"Money was always an abstraction but now it has been spun so fine its very existence is a thought experiment. It has broken free from its earthly bonds and escaped into the conceptual world. Thus – no one understands credit derivatives. They are a secret system of monetary transactions operating in private. The data doesn't exist to know what their effect is.
Few companies know what the risk is that their mortgage-based securities are worth what they think they're worth. Their company books are a work of fiction. Many financial houses have no idea how many or how much of their assets are toxic, or whether their own company is worth anything.
None of us with any exposure to these questions (those of us with savings, a pension or a job are exposed) know if we are solvent. If we did know, there'd be mass panic, economic chaos and the breakdown of civil society. Of course we have to ignore reality."
Tuesday, 13 January 2009
"the world economy is based on a hallucination, a mass deception, a general agreement to ignore reality"
Read more here at Simon Carr's article in The Independent. Here's another short extract:
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1 comment:
What's the solution? I think the mistake was done long time ago, when the Bank of England was established, FED and other central authorities. While there was gold, it was ok, but in last 50 years they (central banks) have become something like bunch of crazy people with God complex, always trying to save the world by simple clicking on "change interest rate" and "issue more money" buttons on their PCs...
Julie
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