Inkwell Institute
2010 Economic Crisis
There are Domino Theories everywhere……the possibility of an uncontrollable economic problem is lurking in the wings…..what would that be, you may ask?
In the recent history of the world there have been several uses of the “Domino Theory”, where if one thing falls others will follow…..like Vietnam, if it fell to the communists then Laos, Cambodia, Malaysia and so on would fall to those hated “commies”. And then there was most recently in the economic sphere where Greece is in trouble and if it falls so will Portugal, Ireland, Spain and quiet possibly the US will fall. There have been other times and incidents where it has also been used but these are the most encompassing.
I see yet another possibility where there is the possibility of the theory actually having some legs this time…….Financial Reform could be setting the stage for another fall from grace. Why? I have NOT seen anything in the two versions of the bill that would prevent this uncontrolled gambling by banks and hedge funds….if anything it will just encourage them to try it again….and again….and again….
Let me put it this way……if you went to a casino and lost all your money but someone else paid for your loses….would you stop gambling? NO! You would not! And that is what the FinReg bill will do….it will reward the gamblers for their loses and penalize the country at the same time….all I can say is……THIS IS THE GOVERNMENT THAT YOU VOTED FOR…..ARE YOU HAPPY NOW? WHEN WILL YOU DIPSTICKS HAVE HAD ENOUGH OF THESE GAMES BEING PLAYED WITH YOUR LIVES?
Yes. Good post. You’re quite right, of course…
The problem as I see it is that the more responsible of ordinary people (very reasonably) want to put their earnings into and save with a bank (or pension fund etc.) that will pay them interest. The difficulty is that even the banks don’t seem able to tell the difference between an investment that is “risky” and one that is “sound” and, if they can’t make interest, then their customers can’t get paid interest and so on…
What you complain about is actually another shade of what I always complain about – FinReg and all other banking legislation is simply tinkering with a broken system and what is required is a fundamental change in attitude and practises. The problem lies with the whole principle of modern banking and finance and that’s not going to be easy to do anything useful about.
I think there’s another “con trick” that most people don’t see – the whole reason BEHIND the decision to support the banks – the bailout – was only superficially in order to protect the guy in the street – it was nothing more than a lucky, necessary side effect – a necessary evil to these people. It was done to quieten the ordinary people’s fears so they would stop queueing outside the banks to withdraw their cash! Of course, the result was the same, but it wasn’t their prime concern by a long way.
I have some ideas, but I can’t honestly say that I have any definitive answers that I’m at all sure of…
What I DO know, though – what I am absolutely convinced of – is that it is essential for the future for us all to find a way to separate ordinary banking, finance for business and the smaller savers, house buyers and long term investors from financial speculation. If that were done effectively, then the next time they screw up, the speculators could go screw themselves and THAT fact alone would make a whole lot of them think twice or more about a lot of what they do because they’d be risking THEIR OWN money, not the people’s!
Thanx……I am typing between severe storms coming ashore thanx to Alex…..I will most likely be brief….things will continue to roll along and we will continue to jump from one recession to another….without some sort of control the bankers will continue to play their games…..you are right about the tweaking instead of real reform…