The financial markets are giddy. The G-20 has engineered "loans" to the IMF and the World Bank totalling over $1 trillion. This sum apparently saves everybody from the folly of previous bad lending.
What is the real meaning? The financial markets are rightly excited. Every taxpayer's wallet has been opened to the financial barons of the world. Best of all, the taxpayer doesn't really know it. The "loans" are financed by deficits, so the inflationary effects of the gift will not be known for months or years. In the meantime, the financial rats can make new fortunes by trading in the old toxic waste at taxpayer expense. Our financial and poltical leadership understand this very well...shame on them. There is no price too high to maintain power...so long as it is the taxpayer that pays it.
With some luck, a new round of lending can commence based on the old lending formulas. For example, GM (the government motor company) has renewed subprime auto lending. Why wouldn't you buy a new car? The payments are low, and if circumstances are dire, the taxpayer will pick up the tab (I'm not making this up).
Rest assured, no politician will be forced to explain why new bad loans cure the effect of old bad loans. Desperate folly abounds. It might work...but only for awhile. The Hedge Tax would have prevented this. I pray that our republic can survive it.
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