Inviting meltdown: Preserving the Status Quo with Artifice and Lies Leads to Systemic Collapse


These few words refer to the “economic domain” and, in particular, the sad state of the Euro. However, what I wanted to highlight (perhaps reiterate would be a better word) is the universality of complex systems. Hence the ability for us to learn lessons in economics from biology, politics from forestry management, etc.

But these are lessons that each and every business owner or wannabe business “leader” would do well to understand and apply NOW and NEVER FORGET! This isn’t new news or new wisdom and if you don’t believe me, contemplate this, from a few centuries ago:

“…in its beginning it is easy to cure, but hard to recognise; whereas, after a time, not having been detected and treated at the first, it becomes easy to recognise but impossible to cure”

– Niccolo Machiavelli

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Euro 2011: the “tipping point”


Time is NOT on our side!

Despite the urgency, Europe’s leaders still cannot decide upon the best course of action since all of the available options have potentially serious side effects on the economy and financial system at a time when Europe is already headed for a recession, if it is not already in one.  EU industrial production for October was down 2% while Germany’s ZEW (confidence index) has entered deep recessionary territory.  The leading indicators for Italy and France have also dropped to levels indicating recessions in the past.  Austerity unaccompanied by national monetary policy and the ability to devalue can only exacerbate this negative trend.

The problems appear to be spreading to the rest of the globe as well.  Both Indian and Brazilian industrial production is weakening while their leading indexes are pointing down.  Korean industrial production has been flat all year.  Notably, the developing nations’ economies are heavily export-driven, and Europe is an important customer for their goods, although there are undoubtedly country-specific factors at work as well.

Business Insider

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LIBOR: The territory looks familiar but no more appealing!


And Now Banks Are Beginning To Freak Out About Lending To Each Other Again

Euro 2011: the “game” was done in 1st Quarter but deep in the 4th the lights are going out!


Risk rating on internet

The following graphic represents our [Ontonix] rating of the entire European Union (comprising 27 countries, each described via 24 macro-economic parameters) and which we analyse every quarter (results from Q1 2011 analysis). For a more in depth analysis of feedback loops within networks the full article can be found here:

Reality is Made of Loops But All We See Is Straight Lines

A 1 star rating, in a 5 star stratification, tells anyone, pretty well, all they would need to know about the subject being rated!

Unlike the Rating Agencies our rating does not come in the form of an, over-priced, “opinion” that, on the bases of numerous failures in the recent past, are worth very little: if you received such inaccurate opinions from a Doctor or Surgeon they would have been the subject of numerous Medical Malpractice lawsuits and be struck off long before now. Their incompetence would tend to affect only one person at a time NOT tens of millions over generations!!! Read more of this post

Selling More CDS on Europe Debt Raises Risk for U.S. Banks – Businessweek


The US must be delighted that the rumbling crisis in Europe is deflecting (or merely delaying) calls for closer scrutiny of their own financial "smokescreen".

We are at the stage where I really doubt it matters which gerry-built financial structure collapses first! Conditions are such that these fragile structures will fall one after the other and those, whose personal and collective greed led them to steer a course intended to preserve accumulated power and wealth, will come to realise the futility of the exercise when they lose both…and more.

“Risk isn’t going to evaporate through these trades,” Cannon said.

“The big problem with all these gross exposures is counterparty risk. When the CDS is triggered due to default, will those counterparties be standing? If everybody is buying from each other, who’s ultimately going to pay for the losses?”

via Selling More CDS on Europe Debt Raises Risk for U.S. Banks – Businessweek.

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