Sunday, December 4, 2011

The Death Of The Washington Consensus

A small object makes a great one appear still greater. A great object makes a little one appear less.
David Hume, A Treatise Of Human Nature, Book II, Section VIII, p. 375

Did you enjoy that little market rally on Wednesday last? What was the up on the day in Toronto? About 400 points, thereabouts? Did you see that little low key explanation of why that little rally happened? It was the concerted announcement and move by six central banks, USA, Canada, Japan, And The EU Central Bank, to name a few, to facilitate interbank credit. It is clear that they are breaking a little unwritten rule that they said only recently that was not going to be done. The Oracle of Ottawa could not help but notice the gravity of this low key event. It seems to this humble blogger that the powers that be, have broken the first rule of the Washington Consensus . And that rule concerns fiscal policy discipline.

Washington Consensus - Funeral Arrangements
To Be Annouced...

But alas dear readers, it is too little too late. Although the Oracle of Ottawa is hoping he is wrong, the economies of the free world are so utterly and hopelessly fucked and weakened by decades of the Washington Consensus, that there is no hope for us now. Although the right wing master plan has been a total success, there are so many people broken and busted and the ones that were not broken and busted have gone to ground. Every one is too afraid too spend on just about everything. Frightened people don't spend money. They preserve it for the uncertain future ahead. And the future ahead is very uncertain indeed.

Some people in some countries are not going to play by the rules at any time. As a matter of fact, they haven't been playing by the rules at all, and they, I am sure are ready to pop this fact onto the world sometime in the near future. It will be a very rude awakening indeed! But hey, like the right wingers say, they have the right to fail. And the rest of us are just going to be collateral damage. The Washington Consensus was a huge success when you reflect upon it. To bad there is isn't going to be anything left to fight over...

On the verge of the last great train wreck, wait for it...

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