STWR - Share The World's Resources

"Ideas about how the world works that don’t accord with reality can be unhelpful. That’s especially true about mainstream economics, which is based in part on ideas that made a lot of sense at some point in the last 250 years but that have outlived their time and usefulness."

"Despite the bad economic news that lies ahead before we get out of this mess, it is worth noting the return of some vitally important economic commonsense."

Global Research interviews Hamid Varzi, an economist and banker based in Tehran, about the myth of Reaganomics and Bush Jr.'s lack of foresight in re-establishing irresponsible "supply side" and "trickle-down" policies which have led to the current subprime crisis - and the tip of an economic iceberg for a nation whose wealth has been grown largely on the back of speculative credit derivatives totaling more than double the size of its entire economy.

The world is holding its breath, still trying to grasp the potential enormity of what is unfolding. Economic downturns and stock market crashes are hardly unfamiliar, of course, even if a decade or so seems a long time ago for western consumers habituated to rising house prices and non-stop shopping. But this crisis threatens to be rather different, a Big One. 

The most striking dimension of today's world economy is its huge and uncontrolled financialisation, which is not being invested in production and is merely benefiting a few multi-billionaires. Less than 1% of the Indian public has substantial share holdings. But the recent crash in the stockmarket makes front page headlines. Why?

With Wall Street capital disappearing as fast as foreclosures are climbing, one foreign head of state had an epiphany. French President Nicholas Sarkozy advanced the idea recently that the global financial system is "out of its mind." To develop this theory further, I've reconstructed below some of the mileposts on our journey to this financial loony bin.