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Tuesday, July 1, 2008 |
Spiegel: "Humiliation for Mr. Dollar: Ben Bernanke, the chairman of the United States Federal Reserve Bank, faces a general investigation by the International Monetary Fund. Just one more example of the Fed losing its power.
No Fed chief in US history has been forced to submit to the kind of humiliation that Ben Bernanke is facing.
This is partly down to circumstances. Inflation is going up and up, and this year's average will likely top 4 percent. But this time Mr. Dollar is also Mr. Powerless. He can raise interest rates in the fall, or he can pray, which would probably be the better choice. At least prayer would not prevent the US economy from growing, a highly likely outcome if interest rates go up.
After years of growth, the United States is now on the brink of a recession, one that is more likely to be deepened than softened by a tight money policy. Investments will automatically become more expensive, consumer spending will be curbed and economic growth will slow down, immediately affecting unemployment figures and wages.
Modern inflation is driven by the global scarcity of resources. Nowadays purchasing power exceeds purchasing opportunity. Most of all, there is not enough oil, and too few raw materials and food products. These increasingly scarce resources are becoming the focus of disputes among many people and billions of dollars are at stake.
For seven years, US President George W. Bush refused to allow the IMF to conduct its assessment. Even now, he has only given the IMF board his consent under one important condition. The review can begin in Bush's last year in office, but it may not be completed until he has left the White House. This is bad news for the Fed chairman."
Theoretically, the Bush dynasty is over and finished. If no cheating goes on the Democrats will take over power soon.
However - and this is very worrying - it is significant that Obama has much support from the American Jewish population. A nation on the brink of economic catastrophe can make strange moves. And if Israel intends to strike Iran during the change of power and the small period of power vacuum in the US - which I am sure Bush would be happy to extend as long as possible, they may think they have a strategic advantage and will get away with it, but they may stretch their luck a notch too far. The Israeli God may decide that enough is enough and his chosen people needs a dressing down. When a nation continues to create hostility it's luck is bound to run out one day. And this need only happen once.
The situation at the moment is very serious. Bush is an unguided missile and a war criminal. Israel seems to prepare for Armageddon. Worse is that if this happens it will not be a regional conflict. It will have worldwide consequences, not in the least in our economy.
Let's hope there are still people with some moral and political sense where it matters. Sometimes it takes more strength to prevent violence than to give in to it. The future and credibility of our Western civilization is at stake.
10:52:03 AM 
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© Copyright 2008 Hetty Litjens.
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