Over time in this blog I have deployed the term Western Financialism to describe an economy like the one we have in the United States. But what does that mean? To me, Western Financialism, focuses on consumer spending, particularly in the middle class, a la "middle class consumerism," over production and exporting, and to finance such spending, debt.
Western Financialism means running an economy in the least sustainable way possible, by relying on population growth, unaffected demographics (not yet indoctrinated in WF [China, India, South America, etc.]), and inflation as fuel for the continuation of growth. Maddeningly simple, and yet hyped as complexity, this kind of economy ticks not like an engine of growth, but like that of a bomb set to explode.
Western Financialism never seeks stasis, but always looks for fresh victims in order to sustain its ravenous feeding cycle. Western Financialism is a virus. Fresh off a trip to China to "encourage spending and decrease economic reliance on exports," please see older blog post here, Tim Geithner now speaks to the G20. While the Europeans seek to control their budget deficits in light of the current meltdowns of their member nations, Mr. Geithner, the current mouthpiece for economic recklessness has this to say:
"Stronger domestic demand growth in Japan and in the European surplus countries is needed," Geithner said at a separate press briefing in Busan. Spending in both areas is “relatively weak,” he said.
What is the European sentiment against which such a retort was drawn? (both above and below quoted from Bloomberg article, here)
While Geithner echoed the view that fiscal consolidation is needed, he said it should be done over the “medium term.” European officials said today that budget tightening needs to come next year, and German Chancellor Angela Merkel said that growth can’t come at the price of high state budget deficits.
So in keeping with his policy of fighting fire with fire, debt and spending against a backdrop of wealth destruction brought about by debt and spending, Geithner pledges his mind and diplomatic sway toward the ruination of others for the benefit of ... who? Politics and economics are inexorably linked. For this reason no man or woman has the balls to stand against this hypocricy and self-start a sort of economic Middle-ages where the tumult of times past are digested before an economic Renaissance could be born. For shame.
A dude I follow on twitter, @Dasan, wrote a book report, here, on The Big Short by Michael Lewis. He (Dasan) selected a few favorite quotes from the novel. A bit out of context, but give this quote, my favorite, a try:
After a meeting with Ken Lewis, CEO of Bank of America: “I was sitting there listening to him. I had an epiphany. I said to myself, Oh my God, he’s dumb! A light bulb went off. The guy running one of the biggest banks in the world is dumb!”When will that day come for the nations who listen, and are coerced into agreeing with, the complete economic nonsense bandied about by these politician-economists who fail to make tough economic decisions at home? Maybe that day has already come?
I wonder what America will look like as a 2nd World country. I think I will find out before my time passes.