There’s an old saying that, ‘When the USA sneezes, we all catch
cold.’ Alistair Darling and Gordon Brown know that the USA is already
in recession. They know that the financial crisis is causing the
hatches to be battened down all over the world. But, they say, Britain
is immune. They’ve even commissioned a Treasury report to try to prove
it. Don’t believe them. The chill winds of economic crisis are
coming our way. The parallels between the US, which is already in the
mire, and the UK are stark.

The Financial Times has reported a debate among accountants
about giving a ‘fair value’ to company assets.
What does this mean? As we know, finance capital has a slight problem at present.
Banks, hedge funds and other financial institutions have assets on their books
that they have found out are actually not worth as much as they thought when
they paid for them.

The nineteenth century was an era of price
stability. It was also the age of the gold standard. Inflation can have many
triggers, but it always involves an increase in money emissions at some point
in order to give expression to higher prices. It is difficult to increase the
money supply quickly if you have to mine precious metals, so runaway inflation
just didn’t happen back then. The government can’t really control inflation.
Now it’s back!