The Economy is Tanking? And we’re debating Trump?

Ukraine is mired in corruption, fraud, strife, a failed economy, war, hatred and poverty. So what are they doing about it? They are passing a bill lickety split that says it is a crime to call Russia – Russia. The sanction? A fine of nearly $3000. With the average wage in Ukraine coming in at a measly $200 per month, the fine would not be remotely collectible and result in the creation of ‘debtors prison’. Remember the British? What an imbecilic waste of time and energy.

The media continues to blame Russia for all of Ukraine’s problems including their economic woes, their internal corruption, their inability to forge anything worthy of acknowledgment. Blame is the new agenda. It has blossomed into a global thorny bush that has no flower to soften its prick. It was the Obama agenda the moment he began his initial campaign. It is the GOP agenda, the Hillary agenda, the UK, the German, the Canadian fallback for all things less than wonderful.

Ukraine’s Poroschenko has asked for the resignation of the Prime Minister, Yatsenyuk, but he has apparently refused and powers forward with the cure all formula to the Ukraine crisis – make the word Russia – a criminal act.

In our own lands of freedom we see Obama hailing the heroine author of To Kill A Mockingbird, while simultaneously snubbing the funeral of one of our Chief Justices, Scalia.

We watch as Turkey invades Syria and say nothing. We give the Hillary corruption a green light as she forges forward in her bid to become President while knowingly falsifying information, data, records, taxes, Foundation policies, etc… and these boots they keep on walking – walkin’ all over you…

Obama has managed to create the worst cooperative atmosphere in the US in history, the worst foreign relations, the most rhetoric, and a division within the population reminiscent of the Civil War!

And within this midst of madness, we are not paying attention to the economy.

The demand for large and medium sized industrial and commercial loans has plunged into negative territory. Manufacturing is contracting and the wealthy are dumping their real estate. The outlook for growth in the EU is feeble and we still blame the fall on China. China propped us up!

So while we are distracted with rambling politics in the US, refugee crises in the EU, energy prices in the proverbial twalette, and fabled vaccine crises, we have failed to pay attention to the picture at large – the economy. In all, Germany, France, Canada, the US, the UK, Brazil, Italy and Japan have all had their economic outlook downgraded by the OECD for 2016.  That is not a good thing!

With zero interest rates, low inflation, a crumbling market, consumer confidence tanking, and faith taking a dive, insurance companies have quietly upped their cost for bank defaults implying that anticipation of more bailouts is rising.

Austerity programs have proven less than fruitful as they are continually adjusted and readjusted as countries slide and the mark is passed. Instead of informing us of our circumstances, the media is filled to the brim with stories about entertainers, who said what when, who showed a lot of skin, and a smörgåsbord of banal information to keep us in the dark.

In 2014 when oil began its perilistic descent, the Wall Street Journal was quick to claim that the trough would be good for the global economy. Obviously, that has not been the case.

What can be done?

The UN and OECD believe that greater government intervention into the economy is necessary in order to boost the stagnant to declining growth. They state that more investment in infrastructure, education and social sectors is the ticket. And while private equities did take advantage of the low interest rates, instead of using the funds to grow and expand, they used the money to buy back shares of stock, further contracting growth.

But does that work in actuality? The IMF approved over $15 billion in loans to Ukraine, and ‘forgave’ its debt to Russia. Nothing changed. In fact the economy of Ukraine is worse than ever. The IMF’s largest outstanding committed loans are for; Portugal, Greece, Ireland and Ukraine. Portugal and Greece remain in austerity with little positive change in their economic outlook and actually some expanding negative.

So maybe, just maybe the theory behind the OECD, the UN and the IMF is simply – wrong. From a simplistic standpoint if an individual were in debt and default and they went to a financial advisor, I doubt the advice would be to simply borrow a whole lot more…and that would solve the problem. The advice is and always has been – cut costs, reduce debt, create a budget that is balanced and attainable, and expand spending gradually commensurate with income. While it is simplistic, the incentive for individuals is high while the incentive for businesses and government to abide by these same rules is unfortunately low.

And so we are left with one word – incentivize. Providing incentives, as well as consequences. What is the carrot? Because right now – there is nothing.

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