Open Democracy: 27th October 2008
It is a small measure of the dramatic financial meltdown of 2007-08 that leading representatives of western liberal capitalism ransacked the past for reference-points to convey its scale…
In my contribution to the Green New Deal in July, 2008 I warned that corporate debt defaults were the next “big shoe to fall”. We are all aware of the devastating consequences of defaults by sub-prime borrowers. However their debts are miniscule compared to outstanding corporate debts. Now, I firmly predict,corporate debt defaults are about to cascade down on the global economy, leading to devastating impacts, not the least of which will be widespread unemployment. How can I be so sure?
Sunday 5th October, 2008
The decision tonight by Germany to guarantee 100% of all savings in German banks first flagged up by the BBC earlier this Sunday evening, but modified later, is a clear signal that there is panic afoot. A run on German banks must be imminent. Why? Because the only way to prevent a run on banks is to guarantee 100% of savings. The fact that Germany has done so, or hinted that she will do so, means that her government is taking urgent, unprecedented and unco-ordinated action, to prevent such a financial catastrophe occurring tomorrow morning. Others must now follow to prevent a systemic run on the global banking system. To avoid armageddon.
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Wednesday 1st October, 2008
The massive deflation/de-leveraging of credit and debt that is now cascading through the banking system and rapidly deflating the value of housing and other assets in the Anglo-American economies will precipitate large-scale, global economic failure, for years to come.
Tuesday 30th September, 2008.
Anglo-American finance ministers and central bankers, like little Dutch boys, try desperately to plug leaks in the bursting dyke that is the international financial system. In the US, treasury secretary Hank Paulson hoped for $700bn to plug the gaping hole in Wall Street’s banks. In the UK, the government is not just plugging holes, but setting aside competition rules to encourage the monopolisation of finance.
Tuesday 30th September, 2008.
Sir, Your editorial “In praise of free markets” (September 27/28) conflates regulation of trade markets with that of financial markets.
This is a flawed analysis, one at the core of most economic orthodoxy – that money, like land, oil, soya beans, diamonds or gold, is a commodity, and therefore that trade and markets in money are no different from markets in, say, soya beans.
Hank Paulson, President George Bush’s Treasury Secretary, launched a unilateral plan to save the western banking system last Sunday, then appealed to western governments to bail out their own banks.
‘Fair enough’ one might say. After all, the US’s staunchest and most compliant ally, Britain, actively colluded in the build-up of these massive, and now unpayable, Wall St. debts, and British banks will likely benefit from the bail-out.
Lets not make any bones about it. Hank Paulson the US Treasury Secretary’s scheme announced yesterday represents a coup d’etat by the finance sector as Yves Smith rightly argues (21st September). The stakes are high. In a few months time we may have a Democrat President and a less compliant Congress. Right now, with the stock market gyrating and banks failing is as good a time as any for the finance sector to stage a coup d’etat.
20th September, 2008
In the midst of all this tragedy and chaos, one has to savour the moment. The sight of all those free-market capitalists, trained by economists at the Chicago School of neo-liberalism, handing over to ‘big government’ the financial system of the biggest free market economy in the world.
19th September, 2008: My comment for the Guardian’s site, part of a debate on the Credit Crunch organised by the new economics foundation, of which I am a fellow…
Bankers have gone to great lengths to damage our confidence in the banking sector. And loss of confidence and trust on this scale can’t be fixed by banning a few short-selling speculators or by nationalising a bank here, an insurance company there. Nor is confidence restored when ministers meet up with bankers on the quiet, and grant them monopoly powers (as with Lloyds).
A response to the "Triple Crunch" of financial crisis, climate change and oil depletion. Read the report published by the Green New Deal Group and nef (new economics foundation).
Welcome to my blog about the financial crisis. I'm Ann Pettifor, author and analyst of the global financial system, and co-author of the Green New Deal. I predicted an Anglo-American debt-deflationary crisis back in 2003, and am known for my work on sovereign debt and international finance, including Jubilee 2000. Currently a fellow of the new economics foundation and director of Advocacy International.