Guest Post by Jim Kunstler
While the folks clogging the US tattoo parlors may not have noticed, things are beginning to look a little World War one-ish out there. Except the current blossoming world conflict is being fought not with massed troops and tanks but with interest rates and repayment schedules. Germany now dawdles in reply to the gauntlet slammed down Sunday in the Greek referendum (hell) “no” vote. Germany’s immediate strategy, it appears, is to apply some good old fashioned Teutonic todesfurcht — let the Greeks simmer in their own juices for a few days while depositors suck the dwindling cash reserves from the banks and the grocery store shelves empty out. Then what?
Nobody knows. And anything can happen.
One thing we ought to know: both sides in the current skirmish are fighting reality. The Germans foolishly insist that the Greek’s meet their debt obligations. The German’s are just pissing into the wind on that one, a hazardous business for a nation of beer drinkers. The Greeks insist on living the 20th century deluxe industrial age lifestyle, complete with 24/7 electricity, cheap groceries, cushy office jobs, early retirement, and plenty of walking-around money. They’ll be lucky if they land back in the 1800s, comfort-wise.
The Greeks may not recognize this, but they are in the vanguard of a movement that is wrenching the techno-industrial nations back to much older, more local, and simpler living arrangements. The Euro, by contrast, represents the trend that is over: centralization and bigness. The big questions are whether the latter still has enough mojo left to drag out the transition process, and for how long, and how painfully.
World affairs suffer from the disease of terminal excessive complexity. To make matters worse, much of the late-phase complexity operates in the service of accounting fraud of one kind or another. The world’s banking system is mired in the unreality of so many unmeetable obligations, cooked books, three-card-monte swap gimmicks, interest rate euchres, secret arbitrages, market manipulation monkeyshines, and countless other cons, swindles, and hornswoggles that all the auditors ever born could not produce a coherent record of what has been wreaked in the life of this universe (or several parallel universes). Remember Long Term Capital Management? That’s what the world has become.
What happens in the case of untenable complexity is that it tends to unravel fast and furiously. That’s exactly why avalanches and earthquakes happen all at once, not stretched out over a six week period. The global financial scene not so different. It’s just another matrix of linked mutually-supporting relationships that can implode if a few members weaken.
One question worth reflecting on is whether the implosion is actually well underway on-the-ground in real economies, with just the scrim of illusion to make the surface appear intact. That surely seems to be the case in the USA, where the so-called economy has already avalanched into a rubble heap of part-time scut jobs, defaulted college loans, underwater mortgages, and groaning pension funds — with an overlay of pointless and endless motoring.
Over in Euroland, the Greek “no” also implies that every other sovereign nation wallowing in deep financial shit will demand a haircut (and a disinfectant shower). Italy, Spain, Portugal, Ireland, and even France cannot possibly meet their debt obligations. Their citizens are being taunted with currency controls, too, and they have every bit as much potential to go ape-y as the Greeks. Notice you haven’t heard much from their leaders and financial ministers in recent weeks. They are all standing on the sidelines watching the Greeks go through the wringer — but you can be sure they are all making plans of their own.
The failure of the European experiment will be extremely demoralizing to the hopeful citizens of that continent, who emerged from the bloodbath of the early 20th century to become the world’s premier peaceful tourist theme park. I don’t know that they necessarily have to go back to fighting each other on battlefields with things that blow up and destroy human flesh, but they surely have to decentralize and re-fashion some kind of simpler, local way-of-life if they expect to remain civilized.
It’ll happen everywhere. The Japanese are next, of course, and they may be the most fortunate, since they retain more than a few shreds of memory for exactly that mode of life: the Tokugawa shogunate (the Edo period, 1600 – 1853), a manner of high pre-industrial economy and culture that might have persisted indefinitely had not Commodore Perry come knocking on their door, so to speak, in his “black ships.”
Ukraine is about halfway back to being medieval with excellent potential to overshoot even that. The Euroland PIIG(F) nations don’t have the energy resources to extend Modernity, even if the banking system wasn’t terminally ill, and then on top of that they have the ethno-demographic quandary of creeping Muslimization — plus the additional flotillas of desperate boat people arriving daily.
America, count your blessings. Tattoos, obesity, drug use, and shiftlessness are all basically behavioral choices. You don’t need a finance minister or a central banker to overcome those problems.
The third World Made By Hand novel
!! Is available !!
(The Fourth and final is near completion)
“Kunstler skewers everything from kitsch to greed, prejudice, bloodshed, and brainwashing in this wily, funny, rip-roaring, and profoundly provocative page- turner, leaving no doubt that the prescriptive yet devilishly satiric A World Made by Hand series will continue.” — Booklist
My local indie booksellers… Battenkill Books (Autographed by the Author) … or Northshire Books…
or Amazon…
Black swans? Bullshit!
The guy in charge was asked to speculate on what his post-presidency would look like in a decade. Why, cotton candy sky’s and free shit for everybody.
“The truth of the matter is that for all the challenges we face, all the problems that we have, if you had to be — if you had to choose any moment to be born in human history, not knowing what your position was going to be, who you were going to be, you’d choose this time. The world is less violent than it has ever been. It is healthier than it has ever been. It is more tolerant than it has ever been. It is better fed then it’s ever been. It is more educated than it’s ever been.”
Doofus in charge.
You can tell he was raised by his mother, aunts and grandmother. Always told how special and smart he is. He may not be the dumbest prez ever, but he is the most clueless, voted in by a ever growing FSA.
Hilary 2016!
I really have to say, Kunstler could be the most descriptive wordsmith writing today. He is so ‘on” in describing the rif raff of America. I think he will eventually be proved right on the oil decline. He would be a lot more credible if he hadn’t predicted dates of the economic collapse like he was doing regularly a few years ago.
Not always a fan of Jim K, but this article is one I’m going to be spreading around.
Greece and the Troika: Next Moves
By Janet Tavakoli
Europe is snared in its own web of false narratives. The first being that Greece can and will repay its debts. Those holding PIIGS’ debt are squealing today.
All the roads ahead will be hard for Greece. Some Greek corporations have already issued scrip, due to the shortage of Euros. Handelsblatt reported that Greek banks will be tapped out by the end of the day today. Greece could go back to its own currency, but what will back it? Or as others suggest, Greece can nationalize its Central Bank and print Euros at will, but the Troika’s next move will probably be to label that a criminal act, because it desperately needs to keep other fringe debtors in line. Demonizing Greece may be the temporary fallback position.
The Eurozone may try to cut off currency compliant paper and ink to Greece–if Greece didn’t have the foresight to secure supplies.
Greece prints Euros that start with Y in the serial number. If Greece does nationalize its Central Bank and starts a massive Euro printing program, Draghi may suggest that Euros with serial numbers starting with Y are counterfeit currency. He probably wouldn’t dare say that explicitly, but there will have to be a mechanism to warn other countries it won’t be tolerated.
Here’s a bonus question: How many unauthorized Euros have already been printed, not just by Greece, but by other European countries?
Greetings,
What we have here is a situation that is similar to our Civil War. The South, which paid 75% of this nation’s taxes, had had it with being the cash cow to a hostile central entity and decided to leave. What happens if the PIGS all leave at once? If Greece can walk away from its debt or print its own money then everything is on the table. Everything.
Holders of Greek debt are screwed. The Greeks are unable to pay. The taxpayers in Euroland are not in the mood to make them whole. Will they or won’t they? I don’t know maybe they can kick the can a little further. Looks as if the socialists have run out of other peoples money.
The Greeks are in for a very very uncomfortable time. Civil War?
We need to punish the Greeks .. teach them a lesson
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thinking
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thinking, thinking ……
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fuckit. Let’s bomb Sri Lanka!!!
Stucky you got that right. Who says we haven’t fallen down the rabbit hole.
When people are deceived and purposely misinformed, there is fraud behind it, without exception.
The most brilliant Con is when you don’t realize you’ve been Conned and are left bewildered.
Most Americans fall into the category.
“Holders of Greek debt are screwed.”
Unless someone like Russia bails them out, then holders of Greek debt are sitting pretty.
Stucky, you nailed it! Let’s bomb the shit out of Sri Lanka because…..well, just because it’s fun to bomb people.
What if the Greek people start really suffering long term, like they haven’t since who knows when, and they end up begging the EU to save them, and will accept any austerity measures no matter how horrid? It could happen.
When the Europeans voted in the EU, they consigned themselves to the tender mercies of however is in power. They sucked up all the free shit and laughed at the hardworking Yankees. But when it all falls apart, all they will want is to be fed. They will be willing slaves. If only they had guns, they could have some power, if they were brave enough to display it.. But that was baked in the cake after WWII, and an unarmed populace are not citizens, but slaves.
At least a slave is fed. They’ll have that going for them.
Yes, Admin — the youths have the sense of it: Default, Bankruptcy, Restructuring, Settlement, Repudiation, Jubilee…
It is fitting that Greece is the setting for Act 1, Scene 1
Yes, Admin — the youths have the sense of it: Default, Bankruptcy, Restructuring, Settlement, Repudiation, Jubilee…
It is fitting that Greece is the setting for Act 1, Scene 1