So. Just because a smallish country failed to pay a mere 1.6 billion euros and because China finally joined the rest of the globe – both moves being obvious for some time now for all who wanted to see – the 400 richest people lost a total of $70 billion.
Does any of this make any sense?
Why didn’t some of those guys get together and used their absolutely huge resources to do something to avoid their losses – saving the planet as a by product? And what’s the use of them being so ‘resourceful’ if they weren’t able to do this?
Things are even stranger because these guys can act without having to look over their shoulders. Political leaders depend on their constituents, the CEO’s of the big international corporations depend on their boards… the 400 depend on absolutely nobody but their own judgement.
Or maybe this is the real problem? That too many resources are concentrated in too few hands?
‘Too big to fail’?!?
Shouldn’t Warren Buffett and the company step on it about the Giving Pledge while there still is something left to give?
Not to mention the fact that we, the people, should hold our elected governments responsible for their shenanigans,,,
By the way. Taxing our way out of this huge imbalance wouldn’t work. It would just move concentrated decision power from one set of hands into another. The cause of what is going now is that power has become too concentrated for our own good, not who exerts it. Just take a peek back in history. Every imperium has crumbled under its own weight very soon after decision has become centralized. From the Roman Empire to the Soviet Union who tried to run a centrally planned economy. And the same is valid for economic ventures, monopolies end up badly.
PS I’ve just read an article by Hans-Werner Sinn, a Professor of Economics and Public Finance at the University of Munich, and President of the Ifo Institute for Economic Research who serves on the German economy ministry’s Advisory Council.
He analyzes the current developments as a ‘game’ between the Tsipras/Varufakis team – who are supposedly using the good cop/bad cop tactic and the ‘naive’ ECB who doesn’t make up its mind to start acting responsibly towards the profligate Greeks.
Maybe this is exactly the problem. Some of the top decision makers have forgotten that the ordinary people, those who bear the brunt of the decisions taken at the highest levels, are human beings. Not numbers to be interpreted using the ‘game theory’… or masses (herds) to be managed (manipulated) according to the latest ‘political science’ theories…
Further reading:
How we got here:
“Greek Debt Crisis: How Goldman Sachs Helped Greece to Mask its True Debt”
“Why Greece is in trouble (again)”
How some of the international financial institutions envision that the economies of the EU new entrants should be run:
“These public institutions, funded by taxpayers and owned by governments, have explicit mandates to increase local development in the countries where they spend their money.”
“Lidl has received almost $1bn in public development funding”
Time and time again history has taught us that systems where decisions are taken in a centralized manner eventually fail. The Soviet Union had a centrally planned economy and even privately owned monopolies end up in failure. United Fruit is only one of the many examples that we have at our disposal.
Going back to Greece we have two sides that have promised so much that they cannot back down without personal damage.
The Greek political establishment has promised eternal bliss for those linked with the state – and used borrowed money to fund their promises. Now, that the entire system needs a thorough reform no one is daring even to speak about this subject. Things there are compounded by the fact that the Greek bona fide entrepreneurs, those that keep the economy going, are used to dodge taxes – a somewhat understandable position, who would pay willingly knowing that the money would be squandered?
The European decision makers, those who have turned a blind eye to the Greek shenanigans and later bailed out the banks who have lavished money into those shenanigans, now have to explain to their constituents how come so much money has been sunk into this mess and why so much of it will never be recouped – Greece cannot ever repay the whole amount and survive as a working economy.
Quite a complicated mess that cannot be solved until all the cards are thrown on the table.
Deutsche Bank is sitting on more than $75 Trillion in derivatives bets — an amount that is twenty times greater than German GDP.
nicichiarasa 