Greece - what goes around comes around

For those who may have forgotten or don't know, Goldman Sachs sold Greece a bunch of derivatives that has left the country bankrupt. For the idiot right wing talking heads who think this austerity is the right way to go I only assume they've never experienced what it's like to go without food or heat.

President Francois Hollande and German chancellor Angela Merkel have voiced their support for the debt-stricken nation.
Yeah by slapping them with more debt. These people aren't stupid. Just today the people over there withdrew some $800 million from the banks. That's a good chunk of change considering it's a small country.

As was reported here earlier the economic storm is coming. Greece will default on it's debt next month by all indications. China is not in much better shape as demand has dried up.
China's biggest four banks barely issued any new yuan loans in the first two weeks of May, extending the country's weak credit growth last month, the state-run Shanghai Securities News reported Wednesday, citing an unnamed source.

Then there's Spain and Italy and by the recent riots that of course made no headlines here it's only a matter of time before they too default. Britain and several of the other nations that are in financial trouble have yet to experience the effects of their austerity measures. To it's credit China is about to embark on government backed infrastructure projects to get it's people working. Their growth rate had been high relative to other countries but as they are the largest nation on the planet even small glitches in their economy can have a broad impact. Their growth rate has dropped to 9.5% from a high of 11%.

Then there is the U.S. We see that Chase and probably the rest of the boys are up to their old tricks gambling our future and our childrens' future at the crap tables of Wall Street. Anybody out there taking bets on when the house of cards is going to collapse? I had predicted 6 months a few months ago but now I'm not so sure. This whole mess is based on debt and adding more debt without producing anything is not going to make things better. The solutions are quite simple though. Consider the following:
1. Reinstate Glass - Steagall. That was the bill that separated the banks from the investment houses there by eliminating the gambling with our bank deposits.
2 Eliminate naked shorts. That's betting that a business will fail even though you own no shares of the business.
3. Cut subsidies to companies that are making obscene profits.
4. Put a federal tax on all stock trades.
5. Dump the Bush tax cuts for everybody.
6. Use the money for a jobs program before workers get to old to help rebuild the infrastructure.
7. Get out of Afghanistan and use some of that money for vets with injuries and PTSD. After 4 and 5 tours of duty we're going to have some ticking time bombs here.
8. Start a real energy program to get off of fossil fuels.
9. Reinvest in education and research.
10. Get the money out of politics.

I see the banks are wising up and finally forgiving debt on home mortgages. You know why that is? Because they can't handle anymore red ink on their balance sheets. Better to have some cash flow than an asset that's costing them money to maintain or tear down. The effects of the Alt-A loans is starting to kick in which won't make for a good quarterly report.

So there you have it. Wall Street sold this crap paper around the world and it's coming back to bite us in the ass. What goes around comes around.