G'day all, The fortunes of the Australian rouble have moved me to cast yet another rheumy eye at the world. If, as Jerry Seinfeld would have it, we are at the butt-end of the world down here, at least we're ideally positioned for the reading of entrails, eh? The IMF is broke - next time a national economy hits the wall, there'll be no-one there to 'save' it, (ie. indirectly donate money to currency speculators and extricate wealth from said economy's future so that western institutions may be reunited with their investments). Most commentators reckon central banks are the last line of world capitalism's defences (our own guru, Max Walsh, among 'em), and that the way to save world capitalism is for these to loosen their grip. Yardeni reckons 'commodity' prices are the leading indicator of world economic health, and he's been watching 'em plummet for a while now (which is why the Oz currency is in the toilet - imagine a large sheep paddock, dotted by the burrows of introduced species of miners, and you've a good take on our economy). So what's the Fed gonna do? Steve Beckner reckons it's gonna tighten. It seems the US economy is enjoying the world's agonies just now - as dollars flee from around the world to spend the Autumn on Wall St and world product is vomited on to American shelves at whopping cross-currency-driven discounts. There, the Fed needs to keep a lid on the pot, lest it boil over - but everywhere else cheaper money is needed to whip up demand and (theoretically) employment. Everyone keeps revising world growth projections downwards (I remember scoffing at the IMF's 4.1% prediction only last year); no-one has explained a likely scenario for world recovery, although many say it'll eventually blow over; Japan is not yet walking its talk of ruthlessly criticising its own navel; Adolf Yeltzin is now even on the bourgeois nose, Chernomyrdin has only a delinking, rouble-printing option open to him, and the chances of a 'stable' Russian government in 2000 are, er, modest; and India and China (which must have constituted a significant portion of that IMF projection) are beginning to creak - yet Wall St keeps making like Mr Creosote. Better get a bucket ... Cheers, Rob.
