The archive is catalogued by 'Politics', 'Economics', 'Mockery', 'In other news' and 'On other things' 


"Who controls the food supply controls the people; who controls the energy can control whole continents; who controls money can control the world" - Henry Kissinger

and yet...

"Sooner or later everyone sits down to a banquet of consequences" – Robert Louis Stevenson

There is no Tooth Fairy

Strong economies are based upon 1 - savings, 2 - production and 3 – personal responsibility. They are not built upon 1 - credit that has been diced, spliced, leveraged to the sky & ‘marked to fantasy’; 2 - bartenders and bureaucracy, and 3 – central planning. 

I’ll put it less politely:  Strong economies do not issue from the promises of politicians, the shenanigans of their cronies, or the ‘models’ of their pet academics. What you get from such governance is lies, ‘clever $hit’, and excuses…and the gradual decay of personal initiative and responsibility.

Whether the political face of such a system is from the ‘left’ or the ‘right’ is secondary to the dynamics involved. The ‘battle’ is between ‘liberty’ and ‘central control’; democracy, such that it has ever existed, and oligarchy.  Oligarchy has been on a roll for the past twenty-five years. The backlash of the last two is not over, not even if Macron wins the French election by a comfortable margin. Why not? Because economic decay will not be reversed by replacing an old bag of wind with a new empty suit. Macron is a member of the club – he will change nothing.  When reform is disallowed, collapse takes its place. This is nothing new – ask the Romans. 

The European Commission, the ECB, Angela Merkel and most of the governments throughout the western world will be praying for a Macron victory today. They may well get it.  If they do, they will breathe a sigh of relief and think that the worst is over. It’s not – tomorrow morning the banking system will still wobble like a Jenga tower in a kitchen of late night drunks; the tragedy of Greece will still be an untended sore; the same group of disconnected old fools will still hold sway in Brussels…and the euro will still be a peg rather than a currency…and pegs always break.

The world will not return to healthy economic conditions until there is a massive clear out of the debt that is clogging its arteries. If the politicians won't do it, the markets will – there is no Tooth Fairy, and there never was.

Hidden in plain sight

Summers on Mnuchin