This may sound a bit retrograde,or even corny and old fashioned, but real economics can only be founded on an agricultural system. This is the lesson that I have learned from the current crisis. We all know that green plants fix carbon and convert it into food which we can eat, even in the event of a drought or flood we can still rely on foodstocks. Investments in stock markets, on the other hand, generate more money for reinvestment, in the event of a crash, everything goes bust, and we all know that human beings cant survive on junk bond certificates. Subsidies by the US and the EU over the past few decades ensured that small farmers across the globe lost their livelihoods to the big names in industrial agriculture. Now the US is suffering for its protectionist policy. I am not religious or moral, but i can see that there is a lesson in this for all of us, it is about pride, suppression of the weak by the strong and the eventual payback that restores the equilibrium of things. We need to be realistic about long term growth, in fact we need to reinvent economics to ensure long term sustainability and equity of distribution. Until this is done, the economic world will experience crisis after crisis until it finally collapses. The real solution lies, not in adressing the problem at hand, it lies in understanding the meaning of humanity and nurturing the human spirit.
This is a good article as it enables lay people like me to understand the big picture. The USA has been collectively borrowing more than what it can pay for. I recall that in India, 20 to 30 years ago, we never borrowed, we made ends meet with what we had,and i am sure most Indians reading this will agree. For common people, economics in not reflected in GDPs, Growth and Exchange rates, or even knowledge of the fundamentals. From the perspective of the common man economics relates directly to security. After all none of us would like to drive around in a Ferrari purchased with credit, we would prefer to see our children get a better education. I have come to the conclusion that this whole economic illusion is just created to ensure that ordinary citizens "feel good". In the final analysis, human happiness is founded on faith in the system which he/she inhabits. I have more respect for a farmer who toils in the field and is carbon neutral, than for the CEO of a transnational corporation who jets across the world in a Learjet.
For too long, US has been indulging in finacial engineering out of bankrupt companies. Those in this trade get away with millions. These shenanigans have moved overseas including India. The huge bucks invoved have attracted talents away from hard core engineering disciplines. The old fashioned way of prudence and hard work have given way to sleek marketing.
The reality is staring at US. This could be the beginning of a slide into utter chaos. They are running trillion dollar deficits by printing money and issuing treasury bonds. The derivative instruments runs into trillions. Even Europe is infested now with one rogue trader ruining Societe Generale, the big French Bank.
US has no clue how to rein in on splurging as if there is no tomorrow. They are living on borrowed time. These gun slingers will face reality soon. The politicians do not want the public to know the truth or afraid of facing it themselves.
Who will pay the bills ultimately, not the Americans than I know of?
RE:Quick sands
by Siddharth Pandit on Feb 04, 2008 05:36 AM Permalink
You are right Ameircans are not going to pay for this. Because this (deficit) debt is mostly held by foreigners and the bankruptcy laws in America will be protect people who are declaring bankruptcy and will penalise people who hold such debts so it is buyer beware scenario for the bonds
When Bush started oil prices were $ 20 doller a barrel. Now $100, they are collecting the money thoughout the world. Still not help as the collected money goes to few pockets.
US soldiers and US Kids are worst affected by Bush's policeis.
Profits are only for US Oil giants, Military firms etc. they are awarded contracts without even bidding. How on earth this all could happen.
and till last week nobody knows something like this will happen.
RE:Greed and wrong policies
by Palani on Feb 02, 2008 03:09 PM Permalink
However he played an important role in the war against terrorism. he only helped to kill the tyrant saddam who killed thousands of innocent people. he is hunting the worst terrorist of of the world. America can not select him again as president because of the policy that one man cannot be nominated for the thire term as presiden. Otherwise American people will select him as a president once again.
RE:Greed and wrong policies
by Uruj on Feb 02, 2008 04:36 PM Permalink
You are a casualty of mass mis-journalism and widespread propoganda by the West. Come out of it and see the truth. The worst terrorist in the world resides in America - Mr.Bush.
RE:RE:Greed and wrong policies
by Khan Ashfaque on Feb 02, 2008 07:33 PM Permalink
Im with U.Excellent comment.Let us pray for ourselves. And Let the USA Doom.
RE:Greed and wrong policies
by Rahul Oberoi on Feb 02, 2008 03:45 PM Permalink
Chashma utaro hero Palani. Which wqorld are you living in ? Americans NEVER elected this moron Bush - it was becoz of his pop's connections at the hightes level that this clown has been sitting where he is. And for GWB killing the tyrant Saddam - Saddam killed thousands in your words, Bush has killed millions of innocent Iraqi's by simply lying. Everyone knows that the war on terror is an excuse to get their oil deposits. And if the war on terror is so much to him, why is he not attacking pakistan and if he really wants democracy why doesnt he attack China ? Naaah he cant - the chinese will whip his a$$.
Dude, its a$$lickers like you who idolize the US with rose tinted glasses on. Reality is a different ballgame.
US dooming in the short run could sound a doom for country like India too. But, If Indians can be the BEST bets for US corporation for Revival, India has plenty of such people.
If Our Govt Allows the Right things be done, India can do well even with the US Market dooming.
Let us pray for Ourselves. And Not American Economy.
RE:Let The US Doom
by chanakya maurya on Feb 02, 2008 04:11 PM Permalink
Praying is not going to help Bharatvarsh any more.
It is time to play.
And play very smart.
Not in the hands of the americans.
But putting our own mechanisms to work.
The first thing is to remove PC from North Block and let Reddy occupy that place.
Reserves should be gradually but totally and swiftly be transferred into Euros at least until the subprime criminals (yes they are criminals because they flouted the basic economic disciplines) subpoenaed tried and sentenced.
If putting all eggs in one basket (Euro) is not advisable by political and economic pandits, we must identify a bunch of safe currencies and put our money there rather than let monkeys like Ben and George handle our money.
RE:hmmm
by Anil Bharali on Feb 02, 2008 02:28 PM Permalink
Gulf countries's oil in concession plus looting has definiely coveredup Us economy.They (both US andUK) get oil ten dallars per barrel for next thirty years.That is the reason Bush was desperate to attack Iran.US wants to remain in gulf countries for their own interest in some pretext.
War in Iraq is killing US, as per Robert Kiyosaki "To make matters worse, the Iraq war is costing the United States $500,000 a minute. At the same time, President Bush vetoes health insurance coverage for the children of poor people. Something's very wrong with a nation that would rather spend money on war than take care of its children".
RE:Uncle has AIDS
by panacea industries on Feb 02, 2008 02:27 PM Permalink
The whole world is being made to pay for the illegal and barborous assault on Iraq.
