Is the Western World on a rollercoaster to nowhere in particular?

Quite surely it is if the apparatchiks of the EU remain unfettered

Though the International Monetary Fund in a recent report believes the developing world is fast catching up with the developed world, the overall impression is that it slightly hampered by recession across Europe, the USA and Great Britain. After centuries of progress and the transfer of western technology to the third world, in pursuit of profit margins, it is apparently of little concern to the transferees of western production lines to China and beyond that in the end it must be limited by the ‘Law of Diminishing Returns’.

After WWII it was Japan playing catch up and Germany rebuilding that the new factories and production facilities should inevitably have an advantage in export markets as the latest machinery and production techniques were incorporated. So a period ensued where both Germany and Japan were able to build worldwide export markets, with the tremendous advantages, bestowed by this progress.

But the fact that globalisation is all about equalisation is beyond question, though if the limit of transfer is the pursuit of profit we will undoubtedly arrive at a point where this transfer of production techniques becomes self-defeating. So the obvious question then is can the west survive intact as a service sector?

We see the answer to this, in the efforts being made to shift the balance of power in this respect by the attempts from Brussels and the USA to master in financial services. Even tiny Sweden attempted to get in on the act, when it audaciously entered a bid to takeover the London Stock Exchange.

Then the New York Stock Exchange ventured east as did the NASDAQ, though in the end they only managed to pick up the dregs, in Paris and Bonn. The reason for all this manoeuvring, is probably that it suddenly dawned on these entities that the ‘City’ of London had become the Clearing Bank for the World and for as long as that remains the case for the UK, the rest of the world can be our workshop.

The real answer to that one however will await the way things pan out, though in reality it probably depends on supply and demand curves. There has to be a point though, where the demand for the latest technology is sated somewhat by the ever rising prices at the hands of the Fractional Reserve Bankers and the ten percent year on years demands of the investment houses that drive this financial sector. Maybe they reckon they can go on, year on year constantly driving up prices to satisfy this element of the equation.

But once again this relies on supply and demand and history dictates that as in the past a flushing out of the system has to occur. This happened on many occasions in history. In fact as recently as the 1700s, when Sir Isaac Newton as Master of the Royal Mint in the days before decimalisation of the currency, had wanted to set the price of a Golden Guinea at - £1-0s-10½d, but was overruled by parliament. They decided in their wisdom to make it £1-1s-0d. This altered ratio of the gold to silver price and allowed British merchants to transfer almost the entire inventory of continental gold to Britain

At some moment in time parliamentary government must wake up to the fact that it cannot forever, go on issuing interest bearing debt and allowing the lending banks to create money out of thin air. In addition to which, the writing-off of debt destroys credit. The very thing they claim we need to revive the economy.

Ergo - The ‘Law of Diminishing Returns’ - The first choc ice is ace, but by the time you get through the third or fourth, it’s yuck!

Watch this space I’ll be back!

Tom.