Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - 30th Nov 21
Omicron Covid Wave 4 Impact on Financial Markets - 30th Nov 21
Can You Hear It? That’s the Crowd Booing Gold’s Downturn - 30th Nov 21
Economic and Market Impacts of Omicron Strain Covid 4th Wave - 30th Nov 21
Stock Market Historical Trends Suggest A Strengthening Bullish Trend In December - 30th Nov 21
Crypto Market Analysis: What Trading Will Look Like in 2022 for Novice and Veteran Traders? - 30th Nov 21
Best Stocks for Investing to Profit form the Metaverse and Get Rich - 29th Nov 21
Should You Invest In Real Estate In 2021? - 29th Nov 21
Silver Long-term Trend Analysis - 28th Nov 21
Silver Mining Stocks Fundamentals - 28th Nov 21
Crude Oil Didn’t Like Thanksgiving Turkey This Year - 28th Nov 21
Sheffield First Snow Winter 2021 - Snowballs and Snowmen Fun - 28th Nov 21
Stock Market Investing LESSON - Buying Value - 27th Nov 21
Corsair MP600 NVME M.2 SSD 66% Performance Loss After 6 Months of Use - Benchmark Tests - 27th Nov 21
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With Fincrew.my - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Why BITCOIN NEW ALL TIME HIGH Changes EVERYTHING! - 22nd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Life and Times in Propagandistan

Politics / Propaganda Aug 15, 2014 - 11:45 AM GMT

By: Raul_I_Meijer

Politics

The UN said earlier this week that in east Ukraine over 1000 people – a conservative estimate – were killed during the last fortnight in the battles over Donetsk and Luhansk. Today, there are again reports of more heavy shelling by the Ukraine “army”, and dozens more deaths, while the Russian aid convoy is still not – allowed – anywhere near the cities.

At this rate, who’s going to be left to receive any of the food and generators and sleeping bags? I have a dark suspicion that if we don’t resolve this issue, and fast, we’re going to regret that for a very long time.


For “us” to be subsidizing this sort of military operation, a policy largely underwritten and justified by unsubstantiated blame claims in a media-wide campaign about a tragic plane crash 4 weeks ago to the day, is not something even a single one of us should be proud about, let alone happy.

We should all feel deep shame and guilt. How can we at the same time denounce one genocide and sponsor another? Our leaders may not care about a dead body or two more or less, but that doesn’t mean we shouldn’t either.

And how many hundreds of American soldiers are already back on the ground in Iraq again, while their army commanders emphasize the limited scope of air strikes? Are we supposed to just wait for the PR spin to serve up the justification for boots on the ground in their thousands? What’s it going to be this time? And how wrong is Ron Paul in suggesting this is a trap?

Whatever it is, we better make it fast, and step on the gas, or Europe will no longer be of much help. Well, either that or their domestic problems will; become the very driver for their involvement in warfare abroad. Even the Germans are sending support in Iraq now, right after the US announced they found there are far less Yazidi people on Mount Sinjar than someone told them there were. Perhaps they should all ask Putin to help. With both aid and intelligence.

And grout. The Mosul dam was built on gypsum and needs daily injections of grout – a liquified cement – or it falls to pieces. No need to bomb it. And that would mean flooding Baghdad – and the US multi-billion Green Zone. Mission accomplished.

However that may be, 6-7 years into the famed recovery, of which we’ve, come to think of it, seen about as little evidence as of the alleged rebel/Russian involvement in the plane crash, Germany’s GDP drops. Now, you’re thinking, so did US GDP earlier this year, and we spun our way out of that without a glitch. All under control, Captain, my Captain.

But Germany has 27 weaker vassal states on its back, and if it can’t even carry its own weight anymore, then what’s next? Obviously, there are plenty of experts claiming it’s a temporary thing, but when temporary gets to mean 6 years and more, it becomes meaningless.

Then again, so much in the propaganda machine we live in, that dictates what we think about the economy and about politics, is devoid of any real meaning, and the machine’s still going strong, fueled by the people’s unquestioning ignorance and their fear of losing their comfy plush caves. Baby, it’s cold outside. Older than Rome.

Spain was supposed to be the leading example of what weaker European brothers could do. Turns out, that was also just spin. Industrial production does not fall in economies recovering from gutter scraping circumstances. France is a basket case. A basket increasingly filled with stale bread and cheap wine.

Other EU nations report actual growth, but why should we believe any of them? Why should we believe any of this has to do with anything but appearances?

One country where keeping up appearances simply doesn’t work anymore – and that’s saying a lot these days – is Italy. A new young prime minister was elected on big promises – and already failed miserably. Nothing can save Italy as long as it’s part of the Eurozone. Or Greece, or Portugal, or Spain. Policies will be set according to what the richer nations want and need, and while the disadvantages of that can be hidden in times of plenty, they stand out all the more in poorer days.

On the surface, Italy doesn’t even seem to do that bad. It has a primary surplus, for one thing. It’s just that, as Ambrose Evans-Pritchard writes:

Output has collapsed by 9.1% from the peak, back to levels last seen 14 years ago. Industrial production is down to 1980 levels. [..] Bank loans to business are still falling at a rate of 4.5%. [..] The debt ratio may test 140% by the end of the year, uncharted waters for a country that effectively borrows in D-Marks.

It’s the debt that does in Italy, at least as long as it’s denominated in euros. Tempted by manufactured low yields on its bonds, Rome lets the debt soar on:

Ambrose calls for spending, he’s a Keynes man. To him, the failure is the resistance to more spending, in the spirit of the Fed, and Tokyo and Beijing, by Brussels – or Berlin.

But I think it would be, and would always have been, borderline lethal, since it would be like throwing debt on top of the debt Himalayas. There is a limit beyond which more spending cannot possibly be of any help, and the entire western world passed that limit many years and many trillions of dollars and yen and euros and liras ago. What’s left is the interest payments that are certain to burden us like so many Quasimodo’s for many years to come.

No, Ambrose has it right in some of his other comments

Mr Renzi is on his own. He faces an ECB that has fundamentally violated its contract with Italy, letting EMU-wide inflation fall to 0.4% knowing that this causes the Italian crisis to metastasise.

Italy must look after itself. It can recover only if it breaks free from the EMU trap, retakes control of its sovereign policy instruments and renominates its debts into lira, with capital controls until the dust settles. Italy would not face an immediate funding crisis since it has a primary budget surplus. Its net international investment position is -32% of GDP, compared with -92% for Spain and -100% for Portugal.

There is no easy way to leave the euro. The interlocking structures of monetary union have gone much further than a fixed exchange peg. Vested interests are powerful and merciless. But it is not impossible either.

The matter will surely come to a head as Italy’s debt trajectory hits the danger zone. This time it may not be quite so clear that the country wishes to be rescued on European terms. Mr Renzi may appropriately conclude that the only possible way to deliver on his Risorgimento for Italy, and to craft his own myth, is to gamble all on the lira.

I don’t see Matteo Renzi crafting his own myth, I don’t see him sticking around long enough. Someone’s got to take the blame, and no matter how much choice Italy has by now, there’s always room for one more.

But I do think that at some point Italy will see there are no other choices left but to be its own boss.

It’s just that the sooner it does, the better it would be by far. It’ll be much harder when everyone else is running for cover too.

It would seem however, that Italy’s own propaganda machine needs to be silenced first. And that’s never easy.

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.
Raul Ilargi Meijer Archive

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


Post Comment

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