OOOBAMA

Obama sees US$ strong, no single world currency

This headline from reuters stunned me for a second and made me burst into laughters. This is clearly an intellectual joke, I hope. He said that the dollar is extraordinarily strong. Yes, true indeed, despite its worthlessness.

As the days goes by after he got on office, the probability of him being a flop gets higher and higher. In fact, I think he actually is.

I believe he will be right when GDP rises again, with high inflation it will be.

Remember that in the elections, his speech was clearly for all the common people. But now, his actions are clearly for the ideals of being a global superpower and for the elites.

This clearly shows an agenda that he got to know after assuming presidency.

'by moving from an era of borrow and spend to one where we save and invest.' - Obama
Where are they going to get the savings? How many decades do they need to reduce their debts? Invest in financial instruments? Maybe America can teach China what are 'provisions for doubtful debts and bad debts'. God Bless America

Bailouts, pumping of liquidity - Realistically

What people don't understand is the conflict of interest between the government and the people. The wants of the people are not the same for the wants of the politicians.

During the USA presidential elections, if you saw the statistics, the majority of funds for Obama was from the city of New York. Realistically, no money donated was without strings attached. Realistically, politicians are more concern with a rich person than a homeless person in the street. Realistically, the politicians ultimately have their own interest at hand - to stay in power.

So, how would a bailout of AIG have helped the american people? Realistically, the reason quoted sounds convincing but is fundamentally not. The reason that it is too big to fail, and that it would cause a collapse of the financial system is purely a scare tactic. The trade-off of not failing is the taxpayer's money. Even if it was bailed out, the unemployment rate would still increase and GDP will still decrease in a rapid downcycle. So the real reason must be that it was too big to fail for the politicians and the elites.

How would a pumping of 1.25 trillion dollars help to ensure credit flow and thus an improvement of the economy? The common people will not get a single benefit. Instead, the taxpayers are the ones paying to support the capitalistic system after they took excessive risk knowing that they will be bailed out. They were incentivised to do so.

If you notice, whenever there is a crisis, the government will definitely help the capitalist. It acts as a middleman in channelling funds from the people to the capitalist., like a ponzi scheme. It is a cruel fact that we pay attention the most to those that gives us the most benefit. But it is a consolation that we can control our focus to the people that needs our help, if we have a heart.

Since the start of civilisation, with different ways of organising people, from feudalism, communism, capitalism, each has been replaced by the later. Capitalism will not be an exception. In my opinion, as the rich and poor disparity widens and grows exponentially till the middle class diminishes, you will see a civil war with a scale as large as the whole world. It is inevitable and is only a matter of time.

Even the once great Rome, the great Qing Dynasty that did not believe that they were perpetual, fall into the abyss.