Monday, 13 October 2008
Can They Prevent An Economical "Disaster"?
I'm talking about the most powerful(?) country trying to revive the financial market that went into complete freeze last week. It's terrifying when the "patient" doesn't respond to any drug administered...
They have to act fast, any days if not minutes are crucial. Any wrong decision will have a lasting impact.
Finland can only watch and hope that they will do the right thing. "Thing" is the appropriate word as nobody knows, what it is. How to cure a patient that should have been treated a decade ago, but was let unchecked due to "stimulus" that pushed its system to the extreme.
2009 will be a terrible year no doubt. To be franc, I knew for long that 2009 would be a difficult year, but not to this degree... I was thinking that we would get something in between the 1990 and 2001 recession. Noticeably not as bad as the 90's but far worse than 2001. Today it seems that we are in an uncharted territory. Nobody knows how bad it will be and how long it will last...
"Mr Katainen added that he did not see the Finnish domestic market stalling provided consumers carried on spending."
They were excesses, no country has not had excesses. During those excesses you start to get erratic behaviours - ecological deterioration , destruction of vital resources, corruption rising, violence getting extreme. "We got it"... Somehow the economic woes, we are experiencing are somehow part of readjusting unsustainable growth amid increased greed and a massive wealth gap difference.
"The banks are largely responsible for the mess we're in, they have to be responsible for getting us out of it", Bini Smaghi, European Central Bank executive board member, told a group of businessmen in Washington today.
On top of that, you have banks, ran by ex-crooks, that need to deleverage. They need money. Nobody want to lend to them. So the only alternative for those banks to get the money is from the most liquid place: the Stock Market...
"The Finnish branch of Icelandic bank Kaupþing has asked the Finnish government to borrow it some cash to help pay back depositors, Mari Kiviniemi (centre), the Finnish minister in charge of financial supervision, said Friday."