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Ian Welsh returns

Ian Welsh used to post extensively at FDL but has been absent for awhile; here is his latest from HuffPo.
"As the Euro and the Pound come under pressure bend over and kiss Europe’s economy goodbye"

"Notice, that while China has significant issues, it does not have this issue because it does not rely on hot money. No smart government should. Currency flows are far too fast, not only should there be a tax on all currency flows but every smart country should make it essentially impossible to move large amounts of money in and out of its economy quickly without taking a huge haircut. Flighty money is more trouble than it’s worth. Money that wants to come, and stay, and really invest in the economy should be welcome, but fast money should be heavily discouraged. The harm done by such money is far larger than the good.

Likewise the hot money needs to be taught a lesson. Such "investors" seem to think that they deserve higher than market returns in exchange for lending money. The people lending money are expected to bear all the risk, and expected to get less than market returns (since they’re giving the surplus to the hot money). Would you borrow money under such circumstances? Of course not, which is why no one who doesn’t have a sure thing does, which is why the economy doesn’t grow, because the idle money thinks it deserves most of the returns and none of the risk, and entrepreneurs aren’t interested in that deal."

From here.

And as DDayen points out, Wall Street has nothing to fear from the Obama/Geithner ‘financial reform’.

So when Obama touts that the legislation will end "too big to fail"(TBTF), someone, please, stand up and say the truth: "LIAR !!"

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ubetchaiam

ubetchaiam

Jobs I've had: mowing lawns,delivering newspapers,Bedding deliveryman, short order cook,vietnam vet,bookkeeeper in Fulton Fish Market,merchandiser/asst. buyer in Garment District,Womens shoe store salesman and asst.mgr.,wholesale egg delivery man,telephone company phone booth and car washer,taxi driver,mud carrier for bricklayers, college student,radio/tv repair training, fm disc jockey, dealer,Vegas bartender,registered commodity representative(broker and mgr.),programmer,systems programmer,systems engineer,pre and post sales engineer,computer admin, computer systems support,notary public and probably a couple of other jobs I've forgotten.

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