Greece hasn’t defaulted (so far), but some of the buyers of credit default swaps, basically insurance policies that pay off if there is a Greek default, claim the terms and conditions of the bond swap constitutes a “credit event” or default. If it is, they want to get paid.

The proposed European plan is fundamentally flawed. It made no attempt to tackle the real issues – the level of European debt, how to reduce it, how to meet funding requirements or how to restore growth. Most importantly there was no new funds committed to the exercise.

It looks suspiciously as if Warren Buffett, for all his undoubted investment success, has never actually studied any monetary history.

With a combined GDP of $8.7 trillion in 2010, the BRIC economies already account for 45% of global economic growth

The commodity boom has created a “two track” economy. The mining and commodity boom benefits a small part of the economy whilst simultaneously creating problems for other parts. The mining and energy sector account for less than 10% of the Australian economy.

Occasionally we receive comments along the lines of ‘you try to push the market lower’ or ‘talk the market down’. Some mistake our realism for grumpiness. Or assume we just don’t like it when the stock market goes up. While flattering, we must admit we have no control over the stock market whatsoever.

There is a delicious irony in the world of economic policy at the moment. The Asian crisis back back in 1997 and 1998 was brought on by the same things that led to the current crisis in Europe and the US (and the one I believe is coming to China).

Not interfering with the market’s adjustment process is simply allowing Schumpeterian “creative destruction” to operate, and cleanse the forest. But that process is anathema to well-compensated entrenched interests that suckle from the teat of the State. Banks, for example.