“The Worst Role of Government in the Markets”

Global Market Update From Damien Cleusix Via Zero Hedge

I feel it is important to emphasize – as we move toward recession – that we shouldn’t blame what is happening here on capitalism or free markets. We really have only a caricature of those here. We have a system that is constantly eager to abandon the proper role of government in the markets – which is effective regulation of risk – and to substitute it with the worst role of government in the markets – which is absorbing losses for those whose losses should not be absorbed, and pursuing policies tilted toward the constant creation of speculative bubbles and the avoidance of required economic adjustments, rather than the productive allocation of capital.

Cleusix says the financial sector, banks more specifically, are using the ghost of the Lehman Brothers to scare the government and the public into believing shareholder and bondholder losses will mean downfall for us all. Clearly governments worldwide have embraced this culpability. The Occupy movement also clearly shows the public backlash to the abject robbery of the past decades. He also gives a succinct summary of the Eurozone turbidity, foreign exchange markets, equities, and commodities (gold and copper).

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