Best of the Week
Most Popular
1. Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - Raymond_Matison
2.Uber’s Nightmare Has Just Started - Stephen_McBride
3.Stock Market Crash Black Swan Event Set Up Sept 12th? - Brad_Gudgeon
4.GDow Stock Market Trend Forecast Update - Nadeem_Walayat
5.Gold Significant Correction Has Started - Clive_Maund
6.British Pound GBP vs Brexit Chaos Timeline - Nadeem_Walayat
7.Cameco Crash, Uranium Sector Won’t Catch a break - Richard_Mills
8.Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - Dan_Amerman
9.Gold When Global Insanity Prevails - Michael Ballanger
10.UK General Election Forecast 2019 - Betting Market Odds - Nadeem_Walayat
Last 7 days
The Gold Stocks Correction and What Lays Ahead - 19th Oct 19
Gold during Global Monetary Ease - 19th Oct 19
US Treasury Bonds Pause Near Resistance Before The Next Rally - 18th Oct 19
The Biggest Housing Boom in US History Has Just Begun - 18th Oct 19
British Pound Brexit Chaos GBP Trend Forecast - 18th Oct 19
Stocks Don’t Care About Trump Impeachment - 17th Oct 19
Currencies Show A Shift to Safety And Maturity – What Does It Mean? - 17th Oct 19
Stock Market Future Projected Cycles - 17th Oct 19
Weekly SPX & Gold Price Cycle Report - 17th Oct 19
What Makes United Markets Capital Different From Other Online Brokers? - 17th Oct 19
Stock Market Dow Long-term Trend Analysis - 16th Oct 19
This Is Not a Money Printing Press - 16th Oct 19
Online Casino Operator LeoVegas is Optimistic about the Future - 16th Oct 19
Stock Market Dow Elliott Wave Analysis Forecast - Video - 16th Oct 19
$100 Silver Has Come And Gone - 16th Oct 19
Stock Market Roll Over Risk to New highs in S&P 500 - 16th Oct 19
10 Best Trading Schools and Courses for Students - 16th Oct 19
Dow Stock Market Short-term Trend Analysis - 15th Oct 19
The Many Aligning Signals in Gold - 15th Oct 19
Market Action Suggests Downside in Precious Metals - 15th Oct 19
US Major Stock Market Indexes Retest Critical Price Channel Resistance - 15th Oct 19
“Baghad Jerome” Powell Denies the Fed Is Using Financial Crisis Tools - 15th Oct 19
British Pound GBP Trend Analysis - 14th Oct 19
A Guide to Financing Your Next Car - 14th Oct 19
America's Ruling Class - Underestimating Them & Overestimating Us - 14th Oct 19
Stock Market Range Bound - 14th Oct 19
Gold, Silver Bonds - Inflation in the Offing? - 14th Oct 19
East-West Trade War: Never Take a Knife to a Gunfight - 14th Oct 19
Consider Precious Metals for Insurance First, Profit Second... - 14th Oct 19
Stock Market Dow Elliott Wave Analysis Forecast - 13th Oct 19
The Most Successful IPOs Have This One Thing in Common - 13th Oct 19
Precious Metals & Stock Market VIX Are Set To Launch Dramatically Higher - 13th Oct 19
Discovery Sport EGR Valve Gasket Problems - Land Rover Dealer Fix - 13th Oct 19
Stock Market US Presidential Cycle - Video - 12th Oct 19
Social Security Is Screwing Millennials - 12th Oct 19
Gold Gifts Traders With Another Rotation Below $1500 - 12th Oct 19
US Dollar Index Trend Analysis - 11th Oct 19
China Golden Week Sales Exceed Expectations - 11th Oct 19
Stock Market Short-term Consolidation Does Not change Secular Bullish Trend - 11th Oct 19
The Allure of Upswings in Silver Mining Stocks - 11th Oct 19
US Housing Market 2018-2019 and 2006-2007: Similarities & Differences - 11th Oct 19
Now Is the Time to Load Up on 5G Stocks - 11th Oct 19
Why the Law Can’t Protect Your Money - 11th Oct 19
Will Miami be the First U.S. Real Estate Bubble to Burst? - 11th Oct 19
How Online Casinos Maximise Profits - 11th Oct 19
3 Tips for Picking Junior Gold Stocks - 10th Oct 19
How Does Inflation Affect Exchange Rates? - 10th Oct 19
This Is the Best Time to Load Up on These 3 Value Stocks - 10th Oct 19
What Makes this Gold Market Rally Different From All Others - 10th Oct 19
Stock Market US Presidential Cycle - 9th Oct 19

Market Oracle FREE Newsletter

Stock Market Trend Forecast Oct - Dec 2019 by Nadeem Walayat

David Cameron Chose Well

Politics / UK Politics Dec 10, 2011 - 04:54 AM GMT

By: Paul_Tustain

Politics

David Cameron was today forced in Brussels to choose between the free market and the vanities of overreaching politicians...

Today is a very sad day. We believe that the markets are telling us that there is a horrible abscess in Europe, and that the Euro is the pus. We believe that fuelled by injustice, the infection of nationalism will now tear Europe apart - making outright enemies of Germany and Greece, France and Italy, the Netherlands and Spain.


Our European friends are today irritated by Britain's refusal to come to their drunken party. Not for the first time we are the odd man out, and being pointed at by the shallowest politician in Europe. It's OK. We can live with a little name-calling for the moment, and we look forward to quietly rebuilding our friendships with every one of you in the future. We hope it will be soon.

You are right. Our financial system contributed - in part - to the mess we are in. But you are wrong as to the reason and the solution. What happened is that over a period of years the political classes in London, New York and the smaller financial centres of Europe worked together to hold down the cost of credit. Ever since 2001 they suppressed the will of the market for higher interest rates. They did this to foster the 'feel-good factor' and to get themselves re-elected. It was the irresponsible and self-serving policy of elected representatives all over the western world, and it is without any doubt the root cause of the explosion of credit which we now have to pay for.

The result of the explosion of credit was an enormous pile of cash accumulated at the banks of the world. It represented the savings of an older generation, and there was far too much of it. It was lent very unwisely. That happens. It's life. And usually it means the creditors lose their money and gain some wisdom.

Only this time some of the creditors - particularly Germany and France - don't want to lose their money. They want to force two or three generations of Greeks, Irish, Portuguese, Italians, Spanish and Belgians to pay, pay, pay. Germany and France lent to your father, yet you become the indentured slave.

That should never be how bad money-lending is resolved. The lender should take the hit when the borrower cannot repay; it helps to focus his mind before he lends. In Britain we got rid of inter-generational debt servitude 200 years ago, and it is not progress to return to it.

As it happens in Britain we have the same deep insolvency problem to resolve, but it is going to be resolved in a different way. Our government is going to have to print to eliminate the debt - just watch. There is going to be a storm and Sterling will be murdered. Interest rates are going to climb sharply as world markets demand the return of their rightful position as the setters of the cost of money. Those rate hikes and concomitant inflation are going to eliminate twenty five years of savings, and twenty five years of a silly, credit-fuelled house price bubble. By the time it ends the creditors will have paid in full. Houses will be again affordable by anyone with a half decent job. Retirement at 55 will have been consigned to the dustbin. Student loans will have inflated to irrelevance, and Britain will again be a great deal fairer than it currently is.

In Europe you will doubtless laugh quietly as this storm hits us. But you will have no reason to make war on us, and you won't want to, because your strength will be all used up making war on each other. We do not believe that 1,000 years of carefully constructed and often hard fought mutual independence should be sacrificed on the altar of a bad monetary union. We do not believe the people of Europe will want it when nationalist tensions materialise. We think that Europe's political class is making a monumental error in order to hold on to something which carries their political credibility. We think they will fail and that Europe will suffer dreadfully for it.

It is a black day, because contrary to your belief we love Europe. We also love our free market and the way it exposes the vanities of overreaching politicians. Today you forced David Cameron to choose between the two, and he chose well.

By Paul Tustain

BullionVault.com

Paul Tustain is the founder of BullionVault.com – with 13,000 customers and $600m in gold bars, now the world's largest store of privately-owned investment gold bullion.

(c) BullionVault 2011

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Diane
11 Dec 11, 10:42
Well Said

Hello Paul,

I agree with what you hav said.

I was also filled with sadness when I heard the news, as it is a great shame that the European Union has failed to address their real problems.

I agree that David Cameron had no choice to do other than he did. If he had signed the UK up to the treaty, the consequences would have been far worse.

All best wishes,

Diane :)


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules