Firewall or Farce!

Firewall, or Farce?

I believe the medication is Bailout going by the name Firewall.

Spain is suffering 50% youth unemployment. If we wait long enough, the "50% of the unemployed youth" will become unemployed grownups. Will the Firewall be large enough to cover Spain's economic problems arising from the lack of revenue?

What I said of Greece can be applied to Spain. No economic development, no growth. No capital investment, no economic development. And Merkelism is still the solution based on the fear that someone, somewhere, is earning a living.

Slimviews (My unfunded, unsupported, non-profit, and--alas--unprofitable web blog has a few "best hit getters.")  These are the top three.

Too Greek to Fail. http://slimviews.blogspot.com/2012/01/too-greek-to-fail.html

Merkel's Last Stand. http://slimviews.blogspot.com/2011/12/merkels-last-stand.html

China! Economics! Diversification!
http://slimviews.blogspot.com/2012/01/china-economics-diversification.html

Next:

Add firewall to the cliches, slogans, and platitudes of those who've failed to propose a solution that may work.

Big Bazooka; Grown up in the Room; Full faith and credit; Millionaires and billionaires; Granny death panels; lock and load; double bazooka; kick the can down the road; and, now....Firewall.

Have the economists forgotten about the numbers. Oops! Poor example. "Some people use the facts the way a drunkard uses a street lamp. More for support than illumination."

Add to that the fact that everything that has been said by the Public Intellectuals has been descriptive, not prescriptive, it is easy to believe that the only consensus embraces whatever won't work, hasn't worked, doesn't work, and can't work.

"You cannot cut wages, fire people, raise property taxes, and call it a solution." Slim Fairview.  And, it certainly is not labour reform.

Now, The Chancellor has to face hostility and opposition at home.

Merkel has become Chancellor Bligh in the crow's nest ordering her crew to bail the boat.

"Chancellor, can we plug the holes in the bottom of the boat, first?"

"No. First you bailout the boat, then you plug the holes."

From the Quotations of Slim Fairview:

"There are no unintended consequences, only unwanted consequences."

Case in point.  For the purposes of illustration.

Assume every pastry chef in Greece, Spain, and Italy is fifty-three years old.  Assume further, that retirement for pastry chefs is fifty-three years of age.  If every pastry chef decided to wait ten  years to retire, you will have as many unemployed youth not becoming pastry chefs.

Why point this out?  Because one solution proposed to solve the EuroCrisis would be to delay retirement.  Well, okay, that would cut back on paying out pensions.  However, that would mean paying out unemployment benefits to unemployed youth not being hired as pastry chefs.  Do you see the conundrum?

Now, add to that the firing of some pastry chefs and cutting the wages of other pastry chefs.  The unwanted consequences?  More unemployed pastry chefs, pastry chefs making less money, and less money in the economy.  This is not labour reform in anyone's lexicon.  (And I did not yet mention raising property taxes.)

To understand how crucial some aspects of economic development are:

The Multiplier Effect

http://www.slideshare.net/slimfairview/the-multiplier-effect-4962273

Economic Stimulus

http://slimviews.blogspot.com/2011/06/economic-stimulus-by-metaphor.html

The above two are crucial in explaining (using metaphors) how economic stimulus works and explaining the multiplier effect.

Now for some analysis:

Have we followed Merkel's lead?  Yes.

Have conditions gotten better?  No.

Have conditions gotten worse?  Yes.

Conclusion?  Don't follow Merkel's lead.

Warmest regards,

Slim

slimfairview@yahoo.com

Copyright (c) 2012 Slim Fairview

All rights reserved.

Merkel Blinks! Slim Wins!

Merkel:  I will not let Greece Default.

Now that Chancellor Merkel has revealed that she alone is in charge, Merkel has also revealed she blinked.

Last week I received a retweet.  Sarkozy declaimed that Merkel is not the problem.  Who said Merkel was the problem?  To the best of my knowledge, I am the only one who's said, Merkel is the problem.

Merkel's Last Stand

Two Down, Merkel to Go.

The EuroCrats'  Trojan Plan: Destroy Greece!

Oops!  EuroGlitch

You Can't Fool the Lion

I said it at great length, in great detail, and in no uncertain terms.

Need I explain that the one pronged approach of Merkelism is a weapon not a solution?

Merkelism:  An economic system based on the fear that someone, somewhere, is earning a living.

"The rise or fall of the middle class is a leading indicator of a countries economic well being." Slim Fairview

China: rising middle class, rising economy.

India: rising middle class, rising economy.

Soviet Union: No middle class, no Soviet Union.

US: Declining middle class, follow the path of the trajectory.

If Greece needs to look to a model, try Poland.

The Greek government cannot cut wages, fire people, raise taxes and call it economic reform. That course leads to economic disaster.  However, more than losing the election by creating problems of austere proportions, the government worries more about the rhetoric of the solution.

People are finally conceding the call for Growth. Tim Geithner--finally. And Drs. Rogoff and Krugman--on Fareed Zakaria GPS--at odds on most things provided me with vindication, validation, and concurrence. They embraced the need for growth and that austerity will drive down GDP.

What do the EuroCrats fear?

To have growth, you need economic development.

To have economic development, you need capital investment.

To have capital investment, you need investors who expect to make a profit.

Privatisation is not a dirty word when the Greek bus drivers owns stock in the Athens Bus Company.  Remember Poland?  For decades, the Polish people were ground beneath the boot-heel of communist military occupation.  Where is the Greek Lech Walesa?

Bailouts are an expensive way to perpetuate an even more expensive problem.  Still.  You must do your reading assignment.

Merkel's Last Stand:  http://slimviews.blogspot.com/2011/12/merkels-last-stand.html

Too Greek to Fail:  http://slimviews.blogspot.com/2012/01/too-greek-to-fail.html 

Two Down, Merkel to Go: http://slimviews.blogspot.com/2011/11/two-down-merkel-to-go.html

China! Economics! Diversification!  http://slimviews.blogspot.com/2012/01/china-economics-diversification.html

You Can't Fool the Lion:  http://sidestreetjournal.blogspot.com/2011/12/you-cant-fool-lion.html

Your Dentist Can't Solve the EuroCrisis: http://sidestreetjournal.blogspot.com/2011/12/your-dentist-cant-solve-eurocrisis.html 

All crucial, essential, but not as essential as Chancellor Merkel Stepping down, and the EuroCrats embracing Capital Investment, Economic Development, and Growth.

Sincerely, 

Slim

slimfairview@yahoo.com 

Copyright (c) 2012 Slim Fairview

All rights reserved.