20 February 2017
Reality in Trumpland (what's he smoking?)
Its very easy to poke fun at Donald Trump. He presents a huge target and his regular and outlandish claims and statements of 'fact' give a new meaning to the term 'fake news'. But poking fun a Trump disguises the very real threat he represents to us all.
After the financial chaos of 2007/8 governments both here and in America brought in regulations to restrict the ability of banks to indulge in 'casino banking'. Banks had to split their operations so that their 'riskier behaviours' were undertaken with their own money rather than yours and mine. At the same time, banks were required to hold larger capital reserves so that, should the worst come to the worst, they could call on their own reserves rather than coming running to the taxpayer. All well and good but now Trump wants to get rid of these restrictions because, in his view, they are bad for business, confirmation if such was needed that Trump likes to play with other people's money, rather than his own.
Now, I have felt for some time that the financial sector needs a real overhaul to promote modest rather than excessive rates of growth. At the same time, banks, and bankers themselves, should be made directly responsible for their actions. This might mean that irresponsible actions might result in bankers loosing their houses rather than savers loosing their savings.
But the financial establishment is a pretty resilient beast and, thus far, has shown itself capable of resisting meaningful regulation. In Trump (as with Thatcher and Reagan before him) the financial institutions have a great supporter and they can probably look forward to a reduction in regulation and a bonanza in bonuses. And this might finally bring about the collapse of free market, unregulated capitalism, which, in turn, might offer the opportunity for the restructuring that the institutions have so successfully resisted for so long.
So Trump might, by accident, represent an opportunity albeit a painful one. (Read about Charles Eisenstein's thoughts on the subject here.)
Posted by niall connolly at 18:21