Economic points to ponder

Over the past few days there have been a few articles worth noting.

Zero Hedge points out that as of the second quarter of this year, gross notional derivatives outstanding worldwide totaled no less than $639 trillion.  That's compared to a Gross World Product (i.e. the Gross National Product of every nation on earth, added together) of only about $69.11 trillion last year.  In other words, derivatives (which are nothing more or less than financial speculation - bets, if you will) are valued at almost ten times more than the entire world economy.  This is, of course, absolute nonsense - it's not practically possible - but nevertheless, a derivatives crash can (and may yet) bring down the world economy with it.  This is what the banksters have wrought, and our politicians have let them do so.  Let's remember that when the crunch comes.

Next, Der Spiegel has a very interesting article on a world addicted to debt.  It has a European-centric focus, of course, but it's one of the clearest explanations I've yet found of how things got this bad.  The article is titled 'Betting With Trillions'.  Highly recommended reading.

Also in Der Spiegel is an examination of Greece's wealthy class - the 1% of the population that controls most of that country's wealth.  While demonstrators take to the streets to protest the Greek government's austerity programs, the rich continue to live in idle tax-evading luxury.  It's a sickening article . . . but what it describes is repeated on this side of the Atlantic too.  Look at the attitudes and behavior of the top 1% of American society, and you'll find much the same behavior.  (Please note that I'm not opposed to people being rich, and have no objection to anyone becoming as successful as they can.  However, I believe that those who 'have it' are well advised, in the current economic climate, not to 'flaunt it' in the faces of those who are literally starving, or losing their homes, or facing ruin.  I regard the Paris Hiltons of this world as the unacceptable face of capitalism, to put it mildly!)

All the linked articles make for interesting reading.

Peter