Daily archives: June 14, 2011


Inflation as measured by the retail price index remains stubbornly at 5.2%, despite all the obvious deflationary pressures on the economy and continuing weak consumer demand. Strangely, the attempts to explain this being offered by media pundits all miss out quantitive easing, or to use a more old-fashioned term, printing money.

It is deeply unfashionable to hold to the view that simply to create more money reduces the value of the money already in circulation in relation to the supply of available goods; but that is what all history tells us (the benchmark example being the rampant inflation after Spanish opening up of the New World greatly increased the amount of gold coinage in circulation). Common sense tells us that too. Otherwise we could simply solve many of our problems by printing another couple of trillion pounds.

A couple of years ago, I suggested “Enough quantitive easing and we can eventually get back to stagflation”. We are just about there. Why have none of the experts noticed?

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Those Americans struggling through housing repossession, unemployment and medical bills will be delighted to see it confirmed that 6.6 billion dollars of US taxpayers’ money in cash was stolen during the Iraq war, probably by members of the US’ puppet Iraqi administration. Precisely the same thing has been happening in Afghanistan, with less publicity so far.

More details are emerging about the supply of Egyptian natural gas to Israel, way below the world price and reportedly even below the cost of production, and the bribes received by Mubarak, his sons and Hussein Salem, Mubarak’s bagman. But what is going to be really fascinating to see is whether evidence comes out of US influence in the corrupt aspects of this deal, (the origins of which were in a hidden protocol to Camp David, which subsidised Israel and boosted their Egyptian puppet.

The tides of Middle Eastern events are linked in numerous ways. Pressure on Hamas to reconcile with Fatah was not only coming from their own people, but from the loss of Hamas’ support from Syria’s Assad and their operating base in Damascus. Hamas’ links with Syrian Islamic groupings, which are now in the resistance to Assad, led to this breakdown in relationships. The importance of Assad’s logistic support to Hamas has been largely overlooked. Yet the awful Assad is still viewed by the West as more accommodating to Israel than any successors might be, which is one major reason why there is still no concerted call for him to step down, despite the largest scale and most sustained violence against civilians of the entire Arab spring.

Meantime NATO’s continued bombing raids in Libya seem ever more a waste of time and money – something which UK taxpayers currently do not have to spare. That our Middle Eastern policy is based on self interest and not on support for principles of freedom is undeniable, with Bahrain the most glaring example. The medical staff are today being processed through a military tribunal for imprisonment for treating injured protestors, while yet another prominent opposition activist has died from torture, without a peep from our government. So we obviously do not care for human rights. But what preisely we are supposed to be achieving in terms of self-interest in Libya is equally unclear, as our involvement in this low level civil war fritters away money and resource apparently with no plan.

The same is true of Afghanistan, where we seem to have accepted finally that we are not going to create a western democracy, nor is there significant progress in reconstruction. It will make virtually no difference to events if we leave tomorrow or in 2015. We are paying a great price in blood and treasure for the pride and arrogance of our political class.

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