In news that will surprise not very many, the World Bank warns of the strong potential for social unrest as a result of the global economic crisis.
Their solution, in case you can't already guess for yourselves, is naturally that governments should print money with gay abandon. Like more money in and of itself does anything good.
My take on this is that the availability of more money just cheapens the value of all existing money, and the price of necessities (ie: food and energy) simply rise in price to reflect this. Since the elite are the only ones with access to the new money (think you can get a loan direct from the Bank of England at 0.5%? You're welcome to try... But guess who can do just that?) they are the ones in a position to be able to buy commodities at these currently depressed prices, and they start the bidding from there. In time the banks will come to be comfortable with issuing new loans (in other words, creating more "money", thanks to the fractional reserve banking system (FRB) we "enjoy" these days). As this additional magic money, created by the banks, floods into the economy, people feel richer (they can get access to money more easily) and they bid the prices back up on "stuff". Well, surprise surprise, the rich got richer and the poor got poorer. Again. Who could have seen that coming?
This is just how it works, until such time as FRB is once again abolished. Which it should be, if you want to see the end of boom and bust. The chances of this coming to pass with any of the current crop of democratically electable politicians? Zero -- they are the ones who stand the very most to benefit from the whole game, and none of them moreso than the Democrats/Labour. You think they are on your side? Wrong -- they are on their side.
If you want to see the end of FRB and you're in the USA, you need to vote for Ron Paul. If you are in the UK, well that's a lot harder but you can look out for the UK Libertarian Party on your voting slip; they are the ones who pledge to do just this, among many other items that make sustainable economics and politics a reality. You might well be in the majority, who have been conditioned to reflexively think "Libertarian? No thanks, I'm not a selfish ignorant right-winger", but I would respectfully request that you should learn to think for yourself rather than think what you're told to think. Check out their policies for yourself.
Tuesday, 26 May 2009
World Bank warns of social unrest
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