The Euro



'THERE MAY BE TROUBLE AHEAD'


'It'll all end in tears !', as Eddie (1), the shipboard computer on the starship 'Heart of Gold', in Douglas Adam's 'Hitchhiker's Guide to the Galaxy' (2), remarked on landing on the planet of Margathea (see right).

Currencies can be very useful for the majority of people, as long as one's attention is not focussed on them - those little intrinsically worthless pieces of paper and disks of base metal - which smooth our way through life.

The problem, of course, is that they are intrinsically worthless, as the Germans found out to their cost in the 1920s.
(see left a fifty million mark note -
which might have just bought a loaf of bread !)

And the solution ?

First the Rentenmark,
(see right - which surprisingly restored the value of the German currency),
and then the Reichmark, (see right), and finally World War,

which eventually gave birth to the mighty Deutschmark (see left).

And was the Deutschmark the precursor of the Euro ?


Well by the way that Angela (3) is behaving the answer is probably yes.

And what, you may ask, is the Rentenmark (here I am writing for the non historians and non economists) ?

The Rentenmark (literally, "Debt Security Mark") (RM) was a currency issued on 15 November 1923 to stop the hyperinflation of 1922 and 1923 in Germany.
The Rentenmark replaced the Deutsche Mark.
Due to the economic crises in Germany after World War I, there was no gold available to back the currency, therefore the Rentenbank, which issued the Rentenmark, mortgaged land and industrial goods worth 3.2 billion Rentenmark to back the new currency.
The Rentenmark was introduced at a rate 1 Rentenmark = 1012 Deutsche Mark, establishing an exchange rate of 1 United States dollar = 4.2 RM.
The Rentenmark was only a temporary currency and was not legal tender.
It was, however, accepted by the population and effectively stopped the inflation.
The Reichsmark became the new legal tender on 30 August 1924, equal in value to the Rentenmark.

The monetary policy spearheaded by Hjalmar Schacht (4) (see left) the Central Banker and Hitler's economic miracle worker - together with the fiscal policy of German Chancellor Gustav Stresemann (5) (see right) and Finance Minister Hans Luther (below left) brought the inflation in Germany to an end.


Now why was the Rentenmark so effective in bringing German hyperinflation to a halt, and producing a stable economy ?

The simple answer is that mortgaged land and industrial goods, instead of gold, was was offered as collateral on the currency - thus guaranteeing its value - and perhaps the present European leaders could learn something from that position.

The problem of the Euro is that while the economies of some states can 'represent' a realistic guarantee of the currency's value - ie Germany, other states, ie Greece cannot.

In addition those countries tainted with 'orientalism' in the past, - Greece, Spain, Portugal and Italy, have developed an economic culture of excessive credit and non-payment of tax.
These states, on becoming part of an organisation which has been dominated by a culture built on a 'Teutonic/Protestant' work ethic have now found that their excessive debt can no longer be disguised by currency manipulation, and now find themselves exposed to demands for repayment which their total assets cannot cover.

The author of this blog would suggest, therefore, that the eventual result of this situation will probably be the 'shrinkage' of the European Union - to exclude low productivity economies, and the removal of such economies from the Euro Zone.

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Notes


(1) Eddie is the name of the shipboard computer on the starship Heart of Gold.
Like every other system on the spaceship, it has a Sirius Cybernetics Corporation Genuine People Personality. Thus, Eddie is over-excitable, quite talkative, over-enthused and extremely ingratiating, or alternatively a coddling, school matron-type as a back-up personality.
Shipboard networking interconnects Eddie with everything on the Heart of Gold; at one point, the whole ship is effectively crippled by Arthur Dent's request for tea from the Nutrimatic drinks dispenser; the computation of which nearly crashed Eddie and everything connected to him.

(2)The Hitchhiker's Guide to the Galaxy is a science fiction comedy series created by Douglas Adams. Originally a radio comedy broadcast on BBC Radio 4 in 1978, it was later adapted to other formats, and over several years it gradually became an international multi-media phenomenon. 

(3) Angela Dorothea Merkel née Kasner; born 17 July 1954 is the current Chancellor of Germany (since 22 November 2005).
Merkel, elected to the Bundestag (German Parliament) from Mecklenburg-Vorpommern, has been the chairwoman of the Christian Democratic Union (CDU) since 2000, and chairwoman of the CDU-CSU (Christian Social Union) parliamentary coalition from 2002 to 2005.
From 2005 to 2009 she led a grand coalition with the Christian Social Union (CSU), its Bavarian sister party, and the Social Democratic Party of Germany (SPD), formed after the 2005 federal election on 22 November 2005.
In the elections of 27 September 2009, her party, the CDU, obtained the largest share of the votes, and formed a coalition government with the CSU and the Free Democratic Party (FDP). Her government was sworn in on 28 October 2009.
In 2007, Merkel was also President of the European Council and chaired the G8.
She played a central role in the negotiation of the Treaty of Lisbon and the Berlin Declaration.
In domestic policy, health care reform and problems concerning future energy development have thus far been major issues of her tenure.
Merkel is the first female Chancellor of Germany.
In 2007, she became the second woman to chair the G8, after Margaret Thatcher. In November 2011 she became the longest-serving leader of a G8 country.

(4) Dr. Hjalmar Horace Greeley Schacht (22 January 1877 – 3 June 1970) was a German economist, banker, liberal politician, and co-founder of the German Democratic Party.
He served as the Currency Commissioner and President of the Reichsbank under the Weimar Republic.
He was a fierce critic of his country's post-World War I reparation obligations.
He became a supporter of Adolf Hitler and the Nazi Party, and served in Hitler's government as President of the Reichsbank and Minister of Economics.
As such, Schacht helped implement Hitler's policies of redevelopment, reindustrialization, and rearmament.
He was forced out of the government by disagreements with Hitler and other prominent Nazis in December 1937, and had no role during World War II.
After the war, he was tried at Nuremberg and acquitted.
In 1953, he founded his own bank, and advised developing countries on economic development.

(5) Gustav Stresemann (help·info) (May 10, 1878 – October 3, 1929) was a German politician and statesman who served as Chancellor and Foreign Minister during the Weimar Republic.
He was co-laureate of the Nobel Peace Prize in 1926.
Stresemann's politics defy easy categorization.
Arguably, his most notable achievement was reconciliation between Germany and France, for which he and Aristide Briand received the Peace Prize.




Arab Spring


3rd August 2011 - Egypt - From President to Criminal

When the author of this blog first visited Egypt about 15 years ago he found village people living in mud-brick houses, with a fan to keep cool in the summer, with black and white televisions, if they were lucky an ancient 'phone, and maybe a bicycle.
Now they live in brick and concrete houses, with air conditioning, with colour and satellite television, - even the children have mobile phones, many have computers, and many have cars, or at least a motor-bike.
Hospitals are better, shops are full of copies of designer clothes and most people are decidedly better off.
But the man who led the government which provided these improvements is in a 'cage', awaiting a trial and undoubtedly punishment.
It's unlikely he was responsible for more deaths than the still deeply revered Nasser, and while he and his family were undoubtedly 'corrupt', then so are the majority of the Egyptian people - they always have been - from the time of the Pharaohs, - and probably always will be - the Mubaraks were just corrupt on a presidential scale.
In the civilised world we don't put 83 (?) year old men (even if we think they are murderers) in cages, even before they have been found guilty - so the Egyptian people - who seem to want this - seem to be as barbaric as the so-called 'criminals' whom they are so keen to humiliate and punish.

And punishing Mubarak and his sons will not solve any of Egypt's intractable problems.
The most likely outcome of all this lunacy will probably be a fundamentalist (Salafist) Muslim government, which will topple Egypt into the mire at present occupied by Sudan and Somalia - but then, as the author of this blog has always said - 'the Egyptians are good at shooting themselves in the foot !'




The New Arms of Egypt ?

And as for the much vaunted 'Arab Spring' - it's the beginning of an 'Arab Night' - plunging the whole area into conflict and economic disruption - that is, even more conflict and more economic disruption - which in the end will undoubtedly be unjustly blamed on the West and the Zionists.

23rd August 2011 - Libya

Never trust an Arab ! - Good advice from John Stokes Crawford.

In Libya, as Gaddafi grew old, certain members of his government decided that they didn't want to be passed over as Gaddafi sons took over - and so the broke away - moved to Bengazi - and set up an alternative government. Just another Arab coup.
They said they were creating a democratic, free Libya - but Arabs have no understanding of the words - they only understand the family and the tribe.
All the nonsense about freedom and democracy was simply for Western consumption - a ploy to get money and military support.
Now they have entered Tripoli, claiming to have captured two of Gaddafi's sons, whom they claim they have sent to the International Criminal Court of Justice. - Just another Arab lie !
What should the West do ?
Have nothing to do with these Arab family squables !
Leave them to stew in their own internecine conflicts.


The new dictator of Libya ?

Mustafa Abdul Jalil  (left) (born 1952) is a Libyan politician.
From 2007 to 2011, he was Minister of Justice (unofficially, the Secretary of the General People's Committee) under Colonel Muammar al-Gaddafi.
It was he who sentenced to death the Bulgarian nurses.
During the 2011 Libyan civil war, Abdul Jalil has been identified as the Chairman of the National Transitional Council based in Benghazi, which controls much of the country in opposition to Gaddafi in Tripoli.
Now the new, unelected government of Lybia has accused neighbouring Algeria of an 'act of war' - and have declared that they wish to execute Gaddafi by firing squad.


مُعَمَّر القَذَّافِي‎ 
Muʿammar al-Qaḏḏāfī

Muammar al-Gaddafi was raised in a bedouin tent in the desert near Sirt.
According to most conventional biographies, his family belongs to a small tribe of arabized Berbers, the Qadhadhfa.
They are mostly stockherders that live in the Hun Oasis.
According to Gaddafi, his grandfather, Abdessalam Bouminyar, fought against Italian occupation of Libya and died as the "first martyr in Khoms, in the first battle of 1911".
Gaddafi attended a Muslim elementary school as a youth, during which time he was profoundly influenced by major events in the Arab world.
He was passionate about the success of the Palestinians and was deeply disappointed by their defeat to Israeli forces in 1948.
He admired Egyptian President Gamal Abdel Nasser, and looked to him as hero during his rise to power in 1952.
In 1956 Gaddafi took part in anti-Israeli protests during the Suez Crisis.
He finished his secondary school studies under a private tutor in Misrata, concentrating on the study of history.
In Libya, as in a number of other Arab countries, admission to a military academy and a career as an army officer only became available to members of the lower economic strata after independence.
A military career offered an opportunity for higher education, for upward economic and social mobility, and was for many the only available means of political action.

For Gaddafi and many of his fellow officers, who were inspired by Nasser's brand of Arab nationalism, a military career was a revolutionary vocation.
Gaddafi entered the Libyan military academy at Benghazi in 1961 and graduated in the 1965–66 period, along with most of his colleagues from the Revolutionary Command Council (RCC). Gaddafi's association with the Free Officers Movement began as a cadet.
The frustration and shame felt by Libyan officers at the time of Israel's defeat of the Arab armies on three fronts in 1967 fueled their determination to contribute to Arab unity by overthrowing the monarchy.
An early conspirator, Gaddafi began his first plan to overthrow the monarchy while in military college.
Gaddafi pursued further studies in Europe, and false rumors have been propagated with regards to this part of his life—for example Gaddafi did not attend the Royal Military Academy Sandhurst, though he did receive further military training in the United Kingdom.
On 1 September 1969 a small group of junior military officers led by Gaddafi staged a bloodless coup d'état (bloodless - unlike the revolution against Gaddafi which has shed an ocean of blood - with the help of the European powers) against King Idris while he was in Turkey for medical treatment.
His nephew, the Crown Prince Sayyid Hasan ar-Rida al-Mahdi as-Sanussi, was formally deposed by the revolutionary army officers and put under house arrest; they abolished the monarchy and proclaimed the Libyan Arab Republic.

Gaddafi looked to Gamal Abdel Nasser as a role model and based his government on Nasser's Egypt.
Gaddafi's ideology was largely based on Nasserism, blending Arab nationalism, aspects of the welfare state, and what Gaddafi termed "popular democracy", or more commonly "direct, popular democracy".
He called this system "Islamic socialism", as he disfavored the atheistic quality of communism. While he permitted private control over small companies, the government controlled the larger ones.
Welfare, "liberation" (or "emancipation" depending on the translation), and education was emphasized.
He also imposed a system of Islamic morals and outlawed alcohol and gambling.





Death of Muʿammar al-Qaḏḏāfī



On 20 October 2011, a National Transitional Council (NTC) official told Al Jazeera that Gaddafi had been captured that day by Libyan forces near his hometown of Sirte.
He had been in a convoy of vehicles that was targeted by a US Predator Missile which was followed by a French air strike on a road about 3 kilometres (2 mi) west of Sirte, killing dozens of loyalist fighters.
Gaddafi survived but was shortly afterwards captured by a rebel militia.
At least four mobile phone videos showed rebels beating Gaddafi and manhandling him on the back of a utility vehicle before his death.
One video pictured Gaddafi sodomized "with some kind of stick or knife" or possibly a bayonet, after his capture.
In another video, he was seen being rolled around on the ground as rebels pulled off his shirt.
Later pictures of his body showed that he had wounds in the abdomen, chest, and head.
A rebel who identified himself as Senad el-Sadik el-Ureybi later claimed to have shot and killed Gaddafi. He claimed to have shot Gaddafi in the head and chest, and that it took half an hour for him to die.
Gaddafi's body was subsequently flown to Misrata and was placed in the freezer of a local market alongside the bodies of Defense Minister Abu-Bakr Yunis Jabr and his son and national security adviserMutassim Gaddafi.
The bodies were put on public display for four days, contrary to Islamic law, with Libyans from all over the country coming to view them.
Many took pictures on their cell phones.