Alex,
Thanks for posting the Kutyn piece.
For those willing to entertain the depression scenario, this analysis is as probable as any. The last couple of paragraphs are rather disturbing, though. New World Order? Anarchy by Design? I have my doubts. At this point, I feel this planet's financial system is about as controllable as the daily rainfall levels. To wit, a quote from the article:
"This is the ultimate irony of today's financial system. Society pays interest to banks on money that financial institutions created from nothing. After banks have leveraged the maximum gain from society, then society is asked to pay for the losses of the banking system as it falls apart."
This is a classic observation! I don't think it's a conspiracy, though, we just have a really faulty system. A faulty system which continues to be extended without much consideration for the longer-term impact. We have a financial system built up ad hoc -- for what sane society would set out to devise such an irrational system and subject its members to such unpleasant vagaries over and over. Well, yes, a greedy one, but that was supposed to be a rhetorical question. :o)
So why not start afresh, with a modern, rational system that is sustainable, self-correcting, and robust? Too late for that! Far too many deeply entrenched self-interests at the upper economic echelons to go that route. Will it always be this way? Yes, unless some total disaster washes the whole mess away.
The global financial system reminds me of a huge, complex software package that was written in the 50's but is still in use today. Yeah, it sort of works, but don't go about trying to modify or extend it in a major way. Is it an optimum system? Absolutely not. Is it a flexible, adaptable system? Nope. Does it adequately meet the needs of all its users. No, not really. Is it easy to modify? Not without the potential of problems in other parts of the system. In fact, without proper and thorough analysis, the whole system may come down once an ill-considered modification is put in. Are the owners and users of the system amenable to radical changes? Very rarely.
Over time, little by little, the large software system becomes "unmaintainable". The accumulation of change has left the original design unrecognizable. Each change has left minor or major side-effects that corrupt the original design and compromise performance and robustness. Many of the changes that have been made are undocumented, poorly thought out, and/or inadequately tested.
At some point, it is determined the business cannot compete or perhaps even survive with the current system. A replacement becomes critical. We find there is heavy resistance to replace the system. People are secure in their jobs using the current system, despite all its flaws.
So what can happen? The system fails catastrophically one day and the company goes belly-up, management and all. Or, unable to compete using the faulty system, the company is bought-out by a competitor. Former management is bailed-out and happy. Or, the current entrenched (expensive) staff is fired, the old system is discarded, a new system is brought in, and a new, more amenable staff is hired by management to run the new system, or perhaps the current staff is retained and retrained at a lower wage rate.
To complete the analogy, out financial system is the aged software system. The company is the whole planet. Most of the people on the planet are the staff. The replacement of staff or lowering of wages rates are wealth losses experienced by most people while transitioning to the new global financial system. Capitalism has already bought-out its only competitor, Socialism. And (global) management becomes (or already is) the ruling elite of New World Order! Hmm, maybe Kutyn is on to something. Maybe not. |
