The Tally Stick

Taking measure in our times

Attali Warns of ‘Worldwide Weimar’ as Governments Print More Money

without comments

Jacques Attali is correct in his assessment on the current financial situation in the United States.  It makes me wonder if our elected leaders know how we bring money into existence.  Statistics show that foreign participation in our T-Bill sales has been steadily declining, 2 weeks ago we sold $60 billion in Treasuries and we only had 18% participation from foreign investors.  We now have the Federal Reserve talking about monetizing our debt to make up the difference.  The reason why the destruction of our currency is a possible outcome is because we are not hearing plans for us to reduce spending or creating jobs in the private sector that are sustainable.  The lack of real income is the core of the problem and until we address that without the answer being, expand government then I fear we will print our currency until foreigners will charge us more for their goods and we will push the market economy to the side and we will slowly turn into a control economy that will grow based on “top down” decisions from high up.

This situation happened in the U.S.S.R and it reduced their productivity to a point where the goods did not get to the place they were needed the most and people died in that process.  We need to put the brakes on our deficit spending and trade agreements that have reduced our middle classes income that has had a trickle down effect on the lower class.  The plan on infrastructure spending is a good idea but we need to take a little time to make sure we do the right projects so when all is said and done, we will have projects that will add to productivity down the road.

News Piece:

Imagine a country so ravaged by inflation that $1 will buy you 630 billion in the local currency, where a loaf of bread costs tens of billions, and where wheelbarrows are the new wallets.

That was the Weimar Republic in November 1923. A similar prospect may now await the world economy, says French economist Jacques Attali in “La Crise, et Apres?” (“The Crisis, and Then?”), a stinging new critique of the financial meltdown.

Attali, 65, served as a special adviser to French President Francois Mitterrand in the 1980s and later became the first head of the European Bank for Reconstruction and Development. He went on to found microfinance agency PlaNet Finance. In 2007, he steered a panel on economic growth that made recommendations to Nicolas Sarkozy, the current president.

In a telephone interview, Attali traced the roots of the current economic quagmire to what he considers a flawed ideology that warped the financial system:

Click Here to Read the Interview

Written by Tally Stick

February 2nd, 2009 at 11:30 am

Posted in Commentary

Tagged with , ,

Leave a Reply

You must be logged in to post a comment.