September 10, 2012

An Anorexic on a drip is not a healthy patient

Posted in Sunday Business Post · 190 comments ·

Last week was a highly significant one for the EU and the eurozone, but not in the way you might think. Mario Draghi, president of the European Central Bank (ECB), has driven a coach-and-horses through the teutonic barricades of the monetary orthodoxy. While it’s interesting to witness a German defeat for the first time in this crisis, the really interesting aspect is the process that Draghi has unleashed – and where it will end.
The announcement that the ECB will buy the bonds of Spain and Italy will not be enough to stop this crisis, but it has paved the way for the next initiative, which will be evident as soon as the euphoria of this new move wears off. The next big thing will be a fiscal expansion, not contraction, in Europe. Yes, you read right, expansion.

I realise, at this stage, that this is anathema to everything that has gone before – and it is. But so is the idea that the ECB could monetise debt – which is exactly what it has just announced. We are in a state of flux and strange things are happening. Old positions are being abandoned and, in the course of doing ‘whatever it takes’, the world, as we know it, is changing dramatically. So keep an open mind.

In order to get our heads around this change, let’s first define the problems in Europe. Europe has a growth crisis, not a debt crisis. There is a debt crisis because there is a growth crisis, not the other way around. Hoping that austerity would deliver growth in an already enfeebled economy is akin to putting an anorexic girl on a diet and hoping that she will put on weight.
More childishly, thinking that the ECB buying bonds while continuing with austerity is a permanent solution is like putting the same anorexic on a drip and announcing her return to full health.

In time, we will see this for what it is – a short-term palliative designed to satisfy the bond vigilantes who have been threatening Spain. It will buy a bit of time. That’s about it. And each bailout or ECB move has seen more and more money buying less and less time.

That said, those of us who warned that the euro was a problematic currency many years ago (rather than the recent converts, wide-eyed with new-found scepticism) knew that the central bank had to, at the very least, open up its balance sheet to buy the bonds of countries in trouble if the currency was to have any chance of surviving.

Now that we have begun to monetise debt in a move that the head of the Bundesbank, Jens Weidmann, last Friday considered was “too close to financing states via the printing press”, where will this stop?

Someone should spell things out to Weidmann. This is not “close to” the printing press, it is the printing press in the old-fashioned Argentinean sense of the word. We are seeing the ‘lira-isation’ of the euro and, before it’s all over, we will also see countries dropping the IMF conditionality guidelines and borrowing lock, stock and barrel; financed by the ECB.
This will happen because growth will not rebound and, without growth, all plans falls apart.

Think of the move last Thursday as part of a continuum. The old euro settlement is coming apart at the seams.

The volte face by the ECB, which is now buying government bonds directly, is the beginning of the end for the policy orthodoxy that has dominated thinking at the top of the ECB, the EU and various departments of finance around the eurozone for years. In time, the unorthodox monetary policy announced by Mario Draghi last week will be followed by heterodox fiscal policies.
Europe will see a massive fiscal expansion in the years ahead, and this fiscal expansion will kickstart the moribund eurozone economy.

There is nothing new in this conclusion. This is what happened in the 1930s, it is what happened in Japan in the 1990s and 2000s and it is what is happening now in the US.

Before you point out that Japan has been growing very slowly since 1991, just think what domestic demand would have been like there had the government not spent.

The same policy is likely to happen in Europe because this is what has to transpire for the euro to survive. As all the elites are in support of the euro more than they are of any other policy, the price of a credible currency is growth and it will come with expansionary, not contractionary, fiscal policy.
The reason is straightforward: Europe’s banks are broken and much of the continent is entering a liquidity trap. Monetary policy isn’t working, so the authorities will have to try something else.

Demand can come either from the continent itself or from exports. But exports, particularly industrial exports to China, will slump as China suffers from the mother of all property crashes in the next three years. In fact, the coming Chinese property crash will make even ours look modest. The US, although set to be the pre-eminent economy in the world again over the next decade, will take time to get there.

Against this background, domestic demand will have to drag Europe up. This domestic demand will come from budget deficits. Don’t let anyone tell you that the markets won’t finance a fiscal expansion in Europe – they will be gasping for it soon and at rates of interest that will be historically low initially. The threat is deflation; the solution is inflation. It has ever been thus but it, too, will take time.

The reason peripheral Europe can’t get financed is that fund managers on the periphery are putting their money in core bond markets. Look at the countries with their own exchange rates – Britain, the US, Japan, Denmark, Sweden and so on. They are having no difficulty getting finance.

Once the ECB is in buying, it backstops risk and it won’t be able to stop, irrespective of all the wittering on about conditionality. The notion that finger-wagging will stop governments borrowing is embarrassing. By opening up the balance sheet, the ECB has given Europe the permission to borrow. After all, common sense says that you discipline a borrower by cutting off funding, not opening up your balance sheet in unlimited quantities.

All this is still a little bit away yet, and the idea of fiscal expansion will be dismissed as bizarre by those same people who told you a few years ago that there was no problem with the euro. We now know that the biggest threat to European rules – and German rules in particular – is the euro.
Expect lots of euphoria for now – until it dawns on the insiders in Europe and at our Department of Finance that an anorexic on a drip isn’t a healthy patient.

  1. mediator


    Could you please explain your last sentence? Why will Dept of Finance be unhappy with your analysis coming to pass?

    • Hi Mediator

      I am just referring to the Department’s attachment to conventional wisdom. We have a full blown downturn and pushing down bond yields by printing money helps if you don’t sterilize. But if you do, its useless.



      • NeilW

        One week term accounts is hardly sterilization in any meaningful way.

        And there is nothing stopping people hoarding Euros for nothing. Fear does that to people – as the TARGET2 balances show in spades.

        Pushing down bond yields doesn’t help unless it induces people to spend money – either borrowed or from a savings buffer. And there is little evidence that a zero bound will stop people saving in sufficient quantity given the level of fear around.

        Uncertainty is the enemy.

      • Adam Byrne

        What do you mean by ‘sterilize’ David?

        • Adam Byrne

          From Dan O’Brien:

          “A difference between the ECB’s unorthodox actions to date and those of US and UK central banks is that the former has taken countervailing, or balancing, actions to prevent an increase in money supply, which can trigger inflation.

          Central bankers describe countervailing actions as “sterilisation”.”

          But what are those ‘actions’? How is it done?

          • Harper66

            “Sterilization in macroeconomics refers to the actions taken by a country’s central bank to counter the effects on the money supply caused by a balance of payments surplus or deficit.[1] This can involve open market operations undertaken by the central bank whose aim is to neutralize the impact of associated foreign exchange operations.[2] The opposite is unsterilized intervention, where monetary authorities have not insulated their country’s domestic money supply and internal balance against foreign exchange intervention…..
            In the second half of the 20th century, sterilization was sometimes associated with efforts by monetary authorities to “defend” the value of their currency. In the 1930s and in the 21st century, sterilisation has most commonly been associated with efforts by nations with a balance of payments surplus to prevent currency appreciation.”


          • Adam Byrne

            Thanks Harper66,

            I know what open market operations are so I guess that explains it.



      • You know David, after studying your articles over a long period I have come to the conclusion that your main flaw is that you choose bad analogies. Just who is the anorexic? Anorexia nervosa is defined as “an eating disorder characterized by immoderate food restriction and irrational fear of gaining weight” (source: Wikipedia). If you look at all of the world economies, in either the developed or the developing world, you cannot accuse any of them of suffering this delusion. Most of them want to grow fat. Perhaps this is their flaw.

        The only people who fit your description are the Green Movement – who are now largely irrelevant in political terms.

        Another example of your bad choice of analogies was your piece on – “NAMA MONEY PIT COULD BE OUR ECONOMIC STALINGRAD” Economic Stalingrad! If only. Did you think before you wrote that? Stalingrad was a glorious chapter in the history of mankind. A turning point in world history. Still no sign of that here despite the confident predictions of the late Brian Lenihan when he was introducing one of his many budgets that he confidently predicted would turn the tide.

  2. MIT


    You say “Europe will see a massive fiscal expansion in the YEARS AHEAD, and this fiscal expansion will kickstart the moribund eurozone economy.”

    Does this mean that Ireland will now stay in the Euro i.e. with all this new money, we will not need to leave? Thank you.

  3. michaelcoughlan


    When I read this article in the SBP I had to read it three or four times before I could get my head around the implications. My emotions have ranged from utter disbelief, intensely irritated, to sheer terror.

    First of all like so manny of your articles it’s not what you say it’s what you don’t is so irritating. The two most glaring omissions in this one is firstly not a mention of the sterilisation process and how that will work refered to by Dan OBrien in his column. Secondly not a mention of how you think the fiscal expansion will transpire. I presume if sterilisation is in the plan the ECB will sell (or so it thinks) euro bonds to private investors and use the money to buy sovereign bonds? That’s not going to happen because private investors will need a yield to be at unsustainable levels to buy such euro bonds. If the ECB prints money to buy sovereign debt this runs counter to your point of view all along that good money will only be wasted trying to pay for previous mistakes.

    As for the debt versus growth trap nonsense you subsequently say Europa banks are broken which is correct. You point regarding debt versus growth is like the titanic captain saying I have a flooding and pumping crises. No he dosent he has a hole in the boat and Europa hole in the boat is a banking crises.

    You haven’t pointed out what form fiscal expansion will take. If sovereign governments are going to borrow while still rung budget deficits where will the money come from to pay back the capital invested unless the can sell equity shares in the newly expanded businesses?

    Fiscal expansion US style is to grow the army employ More people in that organisation and supply more material to it. To balance the books subsequently you must invade your neighbour and transfer his wealth to your balance sheet. The US did this before the last war in Iraq by signing contracts with it’s companies for work in Iraq BEFORE the war was even fought. Hitler used the money in the 30s to build up the army and employ people and then expanded eastwards to balance the books. He called it lebenshraum. (living space).

    Here is economic argument for fiscal expansion through warfare;

    By the way David the former manager of Bloxams stockbrokers has been given the top job in davys AFTER Bloxams failed on his watch.

    Banking or bankers crises?

    What a joke.

    • Michael

      Sterilisation is precisely why this can’t work. I would have thought that was so self evident that it didn’t need explaning which is why I didn’t refer to it. The aim of monetary policy should be to expand available money supply when the threat is deflation, not pander to some German obsession about inflation now when the problem is deflation. As for how fiscal policy will materialise, who cares? My job is not to spoon feed it is to signal.

      All the best


      • NeilW

        Euros are perpetual zero interest bonds. It is perfectly possible to save in them – even if the ECB/NCB is paying no interest.

        Low interest rates do not guarantee enough people will borrow, nor that enough people will spend their savings.

        Only a reduction in fear of the future will do that.

      • michaelcoughlan

        Hi David,

        Dont you think that if fiscal expansion equals never ending warfare then we should all care? You remember you had an article about how a broke Spain had to fight one war after another with its neighbours after the credit expansion from the stolen aztec gold lent in europe imploded in order to balance its books?

        If the euro zone countries almost all of which have a budget defecit borrow to expand and there is no such thing as a free lunch in economics then someone is going to get a hiding!

        Regarding your anemic patient on a drip thats exactly what the doctors (bankers) want because whats causing the problem is the underlying cancer which these doctors (bankers) want to protect at all costs. They are not trying to help the patient only the cancer!

      • Tony Brogan


        A lot of us thought that it was self evident that we have a debt problem first that is so severe growth is impossible.
        You emphatically disagree.
        I would like to see your reasoning as to how you expect people to borrow more money (that is the only way it is issued, as debt)when they are already underwater, broke, bankrupted , hanging on by their teeth etc. Then how will this provide growth if it can be accomplished which I think impossible.

      • Deco

        In defence of the Germans, in the real estate sector in Germany there is inflation. And it is directly related to the interest rate policy of the ECB.

        But nobody is mentioning this in the media in this country, for some strange reason….

  4. Adam Byrne


  5. AthruMor

    If fiscal “expansion” at EU level is now inevitable (?)…where sit the fiscal *controls* needed to ensure the money is well spent?
    Isn’t the EU missing the tight link between fiscal and economic policy that is in place in US, UK etc?
    Perhaps there is a strong link between EU commission and ECB.. yet the EU doesn’t yet give a steer on national health or education spending, does it?
    May be missing something.. (I’m not trained in economics)..

    • StephenKenny

      Economics is not concerned with how the content of economies actually work. Demand created by employing half the population to dig trenches, and the other half to fill them, is the same as any other demand.

      The argument is that the economy must be fixed before anything else, and the only way, in the current situation, is to simply give the most popular business sectors, and the public sector, buckets of money, for them to keep on spending it until the economy improves. Bearing in mind that the definition of an economy now is simply aggregate demand, it is self evident.

      The result will be a boom in public sector employment, and a collection of a mini property booms. This will continue until it can’t anymore,

      • bonbon

        Why not be crystal clear and say that is orthodox Adam Smith, supply and demand, London School of Economics stuff.

        The incredible insanity of this British imperial hangover, is, as Arthur Griffith pointed out founding Eire, is production does not exist in that “economics”. It is exactly the utter incompetence that brought the transatlantic to its knees. Digging trenches and filling them in – what an astounding view of economics. Bizarre in the extreme.

        The incredible insanity of Keynes belief in money producing growth in the economy is matched only by the wild-eyed belief in gold for the same purpose by ostensible opponents.

        DMcW makes a bizarre reference to the 1930′s and I think we need an explanation – if “spoon feeding” fellow Irishmen is not below his dignity.

        • Tony Brogan


          September 10, 2012 at 8:00 pm

          Why not be crystal clear and say that is orthodox Adam Smith, supply and demand, London School of Economics stuff.

          Because it probably isn’t. some people figure things out themselves without being spoon fed or indoctrinated by others.

          Besides which you would use it to go on another rant. In this case you did not wait , you assumed and blew your gasket yet again.

          • bonbon

            It is Smith. It’s popular, pervasive, whether one believes the opinion is their private property or not.

            The indoctrination is shared by “elites”, workers, writers as “self-evident”. It is only when one points out the basis and doctrine actually written down by the perpetrators, one faces the extremely embarrassing silliness one held dear.

            And Smith pervades the Austrian School, Keynes also. It clears the smoke and mirrors of the entire British School.

  6. graham b

    Surely by now it must be obvious to anyone with half a brain,that what is desperately needed is a healthy dose of economic growth, and consequently that the current focus on austerity is counter-productive. I have always been somewhat cynical about the level of intelligence possessed by politicians, but even I can’t believe they are all completely stupid. So why on earth do the powers that be continue to pursue such deflationary policies when they are so obviously failing? What am I missing?

    • You’re missing the Groupthink of the European political elite which have been following the German “no hyperinflation above all else” mantra, probably on the basis of Germany being seen as footing the bill so far, and an austerity based bill seen as cheaper in the short term. If the fiscal sands are shifting as David suggests, one wonders if this new money can be gotten out of the banking system where it’s inert, into the real economy thus triggering growth, otherwise good money after bad….so is it time to start the countdown to the end of austerity clock?

      • StephenKenny

        If you will excuse me, this is perfect media talk:
        “…one wonders if this new money can be gotten out of the banking system where it’s inert, into the real economy thus triggering growth….”

        We successfully got money out of the banks into the real economy for twenty years, and it triggered growth.

        The growth ended in 2007.

        Is there a single reason the results we have seen won’t be repeated if we simply repeat the same process, using the same conditions?

        • bonbon

          There was no physical-economic growth, rather derivative mountains of it. As that vanished, the sheer wreckage of the physical economy, both hard and “soft” will be unbearable for most to see what they have wrought.

          There was real growth up to 1971. Vietnam ended that. Carter pulled the plug.

          • Tony Brogan

            1971 ? No Nixon went off the gold standard and reneged on the 1944 Bretton Woods agreement. since then unfettered printing of debt based money flooded the world with credit aided by fractional reserve banking.
            First there was growth with 1979-80 credit boom, then a bust engineered by Volker 1981-2. Then more growth and then deminishing growth,now contraction.
            Inflation of 6-8 % under reported as 2%.Expansion of GDP, a monetary amount, of 3.5% mius the correct inflation of 7% leaves a contraction of 3.5% p.a. A depression.
            Using stats from John Williams will show this. Europe the same. We have a monetary inflation and an economic delation. Stagflation. An hyperinflationary depression is coming as Draghi and Bernake play together.
            Derivatives piled on each other in an orgy of bets that have destroyed the world financial system and the economy with it.

            Therte are no longer any free markets , all is manipulated or lies.

          • bonbon

            “Boom” is not growth, bubbles as we now well know are not growth. There were never “free markets”, never existed outside of Adam Smiths tome.

            The bubbles began after Nixon, and today are well spectacular. Not growth though. In fact each bubble burst leaves an economic crater.

        • Tony Brogan

          “We successfully got money out of the banks into the real economy for twenty years, and it triggered growth”

          Correct. Result was a debt based inflationary boom. We now have the deflationary collapse. The PTB are trying to make it go away by the addition of more credit. At some point borrowers become debt saturated and no matter what they receive they can spend no more and make no further payment.Law of deminishing returns. We are at a negative effect now for each additional infusion of new credit.

    • bonbon

      I have pointed out above the mental disease rampant in both political and voter circles that money, whether paper or metal, will somehow leach or ooze economic growth with no mental capital involved at all. Well where there should be a knowledge of productive powers of labor, there is a complete vacuum, because production has been systematically removed from the transatlantic economy. Hardly any have any exposure to a productive growth process. This has stunted, otherwise potentially intelligent people who now can only handwave about manufacturing.

      That is the essential issue to face up to.

      Germany has still some productive growth processes actually in motion, and sees things quite differently, despite some of the most, and especially because of the economy, daft financiers. Weidmann reflects a real economy that needs real banking. This is totally alien to Irish commentators.

    • Tony Brogan

      You are missing the fact that it is planned and deliberate policy. to have a failure is the endgame.

  7. mediator

    Hi Graham B

    You’re missing the endgame. All politicians aren’t completely stupid – just self interested. That describes our fools. However the people at the top are working to a preconceived gameplan to bring about the effective end of sovereignty throughout Europe.

    ie Draghi, Monti, Baroso etc…

    • Ok there’s always conspiracy, so with whom is Europe going to war against as an expansionary policy for later asset transfer? Africa?

    • Tony Brogan

      After europe –the one world government

    • bonbon

      Yer daft, Obama wants to go to war, Europe is incapable of conduction conventional war anymore. Obama wants to short circuit rith to thermonuclear war, an instinctive oligarchical tradition represented by the British Monarchy. Only problem no one can survive that – it would be over in 60 – 90 minutes. There is no such thing a a small thermonuclear war – the full barrage must be a surprise- so no warning.

  8. DMcW: The US, although set to be the pre-eminent economy in the world again over the next decade, will take time to get there.

  9. Adelaide

    Hocus Pocus, or the denial of reality.

    So the PIIGS countries via the ECB will be buying their own bonds?
    Bonds which will finance inflated public sectors?
    Public sectors which will drive domestic demand?

    So, indebted countries will now be buying future debt with present debt to drive ‘real’ job creation, ‘real’ jobs that are created to supply the economic demands of the expanding subsidised public sector? But those ‘real’ jobs are in effect also being subsidised? In short, indebted countries will soon be JobBridge nations, entire economies subsidised by Government debt.

    The reality is Western economies in terms of market-driven jobs are nearing the end game in the face of automation-digitization-mechanization, they have been shrinking since the 70′s with an expanding public sector to massage the numbers. “The Future of Work” (author? an English academic book from the 80′s) charts the past and future demise of private-sector employment up to 2030. The author predicted 50% private-sector employment by 2010 (which regarding Ireland seems not far off, 15% unemployed + 15% civil service + 10% in education/training etc) and then 20% employment by 2030. That’s an 80% (unemployment) human surplus to requirements within our lifetime.

    That is a possibility nobody will voluntarily air on mass media. The anorexic may have terminal cancer.

    • Tony Brogan


    • bonbon

      Author(?) predicted this crisis?

    • molly

      Yes I agree we are being sold down the river,it’s like let’s starve the people and only give them rice and then when the people get sick of rice they will do what ever there told like good little children.
      We are being fed crap after crap to support who ,my money and your money is going towards what a system stacked in the favour of who not me not you but we are not blind when I think of all the waste in this country my tax euros my as well been put on the bonfire ,I would rather pull my finger nails out with a pliers then pay my hard earned euros to support the wasters who run and through there supporters controll this banana republic.
      The fight that’s comming over the budget ,property tax at the end of this year will sort the men out from the I hope

      • bonbon

        Nothing better the elites, Houyhnhnm’s that they are (yes horses do talk), would like to see is Yahoo’s fighting over a piece of raw carrion. Swift’s Gulliver witnessed this.

        Every curse word the Houyhnhnm’s had began with “yahoo”.

        AS DMcW said in the last blog, FG are courting a huge problem.

  10. michaelcoughlan

    Hi Mick Farrell.

    The answer to your question regarding asset transfer after financial bankruptcy through lending can be found in the superlative books both by John Perkins called confessions of an economic hitman and hoodwinked.

    My twopence worth is that the Uk and US are waiting for Syria to fall and then Iran will get it. The same asset transfer policies implemented in the run up to the Uraq war will be put in place this home also.


    • bonbon

      General Dempsey was in London and Dublin last week warning about exactly that war drive. He and the JSC know a war with Russia, and make no mistake, that is what Syria is about, means annihilation.

      What may have been jolly old British geopolitics for 200 years has now reached the point it cannot possibly work. Why? Our command of fire of course.

      Many are waking up this. I means a totally new horizon.

    • bonbon

      Perkins book is excellent, for the 1980′s. He apparently has a second one too, not seen it yet.

      The film “The International” on tv in Germany for the 3rd or 4th time this year is amazingly clear. The BCCI investigation. Anyway the bank chief makes it perfectly clear that the debt loaded on whoever wins a war is all the bank is interested about. Investing in that debt production is business.

  11. SMOKEY

    Did you mean €urophoria?

  12. Pat Flannery

    I agree that the disease threatening the Euro patient is deflation not inflation and that the sterilised drip (if in fact the ECB is serious about sterilisation, which I doubt) that the ECB is now applying will not help. But is not your prescription for massive fiscal expansion not akin to insulin shock therapy that would kill the patient quicker than the disease?

    It appears to me that what economists have not got their heads around is that (economically speaking) there are good bonds and bad bonds.

    If we are to go down this new Draghi OMT road we need a quality control mechanism whereby the ECB would issue bond buying guidelines similar to those that applied to mortgage-backed securities in the U.S. before Wall Street came along and raped FNMA, then put hordes of painted look-alike FNMA whores on the Street. There is nothing wrong with mortgage securitisation per se nor is there anything wrong with a central bank buying government bonds so long as they are not junk bonds issued for junk purposes.

    If the ECB is now going to routinely provide liquidity by buying up European government bonds, which is what you favour, then this activity needs to be transparent and the bonds it would purchase need to be clearly defined in advance.

    Underwriting guidelines kept the American home mortgage market free of the disastrous “sub-prime” abuses for a long time. FNMA worked fine.

    The ECB needs to issue FNMA-style guidelines that will keep out the sub-prime government bonds that will inevitably flood the market if not checked.

    • bonbon

      Until 1999-2000 when Glass-Steagall was repealed.

      So put it back!

    • Tony Brogan

      The truth is we have both inflation and deflation at the same time
      We have monetary inflation causing the apparent rise inprices as the value of all currencies are falling.
      We have economic deflation as business cut back and fail and jobs are lost and wages fall

      This is a mild form of Stagflation and just a precursor to the real thing. A hyperinflationary depression approaches. sponsonsored and encouraged by the constant government interference in the economy creating so many distortions that it no longer functions.

      Survival will be by two things. Land and precious metals.

      • bonbon

        “Land and metal”, that’s the Confederate mantra, “life liberty and property”. The CSA had 1 foreign supporter, Great Britain. Surprise, surprise.

        That’s indeed the future the financial elites want, for 1 billion.

        The US constitution “pursuit of happiness” has the obvious self-evident truth, that the future determines present actions, a free choice. To corral 1 billion into plantations is not a choice.

        The obstinate refusal to snap out of this mesmerized trance, this feudal fantasy, causes incredible utterings such as “simultaneous hyperinflation-deflation”, totally incomprehensible. Next we will be told as with Global Warming frauds, that one ‘flation causes the other ‘flation – warming causes cooling.

        Bertrand Russell, the mephistopheles of the 20th century, said, the ability to convince people snow is any color of grey between black and white is the “true science”. Makes Goebbels look like the pompous amateur ha was.

        • Tony Brogan

          If you bothered to look around you would see that is exactly what we have at present. Monetary inflation and a faultering economy side by side.Prices going up in a depression as economic activity falls.
          go look in a mirror to see who is in a mesmerized trance.
          Quite often you are rude and obnoxious. It’s becoming a habit.

          • Pat Flannery

            Tony & Bonbon:

            While I agree with David that deflation is becoming a bigger threat than inflation worldwide, I do not see that threat as big enough to abandon all attempts at curbing inflation as David appears to.

            I therefore tend to agree more with you Tony, that we need to worry about both, but I do not see the kind of hyperinflationary depression you do. I think the biggest danger lies in the West reaching a tipping point in social inequality as is currently happening in the Arab world.

            The Occupy Movement has not gone away you know.

  13. cooldude

    Interesting article David and very much in line with your recent one where you endorsed the economic policies of Paul Krugman. The basis of this policy seems to be that although excessive liquidity and low interest rate policies have created the problems facing all western economies the solution is well even more excess liquidity and even lower interest rates. At least you are honest and clear in your call that this “is the printing press in the old-fashioned Argentinean sense of the word.”
    Very clear but will this open monetization of debt produce a beneficial outcome for the citizens of Ireland and Europe or is it just a reckless policy fraught with huge danger simply to keep the insolvent banking system afloat. I’m afraid I am of the view that this policy is purely designed to support the corrupt banking system and to move more and more powers away from the sovereign states of Europe and give them to the unelected technocrats at the ECB.
    You say “the threat is deflation; the solution is inflation” Be very careful what you wish for as you could easily end up with a little bit more inflation than you bargained for just like your friends in Argentina during the 90′s. Their currency was debased into oblivion and all those on fixed incomes such as pensioners and the middle class were financially wiped out. The only ones who survived were those who had switched a large portion of their savings into harder currencies such as US dollars and precious metals. The situation will be the same in Europe if we continue down this monetization of debt route. Only this time you can forget about US dollars as a protection of purchasing power as they have the very same debt saturation problem as Europe. This time the only protection will be hard assets which maintain their value the best of which are gold and silver.

      • cooldude

        Just one more point on this huge threat of deflation that we should all be so scared about. There is no sign of it in consumer prices for necessities like food, electricity, petrol or any of the basics needed. The world bank just announced that there was a 10% rise in food prices in July alone. Now I know the drought in America is a factor but food prices have been rising constantly for over 10 years. I see petrol is now over 1.70 euro and rising and both the ESB and Bord Gais have recently raised their prices by over 8%. These are the basic necessities for people and there is no sign of any price deflation there. In fact consumer price deflation would be very beneficial to ordinary consumers even if economists are allergic to it. When I was recently in Power City I didn’t hear anyone complaining that the TV’s are now about 50% cheaper than they were a few years ago and are also of much better quality. No consumers like a bit of price deflation but they don’t like their currency being inflated to oblivion to bail out the reckless banking system. The problem is not really deflation which is just an excuse to embark on this massive bout of debt monetization. The problem is our banking system and the elites who control it and who also control the central banks. Everything that is being done is for their benefit and their centralist agenda and is detrimental to all other people. Not that they give a damn but let’s not try and pretend that these policies will bring any benefit to anyone except the banking elites and their technocrat cronies.

        • bonbon

          We all know what the “problem” is – that’s easy. It’s the solution that occupies thinking minds now.

          • Tony Brogan

            Not everyone agrees on.the problem. DMW suggests growth is the problem , others of us suggest (know) it is the debt came first. Before that the central banking system set up to issue unlimited debt based money. Every cent borrowed into existance. There is the problem unacknowleged by most.
            Most of the solutions do not take this into account and so are dooned to failure. More to the point some believe the solutions proffered are known to not work by those offering them. That is, there is an intentional failure to make matters worse.
            Benanke and Gerthner know so does Dragi, and Borroso.

            They are not dolts, fools or incompetants, they are traitors to the sovereign state to promote the policy of a unitary one world government.

            Wake up and smell the coffee.

          • bonbon

            Of course in the affairs of man, the future determines the present, especially political-economics. Thus it is extremely important to see what future is implied by forecasts. A desired state of affairs will color problem analysis. We desire a future with a rapidly growing population and well being, which means energy, water, production on an unheard of scale. That shows there is a massive growth deficit. We desire financing of 25 year projects, mission-oriented, and that shows a banking system completely not up to the task, in fact a primitive play-thing of the few.

            The future comes first. The current few have a very different future in mind, for 1 billion in a state of plantation slaves, lorded over by the rich.

  14. Peter Atkinson

    Did I hear right last week that some 38 year old American punk financial gambler is in possession of €6 billion worth of Irish debt.Would this be the same punk that was flogging packaged-up sub prime mortgages when he was a 32 year old punk gambler.

    Folks there is no end to this world casiono.We are merely chips placed on black or red dragged back and forth by the house or the gambler depending on who wins on the spin of the wheel.No wonder Lowry and his mates were pushing for a super casino in the Midlands

    I now know that I originally bought a mortgage securitised by something called a house.I can walk away from my house at any time and abandon it but never walk away from my mortgage.If ever I get possession of the deed of mortgage to this fine property I will wrap them in plastic and use them as a sleeping bag.Clearly its worth more than this house ever was.

    My tuppence worth idea as follows.Launch a new currency in January Euro wide called the Yoyo.Dilute it to the power of ten against the Euro and leave all those punk gamblers holding worthless debt.Surely a scheme to dilute gamblers debt holding is the only way out of this mess.

    • bonbon

      Takes more than a punk to rein these guys in. It takes the full power of the nation state, and politicians acting like statesmen, not punks.

      Glass-Steagall, will not dilute their paper, it will render it null and void. Those punks could help building NAWAPA XXI the greatest water and power project ever planned on this planet, and see an economy grow. That’s what’s missing, driving punkishness now. Take away productive powers of labor’s role in society and breed Clockwork Orange.

  15. molly

    How can we recover without death right down and the present government putting a strangle hold on its people.
    If our bonds are sold surly we are hiding from the unfairness of what’s being loaded on to us .
    The can we kick down the road is about to be come the size of a joint oil tank.
    The government want to make jobs and get people of the dole and back to the worker force , but surly they are going the complete wrong way about this
    People who make jobs need the demand there from people who have the money to spend.
    If no money is there because of lack of people with the over and above excess money to spend no new jobs can survive.
    The only reason the amount of people on the dole is stable is people are leaving Ireland .
    The dole figures are hiding the true figure and the government use this to cover up the real state of our mess.
    It’s living one big lie and there is going to be much bigger lies comming .

    • bonbon

      As Luther said it takes 7 lies to cover one. A 7 to 1 ratio. That’s leveraging, what finance does since 2000.

      • Tony Brogan

        Goebels also said that a lie repeated seven times becomes a truth.

        • bonbon

          Well what we hear today from Draghi, Monti, Bernanke would make Goebbels blush. Remember Ashcroft? His formulations casme from advance lying the Strauss method.

          Each securitization of a debt, each derivative step is a packagey lie, sold to the credulous. Glass-Steagall renders the contents of those lies void. There is truth in Glass-Steagall, pungent unflinching.

          Glass-Steagall is a challenge, to Ron Paul also, to act for truth which will not prosper “spontaneously”.

  16. So it’s a choice between the ECB turning on the printing presses and printing a lot of money or we go back to our own currency and do the same thing. Either way, the outcome will be the same: a world full of useless currency in place of the current situation in which we have a world full of useless debt. Communism is the end result – we’ll pretend to work; they’ll pretend to pay us. You experienced the old USSR David, what was that like?

    • Of course you could also say that we might end up with the worst of both worlds – a world of debt and trying to pay it back with a useless currency. The really interesting question about all of this is: who will be the ultimate winners and who will be the ultimate losers?

    • bonbon

      The USSR was forecast to collapse in 1985 at Hotel Kempinsky Berlin. Reason, the refusal of Andropov to take up Reagan’s offer of SDI, the Strastegic Defense Initiative, to make nuclear weapons obsolete, but economically to jump to a higher energy density economy. Failure to act on this initiative drove the USSR to implode with 3 months of the forecast date, and the transatlantic economies now.

      That is why monetary reasoning cannot comprehend the collapse then or now. The Austrian School is mentally bankrupt on this capital error and cannot comprehend the meaning of SDI. Putin has put SDE, the Strategic Defence of the Earth this year back on the table. Defense against the use of thermonuclear werapons, but also against large rocks nearby out there that could wip us out. This is game-changing economics.

      The monetary worrying game is boring as it is, is’nt it?

      • Tony Brogan

        The Austrian school does not promote monetarism as you consistantly say in complete error.They are opposed to monetarism. you mislead.

        But then as a Larouchie you have an inculcated hate on for the Austrians, so it is understandable.

        • bonbon

          The von Hayek school is all about money, “sound money” – that’s monetarism. Keynes the apparent opposite is also about exactly the same thing.

          Monetarism is the belief that dead capital has value, that productive powers of labor are irrelevant. Monetarism stems from the ancient belief in maritime trade, production being irrelevant to sea-farers – that occurs inland after all. Seriously that’s where it comes from.

          • Tony Brogan

            Definition of ‘Monetarist Theory’
            An economic concept which contends that changes in the money supply are the most significant determinants of the rate of economic growth and the behavior of the business cycle.

            Read more:

            In as much as the Austrian school is against such monetary policy your definition is incorrect and misleading. The Austrian’s do not agree with tampering with the economy by monetary or fiscal means

          • bonbon

            The Austrian school believes good things will occur in a vacuum. They are talking about money all the time, “sound this or that”, fiat this or that, but never once about economic production, mental capital – the basis for increased production and advances in methods.

            So von Hayek, Mises and Ron Paul are actually monetarists; Keynes is also arch monetarist.

            That’s the conflict with Alexander Hamilton, Arthur Griffith, Friedrich List…

    • Tony Brogan

      There is a third choice and that is to go back to a national currency based on coin of PM’s. such a currency will not easily debase and is not inflationary. It is, for a sane people not controlled by the PTB, the only choice to stabilize the economy.

      • I think we are getting close to what is the nub of the issue – and the efforts that are going into to whitewashing what it is really all about. The bankrupt elements are rampaging around the world like drug addicts, desperate for anything that will give them ‘one last fix’. They will do anything to get it – invade countries, kill anyone who stands in their way and while there at it, steal anything that has value that converts. They have their eyes set on Middle East oil. They are also zoning in on the world’s currencies, and the one’s that are still strong. And they are spinning us a fable that it ‘all makes economic sense’ to do this. But it doesn’t. It’s a smash and grab exercise, plain and simple.

  17. Tony Brogan

    You have been warned and refuse to heed.

    A credit based monetary expansion (Inceased money supply loaned into existance as a debt) leads to a boom (nobody can forecast where until it is happening) That will inevitable lead to a bust.
    A bust that is unavoidable.
    further monetary expansion however achieved , results in more of the same that we recently experienced.
    Not settling the accounts and purging the debt but with the addition of more debt enlarges the problem leading to a bigger bust down the road.

    A large sector of the population can not afford the debt they have, a large number of sovereign states can not afford the debt they have. How on earth will more debt added solve that problem.

    The world and its economists have gone mad. All the new bonds will find no buyers because the bonds are backed by broke countries and the investing public are broke. The central bank buying the bonds is monetiztion of the debt. It is ludicrious. Central bank print money to loan to the government. Government prints a bond held by the bank.
    Infact all cash goes to commercial banks who hold it as reserves because they are so broke on the negative leverage they dare not let it out.
    Result is no stimulus and no growth.
    Central bank prints truck loads of money that saturates the banks and finally some escapes into the community .
    This goes first to the well connected and does not reach those who need it. rich get richer. Poor get poorer. Inflation rears its ugly head.
    Finally some economic activity is stimulated and banks decide to loan again and based on the fractional reserve system but out multiple truck loads of money. There is a wild blow off boom, as the money is given away for nothing with no repayment terms, with hyperinflation and then collapses in the ashes of a devatated economy reduce to ruin.

    This seeds revolutionary movements around the world. Anarchy is rampant. civil rights are suspended. military governments are installed by UN. Martial law is it and the one world government established.

    Not a pretty sight or happening. Coming to a place near you unless we smarten up and throw the bankers and technocrats out. clean house now and not later.

    “In order to get our heads around this change, let’s first define the problems in Europe. Europe has a growth crisis, not a debt crisis. There is a debt crisis because there is a growth crisis, not the other way around”

    I read statements like this for 40 years and wondered why I could not understand the economy. I finally realised that all the columnists have not got a clue. and the above statement is the proof.

    Of course it is the debt. people have nothing left to spend. Calling for growth to get people to spand what they do not have is insanity.

    We have to go through the adjustment to purge the debt before any further growth can happen.

    The bust cannot be denied. Just delayed. The longer it is held off the bigger it will be.

    • I am inclined to agree with you. I had to read that statement twice before I twigged it for what it was – a stupid person’s idea of what an intelligent statement sounds like. I’m pretty sure that there will be people down in the pub tonight passionately declaiming that what we are going through is ‘a debt crisis not a growth crisis’. It means nothing and doesn’t prescribe any effective remedy. Foot in mouth or a mouth with foot in it – what’s the difference?

    • bonbon

      Who warned exactly? Who other than von Hayek, Mises et al? Ron Paul did the biography of Mises so no surprise there.

      No. von Hayek, when one reads carefully what he says, and wrote, especially his Road to Serfdom, is not economics, and was never meant too be. It is psychology, as he said himself at the London School of Economics. Now of course economics involves the human mind, increasing productive power of labor as a policy, but we find in von Hayek’s “warning” that the mind id incapable of dealing with economics! Exactly as Adam Smith said explicitly.

      This is psywar, not economics. As such it is part of the problem, and in fact never intends a solution.

      Now for sane people, as this crisis is driven by such impulses, will react. One of the horizons that changes everything, is the war drive cannot function. Why, well because of that uniquely human discovery, fire (no animal uses it). It is that we steppwise increased the power and density of fire to the point it cannot be used as a winning weapon. I like that – it poses the ultimate questions now to the elites.

    • bonbon

      Population reduction is the goal, culling the human herd as the oligarchy sees fit. Debased to animal status, governed by pleasure-pain, no creativity tolerated, with metal more worth than productive powers of labor. That’s the view of the cull.

      That’s a bit less comfortable, is’nt it?

  18. Clare Leonard

    Noonan has his head stuck up the chimney looking for Santa Claus every day.
    The ECB policy appears to be,
    accumulate UNPAYABLE sovereign debt obligations over 1 to 3 years, chain the soverigns in, destroy the nation states.
    Why would the ECB wait for inflation to reduce the nation states debt over a longer period, that would ruin their plan.
    Take them out one by one, kill them off fast, while Noonan still has his head in the dark up the chimney.

    Guest Post: How Draghi Opened The Door To Hyperinflation And Denied The Fed An Exit Strategy
    Submitted by Tyler Durden on 09/10/2012 – 14:29 Bond Creditors default EuroDollar European Central Bank Eurozone Germany Guest Post Hyperinflation LIBOR Monetary Base Precious Metals ratings Sovereign Debt Sovereign Risk Sovereign Risk Yield Curve
    We will mince no words: Mr. Draghi has opened the door to hyperinflation. There will probably not be hyperinflation because Germany would leave the Euro zone first, but the door is open and we will explain why. To avoid this outcome, assuming that in this context the Eurozone will continue to show fiscal deficits, we will also show that it is critical that the Fed does not raise interest rates. This can only be extremely bullish of precious metals and commodities in the long run. In the short-run, we will have to face the usual manipulations in the precious metals markets and everyone will seek to front run the European Central Bank, playing the sovereign yield curve and being long banks’ stocks. If in the short-run, the ECB is the lender of last resort, in the long run, it may become the borrower of first resort!

    • bonbon

      Incredible, blaming Draghi for what Ben has been doing all along. An amazing twisting, writhing, rather WallStreet snake like in the grass.

      Ben is about to or already has unleashed QEIII. Draghi denying Ben an “exit”!” Twaddle. The are twins.
      The FED bailed out the Euro over months. What do you think Ben will try on Draghi?

      This crowd are locked in St Vitus’ dance. The only reason either is still standing is the other.

      • Tony Brogan

        Nobody is blaming Draghi for what Ben is doing.
        Ben has provided support to european banks through over night swaps from american banks curtesy of funds supplied by the Fed and added to the tax burden of the US.
        Now Draghi is a big boy and can do it all by himself and lumber the bill on to every European taxpayer.

        • bonbon

          “How Draghi Opened The Door To Hyperinflation And Denied The Fed An Exit Strategy”.

          Draghi denied Ben something? Sure looks like a bankers trick, that jingoistic catch phrase. Maybe something to with the idiotic election.

  19. StephenKenny

    Just a question to ponder.

    In 2007/8, when everything was blowing up, everyone was talking about derivatives as being core to the problem.

    When did you last notice a mention of derivatives, in the newspapers, on the television, of on the radio?

    • bonbon

      Even here? We discussed detivatives in the last blog, securitized mortgages. The host apparently wants to avoid the subject. Derivatives are target number 1 for Glass-Steagall.

      That is why we proposed the HBPA, the Home Owners and Bank Protection Act- to hang derivatives out to dry!

      • StephenKenny

        No Bonbon, not here.
        As I said, the newspapers, the tv, or the radio. i.e. the popular or mainstream media. Ã…s far as I can remember, derivatives are simply not mentioned.

        • bonbon

          They are mentioned, but it is easy to loose it in the noise. Believe it, various media outlets do report all this. That’s the strange thing. Putting the report in front of someone who simply refuses to see it is the thing to watch for. The “going along to get along” game is the silly game, and it it great fun to challenge it. The “I do not want to be heard saying this by my friends”, or “everything you say is right but my party faction loyalty…”.

          That is the problem.

  20. Clare Leonard

    I am not advocating violence,
    the above should read.
    The ECB policy is to take the soverigns out and kill them off.

    • Deflated

      No peace, looks like it is now infact WAR.
      There is too much to lose and we are getting shafted up the arse by this cream pie of a governmant. I am sick of it. Sick of it sick of it sick of it.

      Now is the time to get together and arrange a stand and stop flouting on as if we know something better then the next person. Action is needed and we need to start a movement.

      A lot of talk here – lets get to action. who is with me?

      • bonbon

        We had that before with OWS. Their inability to form an idea, rather their absolute refusal to pursue a creative strategy, left the bankers themselves, Sandy Weill, calling for what OWS should have said loudly, Glass-Steagall. Even the FT had to intervene!

        No more roads to an intellectual nowhere!

  21. “In order to get our heads around this change, let’s first define the problems in Europe. Europe has a growth crisis, not a debt crisis. There is a debt crisis because there is a growth crisis, not the other way around”

    Are you feeling well today sir?

    • Juanjo R

      So what did your beloved German masters have to say then Dorothy? are the tanks ready to roll if needed?

      • bonbon

        Confusion reigns. German citizens never had a single chance to vote for any of this Euro mess. The Euro is London’s project from the get-go.

        Draghi is now trying to pre-empt the Constitutional Court in Karlsruhe – the Judges will rule Wednesday. Rumors have it he got a whiff of something.

        Anyway Draghi’s plan cannot work. It can destroy the German economy.

  22. dwalsh

    I think the ECB is doing what it should have done years ago: protecting the nations who underwrite it; and which it was created to SERVE; not rule.

    Of course, given the background and probable allegiances of who is running it, I am cautious to give the move an unqualified welcome. There will be more to this I suspect than is obvious now.

    • Tony Brogan

      The ECB was created to serve the banks and that is what it will bail out. The people will get nothing except less freedom and more regulation from Brussels.
      Oh and more debts added to the bottom line of every taxpayer balace sheet in Europe.
      The so called solution is a debt entrapment.

  23. dwalsh

    @ David

    The crisis in Europe is not a growth crisis.

    It is a banking crisis, which has metastasised into a sovereign debt crisis by means of deceit and threats.

    The prescription applied has been severe austerities imposed on the general population, thereby reducing growth.

    Making an accurate diagnosis of the crisis is essential to countering it. This is not possible in the mainstream, since the underlying axioms of the financial system (cancer) are assumed to be a priori truths or laws of nature.

    Anyone interested in this approach should have a look at the work of John McMurtry:

    • bonbon

      Again that is a partial analyses hampered by the 40 year lack of any contact with a productive political-economy. There has been no physical-economic growth for 40 years, yes none. Only a paper derivative economy. That policy of course was unforced by the exact same crowd that now are trying to save their system with hyperinflation. As this fails, LTRO, OTB, QEIII, the shattering reality appears. It is too much for economists who have never experienced first hand what a growing physical-economy is. So we have 2 processes underway, a total breakdown of the transatlantic economy and a major shock for the people that everything they thought an economy was about is being rendered, unavoidably, ridiculous. Political candidates are now appearing like complete fakes as people’s illusions fail. The first to go is the hip, cool, wide-eyed handwaving that economy seeps from money or gold. The second is the incredible belief that if a mental vacuum is created spontaneous good things will happen!

      It is high time to abandon such ridiculous notions, stop going along to get along with the faction. Economy will thrive with political intervention, as Arthur Griffith said an economy left to its own will surely suicide.
      I think DMcW’s allegory of the patient is good, but the wide-eyed belief money or metal could kill the patient.

  24. Tony Brogan


    Secret Panic

    Jeff Nielson

    Regular readers know that going back more than a year now, I have been outlining two, potential (and nearly opposite) scenarios going forward. I indicated that either our economies would plummet into a high-inflation/hyperinflation price-spiral (due to excessive money-printing); or they would simply disintegrate, as the Western financial crime syndicate manufactured another crash in order to prevent the previously mentioned price-spiral.

    The latter scenario was precisely what occurred in 2008. However, in a commentary from one year ago titled Why 2011 Is Not 2008, I documented to readers how the “solutions” foisted upon us by the Banking Cabal during this first crisis had dramatically and irreparably damaged all Western economies. The only exception to this mass-suicide was Iceland, which threw the Bankers out — and subsequently saved their economy.

    Because all Western economies are much more crippled than they were just four, short years ago; I’ve indicated my suspicion that the Bank Oligarchs didn’t “have the stomach” for another manufactured crash. This is due to the fact that nothing in our economies is more fragile than the bankers’ own multi-trillion dollar paper Ponzi-schemes.

    Creating another “crash” event would detonate so many gigantic losses on Big Bank balance sheets that no amount of money-printing could avert their total destruction. Put another way, it would require so many $trillions of new money-printing just to “stop the bleeding” with these fraud-factories that the result would be instant hyperinflation — as all the People simply and finally rejected these infinite stacks of the bankers’ worthless paper.

    We now see increasing evidence that this suspicion is being confirmed. While the media again reports that our economies have plunged into another mega-crisis; this time it is doing so (relatively) quietly. In 2008, the Western propaganda machine was just one, gigantic Chicken Little.

    Instead of “the sky is falling,” we were warned (in the most shrill, hyperbolic terms) that we were facing nothing less than the total collapse of our financial systems and our entire economies…unless we listened closely to the bankers, and did exactly what they told us to do. To emphasize their point, the Banking Cabal deliberately “crashed” the global economy — the inevitable result when this banking oligopoly colluded to simultaneously cut-off all capital to an entirely debt-based economic system.

    Deprive some strung-out heroin junkie of his “fix”, and you guarantee a severe (if not fatal) withdrawal reaction. Deprive a global economy filled with debt-junkies of any more debt and you guarantee similar, severe “economic withdrawal” — an immediate economic crash.

    The Big Lie which the bankers tried to pass-off on us was that History’s most-insane gamblers and reckless lenders were (suddenly) “afraid” to lend anyone money. However (as usual) the banksters’ own actions proved they were lying. Even after U.S. Big Banks had literally been guaranteed infinite, free funding (i.e. unlimited quantities of 0% loans); they still refused to do what they had promised — and lend into the broader economy.

    For any banker-apologists who would still dare to suggest that the Big Banks don’t collude; the bankers have already proven you wrong. In confessing to market-rigging with respect to $500 trillion in LIBOR-based transactions; this is by definition a crime of collusion — since the LIBOR rate itself is set collectively, by these same Big Banks.

    In 2012, we see the bankers and the Corporate Media again colluding. However, while in 2008 this tag-team unfailingly acted to amplify panic; today our don’t-worry-be-happy media optimists simply say to us again and again “problem solved.”

    By my unofficial count, the propaganda machine has announced a “solution” to the (made-in-the-USA) “Euro debt crisis” on approximately a hundred separate occasions. That’s a very impressive performance by Europe’s bankers and Traitor Politicians — given that this “crisis” is a mere three years old.

    Today, we see these fearless leaders proclaim their 100th solution: nothing less than “unlimited bond-buying” and “a soup kitchen” for all of Europe’s Big Banks. More specifically, this is precisely what European governments did during the worst of the crisis in the Crash of ’08. The only thing missing between now and then is the general panic. Lest we have any doubts that this new crisis mirrors the crisis in 2008, Bloomberg is very explicit:

    …The European Central Bank’s decision to relax funding rules to mirror conditions last seen after Lehman Brothers Holdings Inc.’s collapse signals hard times for lenders.

    “The soup kitchen for impoverished euro-zone banks is re-opening…”

    Obviously Europe’s bankers and Traitor Politicians have panicked; given they have duplicated their actions from that crisis, which (at the time) represented the most extreme/reckless financial policies ever undertaken by our governments. But it’s a Secret Panic; because instead of media Chicken Littles wailing (to the Little People) that “the sky is falling” we have the Banker Apologists deployed to soothingly assure us “problem solved.”

    In the U.S.; we have the proverbial “calm before the storm.” The government just confessed that the number of non-employed employable Americans (once known as “unemployed”) had hit yet another 30-year high. In other words there are less Americans with jobs today than there were when the “economic recovery” began in 2009.

    It’s only a matter of time until even the most dim-witted American Sheep pulls out their fingers and toes and starts doing some “calculations.” When it sinks in that less people working today than in 2009 means that the U.S. economy has been steadily losing jobs throughout the last three years, they will (finally) realize that the entire “U.S. economic recovery” has been nothing but a gigantic media/government Lie.

    Meanwhile, B.S. Bernanke busily (and secretly) counterfeits U.S. dollars with his magic printing press. With the U.S. already clearly bankrupt, this means U.S. Treasuries are already worthless. However, the world’s biggest Deadbeat Debtor can only delay debt-default by manipulating Treasuries prices to the highest level in history — since that minimizes interest payments on the U.S.’s $16 trillion national debt.

    Thus Chairman Ben secretly counterfeits U.S. dollars in order to secretly buy-up every U.S. Treasury in sight, the only way that implosion of the Treasury market Ponzi-scheme can be delayed. What the ECB has just proposed doing is exactly what Chairman Ben has already been doing for the last three years, and for exactly the same motive: to minimize interest payments for Europe’s Deadbeat Debtors.

    In other words, not only does the U.S. already have its own Secret Panic, but it’s much further advanced than that of Europe. The reason why B.S. Bernanke secretly (and illegally) does what Europe is about to do openly is because the U.S. economy is in actual fundamental terms far more crippled than the economies of Europe.

    It needs the Federal Reserve to secretly engage in this bond-buying because in the words of former Goldman Sachs banker Jeffrey Christian, manipulation works better “if the market doesn’t see you coming.” In other words. One of the Principles of 21st century Western banking is that when you’re manipulating markets you will be more successful if you also hide it/lie about it.

    Yet while it seems that the Banking Cabal and Corporate Media have committed themselves to a “secret panic” strategy; we must never forget the old cliché of the perils of dealing with Cornered Rats. And we must keep in mind that we are truly dealing with “psychopaths”.

    Only psychopaths would ever conceive of perpetrating a $500-trillion crime, since it’s a little too large to conceal indefinitely. More to the point, after they had been caught; only psychopaths would retain the audacity to argue that they should be allowed to continue their crime, since (according to the Criminals) their fraud itself was now “too big to fail.” If (when?) commodities prices are again spiraling out of control — and hyperinflation beckons — we cannot rule-out the psychopaths playing the Crash Card one more time.

  25. Tony Brogan

    There is one thing that is totally different today that has never happened before.
    It is why what may have worked at other times will not work today.
    This is the firstime that ALL CURRENCIES of the world are backed by nothing but the faith of the people.
    There is no gold standard ans no solid honest money anywhere. There is no economy in another part odf the world doing well. All are failing.

    Dragi in printing all these EUROS for the banks will debase the money. Just as the US is doing, Just as the Japan ese are doing and the UK etc.
    The additionof new credit devalues the currency.
    Each currency tries for an advantage over the others.
    It is called competitive devaluations.

    The result is world wide inflation in all goods and services. That is why gold and silver appear to rise in value but relaity is that the currencies are sinking.
    As far as money is concerned silver and gold will be last men standing. When people lose fath in a currency it will buy nothing as nobody will take it. That is Zimbabwean hyperinflation. People were reduced to panning for gold to get money to eat.

    Are we heading there maybe yes or no. but for sure we will have high inflation, not in one place but world wide.

    Those that have adopted a trusted currency will escape and prosper. The sovereign state needs a trusted currency. Eventually only something “as good as gold” will suffice.

  26. redriversix

    Eh Hello….?

    down here…no ..lower..

    yeah thats it,hi how are you all…?

    Just in case DMWC forgot,we are fucked……This financial War is a attack on the people,the real people,trying to survive one day at a time.

    Debating what is a ponzi scheme on these pages is ridiculous,its like trying to debate the “final solution”,its criminal,its wrong and detracts from the real problem that is runaway banks supported by National and E.U Governments and institutions.

    How many families live in fear…?
    How many people have a growing dependence on Alcohol or prescription drugs…… ?

    How many families were affected by suicide last week.?

    How many lost their job last Friday….?

    How many Companies will close this week..?

    How many Mothers or Fathers will have their debit card refused today while trying to buy groceries…. ?

    Will some children go to school hungry today or go to School without the proper uniform and be slagged by their peers for same ?

    Wake up,no one cares about you,Government could not care less,if you are sick,disabled or need social services,forgetaboutit….!

    So..what can we do.?

    Any money you have .keep not give it to Banks or Government,if you cannot protect yourself,how can you protect family…?

    This Crisis is only going to get a lot worse so be prepared,I have no idea what David wrote about today,but that is just me…

    Have a great day

    Rise up,Stand up and say NO MORE !!!!

    • Tony Brogan

      Good day to you RR6
      hope you are well

      • redriversix

        All good Today Tony,

        Hope you are in good form..?

        enjoy reading your posts.

        Have a great day


        • Tony Brogan

          Today is the start of my bike adventure.
          I hope to be packed and aboard the plane in 6 hours!!. bike and panniers are my luggage. Arrive Heathrow 12th mid day and cycle from airport to a pal 20 miles away. Never done this before so I am nervous!!
          Wish me good luck and the bike in one piece at the other end!!Hope the weather is reasonable to start at least.

          • Bon camino Tony :)

            if you get to Galicia you must try the tuna filled delicious “empanadas” yum yum.

          • Tony Brogan

            Hi Josey
            I have not figured out how to get there yet.Ferry and rail seems likely but I need more info.
            Looking forward to it
            I do not speak any language but English so that will be a challenge.

          • dwalsh

            Have a great trip Tony.

          • Tony Brogan

            Hi Dwalsh

            Thanks for the good wishes
            bike arrived in one piece with the laden panniers still attached. I reassembled the pedals, handle bars and seat and cycled from the airport to a pal 30 km distant. all safe and resting up.

    • Johno

      Well said Sir , well said.

    • molly

      NO MORE no more
      The real pain being felt by the Irish is totally forgotten by this government THEY DON’T GIVE TWO FUCKS,did you ever see someone giving the two fingers well that sums it up.
      People can’t survive now how are they going to survive come budget day.
      I would hope people who are in this position to put paying banks to the bottom of there list.
      The only example I would say is do what the government do they suit themselves and they suit there cronies.
      So family’s suit yourself don’t worry about bricks and mortar .
      The Irish people have got to stop this government from walking all over them.

    • Couldn’t have put it better myself. They are all living in a fantasy world.

    • Bravo RR6!!!!

      I don’t bother reading David’s articles anymore only the comments, much more real and cutting edge.

      Perhaps David doesn’t want to rock the msm directly but does it by proxy with the views aired here in the comments.

      Afterall guilt is by association….ditto if we leave our money with the banks.

  27. Suicidal

    Yesterday in my office I met two people who were suicidal and depressed one was a Fisherman in his twenties and the other a married Taxi Driver in his forties .Both with hopeless views on being Irish and the purpose of life in Ireland .

    What makes matters worse is that the Revenue will deprive them from earning a meagre living because they cannot pay their austerity taxes and remove from them their Tax CLearance Certificates.

    • Johno

      My Dad is a taxi driver in Dublin and had a heart attack last year. He was back to work within 2-3 weeks after it as he simply couldnt afford not to. My Mam was very worried about him as he couldnt sleep and was not himself. Seemingly depression can happen after a heartattack and luckily my Dad has come back around he is doing much better now. But it could of been very different. Suicide is a big problem in our small country but like most things its simply ignored by the goverment.

    • redriversix

      I may be wrong John,but I seem to remember some court case a few years back where a Judge ruled that although the Revenue has a right to expect people to be tax compliant, they do not have the right to prevent them earning a living and the defendant was awarded their Tax clearance certificate and a payment plan was agreed to by both Revenue and defendant.


    • There is life after depression John. In some cases it is temporary and many people recover while others may need medication and or counselling.

      Loss of a job can be a huge shock and it takes time to adjust but it can be done.

      What I would say to people suffering from depression is that many people suffer from it and that many recover. It’s not the end of the world and it’s ok to talk about it and get the right help

  28. cooldude

    I have been thinking about this article and have come to some sort of conclusion. We are focussing too much on growth as simply measured in GDP and not enough on economic progress which is measured by high employment and a much higher level of new business start ups than business failures. By simply focussing on GDP growth we will not get the economic progress that our country and the rest of the western world so badly needs. If GDP growth had been available at the time Rudolf Von Havenstein, president of the Reichsbank 1920-23 would have achieved superb growth by simply increasing the money supply on a vast scale. That experiment did not end very well for the people of Germany and although there was some initial economic progress it was a false progress based purely on an increase of the money supply and it all ended in a bout of horrific hyperinflation. GDP growth alone is not a solution which will benefit business and people it must be accompanied by economic progress. To get this progress markets have to allowed to clear and insolvent companies have to be allowed to die. This progress cannot be achieved by trying to inflate away all our problems. If it could Zimbabwe would be one of the richest countries in the world.

    • redriversix

      Hi Cooldude

      Sustainability is not a word much seen or used anymore.

      As you point out,if hard work brought great rewards,Africa as a Nation might be one of the richest.

      This is BANKING Crisis.This financial War needs to be ended,either by Governments or by people.

      Fiscal poor management is a separate issue which has come to the fore BECAUSE of this Financial War and is a separate issue which should be dealt with by placing the Country in receivership / cancelling of ALL debt / began a new Bank and start over.

      September 2012

      E.C.B bond buying is a further example of kicking the barrel down the road and another feeble attempt to solve a deliberate debt crisis with more debt.

      Simply impossible

      September 1944

      Montgomery’s hugely ambitious plan to end the War by Christmas by capturing 5 bridges at ARNHEM,NEIMAGEN,ENDHOVEN,GRAFF and SONNE in Holland
      The largest ever Airborne drop in the history of warfare along with a massive armored ground attack from Belgium.

      It failed…….it was a BRIDGE TOO FAR

      Bond buying debt launched by E.C.B in September 2012 is…… A BRIDGE TOO FAR.

      Protect your families,stay away from lies,spin deceit and utter rubbish spouted by anyone “claiming” to be in charge.Cancel stress ,anxiety and fear…..YOUR IN CHARGE,FORGIVE YOUR OWN DEBT.!

      BUDGET2013 “whats in your wallet”….?

      • molly

        The war now is not of bombs ,tanks ,guns ,sea or air.
        It’s a money war fueled by greed and power hungry people who would trample all over you ,my problem up to recently was I did not watch my back and like most people i taught the bank was my friend and the government was also there for the good of the people.
        Then I took one hard look at the whole system and seen the light.
        It reminds me of what a mate said to me a few years ago after his wife left him,his wife started to read all the romantic fairy tail books and thought a knight on a white horse was going to arrive and save her and then she realised this was only in books .
        So the morel is watch your own back.

    • Tony Brogan

      A1 Cooldude

      My original idea was to introduce silver coin over a period of time so that the economy was not unduly disrupted. It becomes clearer that nothing will be done before a total collapse and so we must be prpared with a plan to execute immediately. The banksters will not cede any space. They must be driven out.
      It is literally a life and death struggle as they will kill to maintain control.That is why it must be the people back change so that there are too many to deal with.
      That is why it is a question of education. That includes educating CMW so remain on the blog and continue to promote these solutions. do not yield space to the enemy.
      Clare is correct, sovereignty must be retaken by the people.
      I quote from somewhere in the distant recesses of my mind.
      “Freedom is never achieved it is always being constantly striven for”.

  29. molly

    TUESDAY, 11 SEPTEMBER 2012 07:00

    Rather than being part of the solution to mass unemployment, JobBridge is part of the problem.
    With mass unemployment haunting Ireland, the Government is under pressure to be seen to be doing something about it. Thanks to its continuation of the disastrous austerity policies of the last government, the unemployment rate is now over 14% (a significant underestimation when those who have dropped out of the labour market are taken into account), with youth unemployment closer to 20%. Without the prospect of a job, around 1,000 people are emigrating from ireland every week.

  30. molly

    With all these people leaving is Ireland a sinking ship.
    Will there be enough people left to pay back all the money we don’t owe.
    The government better do something about this quick because there will not be enough people left to pay there wages unless they want to keep getting us into deeper death.
    Do you want to pay for this farch

  31. joe hack

    Great Weather Eh!

  32. Reality Check

    David with the ECB driving short term yields on the PIGS won’t this lead to more debt being rolled over and over -leading to greater indebtedness in the long term?
    Precisely the opposite of what you have been calling for More Debt>

  33. So David… Would now be a good time to buy? :)

  34. piombo

    Over the summer I have come to the conclusion that Jens Weidmann is right on the money over the ECB shift to monetary financing. Despite what Merkel states publically Weidmann reflects sound monetary policy and hopefully will stick to his guns. Whilst never mentioned by him for historical reasons (but understood by all concerned), his policy stance involves two courageous correlations:
    1) Reduce state benefits and spending to reflect balance of payments equilibrium on a country by country basis assuming a average tax take of 25% GDP, and more importantly;
    2) Impose losses on creditors in the event of sovereign default.
    The former action would require a secular “true up” by the media and politicians to the public right across Europe, while the latter would involve bringing down all of the banking families and their dynasties built up in the last two hundred years.
    Weidmann is young and may well not feel any link with the WW2 generation but if he persists and holds sway, he will be looked upon as a saviour in the same light as Enhart and Adenhauer were by the previous generation.
    I wish him luck.

    • bonbon

      Monti: No Money for the Mezzogiorno; Tremonti: We Need a New Cassa per il Mezzogiorno

      Sept. 8 (EIRNS) — As puppet Prime Minister Mario netta Monti was telling Southern Italians in Bari that they should not expect any money for development, former Economy Minister Giulio Tremonti gave an interview to the Naples daily {Il Mattino}, calling for a new Cassa per il Mezzogiorno, the TVA-like agency that developed Southern Italy in the reconstruction era.

      Monti was speaking at the yearly business event for Southern Italy, the “Fiera del Levante” (Levant Fair) industrial fair in Bari. He said that the recovery is coming, even if people do not see it: “It is true that you do not see the recovery in the figures, with some exceptions, but I invite you to realize that the recovery, if we reflect upon it, is really within us.”

      “I want to be clear,” Monti said: “growth in the South like everywhere else in the world, is not generated by public money pumped into a pipe.”

      Monti also said that he, as a technocrat, was called in “to take in” (or away) and once he has taken, he will make room for a political government. But if politicians start again “to give out,” he warned, technocrats will come back.

      Contrary to Monti’s insane rantings, Tremonti in Naples called for a program for the Mezzogiorno similar to {EIR}’s recent plan for the development of Southern Europe and the Mediterranean. Sometimes Tremonti used the same words, like when, recalling the experience of the Cassa per il Mezzogiorno, said that “when it was operational, the gap between North and South was reduced.”

      “The real problem is that the South suffers jointly the flaws of the market and of the state, without enjoying their benefits.”

      Tremonti blasted the current system where, on one side, centralization is at the EU level, while projects are decided at extreme local level.

      “Whereas throughout Europe projects are done for large infrastructure, in the South flower shops, renovation of buildings and such things are financed. The initiative does not come from the state, but from the local geometer who pushes the city councilman who pushes the regional councilman and so on, up to the government council.” As a result, the government “authorizes 467,000 financial interventions.”

      “When I realized that, I relaunched the original concept of the Cassa per il Mezzogriono. Just that: It was not at all a failure as they want us to believe. In the years when it was operational, the gap between North and South was reduced. We should have repaired it, not closed it.”

      Tremonti says that the “Banca del Mezzogiorno” he created is being sabotaged. However, another measure he implemented has been a success and nobody speaks about it: reduced-tax bonds for financing business in the South have collected EU5 billions. “For me this is a big success, however only the beginning of a phase which must include more initiatives, more capital.

      • piombo

        Hi Bonbon,
        I sent a response last night but it didn’t arrive.
        Anyway, Italy is my home and my family and business base. I only glance at the newspapers and as most other Italians pay no heed whatsoever to the politicians.
        Draghi is the only Italian that counts and he has chosen to take on Weidmann. He will lose as German opposition to this ” confetti” is very deep-rooted.
        I was disappointed by this article’s espousal of OMT and the depiction of Weidmann as some sort of cantankerous child. The thesis smelt of the Queens shilling.
        Germany simply does not want to have to bail out gombeen-social welfare states (Ireland), nor deeply corrupt rigged economies (Italy) nor entire busted political classes (Spain and Portugal) but most of all the Deutsche Volke do not want to have to bail out the Anglo-Saxon Banking systems and the handful of dynasties that control it.

        • bonbon

          Let’s see what the Judges stand up for. They “spoke”, yet no info yet.

          “The Queen’s shilling” – very good!

          Still, if Monti continues, Italy might break up. And as Tremonti said, Draghi wrote the legislation ending the banking separation in Italy with a huge lie about MedioBanca two blogs ago.

  35. Mark Fitzgerald

    David, would it be fair to say the peripheral European countries have a growth problem because they are uncompetitive as their costs and prices are too high relative to their trading partners. How is fiscal expansion going to help countries like Spain and Italy restore competitiveness? Estonia could be viewed as an example where austerity can restore competitiveness which will help enable sustainable growth.

  36. dwalsh


    That’s all it is really.
    All the bailouts; free money to the banks; monetising sovereign debt; and so on.
    It’s really just kicking the can down the road.

    The source of the cancer threatening to destroy our incipient global civilisation is the financial sector. Until that is recognised by our political elites there is no hope of any resolution or recovery.

    The financial sector must be shut down. There is no other way.

    Of course that cannot be done unilaterally. The financial sector has completely enveloped the commercial banking systems of the global economy in its necrotic embrace. This disease can only be dealt with at the global level; it will require unified global action.

    The mass of cancerous finanal assets must be excised, shredded, deleted. This will require nothing less than a complete reorganisation and reset of the global economy.

    • Tony Brogan

      I believe it can be done unilaterally by any sovereign nation with the guts to do what is right.
      If we wait for an internation reset it will be in the form the globalists insist.

  37. Clare Leonard

    When the ECB privatised bank profits and socialised bank losses/stuck the debts onto our back. The ECB and our elected government broke international law under Odious debt.
    We the PEOPLE need to confront the ECB, using Internationl law. It is obvious at this stage we cannot depend on our elected government to defend us.
    The founding fathers of the Constitution of the Irish
    Free State of 1922 gave the powers of initiative and referendum to the Irish people.
    However, these rights were never implemented as the first party to get into power removed these rights from the people of Ireland and gave those powers back to themselves. Within the next few weeks a new political party should/will be formed to reintroduce these rights, with some modification, and give the people the opportunity,should they so wish, to end the phyocrisy of what we call democracy.
    This will/should give the people the ability to have a say in government decisions,at local,county and national level. The strategy will include setting up an online web based forum, where the public can scrutinize political decisions, make proposals and put forward candidates for election, this allows people to propose or veto legislation and other initiatives. It also gives citizens the power to recall or sack elected representatives or ministers who are not working for the interest of the people.
    This should offer the opportunity for people to live in a fairer society by participating in the decision making process on an ongoing basis, rather than ticking a box every four or five years.
    No doubt this will come with privileges and a lot of responsibilities.
    To date, most of the founding members are the unemployed self employed.
    Let us hope the current application is not blocked by
    Leinster House.
    After registration, it is up to each of you to build a better Ireland.
    We the people, by the people, for the people.
    We can do it.

    • cooldude

      Best of luck with your new venture Clare. This country certainly needs it. I will follow it with interest.
      One thing I won’t be doing is contributing on this blog. I have reread this article a few times and I am in total disagreement with both it’s tone and it’s content. As Michael Colgan posted the ECB do not give a damn whether the patient lives or dies they only care about keeping the cancer that is the modern banking system alive. Whether this destroys people’s lives or not they couldn’t give a shit. The theme of this article is that we need to get back to some serious “old fashioned Argentinian” money printing. I find this very disturbing as this policy led to an inflation rate of 4923.7% in 1989. It completely destroyed the middle class and anyone on fixed income. I have no interest in a blog promoting this type of dangerous nonsense. Here is a quote from the now deceased American comedian George Carlin which sums up fairly well the forces we are all up against in this era of corrupt crony capitalism which is threatening all aspects of our lives at the moment;
      There’s a reason for this, there’s a reason education sucks, and it’s the same reason it will never ever ever be fixed. It’s never going to get any better. Don’t look for it. Be happy with what you’ve got… because the owners of this country don’t want that. I’m talking about the real owners now… the real owners. The big wealthy business interests that control things and make all the important decisions. Forget the politicians. The politicians are put there to give you the idea that you have freedom of choice. You don’t. You have no choice. You have owners. They own you. They own everything. They own all the important land. They own and control the corporations. They’ve long since bought and paid for the Senate, the Congress, the state houses, the city halls. They got the judges in their back pockets and they own all the big media companies, so they control just about all of the news and information you get to hear. They got you by the balls. They spend billions of dollars every year lobbying. Lobbying to get what they want. Well, we know what they want. They want more for themselves and less for everybody else, but I’ll tell you what they don’t want. They don’t want a population of citizens capable of critical thinking. They don’t want well-informed, well-educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. That’s against their interests. That’s right. They don’t want people who are smart enough to sit around a kitchen table and think about how badly they’re getting fucked by a system that threw them overboard 30 fuckin’ years ago. They don’t want that. You know what they want? They want obedient workers. Obedient workers, people who are just smart enough to run the machines and do the paperwork. And just dumb enough to passively accept all these increasingly shittier jobs with the lower pay, the longer hours, the reduced benefits, the end of overtime and vanishing pension that disappears the minute you go to collect it. And now they’re coming for your Social Security money. They want your fuckin’ retirement money. They want it back so they can give it to their criminal friends on Wall Street. And you know something? They’ll get it. They’ll get it all from you sooner or later ’cause they own this fuckin’ place. It’s a big club and you ain’t in it. You and I are not in the big club. By the way, it’s the same big club they use to beat you over the head with all day long when they tell you what to believe. All day long beating you over the head with their media telling you what to believe, what to think and what to buy. The table is tilted, folks. The game is rigged and nobody seems to notice. Nobody seems to care. Good, honest, hard-working people: white collar, blue collar, it doesn’t matter what color shirt you have on. Good, honest, hard-working people continue – these are people of modest means – continue to elect these rich cocksuckers who don’t give a fuck about them. They don’t give a fuck about you. They don’t give a fuck about you. They don’t care about you at all! At all! At all! And nobody seems to notice. Nobody seems to care. That’s what the owners count on. The fact that Americans will probably remain willfully ignorant of the big red, white and blue dick that’s being jammed up their assholes every day, because the owners of this country know the truth. It’s called the American Dream, ’cause you have to be asleep to believe it.”
      George Carlin

      • redriversix

        Evening Cooldude

        George Carlin was so far ahead of his time and has been proved to be so correct in his “comic”monologues.

        Quite incredible to see and listen too,I only found “George” last year,but I am very glad I did and try and share as many of his clips as I can.

        May he rest in peace.


      • Tony Brogan

        “One thing I won’t be doing is contributing on this blog. I have reread this article a few times and I am in total disagreement with both it’s tone and it’s content”

        Then it is your duty to set the record straight and not let the error stand unchallenged.
        Your logical thinking and clarity of expression are needed on this blog!!

        Together with others and the passion of such as Clare Leonard you will be persuasive.

      • dwalsh


        I have a similar distaste for David’s articles and perspective; and ditto for some of the posters here too. That’s the real world for you.

        What I see generally unfolding is a polarisation on a broad spectrum from those whose perspective is individuality and self-interest to thoses whose perspective is social and cooperative.

    • gizzy

      @Clare Great initiative. It is time for a new political party. I am prepared for the first time in my life to join one.

  38. Clare Leonard

    We have a constitution. We the people are sovereign.
    This is not my venture.
    This is your venture, if you so wish.
    If we fail to take possession of our sovereignty NOW
    we will loose it forever.
    Put your fist in the air in defiance. Take back the power. Take ownership of your sovereignty.
    I lived and worked in 4 Continents and 11 countries, I watched the corruption, I watched children starve to death because of banking B……ds
    I will not rest.
    I have 4 grandchildren,2 sons,9 brothers and sisters.
    This is their venture also.
    In all of the 11 countries I lived in, nothing compares to Ireland. We are blessed with our beautiful fertile country. Now is the time to protect that blessing for the benefit of all the people. We will not let them rob it.
    I travel around the country, North, South, East, West.
    The people are ready to take back the power.
    We cannot afford to rest.
    Please do not let them beat you down.
    I know some days are really tough.
    We stand together and we can do anything we put our mind to because WE ARE SOVEREIGN.

    • padser

      Clare Leonard – Cool-dude…

      Sorry guy’s….but, where was all this fightin talk back in the noughties? You both sound very intelligent…didn’t you think then’ that there was something wrong with 130% mortgages?? The acres of land worth zillions! Corruption staring us in the face …with endless tribunal’s.etc

      I’m unemployed and have a mortgage, I worry about my Daughters welfare and that’s it -, she tell’s me one day in the near future, she’s going to leave this Country. Why the fuck should I care about Sovereignty?

      Any notion of “true Sovereignty”, went in ’73 – get with the program !! Endless Treaty’s which you and I signed, have led us to here’ for the sake of “integration” with “the EU”. You’d better learn to like it cos’ we ain’t going back…..and we proved our faith in “the EU” – in Nice II.

      Has our ‘supreme tolerance’ of the “system” finally deluded us….so much that it amounts to no more than just a ‘rant’ on a blog-site? Get real!

      Web-host’s like DMcW, serve – at best, nothing more than loose repetitious, anecdotal forensic’s and analysis of something that’s staring us in the face!

      Are you suggesting for one minute that if we were not part of the EU or the influence of the ECB, we would not be affected!? I beg to differ……we Irish epitomise corruption! Politicians right down to our Council’s ,Church et al. And we love it – cos it enables us to sit on our arses typing shite all day and their still there!

      We have subscribed to a corrupt system of Government and Banking for decades and then act surprised when they lie and cheat. That’s crap!

      Take a look at the bigger picture……we are heading for a de jure ‘federal europe’,…….that’s the nut’s and bolt’s of all this shite! It is the most compelling factor for the EU overcoming a “multi-speed” europe, in a bid to secure that unspoken but very mooted concept. It has been peddled through our system for decades by all that have governed this land .What other explanation could anybody possibly come up with – as to why respective financial regulators systematically failed to do their job….they were told not to function, we accepted it then, so we should accept it now. Enda Kenny said “it wasn’t our fault” he was lying’ as politicians do, it “was” and is all of our fault! Beneficial crisis in the making…..I’m getting by in my mind with that theory….if it brings with it a better system than were in, then I’m all for it. If one Banker goes to jail for any of this ‘then’ I will crack-up!

      • bonbon

        We were headed for a federal europe under Napoleon, Hitler, Mussolini and now The British Euro.
        The last is obvious when we hear Churchill coined the phrase USE, United States of Europe, after his gholem tried it differently. Sir Oswald Mosley, British Union of Fascists, picked up that call then.

        That’s the problem. wrecking europe’s nation states has been the empire’s number 1 goal since 1783. Now we have Obama confronting Russia simply because it has asserted sovereignty, defense of sovereignty, and has a nuclear arsenal. See how they cheer for Obama and remember the Nürnberg Rally.

        • padser

          Hitler’ opposed the pan-European movement after WW1 by Coudenhove Kalergi – was that a federal entity then do you know?

        • padser

          I have no doubt it may well proceed this time around. Esp. as far as Ireland is concerned with most of FG – blowing wind in it’s sail! They will probably start wearing the federal armband soon in the Dail, and while picnicking with friends and family!

    • bonbon

      We are active on 4 continents, Ireland, and places you would never suspect.

      Political Sovereignty, as Arthur Griffith said in 1905, means nothing without political-economic sovereignty.

      First step to that: Glass-Steagall, splitting the banks, rendering synthetic debt null, and building up the economy to honor legitimate debt caused by 40 years of decadence. That means Hamiltonian National Banking and Public Credit, the sovereign right of a constitutional republic.

    • Deco

      +1 Clare Leonard.

      The people need to claim their sovereignty and stop paying up for these superstate structures whose modus operandi is the protection of the super rich.

      The super rich are in control, and this needs to be taken from them.

      And the starting point is for the 99% to have a proper discussion about what is going on. RTE News with up date reflections on the concerns to the bankers, and updates from politicians serving bankers is mush. And we are paying for such rubbish.

      More political options are required. And the people need to be encrouaged to understand that “freedom is something that you renew everyday, by your actions”. Borrowing to engage in circuses that undermine the mind is a sure way of undermining one’s freedom.

      In particular, the suburban male needs to switch off the remote control, get off the couch, leave the cans of beer, and start to wake up.

  39. Deco

    With regard to the Irish state system, nobody could call this country “anorexic”. More a case, of not as obese as before, but still clearly overwieght. We do not have auserity in this country. We are still borrowing for largesse to fund everything from millionaires working for the national broadcaster, to politicians in their 50s earning mega-pensions, to quango directors claiming massive mileage allowances to attend meetings where they never make any productive input.

    Greece is only still in the euro because Sarkozy’s policy of looking after failed gambler banks. Spain is only in the Euro because of the seismic damage it would cause to the entire system. And besides, let’s face it – the Spanish is playing hardball with Brussels, unlike our apologizers.

    The scale of the debt is so great that only money printing will prevent defauls in the banks and insurance sector. This menas spreading the pain from those who have on to those that work to have. The hilarious aspect of all of this is that often the left were traditionally advocates of this.

    I disagree with the prognosis that the US will rebound. Some regions of the US will rebound. But some regions of the US are as much in debt as Greece. California and Illinois are reaching the point where they will not be able to sell public debt anymore, and they are as badly run as Greece or Ireland with respect to public matters – in fact often they are run by the sort of politicians who would get rave reviews in the Irish media.

    California is leading the charge into debt disaster in the English speaking world. Ireland was leading the charge, until Ireland could no longer borrow.

    Weideman is correct. The Baltic Dry Index has slumped. The stimulus programs have stopped, because they were only of a temporary nature.

    We need defaults and liquidations to clean up the system.

  40. Clare Leonard

    I have a different perspective on this.
    We have approx. 493 million people in Europe who live under a political system no one voted for. We have 80% of our laws coming from a body no one voted for.
    When corporations (this time banking corporations)
    joint forces with government to exclude the interests of the people.
    The Italians call it FASCHISM.
    That is what we are living under,
    The sooner we face that fact the better.
    Please correct me if I am wrong.
    The first Lisbon treaty 453,00 people voted yes.
    That is 15.81% of the total Irish electorate.
    The second Lisbon treaty, after threats and big money interference from Europe’s elite, only 39.44% of the total electorate voted yes.
    Nice no 2, after more threats 30.99% of the total electorate voted yes.
    In the so called fiscal pact, after threats of no wages for the public service. ONLY 30% of the total electorate voted yes.
    It is impossible to build a democracy on a 30% yes vot.
    Not to mention the fact that no one else in Europe got to vote.
    We must face up to the fact that Europe is now being run by a bunch of unelected FASCISTS.
    Padser, we are a sovereign people, and as a sovereign people we can overturn and change any law we wish, we have NOT signed away our rights under the constitution.
    Unfortunately, for your children, my children and everyone elses children this is a global economy and a global problem.
    Perhaps it may be better to stand our ground and fight on our own turf.
    Unlike many, we still have a constitution.
    We the people, by the people for the people.

    • Deco

      There merging of state and corporate power is called Fascism.

      You have options in the democratic elections but they amount to the same thing, in terms of the policies that get implemented, with different groups being rewarded with other people’s money.

      Money has destroyed democracy, it has destroyed the public discussion, it has destroyed society, and now, it has destroyed the economy.

      There will be no reform or revolution. Instead there will be bread and circuses, until the system implodes. And there will be more moves to concentrate power, so as to control individuals.

      • bonbon

        Belief in money, that currency of whatever kind, has intrinsic value is the not only absurd popular opinion, but the suicidal one.

        As Arthur Griffith, Alexander Hamilton, Friedrich List all said, the productive powers of the nations people have value, so must be encouraged by a national commitment to progress to increase that value.

        Nothing spontaneously sprung from money by unknowable complex writhing, except the current financial disaster.

        The fawning admiration for money is deadly, and popular from Draghi to the voter. There is no point asking for a vote when the majority agree on this anyway.
        Sovereignty is impossible when this insanity holds sway. It must be publicly repudiated, that means economically.

    • padser

      Hi Clare,

      A political system in Europe, most likely reactively formed, and would serve well if the public were not so gullible being sold down the river by self interest at every level (yes that’s you and me too). There is one thing I’ll say about McWilliams and his ilk, they damn well told us ‘then’.
      We are a Representative Democracy “style” by virtue of the fact that we are a “Republic” but we actually aren’t a Republic on paper and in the minds of the Nationalist’s we are a Republic just because the North ain’t! Hell’ I get so confused sometimes, just how I am democratically aligned. But it is democracy nonetheless.

      I voted no in Nice I and no in Nice II….because then’ I was not so keen on the speed of integration with Europe. My sovereign mind extended to the nib of the pen and nobody stood in between. It is tempting now, just because we have the option in our Constitution to revoke….but I’m catching on to the idea that a Federal Europe may convey a more transparent democracy…..not unlike the description you wrote about.


      • bonbon

        “Transparent democracy”? Where exactly do you see signs of that? At the ECB board meetings perhaps?

        Blair says Europe needs good governance, due dilligence.
        Sounds wonderfull.

        • padser

          How bad could it be to take as much power from the clowns in the Dail, that abused the Irish financial system. Ultimately’ the less power I see individual member states getting that have ‘collectively thus inadvertently’ caused this disaster, the better! For various different reasons, people in Ireland did not chastise the Financial Regulators when it mattered. I doubt those same ‘various reasons’ could apply across a wider spectrum. In a sense it causes a reduction in the individual member states’democracy’, but only at Government level.

    • bonbon

      For all the people.

      Eire was founded by an economist, Arthur Griffith, who was in fact the first Irish President. He died with a couple of pence in his pocket later.

      He identified precisely the intrinsic flaw, not value, of British imperial economics. It is exactly the same flaw fawned over today by most quarters.

      We have a tremendous advantage!

  41. redriversix

    N.T.M.A selling 500 Million euro worth of 3 month debt bonds tomorrow offering a interest rate to buyers/Investors more expensive to us than the cost of money borrowed from E.C.B and they trumpet this has a continued sign of Ireland’s return to the bond markets…………it is nothing of the sort,Greece is able to raise this kind of money every three months………!!!!!

    Another waste of our money in the vain hope of Government trying to impress their E.U bosses,than trying to look after the Citizens of this Nation who elected them.

    Remember Noonans Magic trick with Anglo 3.1 Billion promissory note ?…His deceitful attempt at trying to tell the people he got some kind of deal on it,when his “deal” actually cost us a additional 940 Million euro MORE even though the “bond” was paid when it fell due..!!!! STAGGERING !!

    Timing of doing this is once again suspect as Minister Noonan travels the highways & byways of Europe looking for permission/support for some kind of debt write-down which he will not achieve unless he agrees to extend the term of the “loan” and agree to a higher interest rate…….!!!!

    These Govt ministers have proven time and time again to be unprofessional , untrained , and certainly not business people as the N.T.M.A proves time and time again.Incompetent,deceitful , and worst of all,easily influenced and weak.

    Fine Gael food & drink Bill in Mayo “think in” for two days is €9000.00….seems everybody has to tighten belts except them.Their eating it.we are paying for it…Enjoy.


  42. molly

    Do you ever notice on the television you would see country’s That are in major trouble ,you might see people ,starving,rioting,protests ect ect.
    One thing that always stands out no matter how bad things are the government is always well dressed ,well looked after.
    The government comes out with all kinds of speeches ,the people are wrong ,there trouble makers we have to do it our way,now look at Ireland it’s the same way ,the government tells us they are for the people,when did you ever see a government minister lead by example.
    Joan burton came out with a speech that because so many extra people where on social welfare that it was a struggle to find the money to pay them.
    Well if this government helped make real jobs instead of standing in the way there might not be the amount of people on the dole.
    What would the government do if there was no where for Irish people to go to and instead of leaving they would all be on the dole.
    The Irish government said they got a mandate to run the country ,that is a lie,because they told lie after lie to get into power so the mandate should be removed before its to late and they destroy what’s left of our country.

  43. redriversix

    Our P.R.S.I and associated taxes paid in to a social fund in the event of we losing our jobs….if they lost or cannot manage money,their fucking problem.

    Where did the money go.?

    • molly

      Badly invested and also used to pay for the well healed government and there cronies.
      You here all about the black hole in pensions and the lack of money ,it will soon become public record that there is simply such a short fall in money in the pension pot but wait to see who’s left to carry the can .
      It won’t be the government past and present or there cronies.

  44. Johno

    I have always known politicans are over paid but this takes the biscut in my mind. Disgrace. No wonder country is up shit creek.

  45. padser

    Where do I sign…Gay?

    Fine Gael MEP Gay Mitchell said today that greater EU integration can only be a good step for Ireland.

    “And also, by 2050, which is coming at us fairly quickly, Europe will be about 6% of the world’s population, and somebody said in parliament today that Germany and France wouldn’t even qualify for membership of the G8.

    Gay Mitchell’s statement today, as a compelling factor as to why we should Federalise quicker.

  46. Harper66

    “Why does matter now? On 1st October 2012, AIB, a bank which is now 99.8% owned by the State — it would be 100% except the State wants to keep the shares publicly traded. AIB along with the tiddly EBS which merged with it last year have thus far received €20.7bn of the €64.1bn directly given to the banks. It has received another €1-2bn in state-aid from NAMA which paid a premium for the loans it acquired from AIB. By any measure, AIB is without the support of the State an utterly bust bank. And yet it is paying €1bn to bondholders who would be burned were it not for the State.

    This coming Sunday will mark the 81st week of protest, and the communities have decided to extend the protest over three days to allow for protests in Cork and other counties and to conclude with a march on Tuesday 18th in Dublin from the national Garden of Remembrance at the top of O’Connell Street to Government Buildings where the Dail will be reconvening on the first day after the summer recess. The details and itinerary over the three days are here, they’d appreciate support along the way,”

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