- They met. They talked. They agreed to talk more and solved
nothing. A November 4 Guardian editorial headlined,"G20 summit: slumping
to the occasion," saying:
-
- "Yes they Cannes? Sadly, in the end, no they couldn't."
It's well known these summits are more talk than substance. Everything
important is agreed in advance when possible. Technocrats do heavy lifting,
not political leaders dependent on them.
-
- Nonetheless, economic crisis demands better. Eurozone
dealmakers failed. So did G20 leaders. As a result, they're "doomed
to have to try again," but given their banker uber alles agenda, defeat
again is sure. Only reckoning day delay is possible, not turning things
around responsibly.
-
- The best from Cannes was that:
-
- "We all commit to further structural reforms to
raise output in our countries." But who commits to what for whose
benefit? "We will ensure the IMF continues to have resources to play
its systemic role to the benefit of its whole membership."
-
- IMF solutions are trouble, not ways out of it. Operating
as loan shark crooks of last result, bad problems get worse.
-
- The Guardian summed up Cannes, saying leaders "provided
few answers. All the big questions still remain on the table for next time"
under worse crisis conditions because who's willing to solve them responsibly.
-
- If Eurozone leaders had a motto it would be sacrifice
people and economies to pay bankers. Agendas that destructive assure bad
endings. What's ahead may be unprecedented. Ordinary people, of course,
suffer most. Already pain levels are extreme.
-
- Nonetheless, high level meetings discuss ways to increase
it with more layoffs, pay and benefit cuts. On November 7, Eurozone finance
ministers met on whether to give Greece another eight billion euros ($11
billion). Later they'll consider much more, dependent on new social benefit
cuts on top of others up to now.
-
- Also considered were ways to boost European Financial
Stability Facility (EFSF) funding to handle greater expected trouble. Already,
multi-trillions are needed, more than all Europe can provide. Moreover,
the longer crisis conditions fester, the greater the amount needed to keep
troubled economies from collapsing.
-
- In mid-2013, a European Stability Mechanism (ESM) will
replace EFSF, going from bad to worse. Run by a Luxembourg-based Board
of Governors, it's a supranational monetary and fiscal authority, bypassing
elected governments to run Eurozone countries like despots.
-
- As a result, elected leaders will be shut out. People
across Europe have no say anyway. Neither do Americans. Western media scoundrels
are silent. Millions know nothing about planned ESM dictatorship. Most
understand little about causes and extent of today's crisis.
-
- Everything tried so far failed. Financial crisis grips
Europe. Italy may be next after Greece. Prime Minister Silvio Berlusconi's
coalition faces possible collapse.
-
- Bond yields tell much. Those on Italian debt instruments
exceed 6.5%, and spreads off bunds near 600bps are perilously close to
levels, precipitating Greek, Irish and Portuguese bailouts.
-
- They're small economies. After Germany and France, Italy
is Europe's third largest. Its multi-trillion dollar trouble threatens
Europe, America, and other global economies.
-
- Greek, Irish, and Portuguese contagion is spreading.
Comprehensive solutions don't exist. Debt levels are too great to manage.
Major European and US banks are insolvent.
-
- Besides other issues, a $600 trillion derivatives time
bomb affects them, around 10 times global GDP. By some estimates, it's
much higher. Five Wall Street giants hold 96% of them, but major world
banks are interconnected, especially America's and Europe's.
-
- An old song goes, "We'll All Go Together When We
Go." Start humming because reckoning day approaches. As Greece goes,
so do Eurozone partners. As they go, so does Europe, and as it goes, so
do global economies.
-
- Stratfor's George Friedman sees European integration
disintegrating. "Europe will spend the next generation sorting through
this," he believes. "Even if things (get no) worse, the situation
already has been transformed beyond what anyone would have imagined in
2007. Far from emerging as a unified force, (at issue is) how divided Europe
will become."
-
- At the same time, banker and political priorities ignore
the mother of all approaching train wrecks. Progressive Radio News Hour
regular Bob Chapman explained:
-
- "The bottom line is that the financial problems
of the US, UK and Europe are unsolvable. The purge will come sooner or
later, bringing decades of social unrest and perhaps revolution."
-
- Growing rage across America and Europe expresses public
anger with Wall Street crooks and complicit politicians, destroying their
lives and futures.
-
- Weak economic data aren't helping. In Europe, German
factory orders plunged 4.3% and production fell 2.7% in September. Spain's
industrial output fell 1.7% year over year, and France's composite October
PMI (Purchasing Managers Index) at 45.6 hit a 30-month low, signaling downturn.
-
- Falling Euro retail sales added more confirmation. Markit
Group's October Eurozone private sector economic index hit 46.5, its lowest
point since November 2008.
-
- Europe's debt crisis persists intractably. On November
5, Barron's contributor economist Carl Weinberg headlined,"As Cash
Runs Out, Greece Teeters," saying:
-
- Greece defaulting is "only a matter of time."
It's baked in the cake. Nothing can stop it. Delay only is possible. Throwing
good money after bad assures greater trouble, not less. Debt problems aren't
solved by more of it.
-
- As a result, "(o)ur base is grim," said Weinberg.
"If we read Greece's political mood correctly, a default seems (more)
imminent....than ever. There are enough unprepared and undercapitalized
banks in Europe to create systemic risk."
-
- "Unless governments" figure out responsible
solutions, "financial-system failure and depression lie in Euroland's
near future."
-
- Economist David Rosenberg's view is also grim, saying
"(t)here is no Eurozone resolution." White knight BRIC countries
aren't lining up to help.
-
- China won't without attractive returns and key demands
met. Brazil President Dilma Rousseff said, "I have not the slightest
intention of contributing directly to the EFSF. If (Eurozone countries)
are not willing to do (enough), why should I?"
-
- America's economy is weakening, including production,
non-manufacturing, employment, and chain store sales most recently.
-
- As for Europe, Rosenberg called Eurozone rescue plans
farcical. MF Global's demise, the fifth largest US financial industry bankruptcy,
may signal much worse to come.
-
- So does out-of-control debt. US GDP is $14.6 trillion.
Public debt way exceeds Federal Reserve Flow of Funds reported $9.7 trillion.
Excluded was another $7.6 trillion from Fannie Mae and Freddie Mac. Combined,
$17.3 trillion comprises $118.3% of GDP and rising.
-
- Moreover, Wall Street, other corporate, household, and
state and local debt is America's highest ever. In 1970, was 154% of GDP.
Currently it's 360%, affecting all aspects of US life adversely. So going
forward believes Rosenberg, "the business of America is debt reduction."
-
- In addition, despite massive money printing and heavy
government borrowing, more private credit is being destroyed than created.
From January 1, 2009 - June 30, 2011, nearly $3.2 trillion was lost. At
issue is counterproductive policies assuring bad results.
-
- According to Rosenberg, "There is not, under any
reasonable forecast, a growth outlook in the developed world that could
trump the debt destruction that will be required for the credit collapse
to come to completion. In the absence of growth, debt is eliminated via
some combination of austerity and default."
-
- In late 2007, financial breakdown began. Unresolved contradictions
persist. Money power in private hands to make more of it at the expense
of sustainable economic growth and job creation exacerbate them.
-
- Solutions proposed assure greater trouble. All the king's
horses and men couldn't help Humpty Dumpty.
-
- Neither can money power in private hands fix troubled
economies by trashing them and households for their benefit.
-
- Stephen Lendman lives in Chicago and can be reached at
lendmanstephen@sbcglobal.net.
-
- Also visit his blog site at sjlendman.blogspot.com and
listen to cutting-edge discussions with distinguished guests on the Progressive
Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central
time and Saturdays and Sundays at noon. All programs are archived for easy
listening.
-
- http://www.progressiveradionetwork.com/the-progressive-news-hour/.
|
