What Should We Do For The Best ?

I'm not much of an economist or econometrician or econometrist and still can't understand how just about every country in the world owes squillions of dollars, pounds, euros, etc. However, I like to watch a bit of news anyway just to see what's going on in the parts of the world I can't see out my window. And, of course, this financial 'crisis' or 'contagion' (what a popular word that is these days) or as I prefer to call it 'madness' seems to be dominating, and getting in the way of my news watching pleasures. Going by what the 'experts' are saying, albeit in different ways, we are all doomed, as Private Fraser would say, no matter whether we're in or out of Europe. Yesterday's meeting of Cameron and Merkel made me laugh. They actually agreed on something. And that something was, and I'm not making this up, was that something had to be done, and that was about as far as they got.

Perhaps a more important question is what happens when the US defaults... At the moment its debt is upward of 15 trillion dollars… http://www.usdebtclock.org/ The debt is fast approaching 15,013,000,000,000 as I write this and watching it increase drives home just how shockingly fast it is growing! Now if you compare the size of the US debt with the population of the planet… http://www.worldometers.info/world-population/ approx 7,004,000,000 Approx 15,013,000,000,000 divided by 7,004,000,000 = approx 2,144 dollars for every living being on the planet!

I don't know who the hell we owe all this money to either! But I bet he doesn't make any thing (other than financial gambling profits) and thereby doesn't contribute to the real economy. I do know that the people who turn raw materials into things thereby making lots of money, are the ones who are now out of jobs and owing our gambling 'friend,' their livliehoods and worse. "Strike now fellow workers and don't let the warmongering paper tigers... Oh bugger" I've just fallen off my soapbox. Please keep paying me my pension I think I earned it! PS How on earth do you spell 'livelie hoods'?

Got this the other day on the email train;) Flippant but apposite. Dear Mr. Cameron, Please find below our suggestion for fixing the UK 's economy. Instead of giving billions of pounds to banks that will squander the money on lavish parties and unearned bonuses, use the following plan. You can call it the Patriotic Retirement Plan: There are about 10 million people over 50 in the work force. Pay them £1 million each severance for early retirement with the following stipulations: 1) They MUST retire. Ten million job openings - unemployment fixed 2) They MUST buy a new British car. Ten million cars ordered - Car Industry fixed 3) They MUST either buy a house or pay off their mortgage - Housing Crisis fixed 4) They MUST send their kids to school/college/university - Crime rate fixed 5) They MUST buy £100 WORTH of alcohol/tobacco a week ..... And there's your money back in duty/tax etc It can't get any easier than that! P.S. If more money is needed, have all members of parliament pay back their falsely claimed expenses and second home allowances

I think that the whole world should have the same capital thingy. What's it called? I'm talking about the money thing. Like we should all share the money thing... Like euro or dollar or peso, I forget what it's called! Dang it. But it should all be the same. Savannah

Savannah

Sorry about that mispost. But, I forgot what communism is. Well, actually I never really understood what it was in the first place. Could someone explain, please? And is it really 4:10 in the morning in Europe? Or is that in the afternoon? Ugh whatever time it is, we need to share that, too. So confusing!! Savannah

We here in Ireland know all too well about the current turmoil. We've had the IMF in, Germany studying our budget before our own politicians. It seems the Euro is a failed dream, but where does that leave the rest of Europe? If Ireland goes back to the Punt ( our old currency ), then we face the specter of Devaluation and hyper inflation. Not a pretty picture. The World as a whole has to stop believing in the FIAT money, and go back to gold or silver backed money. I'm no expert, but a word of warning the gold bubble is about to burst. Its price is way to high. Sorry for bleating on, and sounding depressing, but I'm looking out from the eye of the storm. On a happier note, I've seen recessions come and go. Hopefully this one will too.

“I would like to know who these countries are in debt to, who is the big cahoona that is lending them all this dosh do you know Mangone?” : Clive-Pearson If you just want to know who buys debt Clive… Watch ‘How can countries go bust?’ http://www.bbc.co.uk/news/15538164 If you want to get a basic understanding of the present economic crisis in Europe try… Making it clear... in 60 seconds. http://www.bbc.co.uk/news/special_reports/global_economy/

These crises (banking, property boom, mortgage market, public deficits, taxation shortfall etc) all seem to stem from bad management and human greed. It reminds me of my 'Downfall of Avarica' piece. (The City of Greed), in which I wrote things like the following:- "They rode into the city in carriages. The unemployed stared at them from behind curtains or from the streets, sitting or standing on the streets, which many now called home, as Avarica’s harsh property laws and rental practices would rather see its citizens homeless and its properties vacant than see the rules protecting the interests of its richer citizens who still remained solvent weakened. The rich and still solvent stayed behind shutters, while mobs of unemployed people banged on their doors, asking for their jobs back, or for mere food, which had always been plentiful before. The Council itself was bankrupt! Not enough businesses were paying taxes, and not enough citizens were earning money or earning enough to make any headway in paying the interest on council borrowing. Businesses and individuals found ways of avoiding paying taxes, while others had suffered in the fierce competition and gone bankrupt themselves, unable to pay their taxes, and throwing themselves on the Council’s mercy. There was not much mercy to be had; their coffers were dry!" I do hope governments manage to get a handle on this crisis. Really expectations have been too high. A more sensible period is required, but one which does provide work for the whole population, sharing rather than profiteering! We must not panic either.

Well, the question “What should we do for the best?“ that is - should we leave the EU or not? has suddenly become a lot more important… perhaps we will not be allowed the luxury of a choice if European sentiment continues to harden against the UK. Below is a link to a BBC ‘graphic’ which allows you to click on 7 different possible outcomes (well 8 if you count ’who knows?’) of the fate of the Euro and the Euro zone. “European leaders, with the exception of the UK, have backed a tax and budget pact aimed at solving the eurozone debt crisis and preventing the implosion of the single currency. This graphic helps to explain what could unfold next in a crisis that French President Nicolas Sarkozy has warned risks "disintegration" of the eurozone.” http://www.bbc.co.uk/news/business-16098582

Another excellent link, mangone. Are you Robert Peston in disguise?

Really Clive, don't you think the first thing politicians and bosses would do is vote themselves a huge rise for being clever enough to get all that money back?

I wouldn't mind being Robert Peston, Pesky... at least then I'd know how best to prepare for a world economic meltdown. Whatever happens in Europe it is the US economy that is the backbone of the world banking system. So, in my mind, the really important question is if the eurozone self destructs and the Euro fails will the US dollar inevitably follow it into the abyss? I often hear whispers that China would step in to prevent the dollar from collapsing… It might sound reasonable since we all know that the Chinese almost always have a huge monthly trade surplus - e.g. $14.53 billion for November. Yet, if the Chinese chose to donate all their trade surplus (at the current level) to pay off the US debt… If the debt could be rounded down and frozen at $15 trillion - it would still take about 86 years to pay it off. http://www.marketwatch.com/story/china-trade-surplus-narrows-beats-estim... NB The 86 years is to pay off the US National debt which is about $15.105 trillion at the moment… However, the total US debt is calculated to be in excess of $56.36 trillion! http://www.usdebtclock.org/