by David Malone
The Irish banks need €24 billion. So now we know. WHAT?! Until we know WHY the losses keep on appearing like poisonous toadstools in the dark, then we know nothing.
Does anyone imagine that the reason why we now find that the banks need more money is because the previous four times the government inspectors simply miscounted how much was missing? This is getting frustrating. It’s like watching a simpleton who doesn’t realise you need to put a plug in the bottom of the bath, wondering why it won’t stay full. Every time he finds, to his amazement, that the level has gone down, he measures how much has mysteriously gone missing this time and tells his mate, “6 inches will do it. For sure.”
There is no fixed ‘amount’ the Irish, or anyone else’s, banks need. The amount they need depends on how much is pissing out of the huge hole in the bottom which the governments refuse to fix (bad loans/debts)
versus how little is dripping in the top (bails outs and economic growth). It’s not rocket science, it’s plumbing.
And does anyone remember this headline, “Japan to buy Euro debt“? “…particularly those in financial trouble”, it said. Oops! That was January of this year. The Euro rallied. Spreads on Greek, Portuguese and Irish debts eased. The wheel didn’t even fall off that plan. It blew clean off, then melted. Japan has hundreds of billion of euros worth of radioactive emergency it’s busy denying, playing down and generally pretending might not be there at all if it doesn’t look.
If Japan isn’t going to help buy European sovereign and bank debt who is? The Fed? America just breached its total debt ceiling again. Congress will have to vote yet another raising of the debt ceiling. Just like Japan has more than once so far, raised the limit of what is a ‘safe’ exposure to radiation. One day it wasn’t safe to drink the water, the next it was. The healing power of bullshit.
Stress tests, safe exposure limits is there nothing which our governments are not prepared to lie to us about? Is there there any moral test they won’t fail?
David Malone is the author of the book Debt Generation. You can read and listen to excerpts from his book here: http://www.debtgeneration.org/index.php