This past week the world lurched another step closer toward another recession and governments seem incapable or unable to provide direction to recover.
When will the European community bite the bullet and let Greece default on its international obligations? The constant drain on the German and French economies is causing their economies to sputter and enter negative growth fields.
The fate of the Euro itself is at stake.
Interest rates can go no lower and government bailouts tend to disappear into a black hole and not help any economy. Indeed less than savory companies seem to suck up the money and paper over non existent expenses.
Gold has fallen, oil is dropping, silver and other precious metals also are facing decline in their value as speculators believe the world is slipping into recession.
Last time the Chinese economy pulled the rest of the world out of its slump – do not expect this to happen this time as they are struggling as well.
The irony of this is that major companies are sitting on record profits and have plenty of cash on hand but are unwilling to expand because they believe the worst is coming. Of course this type of action can complete the circle as the worst will happen because they do nothing. Businesses today are lean, efficient and profitable.
However previous recoveries were partially or mainly due to increased consumer demand for products and paid for by use of credit cards and lines of credit. These now have been either reduced or used less by the consumer so less money is going through the economy. In fact many consumers are limiting or eliminating their credit card use because the interest rates being charged by the lending institutions is almost at the same rate as that charged by organized crime.
And in a case of irony, a bridge in San Francisco is being built as part of the infrastructure program funded by various levels of government and the work is contracted out and is being done by a Chinese firm.
One wonders as to what the benefits to the American economy are with that type of cynical politics.
Here in Saskatchewan we were fortunate to have another week of great almost summer like weather with the temperature this weekend being in the plus 28 range-incredible.
However next week for sure is the time to start to pull the last of the garden out and harvest the last of the summer flowers and put the pots away for the upcoming winter.
Speaking of winter I visited my local tea shop yesterday and began my yearly fall/winter stocking up of various tea blends to sip on during the winter months. The store is a marvelous one in an area of the city that is vaguely Bohemian with turn of the previous century housing. A small hole in the wall store that stocks a huge variety of loose leaf/grind blends from around the world that would satisfy any palate. The lady who runs the store is a delight to talk with and recently took the large step to open a second store in our sister city to the north, Saskatoon. A statement of belief in the economy by a small business owner that is heartening to see. In fact this province abounds with many stories like this and that speaks well for its future.
Meanwhile at the United Nations, another attempt by the Palestinians to achieve statehood was vetoed by the United States.
I think that there will soon come a time when the States may or even will have to reconsider its position on Israel and the Middle East. At this time the US stands firmly behind the Israelis politically, militarily and financially and steadfastly refusing to even consider any other Middle Eastern viewpoints. Perhaps allowing statehood would force the both Israelis and Palestinians to negotiate in true good faith instead of hiding behind inflexible, rigid doctrine driven stances. In particular the building of more and more settlements by the Israelis must stop or the region will surely but surely drift back into warfare and that would possibly involve the nuclear option by the Israelis and Iran in retaliation.
That scenario is a lot closer than you might think.
Over in Russia it appears that Mr. Putin is getting ready to for President again next year. Political power is like a powerful drug, once tasted, almost impossible to leave. Perhaps the American system of 2 terms only for its President is best. I think 3 terms would be better as many Presidents are considered ineffective in their second term because legislators know that there will be a new President soon no matter how they connive to disrupt his agenda – with no regards to consequences to the American people and economy and indirectly that of the rest of the world.
Two women in Europe were fined this week for wearing face covering garb and civil libertarians are in an uproar over perceived human rights abuse by the authorities.
Hmmmm…….wonder where these people are when honor killing is done in Pakistan and other countries? And where are they when western garbed women are spat on and attacked when visiting Muslim countries?
And now there are only three months to go until Christmas…….hmmmmmmmmmmmmm…………………………
Anyway, have a great week and take care out there,