So what next?

OK, so the banking crisis hit. Lehman’s collapsed and banks need bailing out to stop them going to the wall. Then they needed more. Now it seems some major non banking companies are going for handouts. This last point is a fascinating study in social economics. What happens if thousands of corner shops start keeling over due to poor management and not seeing this whole situation coming? Will they be able to ask for handouts because of their own incompetence? Hardly, but then they don’t really bring votes do they. Now on this last point far be it for me to infer that certain industries are being chosen now because of the impact their collapse would have on a voting public, I digress. So all the above still does not seem to be stopping the rot, so central banks slash rates again. This time the Bank of England has reduced rates to a point unheard of in living memory. But what’s this? The retail bankers are pointing out that this makes little difference as the cost of lending to each other remains steadfastly higher. Now at this point, one should kick off one’s shoes, put the aching feet up and reach for the Port, as this could prove to be more spectator sport. Sure enough it does.

Slowly but inexorably the battle lines are being drawn. Yes the Governments have bailed out the Banks around the world. But the realisation is dawning on them that this action has not created a pet for them to show off whenever they feel the need to buy some votes, no indeed. The banks, on the other hand, are learning fast that there is a hefty price to be paid for allowing these new masters in disguise into their portals, watch this space.

But what of these leaders of countries? What exactly are they doing? Well old Gordy Broon is strutting his stuff, telling anyone within earshot that his way is the only way, less said there I think, don’t you? George Dubya doesn’t really care any more, he’s had enough and now looks forward to moving to his new home, in an ultra-chic North Dallas enclave of Preston Hollow next year. Sarkosy, on the other hand, still dives about with all the energy of a whippersnapper overdosing on Red Bull. His latest idea is to throw more money at the problem. I am just so disappointed in these Politicians aren’t you? Can’t they think of something else? Sorry, scrub that question, of course not, they are Politicians and as such have the imaginations of retarded toadstools.

So anyway, it seems ‘Sarko’ recently announced a $33 billion economic stimulus plan, including cash payments to the poor, a bigger rebate on new-car purchases and a speedup in high-cost public works projects. This is after, of course, he has had another jibe or two at the cause of all this, the dreaded Americans.

The extra government spending in France, one of the 15 euro countries, implied a willingness to assume further public debt, already estimated at more than 3 percent of the French economy, and contradicted Sarko's campaign pledges to cut official spending and produce a leaner government. But officials emphasized that the measures were designed to be temporary and that much of the money could be considered investment that would bring growth. Don’t say a word dear reader, just take a deep breath; we can all see where this is going to end up, why don’t they? Simple, I refer you to 2 paragraphs above.

"We do not have a choice," Sarko said in a speech at Douai, in northern France. "Doing nothing would cost us a lot more…” That would be a bit like your normal way of doing things then would it?
Critics, however, accused Sarko of doing too little, too late. "These are baby measures, not in proportion to the problem," said Ségolène Royal. Sarko delivered his speech next to a Renault plant, never one to miss a trick is he. "Our response to the crisis is investment," he said. Meanwhile The Finance Ministry's National Institute for Statistics and Economic Studies reported in early December that unemployment rose by a tenth of a percentage point in the third quarter and now affects 7.3 percent of the workforce in mainland France. The numbers confirmed anecdotal reports of job losses across the country since the slowdown began

One of these fine days our self important, self congratulatory, puffed up, pompous politicians will wake up and smell the coffee. Meanwhile we just keep on keeping on.