h a l f b a k e r y"Look on my works, ye Mighty, and despair!"
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Jim has noticed that governments assume that sovereignty is not at risk when making fiscal policy...
--- a great many governments out there have borrowed lots of money (in some cases running the government costs more than the total value of all the goods and services produced locally)
--- so
far governments have been able to bail themselves out by devaluing the local currency (and so far this has been done by (printing money) and buying back bonds (that the this government previously printed and sold))
--- everything in this schema works great until goverments can no longer raise funds by issuing bonds (internally or externally)
Jim wonders what happens next...
--- since the borrower is a state and not a private entity it is not possible to shut them down through the normal legal process
--- external lenders cannot allow the government to default (because then they get away scot-free)
Jim reckons the problem needs to be handled internally.
Each sovereign member should get a piece of the government to wear as a trophey (placed on the mantel or in some other prominent position) to remind the population that governence is not just a party thing...
[link]
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While Jim clearly has a solid grasp of modern fiscal
dysfunction, sanity continues to hover just out of reach... |
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hmmm you wanna piece o me... |
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Note: Governments (and companies for that matter) seem to rate themselves on the basis that they can issue bonds (or shares). |
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Only, when a companies stock drops to nothing it does not have the option to print some money and buy the bonds (sorry shares) back. Usually a company in this position can no longer raise funds by issuing more stock, is forced into receivership and the remaining assets sold... |
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It is not clear to me what the process is for putting a sovereignty into receivership. Should the united nations step in and stop the government from proceeding with its ponzi scheme...? |
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What happens next is the currency devalues to nothing at which point no one will willingly work for said government. Then anarchy reigns, the people are not protected from each-other or external forces, and he who has the most guns, as opposed to he who has the gold, makes the rules. A horrible state of affairs.
Bun. |
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Oh, well, I'll be fine, then. |
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