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Generational Dynamics Web Log for 10-Nov-2010
10-Nov-10 News -- Europe and Asia bash quantitative easing as G-20 meeting approaches

Web Log - November, 2010

10-Nov-10 News -- Europe and Asia bash quantitative easing as G-20 meeting approaches

South Africa's Boer farmers are headed for Georgia

Europe and Asia bash quantitative easing as G-20 meeting approaches

About 200 organizations have registered to demonstrate during the Group of 20 (G-20) economic summit being held on Thurday in Seoul, South Korea. Many protests will feature such theatrical tactics as animal sacrifices, torch burnings, flag-eating, dummy decapitations and feces hurling, according to the LA Times.

But the main drama is likely to take place in the meetings themselves of the leaders of the 20 "rich and developing nations."

Countries around the world have been bashing the quantitative easing proposal announced last week. Under this proposal, U.S. Federal Reserve central bank will purchase $75 billion in U.S. Treasuries each month until next summer. That money has to go somewhere, and officials in many countries are concerned that the money will create asset bubbles and destabilize their own economies.

German Chancellor Angela Merkel is concerned about a major confrontation between China and the U.S., and has said that she hopes to avoid one, according to Reuters.

The confrontation would come over the long-running American accusation that China has been artificially weakening its currency in order to makes its export products more competitive, and American exports less competitive.

An analysis by the Chinese government publication Global Times gives the reasons why China objects to the new Fed program:

"The most serious problem for the US is the lack of effective demand rather than an insufficient money supply. Currently, the US needs a new fiscal stimulus package and to maintain a strong dollar, rather than the further proliferation of liquidity.
Additional liquidity will not quickly enter the real economy and become assets. It will flow into financial institutions both domestically and overseas, creating new asset bubbles, which might lead to inflation both in the US and globally, and even an uncontrollable situation.
The new round of quantitative easing has brought fresh risks to the majority of the emerging markets. The recent uncontrollable issuing of the dollar and the continued rising of international commodity prices are bringing imported inflationary shocks to developing countries.
The world's creditor countries and emerging economies have been pushed to the edge of potentially malignant inflation and disorderly currency devaluation.
The US policy has not only increased imported inflationary pressure, but also made China suffer huge losses of foreign reserves."

The article goes on to describe imbalances that the QE program will create, and says: "This in turn will trigger a global "devaluation race," which will lead to intensified currency disputes and may cause a new worldwide "currency war" and trade protectionism, thus threatening global economic recovery."

President Obama, who will be attending the meeting on Thursday, has promised to put on a vigorous defense of the Fed proposal. Whether anyone will be convinced remains to be seen.

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When "land reform" occurs in southern Africa, it usually means taking land from white farmers and giving it to black farmers who may or may not have the skills to actually grow anything. (See, for example, "Zimbabwe's 'Liberation Hero' president Robert Mugabe continues to destroy his country.") Now there are fears that South Africa's government will adopt a similar "land reform" program, targeting the country's 40,000 white farmers, most Boers, descendants of Dutch settlers. Many of them are considering accepting an offer by the Georgian government to buy up land in Georgia at rock bottom prices in exchange for bringing their expertise and knowledge of modern farming methods. Independent

Morocco and Western Africa <font face=Arial size=-2>(Source: Al-Jazeera)</font>

Morocco and Western Africa (Source: Al-Jazeera)

Violence is growing between Morocco's security forces and a separatist group called the Polisario Front who are demanding independence for Western Africa, which was annexed by Morocco in 1975. This appears to be yet one more example of stop-start violence between a government and an ethnic group demanding independence, where the violence goes on for decades until it explodes into a full-fledged generational crisis war. Al-Jazeera

France's president Nicolas Sarkozy lost no time in signing into law the pension reform bill that raises the retirement age from 60 to 62. During the Parliamentary debate on the bill, millions of protesters filled the streets. New protests are scheduled for November 23. Agence France Presse (AFP)

(Comments: For reader comments, questions and discussion, see the 10-Nov-10 News -- Europe and Asia bash quantitative easing as G-20 meeting approaches thread of the Generational Dynamics forum. Comments may be posted anonymously.) (10-Nov-2010) Permanent Link
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Generational Dynamics Web Log for 10-Nov-2010 10-Nov-10 News -- Europe and Asia bash quantitative easing as G-20 meeting approaches

Europe and Asia bash quantitative easing as G-20 meeting approaches

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Generational Dynamics Web Log for 10-Nov-2010
10-Nov-10 News -- Europe and Asia bash quantitative easing as G-20 meeting approaches