America pulls out a hanky and the world catches cold

I watched (listened, read) in stunned disbelief as it all happened overnight. Standard and Poors dropped the US economy’s rating to AA+ and billions – billions of dollars disappeared from the international stock exchanges – US, Australia, Europe, Asia – in seconds. Poof! All gone.

Say what? Is this some kind of conjuring trick? Because it isn’t funny. That’s my self-funded retirement these clowns are tinkering with. Let’s just stop panicking, breathe deeply into a paper bag and get logical. I may not know much about economics but I can still ask questions. What REALLY happened that day? An earthquake? A tsunami? A terrorist attack?

Nup. A ratings agency down-graded its assessment of the US economy’s risk. Nothing else changed. Nobody went bust, the wheels of industry continued to turn, people bought stuff in shops. Bear in mind, too, that S&P, which has the dubious distinction of declaring Freddie Mac and Fannie Mae as triple A ratings just before they collapsed, was the only agency making that change. Bear in mind that China and Saudi Arabia both have AA economies. Doesn’t seem to have affected them much.

Why does this piece of paper sleight of hand wipe billions off the Australian stock exchange? We have a stable economy and booming commodities industries. Why don’t our stock brokers stare ’em down? Let’s face it – the stock market is just another form of legal gambling, particularly the futures market. Some of the most highly valued stocks are for companies which don’t actually produce anything – like the world’s banks. They’ve done us all a great, big favour of late, haven’t they?

I’m relieved to see some degree of sanity has returned. Australia’s stock market recovered fairly well, probably when the real people checked what the computers had sold, given a pre-programmed trigger event. And I suppose a few people jumped in quickly to pick up the bargains.

I dunno. It really makes me think that the world economy is based on a tissue of lies. How long are we going to get away with living beyond our means? I don’t mean budgets, people. I mean raw materials like copper, tin, lead and oil. For heavens sake, we’re buying up food crops or ploughing them in to grow organic fuel while millions die in Africa from starvation. It’s well and truly time we considered real sustainability and living within the planet’s means. A better economic model is something that the world’s leaders CAN do something about.


About Greta van der Rol

I'm an author of fast-paced, action-adventure novels, mainly space opera - although I've been known to write in other genres. I live not far from the coast in Queensland, Australia and enjoy photography and cooking when I'm not bent over the computer. I have a degree in history and a background in building information systems, both of which go a long way toward helping me in my writing endeavours.

Posted on 10 August 2011, in Life and things and tagged . Bookmark the permalink. Leave a comment.

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