we can pay other Irish debt holders interest.We will be paying twice over to issue money !!!!!!!John Gormley the Irish environment minister seemed to entertain the possibility of this despicable arangement when being interveiwed by a reporter.Gormley is making a mockery of sovereignty although he may be doing us a favour with his candor.Adam Smith and other classical economists are turning in their Grave.As I have said many times before the ECBs policey of equality between corporate and goverment paper is at the root of their plan to steal the rest of our Independence.The monetory malice of these bastards is beyond even my cynical comprehension.
Sounds quite like the Chinese Greek deal for ships in exchange for bond purchases. The debt piggyback program. I guess we will get all upset now that it is happening to the first world economies rather than just the third world.
Just remember, if you default- they will extend the payment schedule and improve the interest terms. Have to remember to keep those sly polichickens from transferring a percentage to off shore tax havens.
If the bankers had any imagination at all, they might change the program around a little, but I guess if we don't require master hijinks- we will get the same old screw.
Ireland was always a second world country - they just gave us a little monetory heroin and waited a few decades.
We are hooked and cooked now.
Its only a matter of time before they begin to eliminate the dissenters.
If the Irish can survive their love of whiskey, they can survive this as well. We are all cooked now, but you have your wonderful celtic traditions and art, emerald isles and a large island of ratbastards to blame all your troubles on. A positive viewpoint can work wonders- just look at us! We have more debt than grains of sand at the seashore and we still party on like it's 1999!
Alright, I got a little carried away...still, you have a wonderful culture and people. Let's hope they don't find a way steal that as well.
Sorry Sean but you obviously have not been to Ireland for a while - whatever culture was present here was vulgarised many years ago.
The young here are lost or leaving - there's nothing here but empty houses and empty corporate ambition.
Then, that is the greatest loss of all. All the best!
You want to know why France did what it did even though they have mass riots, it's because they have used up as much time as they can and have to start in with austerity. What until the US have to do it. They will try to delay it as much as possible, but it will come. They will cut SS benefits for disabled people and people not of retirement age by 40% and the retired people will be kept at a no cost of living increase (thats for now, they eventually will get their benefits cut also). The states will cut Medicare/Medicaid and also state pensions. People will complain but the argument will be that if we can't cut then we will have to raise taxes on property and other things in the state, and many will shut up then. This is just a small selection of govt. benefits. This has one thing in common that we in the US are so well at doing, it divides and conquer the people who you are fighting. In all it divides the young against the old and the property class/ business class with the renter and consumer class.
By taking the benefits away from the ones not at retirement age, the govt. gets the support of the older retires who still get their full benefits. But after a year or two when they decided to cut the retires SS by 10%, then the younger workers won't fight for them because they will say "so what, my benefits where cut by 40%". And with the Cutting of state benefits over increased taxes, the ones that own businesses and property will allow the cut in benefits over increasing their taxes. We are going to see our standard of living in the US go down over the course of 20 years and it may not come up after the elite and the nuvo rich see how much power they have in a society of 2 classes. We will look like a Mexico and essentially be Mexico rampant crime, corruption at all levels. I bet you anything you will see Americans trying to move to Canada and/or Australia.
Welcome to the third world, it's been long coming.
Austerity works only if the majority of the population understands that it is necessary or forced and it will be difficult for all. I do not think it will work but I might be wrong.
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