My take on the Financial 'Crisis' is so different from most people I know, that last year I made AE602, a presentation on Understanding the Financial 'Crisis' explaining my view, which is recommended watching to help you get the most from the first hour of this week's show as I comment on it. I believe that those who control commercial media are deliberately misreporting the 'crisis', adding irrelevant details to complicate a relatively simple reality. What is called the 'crisis' is in fact not unexpected, and was created as a convenient untruth used to mask the contradictions arising in applying an ideology of perpetual growth on a finite planet and delay the day of reckoning when fictional claims on wealth come home to roost.
Apart from the connection with resource depletion, one essential fact which commercial media omits to mention about the 'crisis' is that it has winners as well as losers; on the other side of every foreclosed home and business is a bank which takes ownership of assets which are sold cheaply. Thus the likening of the financial crisis to natural disaster - one which destroys real wealth rather than transfers it - is as misleading as it is graphic. We look at how commercially controlled media consistently obscures people's understanding and consider some of the wrong questions it asks. We consider the psychopathic basis of the modern economics and look at 'money psychosis', the mass delusion which leads people in monetised societies to confuse the real with the imaginary. The presentation concludes with some down to earth questions designed to speed recovery from this and assist in the turbulent years ahead in which centrally-issued money collapses. As a break from my commentary, we also hear the soundtrack of Quantitative Easing explained, a somewhat light-hearted YouTube video, and a section from The Corporation on the money psychosis of market traders and how they reacted on Sep 11th when they saw the planes hit the Twin Towers.
In contrast to the overview feel of the first hour, in our second hour, we look at the operational details of the transformation taking place. We play a March 2011 interview of Bonnie Faulkner with Michael Hudson on 'The Spectre Haunting Europe'. He describes how neo-liberal economic policies are being ruthlessly applied to nations such as Latvia. He likens the consequences to warfare, resulting in such indebtedness and poverty that mass emigration and a sharp decline in GDP are a result. Unless Europeans vigorously oppose these changes, he anticipates a new feudalism in Europe as social welfare model is rolled back in favour of Chicago school US style capitalism, with consequent deleterious consequences for general welfare and material standard of living.