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The Modern Day Fall of the Roman Empire?

Posted by Larry Doyle on March 27, 2009 1:36 PM |

I have focused on the problems in western and eastern Europe over the last few months. Those problems are not abating. Who would have thought that the host of next week’s G-20 may need the greatest amount of aid of all. 

Should Prime Minister Gordon Brown look to increase the room rates for world leaders in attendance next week? Perhaps a slightly higher fee for the mini-bar? Every little bit helps. 

In all seriousness, the U.K has spent proportionately almost three times as much in bailing out their financial institutions as the United States. 

For those unaware, the U.K. was unable to fully place 40 year debt this week. That experience, known as a “failed auction,” is financially and politically embarrassing, aside from being fiscally frightening. If a country is not able to finance itself . . .

The frustrations in the United Kingdom were expressed the other day by Conservative Member of the European Parliament, Daniel Hannan. For those who missed it, Daniel Hannan Skewers Gordon Brown, is one of the most widely viewed video clips in recent memory. It’s a must see!!

Add it all up, and the U.K. may just end up needing an IMF bailout. Read the IMF: Fifth of Britain’s GDP Spent so Far on Bailouts.

Is this the modern day equivalent of the Fall of the Roman Empire? 

LD

  • lizzy

    I watched the Hannan clip but at the time I didn’t know about the numbers involved. No wonder he was steaming. It is bad that they couldn’t sell their bonds; didn’t the same thing happen at the last auction of U S bonds? I’m loking forward to more coverage of the G-20 as it works out. I am especially curious about the idea the Chinese floated for a new international reserve system. Thanks for the excelent coverage.

  • Larry Doyle

    My pleasure. Glad you like my work. I enjoy writing so I am happy there are people who enjoy reading.

    In regard to the U.S. debt auction I referenced earlier this week, the auction went poorly but it certainly did not fail to draw sufficient interest to place all the bonds. The fact that the U.K. did not draw enough interest to place these bonds is a evry significant story. The media are downplaying it but I don’ think they should be.

    The Chinese idea will take time to play out but the mere fact that they launched it tells us what they are thinking.

    Truly interesting times.






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