*Global growth is set to fall by 2.9%
*World trade is likely to shrink by nearly 10% *Industrial production in rich countries will drop by 15% from August 2008
*Developed economies will contract by 4.5% in 2009 and grow only in 2010 and 2011
*The US economy will decline by 3% *Private capital flows to developing countries are likely to be halved, from $US 707 billion (2008) to $US 363 billion (2009)
*Industrial production in developing countries, excluding China, is set to fall by 10%. *GDP growth in developing countries will fall from 5.9% (2008) to 1.2%.
“Mr Cheng [former vice-chairman of the Standing Committee and current head of the green energy drive] said China had learned from the West that it is a mistake for central banks to target retail price inflation and take their eye off assets. This is where Greenspan went wrong from 2000 to 2004,” he said. “He thought everything was alright because inflation was low, but assets absorbed the liquidity.”
Mr Cheng said China had lost 20m jobs as a result of the crisis and advised the West not to over-estimate the role that his country can play in global recovery. China’s task is to switch from export dependency to internal consumption, but that requires a “change in the ideology of the Chinese people” to discourage excess saving. “This is very difficult”. Mr Cheng said the root cause of global imbalances is spending patterns in US (and UK) and China.
“The US spends tomorrow’s money today,” he said. “We Chinese spend today’s money tomorrow. That’s why we have this financial crisis.” Yet the consequences are not symmetric. “He who goes borrowing, goes sorrowing,” said Mr Cheng.
It was a quote from US founding father Benjamin Franklin.”
Three things give this remark away, in my humble opinion as a long-time propaganda watcher.
1. The speaker is the head of China’s green energy drive. That means he is likely to be on good terms with the green energy people in the US government, the financial center of which is Goldman Sachs. Goldman Sachs has extensive ties with China’s state sector and is counterparty to huge derivative contracts with state banks and companies.
2. It is notable that Mr. Cheng’s language echoes the language of the left-liberal governing class in emphasizing the role of Greenspan at the expense of everything else. Greenspan, being a former Randian and an avowed libertarian, is expendable to this group. Cheng does not mention the role of cheap money, the creation and trading of mountains of derivative contracts, and debt-based policies that go back to long before 2004, and indeed long before Greenspan. He does not mention the Federal Reserve itself.
3. It’s also notable that Mr. Cheng echoes the left-liberal line about over-saving being a problem in China. But the problem is not thrift and savings (i.e. capital formation), which by definition can never be excessive in a capitalist economy where investment is put to work by genuine market forces. The problem ismalinvestment caused by manipulation of the interest rate. And that’s a problem in which the Federal Reserve’s role is critical.
*The derivatives are not mortgage-backed securities (the cause of the 2008 melt-down) but – likely- hedged oil futures in the OTC (over the counter) market, which is unregulated (that is, the SEOs hold synthetic longs).
*The threat – if it is that – has forced gold out of its summer trading range to within points of the $1000 mark, before falling back..and it pushed up the Chinese market by about 5%.(Sept 3)
*The counter-parties are 6 foreign banks, said to include Goldman Sachs, UBS, and JP Morgan. Goldman could take a hit on the contracts for around $15 billion, it’s rumored.
Note: The Chinese have been buying IMF bonds (50 billion) and watching the US meltdown and “stimulus” hocus-pocus with a good deal of warranted alarm, because all it means is their investments are being manipulated and driven down.
Obama’s reappointment of Bernanke was also taken as a bad sign by the Chinese. (correctly).
*Rumors have been swirling of further defaults of major US banks.
*The G20 has a preliminary meeting this weekend and the Chinese are said to have put the purchase of off-market gold on the table.
*[Oddly (?), Washington State is also where the earliest swine flu cases in the US were detected and where one of the largest outbreaks on campus just surfaced today – with some 2000 students at Washington State University coming down with the virus. Washington State had previously received large grants from Homeland Security for emergency preparations for pandemics, had TV Public Service Ads in place, had written up plans and practiced exercises].
Here’s a clip from early in the year that might interest libertarians who’ve been looking outside the US for farmland, in anticipation of any further worsening of the economy.
The video depicts the effects of drought in Santa Fe province….and makes a rather vague (and likely, insubstantial) reference to global warming.
But there are many other problems in Argentina besides drought – bad government policies, problems with squatters, the depletion of the soil from soy monoculture, the influx of genetically modified foods, and the relatively high prices of land in recent years.
And now there’s also increasing social unrest.
I was talking to some American friends who live in one of the north-eastern provinces, Misiones. They liked where they were, but there were certainly problems. Foreigners couldn’t own the land outright, since it was on the border. And the little enclave of immigrants didn’t always get on with other foreigners. On the good side, they thought the land itself was a natural paradise….
“A scientist who advises the Government on swine flu is a paid director of a drugs firm making hundreds of millions of pounds from the pandemic.
Professor Sir Roy Anderson sits on the Scientific Advisory Group for Emergencies (Sage), a 20-strong task force drawing up the action plan for the virus.
Yet he also holds a £116,000-a-year post on the board of GlaxoSmithKline, the company selling swine flu vaccines and anti-virals to the NHS.”
Note, 25% of that is in the form of shares, so he would directly benefit if the company’s stock were boosted by larger sales. But, apparently, he’s completely unrepentant about it.
There’s more:
During the 2001 foot and mouth outbreak, Sir Roy’s advice to Tony Blair led to the culling of more than 6million animals.
The previous year at Oxford University, Sir Roy was at the centre of controversy after claiming a female colleague had slept with her boss before getting a job. He was forced to apologize and pay compensation.
A university inquiry in the wake of the scandal found that he was in breach of rules by failing to disclose his business interests as director and shareholder of International Biomedical and Health Sciences Consortium – an Oxford-based biomedical consultancy, which had awarded grants to his research centre.
Sir Roy was forced to resign, although his career soon recovered. He moved to Imperial College within months, was made the Ministry of Defence’s chief scientist and, last year, took over as Rector of Imperial College, London where he earns up to £400,000 a year.
“State health commissioner P.N. Sreenivasachari told IANS: ‘It’s difficult to say why Karnataka, more precisely Bangalore, which is endowed with adequate healthcare facilities, is witnessing large number of swine flu deaths. We too are puzzled.
‘We can say the virus is already in the air and it’s time people became more aware and cautious to stop the spread of the virus. However, from the point of view of the administration, we have provided adequate healthcare facilities to treat swine flu patients,’ added Sreenivasachari.
Principal secretary (Health) I.R. Perumal said people should not get panicky.
‘People with swine flu like symptoms should immediately get themselves checked, as the city is well equipped to deal with the pandemic,’ added Perumal.
On Friday, two deaths were reported from Bangalore, one came from Bijapur.
My Comment
Why? I have no idea. More international travelers is one reason and a plausible one. But I confess I couldn’t help thinking about this piece I wrote in 2005, “Terror Hits Bangalore.”
One result of swine flu scare-mongering will be a shift of money to influenza research – hitherto absent in India. That means funding for drug trials. I wonder who the lucky drug companies are that will benefit?
The two states hit hardest are Karnataka (where Bangalore is) and Maharashtra (where Bombay is). Those are also the states that are the destinations of most foreign travelers and where India’s IT business and stock market are located. Bangalore is the home of a booming biotech business. And a locus of the anti-globalization movement as well. Just thinking out a loud…
Deaths so far are a hundred or less. That’s in a country of roughly a billion and a quarter where tens of thousands die from traffic accidents (300 a day or around 100,000 a year) and from water-borne diseases like diarrhea, typhoid, and jaundice. Hundred of farmers are committing suicide. None of that has qualified for the term pandemic….OR for the accompanying switch in research funding..
Here’s some information on malaria in India in 2008:
“While the official figures state that in 2008 India had 1.5 million malaria cases, resulting in 924 deaths, the real number of deaths is higher by several orders of magnitude.
“These numbers are a joke,” said Sunil Kaul, a doctor who works for a volunteer organization called the Ant that treats villagers. “In Assam alone we had at least 1,500 deaths last year.”
The real number of malaria-related deaths in India was closer to 40,000 in 2008, according to various non-governmental sources and some government officials who didn’t want to be named.”
Under-reporting and lack of knowledge about the disease are two of the main obstacles in retarding the spread of malaria. But interestingly, it’s also international organizations like WHO that obstruct progress in many ways:
“These problems are further complicated by foreign agencies such as the World Health Organization (WHO), which — under the influence of global lending agencies like the World Bank and big pharmaceutical companies — have pushed India to adopt prevention methods that don’t suit the local conditions and to initiate huge, ill-considered projects rather than targeted ones. ….”
One reader, commenting on my Berlusconi post, defends Larry Flynt’s attacks on Jerry Falwell (something I’ve written on before).
Note: Flynt attacked Rev. Jerry Falwell with a satire in print of the pastor having sex with his mother. Falwell sued Flynt and lost.
I decide to debate the assertions he made in his comment, point-by-point in this post, because they misuse language in ways that are quite common these days.
COMMENT: “I found Flynt’s raunchy satire of Falwell to be very funny and appropriate, although I can understand if others might have different opinions…..”
RAJIVA: Funny? Sexually and publicly humiliating someone in terms that rubbishes the most sensitive areas of their life – their family, their mother, their childhood affections, their sexuality, their religious beliefs, the public’s perception of their work as a minister, their capacity to perform professionally (counseling young people on sexuality or faith or family) – is “very funny,” and “appropriate”?
Actually, it’s considered torture (when done in the military), domestic abuse (when done in the family), and sexual harassment (when done in the work-place).
But it seems as though, if it’s printed, then suddenly it goes scot-free, it gets tagged “free speech.”
Well, some speech is not speech. It’s effectively action. And it should be treated as action.
Libel is a tort.
COMMENT: “He wasn’t attacking Falwell directly, so much as his absurd pompous messianic holier-than-thou persona and the oppressive and xenophobic underpinnings of his beliefs — the very same oppressive and xenophobic culture that was trying to silence and sue him.”
RAJIVA: You’re doing a lot of name-calling.
I disagree with Falwell’s fundamentalism. I never found him to be “holier than thou”. He was genuinely affable, as far as I could tell. Your opinion that someone else is personally xenophobic and oppressive doesn’t equate to their actually being those things, unless you show some evidence of injury, as I did in my previous response. Whatever Falwell said, he said quite courteously and even affectionately, when he spoke to Flynt. I saw them on TV (after the lawsuit, I believe).
COMMENT: The two had completely and violently opposing views on almost everything — I don’t see how anyone can be “cheerful” and “tolerant” and “reasonable” with someone who so thoroughly undermines one’s values.
RAJIVA: The essence of civilization and civility is to be tolerant of views that undermine your own. I have good friends who are evangelical Christians and devout Catholics. Many of them probably hope I will leave off my “heretical” views. It doesn’t bother me at all. And likewise, they aren’t bothered by my questioning of their dogmas. Ideology is only a dimension of personality…
COMMENT: Moreover, Falwell was not cheerful nor tolerant nor reasonable — he brutally tried to sue Flynt for $45M because of this insignificant work of fiction printed in his own private subscription-based magazine,
RAJIVA: You’re worried about the “brutality” of suing a man who made a huge fortune out of overtly misogynistic imagery of female sexuality (this is Hustler, not Playboy)….That’s a twist. Why should you “tolerate” any injury done to you? Do you tolerate muggers and bank robbers or financial criminals? Why should you tolerate vicious slanders in the media? Being civil in debate doesn’t mean you have to give up your legal rights, I hope.
The image was very damaging to Falwell and to his memories of his mother. It was degrading. How do you cap the monetary damages on that? Personally, I don’t think monetary damages alone are suitable for all torts. I think Flynt needed to have some small taste of what he himself had inflicted.
And it’s interesting that he ultimately did. His daughter accused him of incest, didn’t she?
Karma?
What’s more, it turned out, he was the incestuous one. Cheap psychoanalysis isn’t very useful usually, but in this case, it does seem that some compulsion made Flynt deride Falwell for exactly what he (not Falwell) was guilty of.
Shades of all those CEOs and political bosses who harass their female employees…. and then protect themselves by turning around and preemptively accusing disaffected employees of “stalking”… or in other ways undermining their professional claims. I’m talking about the sainted Bill Clinton, beloved of liberal feminists….and of a few other people……
I’m sure this satisfaction with punishment won’t sit well with those who see religious and spiritual values as all “milque-toast” and “mildness.” –
To me, that’s a sign of the decay in our sensibilities and the loss of the noble and chivalric value of honor, which is now confined to the Muslim world, or so it seems.
COMMENT: “Not to mention the far more insidious repressive venom he would spew to his students (all his draconian Religious anti-sexuality stuff, and twisted anti-free-speech poison).
RAJIVA: Did Falwell libel anyone when he was expressing his views? No. Then, those are precisely the views the first amendment is for, not for nasty, libelous attacks.
Also, disliking Hustler-type imagery and language don’t make you anti-sex or repressed, unless your idea of sex is not much more than what boys scrawl on bathroom walls. People can be quite sexual, and not want their sex lives displayed like graffiti.
Or can’t anyone tell the difference any longer? Throwing around the word “prudish” at anyone who doesn’t agree with your own level of tolerance for public coarseness is a misuse of the word.
COMMENT: I’m still not sure how the two managed to become friends later in life. (Also, unless there is more credible evidence — why doesn’t Tanya take a polygraph like her dad did? she already wrote a book about it — one can’t simply assume such character-assassinating crimes :b.))
RAJIVA: Again, most of your argument is personal bile, ad hominem, and assumption.
Jerry Falwell got on with Flynt at the end because, like him or not, Falwell took his religious beliefs seriously, and really did feel he could “hate the sin and love the sinner.” That may not sit well with the left, but my opinion of him has nothing to do with his political views or his dogmas – none of which I share. My opinion of him is based on my perception that whatever he was otherwise, as a public person, he presented himself genially, affably, and reasonably (
[Correction: I should add the phrase ‘when speaking to other people.’ It is true that Falwell used harsh language about groups of people, but that was language based on evangelical and fundamentalist criteria that he held about their behavior. This was the argument I made in a piece called, “God’s Son, Falwell’s Mother, and the Rest of Us Ho’s”].
He did not deserve the filth slur thrown at him by Flynt, he was a better man than Flynt
(Correction: I should add the phrase – ‘in this respect’), and Flynt recognized it at some level….
Update: The fact that through most of history both secular and religious thinkers have regarded homosexual behavior as morally wrong can provide some rational justification for differentiating between Falwell’s attacks on homosexual behavior ( in language like “part of a Satanic system”) and any other random personal attack on another human being. There is a distinction that can be made between those two types of attacks.
Camille Paglia makes this point in an essay she wrote about a Martha Nussbaum critique that I’ll try to link here…
1.Shortly after blogging on certain ongoing and past problems, I got two emails. Each of them is from an IP from my residence in the US… and now here abroad. The messages were odd and mildly threatening.
2. RSS feeds and twitter have been broken – for some time apparently.
3. And now, the latest – my wiki entry (set up by others) has been tagged to be deleted. Why now suddenly? After 5 years and support by numbers of people? Editing is one thing. Why tagged for deletion?
They proved to me by convincing reasons that God does not exist; Afterwards I saw God, for he came and embraced me. And now what am I to believe- the reasoning of others or my own experience? Truth is what the soul has seen and experienced; the rest is appearance, prejudice and opinion.
— Sri. Aurobindo
[Aurobindo, one of the brightest minds that ever existed, a poet, polymath, revolutionary turned sage, and author of some of the most profound books ever written, is for me the central figure of modern India – not Gandhi. And he is for me also the central figure the West has to adopt from the East…]
Bad thinking and bad actions are more closely connected than we think.
Inevitably, bad ideas give rise to questionable ethical propositions.
I am just realizing it after reading Doug Casey’s recent attack on charity ….
by which he means business philanthropy..
Which is of course only one part..of “charity””
So much confusion of terms..so many questionable assumptions
It was a disappointment.
Filled with arrogance…
Inner law, outer law – perish them all, we’re libertarians – a great, unwashed mass of yahoos who feel it’s ok to do just about anything , because – blimey – Doug Casey, latter-day casuist and emeritus professor of ethics — in between land speculation and stock-pumping – has just discovered that the best thing we can do in life is to do whatever we want however we want – because that makes it better for everyone else..
Oh yay. What an insight.
How did I miss that..and all those idiot moralists and artists who thought differently – various nonentities who didn’t amass wealth through speculation..why, they’re just envious fools who got what they deserved..
Casey succumbs to theory..and bad theory, at that.
Although, any theory about ethics at all, if it pretends to rest on its own logical machinery is on its face bad.
All true ethics proceeds from the practice of an ethical life. Not from theory.