The best of Peirpont’s Dubious Distinction Awards in last weekend’s Financial Review is most worthy of a reprint. It’s entitled “Entrepreneurs of the Year”.
To some of the Asian migrants in Athens, who appeared on the streets in June at the height of the mayhem between protestors and police. The Athenians were throwing bottles and bricks at the rozzers in protest against proposed economic austerity measures and the police were throwing tear gas back. The Asians were pushing carts piled high with goggles and liquid Maalox, which they sold to the protestors as protection against the tear gas. If the Athenians had as much entrepreneurial resilience as the Asians, Greece would never have been in trouble in the first place.
The RBA’s recent rate reduction of 25 points was ‘passed along’ by the big banks. Or was it?
Prior to the RBA’s announcement earlier this month, the banks had increased the discounts they offer to the most creditworthy. A full 1% discount to standard variable home loan rates was available then, but following the RBA’s move, the best discounts were reduced, and the end result is a cut of as little as 5%.
So, while the politicians (and public?) think they’ve gotten a big break, it just ain’t so.
Bloomberg’s lengthy report this week that the U.S. Federal Reserve secretly gave the big U.S. banks trillions of dollars, not the billions that were reported publicly at the height of the GFC, was shocking. Even worse, the congressional oversight committees didn’t know about it. So, this band of unelected know-it-alls and their Wall Street cronies, the very ones who got us into the mess, dramatically increased the exposure of U.S. taxpayers without reference to the elected officials responsible for their supervision.
Today, the news is that the Fed is pumping more money (billions) into Europe. If that’s the public line, we must now question the magnitude of the real amount(s). The press isn’t helping; CNNMoney offered this ‘reassurance’,
“It’s important to note — the Fed’s funding does not come from U.S. taxpayers, and is independent from the federal budget.”
So, where does it come from? Oh wait, I know, they’re just doing a lot of creative accounting, which cannot be the answer to the unprecedented mountains of unpayable debt around the globe. Something’s got to give, and I’m afraid that it may be ugly in the extreme.