Tuesday, July 7, 2015

I Said, THE FUNDAMENTALS ARE SOUND!

Isn't anyone listening?
The CSI300 index slumped more than 7% at the open and was down 4.8% at 3,739.18 points by 2.08am GMT. 
The Shanghai Composite Index dropped 8% and was down 4.7% at 3,551.13 points by mid-morning. 
China stock futures pointed to further losses. 
Losses on the mainland also weighed heavily on Hong Kong shares, with the Hang Seng Index down 3.3% and shares of Chinese companies listed in the city falling 4.2%. 
As the markets opened, only 11% of companies on the two key mainland markets were still trading. 
Christopher Balding, a professor of economics at Peking University said that while it was not possible to know exactly why so many companies had suspended trading, a large number were doing so because they had used their own stock as collateral for loans and they want to “lock in the value for the collateral”. 
“Today is all about China, with Greece in the background now that it’s been given a new deadline,” said Ayako Sera, a senior market economist at Sumitomo Mitsui Trust Bank in Tokyo. 
“Shanghai’s early losses were like a cliff-dive, which had a huge impact on investor sentiment.”
What fundamentals?

Imperial Panorama: A Tour of German Inflation

Walter Benjamin (1925-6):

“1. In the stock of phraseology that lays bare the amalgam of stupidity and cowardice constituting the mode of life of the German bourgeois, the locution referring to the impending catastrophe — that “things can’t go on like this” — is particularly noteworthy. The helpless fixation on notions of security and property deriving from past decades keeps the average citizen from perceiving the quite remarkable stabilities of an entirely new kind that underlie the present situation….”

“14. The earliest customs of peoples seem to send us a warning that in accepting what we receive so abundantly from nature we should guard against a gesture of avarice. For we are able to make Mother Earth no gift of our own. It is therefore fitting to show respect in taking, by returning a part of all we receive before laying hands on our share. This respect is expressed in the ancient custom of the libation. Indeed, it is perhaps this immemorial practice that has survived, transformed, in the prohibition on gathering forgotten ears of corn or fallen grapes, these reverting to the soil or to the ancestral dispensers of blessings. An Athenian custom forbade the picking up of crumbs at the table, since they belonged to the heroes. If society has so degenerated through necessity and greed that it can now receive the gifts of nature only rapaciously, that it snatches the fruit unripe from the trees in order to sell it most profitably, and is compelled to empty each dish in its determination to have enough, the earth will be impoverished and the land yield bad harvests”

Austerity vs. Stimulus: Ignoring the Inherent Contradictions of "Growth"

Jennifer Hinton at the Guardian:
The issue of austerity versus stimulus is often framed as the entire debate – if you don’t support one, you must support the other, because there are no alternatives. This is the same binary debate that has been going on for more than 100 years between the state versus the market. Yet, these dichotomies distract people from thinking about what’s really important – the goal of these policies, which is to grow the economy. 
No analysis I’ve read thus far has questioned the damaging role that the endless quest for economic growth plays. Neither austerity nor government stimulus will ever be able to address the debt crises and recessions of the twenty-first century because what we’re dealing with here is an inherent contradiction of capitalism.

Wednesday, July 1, 2015

#MerkBeth


The Cover-up is Alway Worse Than the Crime

The crime:
Nobel laureate [Stiglitz] tells TIME that the institutions and countries that have enforced cost-cutting on Greece "have criminal responsibility"
The cover-up:
"Greece is in a difficult situation, but purely because of the behaviour of the Greek government ... Seeking the blame outside Greece might be helpful in Greece, but it has nothing to do with reality," said Schäuble. "The Greek government is not doing its people any favours at all if it keeps making completely false statements. Nobody else is to blame for their situation. It’s all very sad. We’re in a much harder situation than before. It was always difficult. But it has just kept getting more and more difficult since January." 
Follow the money and it is clear that Schäuble is lying. He knows he's lying and he knows we know he's lying. The bluster is meant to paralyze criticism with its audacity.