29 April 2009

Winners; China, Poland, Chile

"And the losers now will be later to win, cause' the times they are changing.... Bob Dylan

Staying off financial meth will be better for you in the long run. and sticking with the methamphetamine paradigm for a moment; that excessive leverage gives you financial energy and makes you feel great but at the cost of running down your vitamins and immune system and making you prone to psychosis, whats he current course.

I think the European rehab of a week in bed ( severe recession) is better than kicking the corpse with more of the same.

From Times Online
April 28, 2009
Brown left red-faced by debt lecture from Polish Prime Minister

Gordon Brown's attempt to put the economic misery of Britain behind him on a whistle-stop world tour were stymied today when Poland's Prime Minister embarrassed him with a lecture on the perils of excessive public borrowing and culture of debt.

Speaking after a breakfast meeting between the two leaders in Warsaw, Donald Tusk, the Polish premier said that while he did not want to comment on any other economy, the Poles had fared so well because they behaved with "full responsibility in terms of their deficit".

While Britain is struggling to cope with the effect of three quarters of economic contraction, Poland is basking in 12 years of consecutive, uninterrupted growth.

With Mr Brown standing next to him, Mr Tusk said that one of the main reasons Poland has so far managed to avoid the ravages of the credit crisis was because Warsaw had "efficient supervision to banks and sticking to the rules.... not exaggerating with living on credit. These are the most certain ways of avoiding of financial crisis."

Only last week, Alistair Darling, the Chancellor, was forced to admit in his Budget that Britain's public borrowing was on course for a record £700 billion.

Mr Tusk said: "After a few months our Government made the assumption that the method to cope with the financial crisis was not to increase expenditure but the availability of public funds."

While Mr Brown has long backed measures to pump capital back into the banking system, the Prime Minister has been a proponent of trying to spend the way out of a recession, but failed last month to garner a massive co-ordinated fiscal stimulus package across the major economies of the world.

The unintentional slight from the Polish Prime Minister marks the second time in two months when Mr Brown has been reminded that the past course taken by the British economy of light financial regulation and massive over-endebtedness has contributed to the worst slowdown since the Second World War.

Last month, President Michelle Bachelet of Chlie embarrassed Mr Brown ahead of the G20 summit when she said that the Chilean economy had performed so well because the country was able to save during the good times as a cushion for the bad. She said: "I must say that because of the decisions we took in good times, we were able to save money during the bad times."

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