Bad Time Paves For The Worse
Dow is down nearly 4% today.
Morgan Stanley has cut the global growth forecasts to 3.9 percent growth from 4.2 percent for 2011, and to 3.8 percent from 4.5 percent for 2012, and announced today, the European Central Bank will have to reverse its rates policy—both the euro zone and the USA are “dangerously close to recession.”
It must be the time for the US Senate to investigate Morgan Stanley, just as they declared that they would investigate S&P for cutting the US rate from AAA+ to AAA. And of course blame it to Morgan Stanley for the nearly 4% drop in Dow today.
I think Morgan Stanley should have used the word “depression” since the world is already in “recession,” and however one massages the economic data, it is difficult to hide the truth anymore. It is attributed to Ronald Reagan: “recession is when the neighbors lose their jobs, and depression is when we do.” I know of many neighbors who are unemployed right now, so it must be recession.
It does not take a crystal ball to see what Morgan Stanley is seeing. The Tea Party philosophy is not dictating the US finance market, they are dictating the world. The banksters have ruined the world economy with artificial derivative instruments, and are now grinding it to halt with their sole remedy—cut expenses.
They have prescribed austerity measures in Iceland, Greece, Britain, Italy and the USA. They asked governments to cut down social programs, lay off government employees, and increase tax burdens on the poor; in short they had planned to bring the economic houses in order on the back of the poor. We however, did not come here with excesses of the poor; we came here through uneven distribution of wealth, executed through tax cuts and unethical business policies.
What’s the result of all those austerity measures anyway?
The weak economy grows weaker everywhere. Every person laid off from work stops buying anything except essential items, depressing the market further. This is Econ 101.
So my friends get ready—our leaders are not going to choose the only path to recovery—tax the rich—they are going to cut, cut and cut, until there is nothing to cut, and the condition becomes so wretched that none has anything to buy anymore, except the super riches.
And when that happens it would be a time for profound realization that excessive profit ruins capitalism, but then it would be too late to save the current system as it is.