Central Banks Will Provide Unlimited Liquidity (Ludicrous Liquidity)
"In order to provide broad access to liquidity and funding to financial institutions, the Bank of England (BoE), the European Central Bank (ECB), the Federal Reserve, the Bank of Japan, and the Swiss National Bank (SNB) are jointly announcing further measures to improve liquidity in short-term U.S. dollar funding markets. . . ."
"Central banks will continue to work together and are prepared to take whatever measures are necessary to provide sufficient liquidity in short-term funding markets." ( Board of Governors of the Federal Reserve System press release, 10/13/08 )
Into the Hyper-Space of Hyper-Credit and Hyper-Debt: The Great Global Monetary Easing
Our global leaders' complete abdication of responsible finance has been planned at least for months. Not satisfied with the $516 Trillion in derivatives in the world (several times larger than total world GDP, which itself would be more properly called GDC for Consumption), Morgan Stanley's London co-chief economist Joachim Fels said back in March 2008:
"We're inching closer to the great global monetary easing."
German Totalitarianism Ascendant
NPR's appallingly biased coverage labeled the stock market's long overdue move downward toward realistic pricing as "irrational" (implying that the "mark to fantasy" bubble pricing was normal). Abandoning any shred of journalistic scrutiny, NPR obediently and unquestioningly repeated the world governments' spin that they "have no choice but to intervene for the good of the world economy."
Perhaps the translators butchered the language of Goethe but German Chancellor Angela Merkel issued this chilling declaration:
"In a social market economy, the duty of the state is to have control. The state is the guardian of order."
"An offer you can't refuse": Bailout Mafia force companies to take bailout.
Europeans Push Bush Doctrine of Preemptive War on Savers
The "crisis" does NOT justify the planned government ownership of companies, even if we accept the premise that people spend more carefully when they are not sure of price accuracy (which simply will not do, according to the bailout mongers):
- The preliminary necessary step of price discovery eliminates the purpose of the $700-Billion bailout’s existence before government buys a single mortgage.
- The governments' growing list of insurance guarantees against losses in case an asset/stock fails eliminates the purpose of government preemptively buying questionable assets/stocks before the asset/stock fails.
- If I had wanted to buy stocks, I would have bought them. I do not need Bush and Merkel hacking into my E*trade account to buy stock for me.
- George Bush, Barack Obama, John McCain, Barney Frank, Gordon Brown, and Angela Merkel ran the global financial system into the ground and now they fancy themselves to be "masters of the universe" who can outsmart the market by actively trading and timing stock picks. I would ask if you are ready to bet your own money on their abilities but the bailout means that you already are betting your own money on their stock wizardry.
- The completely unnecessary expansion of government ownership will leave the stock market comprised of 2 components, the sovkhozy (government owned shares), and the kolkhozy (ostensibly non-state shares but yoked to the "public good" of governments' hyper-debt policy).
The bailouts completely cut the economy loose from its moorings and cast you adrift in a sea of unknown values. Ludwig von Mises wisely predicted that the Soviet Union would collapse because its centrally-planned fantasy prices destroyed the information about value that market prices provide to you throughout your day, whether it is to buy a soda or a house.
Once the bailouts' unlimited liquidity (cash, credit, and debt) and unlimited insurance (increasing bad risks by hiding their costs) destroy price accuracy, wealth destruction and malinvestment will run rampant (as they did in the Soviet Union).
If you think a free-market bubble correction is risky, wait until you have experienced the government's continued enforcement of "mark to fantasy," Ponzi-scheme, bubble price-fixing.