From the Summit of the Moral High Ground

What is really going on and when did it happen? Do you want to know? I'm going to try to bring together all the economics posts of the last month and try to paint the picture of what is actually happening. Before you read on I remind you that ignorance is bliss. On the 27th October I postulated that the collapse of Dexia bank was just the first in a series of dominoes which would fall, well we now see the systemic collapse continuing throughout western governments and banks. The death of the monetary system has its main motive in the refusal of governments either to manage finances responsibly or to repay debt in the usual manner. Debt grows faster than the economies. The plan is to swindle via the hidden  inflation  tax in return. Greece and now Italy have tumbled because they are locked in a single currency and cannot unilaterally devalue. The creditors (the people who own the bonds) are not involved in the important decisions to debase the currency. Those decisions ...

Jersey is heavily exposed to the bond market according to Senator Ozouf, the paltry 9.17% return on Jersey's fund of funds, which would have been 30%+ had the fund simply bought gold instead, is riding the largest bubble in history — government bonds or sovereign debt. Capital is seeking security in bonds But bonds are not particularly secure One nation after another crashes Jersey's reserves are in that market Jersey has about £1.3 billion which would meet government expenditure for about two years, but this includes the Social Security and employee pension funds. Imagine this scenario: A major government has been forever borrowing from Peter to pay Paul, never lifting a finger to cut its deficits. Suddenly, global investors pull the plug. They dump the government's bonds like a hot potato. They drive bond prices into the gutter and make it impossible for the government to borrow another cent without paying sky-high, budget-busting inte...