Everyone seems to know this except Barack Obama and the democrats. Then again, they probably are fully aware of their destructive economic policies. How can they not be aware? Nobody's that stupid.
Telegraph: Mervyn King, Governor of the Bank of England, fears that America shares many of the same fiscal problems currently haunting Europe. He also believes that European Union must become a federalised fiscal union (in other words with central power to tax and spend) if it is to survive. Just two of the nuggets from one of the most extraordinary press conferences I have been to at the Bank.You can watch video or read the text of King's remarks here. While I agree that the US shares Greece's debt problems, I would caution the nation states of the EU against creating a federal Leviathan with the power to tax and spend.
What with all the excitement yesterday over our new Government, I never had time to remark on the Inflation Report press conference. Most of our attention was on what King said about the Government’s fiscal plans (a ringing endorsement). But, as Jeremy Warner has written in today’s paper, it was as if King had suddenly been unleashed. Bear in mind King is usually one of the most guarded policymakers in both British and central banking circles. Not yesterday.
On a related note, Republicans have introduced a bill to prevent the European bailout. This news should add a little fuel to the fire. As should the fact that the Fed is swapping dollars for Euros, and the Euro just broke through it's 14 month low. So we're trading our worthless paper for their even more worthless paper, while incurring debt to do so. It's insanity.
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