From the Summit of the Moral High Ground

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...

Historical Archive This article is preserved as part of the historical record of this blog. It reflects the author's views at the time of publication. The content has not been substantively altered, although the HTML, accessibility and formatting have been updated to meet modern web standards. Since the day after the election, the news has been that things were not as good as they appeared during the campaign and were, in fact, very bad. If you had listened to Dr. Forskitt or me during the campaign, this was exactly what we had been trying to tell people despite the media blackout. As pension monies are withdrawn from the market and paid out, a collapse in share prices is inevitable. Between 2011 and 2016 the baby boomers retire. The latest post-election revelation was that the States Employees' Pension Fund was in deficit. Beneficiaries had already received an increase below inflation and it appeared that below-inflation rises would continue for the foreseeab...