Thursday, December 30, 2010
“Asia’s Revenge” Is Nonsense!
The Financial Times chief economics commentator Martin Wolf made a strange argument about the recent financial meltdown on Wall Street. He published a newspaper article entitled “Asia’s Revenge,” accusing China and others of creating what he called a “Bretton Woods II” or “export-led growth” plan in order to seek revenge on the USA because Western hedge funds created the Asian crisis in 1997-98 (Financial Times October 8, 2008). It is easy to blame “others” rather than oneself. It was not the Chinese president that signed the Glass-Steagall Act in 1999. This was Bill Clinton wit overwhelming bipartisan support from congress. Nor was it the duty of the head of the Bank of China, to tighten regulations of financial derivatives and not allow cheap money on Wall Street; this was Federal Reserve former Chairman Alan Greenspan’s job. Moreover, no CEOs in China were awarded tens of millions of dollars in bonuses for creating a scheme that resulted in financial meltdown and financial chaos. It was greedy Americans who broke the law by selling subprime loans to American citizens. Nobody believes that the Chinese or the Arabs, had a plot to destroy American wealth. Unfortunately, even Ben Bernanke, the chairman of the Federal Reserve, did not understand what was going on in Wall Street; Bernanke needed a special lecture from people in Wall Street to learn the current complicated financial methods. How can one blame everything to China or others. It is American self-destruction on the Wall Street!