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Western Economy - This Is As Big As We Will Get

Politics / Social Issues Sep 03, 2014 - 10:47 AM GMT

By: Raul_I_Meijer

Politics

This is it. This is the biggest we’re going to get. We won’t grow anymore. Not bigger, not wider, not taller (just thicker perhaps, in the sense of more stupid). I return to this from time to time, and still I never see even just one voice in the media with even one hair’s breadth of doubt about the overarching theme of growth at all costs. Is this a sign that economists and other poorly educated people have taken over the world, or is it simply what we are all programmed for?


The only discussion out there is how we can best return to growth. Never if we should return to it. But still, when I look around me I don’t have the feeling that we desperately need to grow bigger. That we need to consume more than we already do, that we need to drive our cars more or move into larger homes or buy more clothes or gadgets or anything.

At least 99% of the time I think that it’s all more than enough. And not just because of the damage our consumption patterns inflicts on our lives and our health and our planet, but certainly also because of what these patterns do to my own mind and soul.

To say that this is it, and we won’t grow any bigger, is not just some spurious remark. The world economy hasn’t actually grown for decades, other than through debt.

The credit issued by Jimmy Stewart in It’s a Wonderful Life could bolster growth. But in a world that’s steeped as deeply in debt as we have become, that debt actually turns into the opposite of growth. We know this happens when more debt is needed every day just to not shrink, like the Red Queen running just to stand still.

From that moment on, more debt can only buy you the appearance and illusion of growth, not the real thing. We passed that point some 40 years ago. If not earlier. You can argue about the exact timing. But not about the fact itself. Still, there’s no argument out there about either.

Joseph Stiglitz has a piece in today’s Guardian entitled ‘Capitalism Needs New Rules To Restore Postwar Growth And Stability’. It secures Stiglitz’s place in history as a useless man, not capable of original thought, like all Fake Nobel for Economics winners. They are people capable of thought alright, provided it’s limited to one dimension only.

The US is the undisputed best of the rest these days. Its GDP growth may be sucked out of some highly paid circle of experts’ thumbs, but at least it doesn’t yet shrink too dramatically. That the entire American growth recovery illusion has been built on ‘debtsand’ is complete and utter anathema. For obvious reasons.

Unfortunately for the American economy, the economies of rest of the world are not so fortunate. They can’t even keep of appearances anymore. Though, granted, that’s not for lack of trying. Which makes sense from the overall storyline point of view. Which dictates that we all must, and therefore will, return to growth. Viewed from that hilltop, any non-growth can only be temporary. And some economist will find the solution to the problem, at which point angels will start singing.

Japan may be the worst of the basket cases. We don’t see everything there is to see yet, since the Tokyo spin machine is perhaps the best asset the country has left. But there can be no doubt that Abenomics is going to turn out brutal. And for many Japanese already has. The last straw will be the GPIF, world’s largest pension fund, switch to stocks just ahead of a giant stock market crash. Then there’ll be nothing left.

China is an economic miracle that’s rapidly turning into a 1.4 billion people size disaster. An empire of debt built on plastic trinkets and quasi slave labor that’s seeing the rest of the world’s debt collapse devastate its own air castles. The unreal estate industry that made up over 20% of the economy has nowhere left to turn. Those local officials who borrowed the most are set to be either imprisoned or have their kneecaps redesigned by the shadow banking backers. Or both. The rest will try hard to fade into the background in some far away location.

Europe is awaiting one last cheap credit splurge that may or may not come, but in a giant spoiler alert we all already know the end of the story. Europe doesn’t just have the global economic meltdown to cope with, it’s also stuck in a horribly failed currency experiment that seeks to force people of very different cultures and languages into a straight jacket that’s already strangling and suffocating some 200 million of them.

Who will be increasingly subject to power politics and vested interests in Brussels, as their lives deteriorate in further decline. The only thing the EU talks about right now is who’s going to get the big jobs in the musical chairs of the new European Committee. It’s the politicians who are important, not the people. Still that’s an issue that will solve itself as circumstances get worse. It won’t be pretty, but it will be resolved.

But come on, who among you can look at the world, at your country, your town, your own homes and lives, and tell yourselves we’re not big enough yet? What more would you want to add? Once again I’ll ask: are you happier than your parents and grandparents? And if not, what exactly are you doing, what are you trying to achieve? Be honest, shouldn’t you lose a little weight?

I can’t leave Ukraine alone when the Kiev government insinuates that Putin has threatened to drop nuclear bombs on them. That’s way beyond the pale.

Just when you think things can’t get crazier, Ukraine’s Defense Minister Valery Geletey claims Russia has in the recent past repeatedly threatened nuclear attacks on Ukraine. That one takes the cake. That is to say, until tomorrow, when Kiev may yet again try to outdo itself in the realm of absurd allegations. Geletey also talked about the threat of tens of thousands of deaths in a ‘Great Patriotic War’, the worst in Europe since WWII. As in, worse than the Balkans.

Obviously, Russia would never threaten Ukraine with nukes, if only because there is no need. At the same time, something Putin actually did say was spun, in a case of deliberate misinterpretation, to insinuate that Russia has plans to conquer Kiev. What Putin really said – to EU head Barroso – was that Russia could take Kiev, in two weeks, if it wanted to. But if Moscow had any such plans, it would just do it, not announce it. However, there are no such plans.

The narrative continues to be built to prepare for the big NATO top September 4-5. There will be many voices calling for Ukraine to be made a member, so European soldiers can be sent into the country, and what’s left of the Donbass after months of Ukraine bombing can be finished of by NATO planes. Let’s hope that plan doesn’t come to fruition, because it would greatly escalate the crisis, and NATO has no chance of winning, it would only lead to more bloodshed.

A number of retired US Army, CIA, FBI, NSA and other intelligence officers sent an open letter to Angela Merkel to urge her not to fall into the NATO propaganda trap:

US Intelligence Veterans Urge Merkel To Avoid All-Out Ukraine War

We the undersigned are longtime veterans of U.S. intelligence. We take the unusual step of writing this open letter to you to ensure that you have an opportunity to be briefed on our views prior to the NATO summit on September 4-5. You need to know, for example, that accusations of a major Russian “invasion” of Ukraine appear not to be supported by reliable intelligence. Rather, the “intelligence” seems to be of the same dubious, politically “fixed” kind used 12 years ago to “justify” the U.S.-led attack on Iraq. [..]

Obama has only tenuous control over the policymakers in his administration – who, sadly, lack much sense of history, know little of war, and substitute anti-Russian invective for a policy. [..] Largely because of the growing prominence of, and apparent reliance on, intelligence we believe to be spurious, we think the possibility of hostilities escalating beyond the borders of Ukraine has increased significantly over the past several days.

Hopefully, your advisers have reminded you of NATO Secretary General Anders Fogh Rasmussen’s checkered record for credibility. It appears to us that Rasmussen’s speeches continue to be drafted by Washington. This was abundantly clear on the day before the U.S.-led invasion of Iraq when, as Danish Prime Minister, he told his Parliament: “Iraq has weapons of mass destruction. This is not something we just believe. We know.”

Photos can be worth a thousand words; they can also deceive. We have considerable experience collecting, analyzing, and reporting on all kinds of satellite and other imagery, as well as other kinds of intelligence. Suffice it to say that the images released by NATO on August 28 provide a very flimsy basis on which to charge Russia with invading Ukraine. Sadly, they bear a strong resemblance to the images shown by Colin Powell at the UN on February 5, 2003 [..]

[..] Although President Vladimir Putin has until now showed considerable reserve on the conflict in the Ukraine, it behooves us to remember that Russia, too, can “shock and awe.” In our view, if there is the slightest chance of that kind of thing eventually happening to Europe because of Ukraine, sober-minded leaders need to think this through very carefully. If the photos that NATO and the US have released represent the best available “proof” of an invasion from Russia, our suspicions increase that a major effort is under way to fortify arguments for the NATO summit to approve actions that Russia is sure to regard as provocative.

According to a February 1, 2008 cable (published by WikiLeaks) from the US embassy in Moscow to Secretary of State Condoleezza Rice, US Ambassador William Burns was called in by Foreign Minister Sergey Lavrov, who explained Russia’s strong opposition to NATO membership for Ukraine. Lavrov warned pointedly of “fears that the issue could potentially split the country in two, leading to violence or even, some claim, civil war,which would force Russia to decide whether to intervene.” Burns gave his cable the unusual title, “Nyet Means Nyet: Russia’s Nato Enlargement Redlines,” and sent it off to Washington with IMMEDIATE precedence. Two months later, at their summit in Bucharest NATO leaders issued a formal declaration that “Georgia and Ukraine will be in NATO.”

The conversation in the west should evolve around American and European, not Russian, involvement in Ukraine. But to get there, we would need actual journalists. There don’t seem to be any left. All we have is parrots, parakeets, chameleons and weasels. And obviously, the way we are fed information about our fatally indebted economies is very much like the way our media feed us misinformation about Ukraine and Russia.

By Raul Ilargi Meijer
Website: http://theautomaticearth.com (provides unique analysis of economics, finance, politics and social dynamics in the context of Complexity Theory)

© 2014 Copyright Raul I Meijer - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
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