For centuries, until the Enlightenment I suppose, most societies lived in fear of their gods or god and felt the need to avert disasters by placating them, him, her or it in various bizarre ways.
Today all societies are in thrall to "the markets." This is as irrational as sacrificing a bull, lamb, virgin or whatever in order to produce a good harvest. It is ludicrous that the welfare of millions, in Greece, the US, Europe generally, the developing world, should be put at risk, not by belief in an external force over which we have no control, but by a few greedy and amoral men (and possibly some women) who it is perfectly possible to control if the world's politicians had the guts and integrity to do so.
I am not a money market specialist so do not have a comprehensive solution, but here are two suggestions:
1. A substantial Tobin-type tax on all monetary transactions, not just foreign currency transactions, to make speculation much less profitable and thus calm erratic fluctuations.
2. All purchases to be backed by actual money: that is, an end to borrowing or leverage.
Further, and perhaps more informed, suggestions welcomed.
The world's principal finance ministers need to get together, sink their petty differences and get tough in the interests of ordinary people whose welfare is being sacrificed at the altar of these false gods.
And do we really need to take so much notice, indeed go in fear of, the priests of "the markets", the ratings agencies, whose confidence in, for example, Iceland, was so far off the mark? It is worth asking whether S&P's downgrading of America's creditworthiness is based on sound analysis or an attempt to undermine President Obama, so he becomes subject to the jibe: "The President who lost us our AAA rating," (rather as the Tories used to mock Labour as "The party of devaluation" until they themselves discovered the short term virtues of economic stimulation by what has become depreciation of the currency.)
Saturday, 6 August 2011
Markets Rule - Not OK
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