If you are new to this blog, you are invited to read first “The Largest Heist in History” which was accepted as evidence and published by the British Parliament, House of Commons, Treasury Committee.

"It is typically characterised by strong, compelling, logic. I loosely use the term 'pyramid selling' to describe the activities of the City but you explain in crystal clear terms why this is so." commented Dr Vincent Cable MP to the author.

This blog demonstrates that:

- the financial system was turned into a pyramid scheme in a technical, legal sense (not just proverbial);

- the current crisis was easily predictable (without any benefit of hindsight) by any competent financier, i.e. with rudimentary knowledge of mathematics, hence avoidable.

It is up to readers to draw their own conclusions. Whether this crisis is a result of a conspiracy to defraud taxpayers, or a massive negligence, or it is just a misfortune, or maybe a Swedish count, Axel Oxenstierna, was right when he said to his son in the 17th century: "Do you not know, my son, with how little wisdom the world is governed?".

Wednesday, 22 August 2012

Greg Pytel: Still out of their depth

In the wake of the completely predictable - but for some reason considered by the mainstream media and politicians as "unexpected" - news that the UK government's tax receipts dipped last July, BBC Newsnight held a discussion between Jon Moulton and Jonathan Portes moderated by Gavin Esler proceeded by analytical material. Whilst Jon Molton was advocating further cuts in public spending to revive the economy, Jonathan Portes argued for more spending at the moment (and possible spending cuts later once the economy picks up). At one point Mr Molton concluded that the UK government did not have any other choice: either cut or increase public spending. Messrs Portes and Esler implicitly agreed.

As it has been shown in the articles on this blog the current economic situation was caused by the financial industry which was turned into a global pyramid scheme. The spending cuts would not revive the economy as any spending cuts would immediately start choking off the economy at the time when banks do not lend to businesses and are not in a position to do so. More government spending, Keynesian approach, would not work either as the additional spending would be stolen by the financial institutions and used as a part of propping up a pyramid scheme. This additional government spending would be converted into toxic waste held by the banks. One way or another it is the same net effect: no growth of the economy.

The discussion on BBC Newsnight showed, again, the nature of the current economic crisis. It showed that those who comment on it or deal with it are completely out of their depth. They are simply confused: Mr Moulton's alternative - cut or increase public spending - is a vacuous argument.

For years it has been argued on this blog that the very first step of any remedial action taken by the government to revive the economy, be it spending cuts or more spending, must be the liquidation of the pyramid scheme run by the financial institutions. Otherwise, one way or another, it will always be a good money thrown after bad, exactly what we see since 2008.

1 comment:

  1. as i say on Twitter: