Loss Of Confidence In Governments Send Economies Spiraling Down

In 2008, the global financial system nearly collapsed from its own greed and wild, unregulated speculation on financial instruments that had little substance. Governments around the world then conducted huge bailouts and it was their citizens who paid the price for the financial folly.

Now governments are under fire. The U.S. and Europe are overwhelmed in debt, trying to convince jittery financial markets things are under control, when they clearly are not. So money flies all over the globe in a desperate search for safety, driving stock markets sharply up one day, abruptly down the next, while the bond and currency markets gyrate up and down in extremes, as do precious metals such as gold and silver.

Meanwhile, giant corporations are flush with cash but most are too nervous to invest it. They are hoarding so much cash, that Bank of New York Mellon is taking the extreme step of charging them to store it.

What does all this tell us? That Washington's gridlock and mushrooming debt and European Central Bank and International Monetary Fund lies about the fast sinking economies of Greece, Ireland, Portugal, Spain and Italy are fooling no-one. The loss of confidence in governments along with their rapidly mounting red ink will ultimately crash the global economy.

Dick
For more information, please see "A Question of Confidence: In '08, It Was the Financial System That Faced Extensive Doubts, Now, It Is Government," The Wall Street Journal, http://online.wsj.com/article/SB10001424053111903885604576488672973950288.html?mod=googlenews_wsj and "New Fee to Bank Cash," The Wall Street Journal http://online.wsj.com/article/SB20001424053111903366504576488123965468018.html