With Hillary Clinton and Gordon Brown in Power, Capitalism is Dead

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Back in Old Blighty, pundits are trying to sort out what the Bank of England’s effective nationalisation of Northern Rock (LON:NRK) means for capitalism and for the current credit crisis. Let’s save them the trouble.

Capitalism is dead. With the current lot of central bankers on the job, Hillary Clinton headed for the White House and Gordon Brown pulling the strings at the BoE, we wouldn’t be surprised at the second coming of Karl Marx. His earthly socialist paradise is nearly complete. Now we just need to make sure all the cops have tasers to deal with any lingering public dissent.

Judging by the stock market, you’d think the worst is over. We suggest you keep an open mind. The Fed’s move is a giant attempt to change the subject, like a stupid party trick someone makes to distract you from the folks puking in the bushes. It’s worked for now.

 “Hold my beer and watch this,” are the famous last words of countless morons. Bernanke is at least in a sharing mood. “Have a beer and watch this,” he seems to have said. We can hardly bear to watch. But we can’t resist either.

“Is this the end of the story of crisis and contagion?” asks Martin Wolf in the Financial Times. “‘Far from it’ is my guess. If we can have such trouble with the financial system when the real economy is healthy, I tremble at what may happen when conditions start to become worse…The financial system looks more insecure than I feared. The unwinding of past excesses may well bring more unpleasant surprises.”

Hold on to your beer. This is going to be good.

Dan Denning
The Daily Reckoning Australia

Dan Denning
Dan Denning examines the geopolitical and economic events that can affect your investments domestically. He raises the questions you need to answer, in order to survive financially in these turbulent times.
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Comments

  1. Dan

    I disagree.

    In both Australia and the US the economic cards for the next three to five years have already been dealt by the neocons.

    In Britain, the Labour Party is not acting any differently to neocon Australian and US governments. In Europe, the Angela Merkel’s centre left government is arguing for tighter fiscal policy while French President Nicolas Sarkosy (formerly the right wing UMP leader) is arguing for looser fiscal policy. Hillary is not on this occasion responsible, not withstanding your suspicions to the contrary.

    In Australia, a Rudd Government would act no differently to a Howard Government on issues of fiscal and monetary policy.

    With the 19th Century vision of capitalism now thriving in Communist China, Capitalism is certainly not dead. It is however time to leave old, fixed concepts of capitalism, socialism and Marxism in the past as the world has moved on.

    The “Invisible Hand ” of the free market has succumb to a terminal case of Parkinson’s Disease. The consequences of this uncoordinated meddling may be felt for generations.

    It may me a long time until the DNA for a new hand is successfully cloned!

    Coffee Addict
    September 20, 2007
    Reply
  2. For there to be capitalism, I always thought one needed to have something called capital to deploy into the economy. While capital still exists (and is possibly still produced in some remote corner of the world), it has been considerably diluted and devalued by lots of debt being injected into the system for the last 20+ years. Of course it’s all denominated in the usual familiar currency units, so no-one notices. Dilution is now accelerating – I doubt that a beer will add much to the party atmosphere. Breweries may do well in any case.

    Reply

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