Saturday, July 30, 2011

Making Sense of the Global Financial Crisis

For many, the global financial crisis and the meltdown in value of money and wealth, the increasing shortage of funds in government treasuries, banks and corporate coffers, the bailouts of Ireland, Portugal, Spain and Greece, with the possibility of the United States defaulting on its treasury bonds interest rate payments over one trillion dollars to China alone, is nothing short of mystery.

Nigel Farage, UK’s firebrand independent politician with a seat in the European Parliament has been calling for the death of the euro zone, claiming that it is a menace to the global financial system. Peter Schiff, CEO and chief global strategist of Euro Pacific Capital has been predicting the coming financial and economic collapse as far back as 2006 and 2007. Most dismissed his arguments as baseless and him as a chronic pessimist, although he had all the numbers right.

And on BBC, in order to make people understand what the crisis was all about, they introduced the Clarke and Dawes comedy show where one asked question and the other answered:

Q. How much does Greece owe ? 367 billion
Q. To whom? Other European countries.
Q. How much does Ireland owe? 865 billion
Q. And to whom? Other European countries
Q. How much do Spain and Italy owe? One trillion each
Q, To whom? Mainly France Britain and Germany.
Q. How will they pay all this money back? Other European countries will bail them out.
Q. From where will other European countries get the money to bail them out? How can one country that is broke bail out the other country is that broke hoping that a country which is broke can pay all this money back...did you include Portugal?” (more)