Desperate Acts
from the Casey Daily Dispatch, Oct. 21, 2011

Yesterday, wearing my InternationalMan.com hat, I was having a nice chat with Gordon Chang, author of The Coming China Collapse, and thought to bring up a story that had just hit the wires out of Europe.

"Hey, did you hear that the European Union is thinking about banning rating agencies from rating sovereign bonds?" I asked.

"Yes, but I dismissed it as a hoax, a joke, right?" he replied.

Well, it's not a joke. Rather than let the newly reformed agencies prove their worth by making an attempt to accurately gauge risk, the EU is in fact contemplating to ban such contemplations.

It reminds me of the recent moves by the Argentine government to fine any economic reporting company there that dares to report an inflation figure that exceeds that of the officially sanctioned rate.

Here is an excerpt from an article on the proposed EU measure from Der Spiegel.

The European Commission is particularly concerned about countries that are negotiating financial aid - for example from the euro rescue backstop fund, the European Financial Stability Facility (EFSF), or the International Monetary Fund (IMF). A ban could prevent a rating from coming at an "inopportune moment" and having "negative consequences for the financial stability of a country and a possible destabilizing effect on the global economy," the draft states.

We've said it before, and we'll say it again - at this point no action, no matter how extreme, is off the table for the struggling sovereign deadbeats.

That gives rise to the need for each of us as individuals to take whatever measures we can to avoid the consequences. Internationalizing your assets while you can, buying tangible assets, investing in your own business and in building your own skills are all intelligent moves at this point.