Pritchard echoes LaRouche: The breakdown of the world system is here!

First, an economics lesson for all the economic illiterates with economics degrees: there is absolutely no way to save the world financial system—it’s a classic catch-22; either most of the world’s banks collapse under their unpayable debts and derivatives obligations, or the bailout required to save them creates Weimar Germany-style hyperinflation on a global scale.

Since the September 2008 collapse of Lehman Brothers, which took the world to the brink of the first possibility, central banks and governments have opted for the second—hyperinflation. (Faced with the choice of firing squad or boiling in oil, they chose the oil.)

Any economist who denies the above, and insists we are in a recovery, is either lying or illiterate.

Following Barack Obama’s blocking in June of legislation to re-enact Glass-Steagall, on the back of the Greece/Spain Euro crisis, LaRouche said the system was finished. In August, when the U.S. Federal Reserve announced a new round of money-printing, “Quantitative Easing II”, sparking a flash of speculation in commodities, LaRouche reiterated his statement, pointing out that we are in the same territory as the last few months of Weimar Germany in 1923, when money-printing was the only economic driver—before it all melted down.

Now, the highly-connected London Daily Telegraph economics editor Ambrose Evans-Pritchard has echoed LaRouche, in a dramatic fashion.

Ambrose wrote on 27th September, under the headline “Shut down the Fed (Part II)”: “I apologise to readers around the world for having defended the emergency stimulus policies of the US Federal Reserve, and for arguing like an imbecile naif that the Fed would not succumb to drug addiction, political abuse, and mad intoxicated debauchery, once it began taking its first shots of quantitative easing.

“My pathetic assumption was that Ben Bernanke would deploy further QE only to stave off DEFLATION, not to create INFLATION. If the Federal open Market Committee cannot see the difference, God help America.

“… So all those hillsmen in Idaho, with their Colt 45s and boxes of krugerrands, who sent furious emails to the Telegraph accusing me of defending a hyperinflating establishment cabal were right all along. The Fed is indeed out of control.

“… Sooner or later we may learn what the Fed’s hawkish bloc of Fisher, Lacker, Plosser, Hoenig, Warsh and Kocherlakota really think about this latest lurch into monetary la la land, with all that it implies for moral hazard and debt contracts.

“If I have written harsh words about these heroic resisters, I apologise for that too.”

Pritchard’s piece is illustrated by a picture of current Fed chairman Ben Bernanke and Rudolf Von Havenstein, with the caption: “Inflation targeting: is Bernanke the new Von Havenstein, head of the Weimar Reichsbank?”

The only way to have a functional financial system, is to scrap the existing one and start again, as Lyndon LaRouche spelled out in his 24^th September webcast entitled, “The New Economy.”