Monday, 31 October 2016

Free Trade Doctrine hits the buffers

Adam Smith may have left us a nice homely with his illustration of free trade benefits (selling nails to Portugal in exchange for wine). And there certainly is an element of truth in it. Exchanging goods and services with others DOES bring benefits to both, domestically and internationally.
But one can take this doctrine too far. When societies that are on a completely different level of development are suddenly brought into the pictures (China, India etc) one cannot allow them to compete on an unconstrained basis and accept them as equals in the marketplace.

ECB blabbering

"Taken together, the ECB's current policy settings are appropriate and are clearly providing the support required to sustain the recovery," Coeure said, adding that support will stay in place "until inflation is sustainably adjusting to our objective."
Well, Benoit Coeure - a signed-up member of the unelected Eurocracy ruling over us and stealing from all hard-working savers in the Eu(rozone) - utters another non-sensical and contradictory statement.
What does he mean by 'recovery'? it probably means economic GROWTH, but then he seems to indicate that inflation is 'their' objective? So would that mean inflation running at 2, 3 or more percent would be 'success', whatever the level of growth?