Amid a rumour-filled day, one that stood was the chatter about the BRICS nations possibly working together to bail out Europe.The rumours seemed to be emanating out of the Brazil camp, but there were also rumours relating to China and Russia, so maybe that’s not that important.
Regardless, the whole thing is scandalous and absurd because, despite the European sovereign debt mess, Europe is actually very rich, and Brazil and China and Russia and South Africa are very poor.
Brazil, for example, is 71st on GDP per capita. China is 94.
The only reason they’re in a position to bail out Europe is because Europe has a screwed up economic system, where countries don’t control their own currencies, and because we’re a slave to accounting and the idea of central bank credibility, preventing the ECB from going whole-hog on the monetization front.
So because of totally contrived institutions — these dumb pseudo countries that don’t have their own currencies — and a silly belief in numbers, we’re getting this situation where the poor most pony up to bail out the rich.
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