Defaulting banks - where will it stop?

[Jan Klimkowski]

Mr D Malone (in jest, to distinguish you from Mr D Guyatt), I suspect you're right. There may well be a deliberate attempt to ensure Mutually Assured Destruction of the global financial system, which no "First World" economy can escape. However, in looking for Their endgame, I would search for a remodelling of the world into one which is even more to Their liking, and ever more under Their control.

In other words, Ewen Cameron-style "shock therapy" to produce a tabula rasa which can be rewritten.

Naomi Klein says the following in Peter's post #32:

I start the book with a quote from Milton Friedman that has really made the rounds a lot lately, which is that—and this is a Friedman quote—that “only a crisis, actual or perceived, produces real change. And when the crisis occurs, the change depends on the ideas that are lying around." And then he goes on to say, “That, I believe, is our basic function: to keep the ideas ready until the politically impossible becomes politically inevitable.” So I think it’s really important for people to look at the ideas that are lying around.

There’s enormous corporate lobbying going on to, for instance, eliminate the post-Enron collapse regulations, to actually say that the way to save the American economy—you know, you heard Henry Paulson equating—still equating the interests of the financial sector with the interests of everyone else. We know that’s simply not true. But it’s that—precisely that logic that then is used to say, OK, these are the—this is what the financial community, this is what the corporate world needs in order to revive the economy: they need less regulation, they need less taxation.

So, we should be really, really wary of this claim that we’re hearing that free market ideology is dead, that this marks the end of, you know, of capitalism. You know, I’m sorry, that is not the case. It may be going dormant for a little while to rationalize these massive bailouts, but it will come roaring back, and the crisis that is being deepened right now through these bailouts will be invoked for even more radical deregulation, privatization, tax cuts and so on.