Austerity – essentially saving and paying back – is probably a recipe for a In ancient Mesopotamia, debt was commonplace; individual debts. Posts about Back to Mesopotamia written by aurelius Ways Out Of The Crisis”” where The Boston Consulting Group (BCG) helped explain. In Back to Mesopotamia? a now prescient report by the Boston Consulting Group (BCG) published in September it was argued that, while.

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The day after should come asap.

It will take time. Capital gains on paper must also be taxed.

Printing does not solve anything, it just delays the inevitable. The governments who have borrowed were elected democratically, goes the reasoning, therefore their actions are legitimate. Citizens must resign themselves to paying off the debt. Austerity — essentially saving and paying back — is probably a recipe for a long, deep recession and social unrest Higher growth is unachievable because of unfavorable demographic change and an inherent lack of competitiveness in some countries Debt restructuring is out of reach because the banking sectors are not strong enough to absorb losses Financial repression holding interest rates below nominal GDP growth for many years would be difficult to implement in a low-growth and low-inflation environment Inflation will be the preferred option — in spite of the potential for social unrest and the difficult consequences for middle-class savers should it really take hold.

To find out more, including how to control cookies, see here: We should tax them accordingly, with a clear, relevant, surcharge in order to induce downsizing to smaller levels. Email required Address never made public. Another POMO desk war casualty. By continuing to use this website, you agree to their use. In considering some of the potential measures likely to be required, the reader may be struck by the essential problem facing politicians: In this paper, we describe what might need to happen if the politicians muddle through for too much longer.


Fiscal policy cannot be a substitute for supply side generated aggregate demand.

Back to Mesopotamia by the way of Cyprus | The Yogi Rock

In other words, the slate would be wiped clean. And mewopotamia outsized salaries and stock option payments to the company executives. It is likely that wiping out the debt overhang will be at the heart of any solution. We believe that some politicians and central banks — in spite of protestations to the contrary — have been trying to solve the crisis by creating sizable inflation, largely because the alternatives are either not attractive or not feasible:.

We need to fully employ the highest percentage of the population that we can. However, boosting inflation has not worked so far because of the pressure to deleverage and because of the low demand for new credit.

First, the preamble from the old ZH post: But some facts would need to be acknowledged before decisive action could be taken:. Alas, even politicians now realize there is only so far that the can can mesopotamix kicked. The truth is far, far uglier than anything anyone in a position of power will tell you because acknowledgment would imply the need to come up with solutions that involve more than merely extending the event horizon for a little longer.

If we want a sound economy, we have to accomplish a couple of major paradigmatic changes in the actual order of things. In Back to Mesopotamia? The only possible discussion focuses on how to distribute the burden of sacrifice needed in order to free up enough budgetary resources to fulfill the commitments of the indebted nation. More than three years ago, the Boston Consulting Group came out with a first class report that used the following words as a subtitle: I am not suggesting we have to tax more.


Fiscal paradises have to be outlawed. The longer the politicians and bankers wait, the more necessary will be the response outlined in this paper.

Funny thing is – this is likely just a test run. BCG wrote the scenario up back | Hacker News

More likely by a third or more. If governments chose this course of action, only true debt relief and thus an end to the painful deleveraging process could lay the foundation for a return to economic growth. Mesopotajia now it is time to face the facts.

The would not be popular, and they would require broad political coordinate and leadership — something that politicians have replaced up til now with playing for time, in spite of a deteriorating outlook. No substantial deleveraging has taken place, and numbers are big enough for a nightmare scenario.

Back to Mesopotamia? (The Boston Consulting Group)

Free trade for all companies, on a level playing ground. But not before the biggest episode of “transitory” pain, misery and suffering in the history of mankind. Take action to reduce dependency on imported oil by investing in new technologies and modernizing existing infrastructure.