Saturday, November 10, 2012
China has had phenomenal growth that slowed and now is continuing. The New York Times reports "the renewed growth has been fueled by rapidly mounting debt, as state-owned banks and the central bank have funneled hundreds of billions of dollars in additional lending to state-owned enterprises and government agencies to finance further investment projects." We could do this too. Our Federal Reserve could loan money to the national and state and local governments to build much needed infrastructure. We are mired in old thinking that austerity is the answer to unemployment. The debt of Chinese state-owned banks and the central bank is only a bookkeeping phenomena of no consequence. Central bank debt is just an accounting matter. It can go on until the economy can not produce further goods. The limit is the real capacity of the economy. Does anyone doubt that our economy can produce more?
Thursday, November 1, 2012
Romney received over 15 million from the government bailout of GM and its Delphi parts supplier. A hedge fund that Romney invested in bot the bonds of Delphi at a discount and then received more than they paid for them when Delphi was saved from bankruptcy. The trust fund moved most of the jobs to China and watched Delphi's stock price rise when it repudiated its pension funds obligations to its domestic workers. Of course in Republican fashion, it conducted a multi-million dollar TV campaign claiming Obama gave a handout to labor. All of this is reported in The Nation magazine of Nov 5.
It is bloody nonsense for Spain and Greece to not sell their bonds to the European Central Bank. They say they fear greater European control. Well let chaos reign from more labor strikes and human suffering!