14 July 2011

The Economist asks: Is deleveraging primarily to blame for the slow economic recovery in the rich world?

My answer to the question: The problems with the world economy are not founded upon spending or deleveraging, rather the primary failing inherent in all industralised national economic planning is an endemic failure to collect proper remittances.
Had Greece and Spain for example taken a path apart from their choice to decimate their revenue base by lowering corporate taxes by as much as 75% over the past decades, their social safety nets and consumer populations would not now be flopping like a fish on the pier, gasping for oxygen.
Ina addition, allowing hedge funds to play unchecked with the fortunes of financial markets with only 10% skin in the game while controlling potential assets nearly 1000% greater than their actual capital risk, markets would enjoy stable, fairly predictable growth. Boring, yet healthy in the continued growth of our capital societies.
Instead we remain mired in a world where bankers and petrochemical concerns rule the roost to the detriment of all others.
As an independent investment baker for a quarter-century, I can say without hesitation that my former industry is not qualified to self regulate and their hegemony over the process of our financial markets must end forthwith.
If in the USA, as one instance, were to enact a 0.5% fee on every financial derivatives transaction passing through our system, we'd have funding enough to employ, care for, and educate all while repairing our crumbling infrastructure and over a decade eliminating in toto our debt and deficit with a rainy day fund in the coffers.
Shame on all who fail to address the foolishness and corporate welfare practiced by our political institutions in support of corporate and banking institutions that constantly rob our nations' people without any consequence.

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