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"As for "austerity," though the word conjures up slow growth in the minds of many, economic history reveals spending restraint as a stimulant. Indeed, the problem today in a recessed Europe isn't governmental austerity, but the unsung reality that the latter hasn't yet been tried."

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the triumph of tory economics - innumerati continue to gripe

Context: newly released quarterly GDP figures appear to be poor.

Britain’s economic problems are being sorted out.

The UK’s biggest problem is the ridiculous debts run up by the previous socialist government.

Government costs are being sliced from every direction, which allows the tax producing part of the economy to start on the long road to recovery.

There is no election for 3 years. Let the socialists bleat. They are entirely irrelevant.

GDP figures are next to meaningless. Meanwhile, there are about 90 days in a quarter, and two-sevenths of them are weekends. That is, there are approximately 64 working days. One day extra holiday is therefore approximatrly 1.33%.

The highly dubious provisional GDP has gone down by around half that.

You really must panic right now, Eds Balls and Milliband say so.

first of a short series on free trade

A recommended scan.

“It is a bitter irony that the excessive power and prestige of the rich today are linked to free enterprise. Listen to this: “This disposition to admire, almost to worship, the rich and powerful, and to despise… persons of poor and mean conditions…is…the great and most universal cause of the corruption of our moral sentiments.” These are the words of Adam Smith, the 18th-century founder of free-market economics.

“For Smith and his followers, there should be no special class of rich people, no priesthood of business. Almost every man, says Smith, lives by exchange, most usually by exchanging his labour for money or goods. He thus becomes “in some measure, a merchant”; so markets are for everybody. These exchanges would not be made for long unless they were advantageous to both sides. The task of government and society is to establish the right legal and moral framework for the exchanges to take place, to keep the markets free. If they are free, they will tend to be equitable. If they are equitable, their participants – virtually all citizens – will tend to get richer.”

related material
Frédéric Bastiat—free markets

The notion of eternal ‘growth’ is rank irrationality. The real world is subject to reality limitations. These limitations apply however large or distant the resources may be. They are not affected by the nonsense developed by dishonest socialist government money manipulation.

If you borrow £1,000 or 100,000 for a house, or a few trillion if you’re trying to buy votes à la Obama and Gordon Brown, you can have a fine party on the loans.

Then comes the hangover as you try to pay back those loans.

Paying back the loans means a lower standard of living than you could enjoy previously, before after you took out the loan.

The UK is now working to pay down loans; starting by borrowing less each year. And beyond that, the government is repaying down Brown’s profligacy.

Of course, standards of living will recede during that process.

Only a crazy person, or a Socialist, would be babbling about ‘growth’ in this mess.

5 billion a month looks horribly like an opening door to fannie may

I am concerned by the volume of nonsense emerging from the recent Mansion House dinner.

Ring fencing won’t work; but far more troubling, 5 billion a month of buying in rubbish assets looks far too much like another government drug habit in the making. Just like socialist Johnny’s [Major] PFIs. Next it will be 10 billion and so on, until another great crash.

Large printing operations, under the the latest euphemism of quantitative easing, are very necessary as part of cleaning up the chaos of Brown the Clown and ‘New’ Labour.

But the sane objective is to stop that necessity as soon as possible. That objective is not to set up another permanent and ever growing added corruption, akin to that which bought down the USA money system.

other related links
telegraph.co.uk/finance
the real story of the fannies

fanny mae and freddie mac - a history
fanny mae and freddie mac - the best politicians money can buy?
fanny mae and freddie mac - clearing up the mess
fannie mae / freddie mac - a summary

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