Arthur,
At 16:30 28/07/2009 -0400, you wrote:
(AC)
All depends on what is meant by melt-down.
An emotive metaphor too easily flung around!
(AC)
Printing money to stimulate an over-leveraged economy doesnt feel
right. Unemployment roles are rising with little indication that many who
are without jobs will ever come back into the labour force.
This, unfortunately, is true. If anything, the present credit-crunch will
accelerate the already-changing job structure (to something which I'm
tempted to call a post-service society) rather than change anything basic
to age-old economic transactions (which, some archeologists now believe,
even our side-kicks, Neanderthal man, was carrying out 40,000-odd years ago).
(AC)
Perhaps the new bubble is the belief that printing presses can run 24/7
with little or no consequence.
As you will recall, I wrote a week or two ago in personal correspondence
that, probably, Western governments will lose their nerve in applying any
more quantitative easing for fear of stoking up a potential dam-burst of
inflation (a more modest, and more accurate, metaphor!). I seemed to be
contradicted in the UK press a day or so later when it was confidently
predicted that the Bank of England was about to release another £25 billion
at their next decision meeting. (This is an unused final tranche of the
original decision.) In fact, they decided not to do so. Nor do I think that
Obama and Geithner will dare to do so in the coming months. It is already
apparent that the first tranches of the original "easing" have done nothing
to employment -- or at least so little as to be invisible.
Keith
Arthur
From: [email protected]
[mailto:[email protected]] On Behalf Of Keith Hudson
Sent: Tuesday, July 28, 2009 1:46 PM
To: [email protected]
Subject: [Futurework] [FW] No melt-down
The present world economy has been described recently on this List as
being in "melt-down". It's not in melt-down at all. The Western countries
are in a severe economic recession but China's production dipped only
slightly during the last six months and is already showing signs of
re-gaining its typical 10% economic growth. Protective trade tariffs might
well be applied by Western countries against Chinese goods -- or attempted
anyway -- but I really don't see how this could hold, politically, in
modern times. Consumer demand for the cheaper Chinese goods by populations
in recession would be very powerful indeed.
Nor will Western governments be able to impose higher taxes year after
year (15 to 20 years at least in the US, Japan and most West European
countries) on those fortunate enough to still be in work in order to pay
the massive debts of quantitative easing. Instead, governments will have
to cut back on government personnel and services. Leaks from the UK
Treasury are already talking about 20% cuts across all departments. Huge
changes are about to take place in all developed countries but it will
still not be an economic melt-down.
Keith Hudson.
Keith Hudson, Bath, England,
<<http://www.evolutionary-economics.org/>www.evolutionary-economics.org>,
<http://www.amazon.com/dp/1906557020/>
Keith Hudson, Bath, England, <www.evolutionary-economics.org>,
<<http://www.amazon.com/dp/1906557020/>http://www.amazon.com/dp/1906557020<http://www.amazon.com/dp/1906557020/>/> _______________________________________________
Futurework mailing list
[email protected]
https://lists.uwaterloo.ca/mailman/listinfo/futurework
