We seemed to have entered a period of post-Christmas hibernation. Our French family have returned and bedded in, one of our Grandsons took himself off to work in the French Alps and with eager anticipation we quietly await the birth of our fourth great grandchild in a few days. His (because apparently it is a "he") sisters are not quite so eager. “He’ll be a nuisance” “He’ll keep us awake at night” “We’re going to come and live with you” etc, but we just know that when he arrives they will become besotted with him, as we all will.
Now tranquillity is fine, but it’s boring and during this period my mind has gone into overdrive. My paternal grandmother was extremely poor, having become widowed at a very early age with 7 children to bring up. But by all accounts she was a suffragette and passionately interested in world affairs.
I think that I inherited her enquiring mind and recently this silly old woman has been wondering why we have a financial crisis. Where has all the money gone to? It has to be somewhere. Surely it can’t have just evaporated. I know that economists will explain to this illiterate old biddy that it isn’t quite that simple but I say why? Who has the money? Answer that.
The banks say they have no money to lend because they lost confidence in each other and consequently the inter bank lending rate (LIBOR) is too high. This is causing businesses to fail, unemployment and the property market has simply gone into freefall. So why, if the banks don’t trust each other, don’t they just borrow direct from Joe Public? At the moment Joe Publics savings are only earning a pittance in interest and some will, no doubt, be squirreling it away in a sock draw. Pay him a rate the equivalent to the LIBOR rate and hey presto, money will pour into the coffers again. Problem solved.
And in the middle we have Gordon Brown looking like a rabbit caught in the headlights, sloshing money around the banking system which immediately disappears into that terrifying black hole, creating more public sector jobs and, God help us, borrowing more money from the IMF.
And how come the IMF has money to lend? And where does the IMF get its money from anyway? From the Countries that it lends it back to? Does it do what it says on the tin? Is it funded by the nations to lend back to the nations? Now forgive me for saying this, but if that is the case it’s absolute bullshit.
I remember once reading that Stalin said the only way to defeat the western world was with drugs, pornography and industrial dispute. Well we have the drugs, we have the pornography and industrial dispute has been replaced with financial chaos. Do we have a hidden enemy at war with us? I have several suspects in the frame at the moment, but I think prudence dictates that I should to keep my own counsel on that one!
And finally .... Don't take life too seriously; No one gets out alive.
Richter cartoon caption - "Orthodox medicine has not found an answer to your complaint. However, luckily for you, I happen to be a quack."
9 hours ago