The current financial crisis affecting the western world appears to have potentially spiralled out of control. The extent to which a fix can be applied to the problem is doubtful, given that much of what is stated in the public press appears to have overlooked some root cause issues that no-one, especially not regulators or their agencies, wish to address.
It would appear that financially, the Greek economy has been on the nose for some period of time. Financial commentators readily admit to knowing that the Greek economy has been a basket case for decades, if not beyond. Their ability to address their own internal issues has been questioned in many quarters and yet, here we are in 2011, with banks and government monetary authorities concerned about the possibility of default by Greece triggering potential financial losses amongst a wide group of private and public investors.
The question that goes begging is why were loans made to Greece in the first place to the extent that they had been? Why was Greece even invited into the Eurozone? Which of the Global Investment Banks earned incredibly outlandish commissions or fees for structuring and brokering Greek debt?
The reality is that until these questions are addressed and the global investment banks brought to account for their careless and reckless behaviour, long term real solutions to the current financial woes of the western world will never be addressed.
This brings into focus the whole value proposition of when is enough enough? At what point in time does financial gain become purely the end point rather than the means to an end in itself?
This underlying question is perhaps at the heart of the latest publication by Dr. Diane Coyle PhD whose orthodox economic views are in fact quite refreshing when seen in the context of her latest expose regarding the explosion of executive remuneration levels in the western world.
What expectations are we building into a society that in Australia, despite general public opinion, is experiencing an ever widening gap between those that have it and those that don't. Our society is fracturing and the historic egalitarianism upon which Australia was built, is gradually slipping away.
Sad to say, but greed is taking over and corporate greed in the finance sector is partly to blame.
The Greek crisis and all that will follow can never be resolved until, as a society, we decide when enough is enough, when the accumulation of wealth without purpose and without recognition that there is a growing list of an Australian underclass, without bringing to heel the investment banking falseness of creating artificial reality, is brought to finality.
With so many worthwhile human causes in Australia and abroad, the accumulation of wealth through such artificial means that leave nothing of substance in their wake, seems pointless.
Maybe Greece and others defaulting will provide the reality hit that is so desperately needed in the western world.
The world's financial crisis can be felt moreover in many countries, communities and societies of the world - and that's really obvious. cpa continuing professional education
ReplyDeleteSo what's to be done about it? Why are the global investment banks not even being seen as part of the problem? What role did Goldman Sachs play in the Greek disasters when they structured the Greek debt and why is this not discussed as part of the overall problem? I understand that during this period the Greek Treasury actually ran 2 sets of books (? Is this true?). Is someone trying to convince the rest of the world that their financial advisers at the time did not know about this? I'm sure their fee was still paid and the resulting bonuses within Goldman's still stood? Are we going to learn from the GFC or are we sticking our collective heads in the sand and not really focused on ALL the relevant issues? Is that too painful and embarrassing an exercise?
ReplyDeleteOnce again I ask - how much wealth is enough for any one group, any one company, any one individual when the world is begging for better social and human outcomes.
What mistakes will we continue to make time after time?