You Might Be Paying for the State to Fail

12.09.2017 • Switzerland

Henry Bonner – Strategy and Council Letter (Switzerland) –

A “orangery” of the castle now serves as a meeting room … with windows overlooking an English park … with statues, pines and cedars … and a view overlooking the village near the castle …

In time, a world of farmers and servants inhabited the buildings around the castle … Forming a community, living thanks to the harvests of grains, and breeding of pigs, cows, or sheep … As in most castles of Normandy , the estate also had an orchard of apple trees to make cider …

Over time, the descendants have sold, lot by lot, the land of the estate, leaving the castle with some farmstead buildings – more or less in a state of abandonment – plus some fields in the vicinity, farmer of the corner … Grapes grow along the walls of the farmyard …

Courtomer has in addition a cooler, dating from the 16th or before – a stone dome over a basin descending into the basement … The castle also hosts on its grounds a temple (the equivalent of a church for the Protestants), having survived the wars of religion under cover to serve as dovecote …

Courtomer could serve as a warning to the “great” and the ambitious … At its origins, the landlords had incomes from the land to support maintenance and labor to keep the place in order …

With the surge in the price of labor, the exodus of people to cities, and the decline in income from land exploitation, the squires throughout France began abandoning their homes … leaving cracks forming in the walls, paint crumbling, piping deteriorating, and – in the extreme – the roofs collapse and the homes get lost.

Everywhere in France, the abandonment of houses and castles testify to the changes in the economy over the centuries …

Degradation and ruin usually waits for constructions, projects, and investments whose interest disappears … whose economy no longer promotes sustainability and value …

Changes within economies leave abandoned factories or buildings in their wake … All projects require maintenance and investment …

Nuclear power plants demand tens of billions to maintain in France … but nuclear loses competition with oil and gas in efficiency …

Like the castles of the lords of the ancien regime, these power stations could be extinguished and abandoned … like the factories after the departure of the industry towards China, Slovakia, or Poland …

Wind turbines and solar power may be abandoned in the next decade … when subsidies are no longer sufficient to keep them alive … or innovations in the field of “renewable” will come to take their allocations and supports.

Beware of “Projects” and Fantasies …

Everyone does his best to use his talents and resources to advantage … A mathematician will try to solve his problems by calculations. An engineer will try to systematize them. An artist will look for images to describe them …

Progress is usually made by error and trial … but sometimes these tests last more than a generation … and today’s projects can become the problems of children.

EDF has made sure to force nuclear power on France … but these power stations represent a disaster for the country’s finances …

The individual goes bankrupt, or stops, when his mistakes cost him money … but states and leaders must not bend to the rules of the economy …

The authorities in Paris are seeking to attract the 2024 Olympics … despite the mess and inconvenience resulting from the Olympic Games over the years … from Rio to Beijing …

Sometimes these projects create problems of passage … and sometimes they fit into the life of the country for decades or centuries …

Right-thinking people today are developing protections for a variety of groups and minorities … protections for workers … rights to trade unions …

… and these good-thinkers leave in the future to worry about the effects and consequences of these “projects …”

If the future does not have the resources to pay, then, like a castle without an owner, the roof collapses …

What to do…?

In the world of finance, debt represents a demand for capital for the future …

In the future, investors, taxpayers, and households will have to pay for a variety of projects and ideas …

Our state debt represents more than 2,000 billion euros … By adding the debts of households and companies, the debt in France comes to 5,000 billion euros …

This “castle” of debts continues to endure as the present world repairs the roofs, repaints the walls, and plugs the holes in the plumbing …

… but when the heirs of the debt will begin to realize the cost of this debt … of the load to be carried while trying to keep it afloat … then, perhaps, they will prefer to get rid of it …

In short, as long as our debt is cheap – thanks to rates at close to 0% nowadays – then the mass should continue to grow, without too much trouble …

On the other hand, on the day of a rise in rates, the debt could see ceding its foundations …

Attention in front of …!

Truly,

Henri Bonner

-Read more at www.lettre-strategie-conseil.com (French)-

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