Global Economic Crisis

U.S. home prices continue to plummet, despite the supposed American economic recovery, bought and paid for with trillions of dollars in borrowed money.  According to the latest S&P Case Shiller home price index, in the month of February American house values declined by .2 percent. This represents a year on year contraction of 3.3%. If anything, the February Case Shiller data reveals an acceleration in the rate of home price contraction in the United States.

The continuing decline in American real estate valuation, which was the original ground zero for the global financial and economic crisis, comes in conjunction with a worsening sovereign debt crisis  in Europe, Japan and the United States. The recent S&P negative forecast on future American government credit worthiness, the massive fiscal imbalance in U.S. federal, state and county governments and a stubbornly high unemployment rate make a housing recovery unlikely. All these factors together point to a continuing economic crisis in the United States.

History may not exactly repeat itself, but it often rhymes. The recent spike in oil prices, now above $100 per barrel, mirrors a development that occurred in the middle of 2008. Then, oil prices hit more than $140 per barrel.  Earlier in 2008, the U.S. Congress passed a major stimulus spending bill, financed with borrowed money,  with the promise that this step would ensure America did not slide into a recession due to falling house prices. We all know what happened afterwards; the oil spike trashed the global economy, after which the world’s financial system was brought literally to its knees. The subsequent global economic and financial crisis brought on the worst recession since the Great Depression of the 1930s.

While supposed experts maintain that the global economy is undergoing a recovery, it is fragile at best, and totally dependent on massive sovereign indebtedness, which is now bringing on a sovereign debt crisis. Just days ago, the ratings agency Standard & Poor’s turned negative on the future credit worthiness of the U.S. government.  If, on top of all these developments, oil prices return to the highs of the summer of 2008, the largely state-subsidized economic recovery underway in many advanced economies is likely to  falter, precipitating a double-dip recession.

Oil prices are not the only metric to watch in the months ahead. It  is, however, a leading indicator of  what is likely to occur to the global economy. If oil price inflation causes enough economic downturn to further depress government revenues, the accelerating sovereign debt crisis will inevitably get much worse.

It is the rating agency statement heard across the world, like the first cannon ball fired at Fort Sumter. One of the three iconic ratings agencies, Standard & Poor’s, sent panic waves through global financial market when it issued a statement on the U.S. fiscal situation, changing its previous outlook on the U.S. government’s finances from “stable” to “negative.” However one interprets the latest statement from Standard & Poor’s ( and many Washington cheerleaders claim that the statement is meaningless and America will never default on its debts), the reality is quite clear: not even the “late to the party” rating agencies that previously classified subprime mortgage-backed securities as AAA grade investments can ignore any longer the catastrophic fiscal trajectory of the United States.

In its statement, S&P indicates that if the fiscal crisis in the U.S. remain unresolved, within two years U.S. Treasuries will be downgraded. The statement acknowledges that the American political system is totally dysfunctional, and appears unable to craft a viable plan to restore fiscal sanity to America’s out of control federal government budget. Reading between the lines, and adding my own perspective ( see my report “Global Economic Forecast 2010-2015: Recession Into Depression”) it seems increasingly obvious that save for a miracle, the United States is headed for a fiscal train wreck of calamitous proportion, probably sooner rather than later.

In our corporatized consumer culture, we humans are subjected to saturation bombing by advertising moguls containing subliminal as well as overt sexual messaging. An outcome of this mass-merchandising of sexuality in the guise of the commonplace is the frequent rendering of the erotic  as ordinary and indistinguishable from the background noise of daily life. One of the ways that creative people can rebel against this vulgarization of what should be extraordinary is to find ways of restoring a sense of unanticipated spontaneity to messaging conveying the erotic aspects of the human condition.

My own recent contribution towards recapturing what is exciting and mysterious about  human sexuality was combining art with utility. In that connection, there is probably no more utilitarian object  than the ubiquitous wall clock. Unlike wrist watches, which long ago became branding  exercises and fashion statements, the commonplace wall clock, be it at the home or in the office, is merely an implement measuring the passage of time. The movement of the dial hands are about as exciting as the numbers they pass in split second motion or by the minute and hour.  In other words, the wall clock is the ultimate  appliance of dullness; inherently practical with undeniably boring optics . We look at our wall clocks out of necessity, such as counting down the moments until five o’clock in the afternoon and quitting time, or the end of a long, sleep-inducing oration.

Having done some fine art photography, with female nudes as my primary subject, I embarked on a project that involved selecting one of my images, and having it substitute for the numbers on a wall clock. The result is my first foray into measuring the passage of time, the Breast Clock (http://www.cafepress.com/nudewomen.524388146). The challenge was to select  an anatomically interesting portrayal of a  woman’s breasts, and have that image substitute for numbers on a contemporary wall clock. The result, I believe is a visually pleasing transformation from the ubiquity of the typical wall clock.

The body is aluminum, the glass face sturdy and the movement is quartz. However, that is all the Breast Clock has in common with other wall clocks. On the dial face of the Breast Clock you will not find a single number. However, what is there is, I believe, is far more interesting and visually pleasing. Keeping abreast of time (pun intended) now no longer needs to be a dull chronological exercise, but can now also arouse passion and a sense of wonderment about what remains very special and miraculous about human sexuality and eroticism.

By combining form and functionality with aesthetics and sensuality, the once ordinary wall clock is now transformed into the visually impactful Breast Clock. It still tells the time, and runs on a “AA” battery. However, that is where the similarity with other wall clocks ends. The real message here is that human creativity can design the everyday products of life to become far more exciting and stimulating. That would be a refreshing change from the current cultural trend towards rendering that which should be an emotional superlative into the bleakness of the ordinary.

Article first published as <a href=’http://blogcritics.org/politics/article/iceland-voters-reject-foreign-depositors-bailout/’>Iceland Voters Reject Foreign Depositors Bailout At Their Expense For A Second Time</a> on Blogcritics.

The politicians in Iceland, pressured by the British and Dutch governments, apparently believe that if at first you don’t succeed, try again. Already the Icelandic voters rejected an earlier referendum on repaying $5.8 billion borrowed by the governments of the UK and the Netherlands to repay Dutch and British citizens who lost their deposits at the privately-owned  Landsbanki. This Icelandic bank had 340,000 depositors in the United Kingdom and Holland, swayed by its “Icesave” high interest rates. When Landsbanki became insolvent, London and the Hague decided to make those 340,000 depositors whole by covering their losses, and then decreed that the citizens of the sovereign state of Iceland were financially responsible for paying back those two foreign governments.

The Icelandic politicians agreed, for the most part, with their colleagues in the UK and the Netherlands. However, they did not take into account the courageous president of Iceland, Olafur Ragnar Grimsson.  He used his presidential  powers to insist that Iceland’s voters  have the opportunity to decide on the scheme to cover the British and Dutch governments’ expenses in the bailout of private depositors whose funds lay in a privately-run ban. In the first referendum, the people of Iceland overwhelmingly rejected the bailout plan. Panicked but undaunted, the politicians in Reykjavik repackaged the taxpayer-funded bank depositors bailout scheme, and mounted a massive propaganda campaign to convince the citizens of the tiny country that taking on massive personal indebtedness to compensate foreign governments in a private commercial matter was a “good” idea, while rejecting the plan  would spell economic ruin for Iceland. Again, the voters turned down their scheme, though by a smaller margin. Nevertheless, the 58 percent “no” vote makes it clear even to the politicians in Iceland that the scheme is dead, and there will not likely be  a third referendum.

It is believed that the assets of the Landsbanki are worth approximately $5 billion, and would cover the vast majority of the compensation paid out by the UK and Dutch governments. That, however, does not seem to be the point. Ever since the global financial disasters of 2008, politicians throughout the Western world have been insistent on their collective view that public taxpayers must cover all losses  incurred by the private banking sector, and assume responsibility for massive quantities of private debt, irrespective of the will of the voters. The firm decision by the people of Iceland and their president provides a glimmer of hope that democracy has not yet been totally demolished  by the private banking interests and their obsequious political servants.

According to the Central Bank of Ireland, the cost of bailing out the Irish banks from the cost of their reckless business  decisions has increased by another $34 billion, on top of approximately $65 billion already spent. This news coincided with Fitch announcing another downgrade on Irish government debt. The current bill Irish taxpayers are being forced to swallow for covering the cost of the follies of the bankers is now a staggering seventy billion euros, or more than $100 billion dollars.

Hank Calenti, responsible for bank credit research at Societe Generale, said it will take another twenty years for the Irish people to pay off the money borrowed by Dublin to cover the cost of the decision by the Irish government to guarantee all the financial obligations of the private banks in the country. This means that every man, woman and child currently living in the Irish Republic is responsible for more than $20,000 in loan repayments to save their banking elite from the cost of their mistakes. Instead, it is the Irish people who will cover the losses, without any vote or input on the matter. Thus, in the wake of the global financial and economic crisis of 2008, this is what passes for Western democracy.