What recovery was that then?

Chronic failure of analysis is the primary characteristic of allegedly expert and political scrutiny of recent economic experience. The Australian today reveals this yet again under this headline: “Global recovery stalled, says IMF, but Australia well-placed to weather economic turmoil”. Then:

THE recovery from the global financial crisis has stalled and the world economy faces increasing danger of turmoil and recession, the International Monetary Fund has warned.

But the Australian economy has more scope to adjust than most countries, with the ability to slow its return to budget surplus if conditions get worse, and it will be buttressed by the continuing strength in Asia, the fund says.

If the reporter cannot distinguish between the Australian economy in general and the budget of the federal government in particular, then it is indeed too much to expect anything more than this repetitive wailing by alleged experts, however mighty their position.

What all analysis known to me—not all available by any means—fails to note is that bondholders and others do not provide mark to market values of their holdings. That is, measures of institutional or individual worth have failed to acknowledge the serious loss of value of those holdings in the wake of the collapse of the US and other housing markets. It means that loans based upon real estate and other values in 2007 must logically be worth much less now.

Contrary to the parroted scribblings and preaching from  economists, politicians and other commentators, no economic recovery has evolved in the wake of the GFC. GPD figures used to convey such an concept are inherently false. Borrowings by governments, not only to rescue financial systems and, allegedly, to stimulate economic activity, only accumulate as debt. Some do very well out of it and for governments the further attraction of using such “stimulus” as electoral bribes is wonderful: the perfect combination of economic theory and electoral usufruct. And in Australia, just to deflect any potential criticism (particular after Rudd’s $900 giveaway to some), government dressed its stimulus as an “education revolution”.

And now it’s over. Only the bills remain. And they have teeth, very sharp teeth which will cut the ground from under many conceits over the next twenty or thirty years.

Intellectuals or persons imitating intellectuals have a great deal to answer for. Chronic lying, whether as self-deceit or deceiving others is bringing severe punishment upon countless millions utterly defenceless in the onslaught of intellectual and political treachery. And that’s without mentioning the big scam of climate change (apd)! Nor the slime-based popular culture that the australian government wishes to make immediate by spending in excess of $40bn on high speed broadband (the fly in the ointment is the price but let that pass for the moment).

The outlook, from various points of view is truly dreadful. At its heart lie a variety of interwoven deceits. Daily and other media do their utmost to ensure they remain hidden from view. The public is ever less impressed even if its responses thus far are inchoate. For Australia the hatred of the Prime Minister centres on one act of deception. Gradually that expands and deepens as it does elsewhere. The future has just begun.

Edmund Burke once remarked: “You can never plan the future by the past”. Yet have any governments based their economic policies on other than the past? No. And because of that corruption the future is cast. Hence the farce of the IMF today (and of the risible Wayne Swan)—and tragedy.


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