Via Peter Tchir of TF Market Advisors,
Suddenly, everywhere you look, “austerity” has become a 4 letter word. Clearly it wasn’t excessive spending that caused too much debt. Surely we didn’t hit a financial crisis in spite of excessive spending, nope, it is all the fault of austerity.
In the rush to avoid supporting anything that could be viewed as “austerity” we have lost sight of what austerity is, and how it can impact [...]
And so the focus shifts to the quietest neighborhood on the block: “The negative [Moody's] outlook on the province [of Ontario] reflects the softening economic outlook, Ontario’s growing debt burden, and the extended timeframe to achieving a balanced budget.” What’s next: someone dares to question the stability of Canadian banks which as we it turns out may have a few hundred billion in hyper-rehypo assets (Canadian Imperial Bank of Commerce (re-pledged $72 billion [...]
Ireland’s government was not in trouble. It did not have the overspending and long-term-debt problems that Greece did. Ireland’s fiscal balance was fine except for the need to take control of the failed private banks. So the IMF has taken on a new role, as a guarantor of private banking and private-sector stability, that is far removed from the visions of 1944.
Our best hope is [...]