On L'O.R. adding its two cents to US economic woes

I'm not sure what all to make of this. But I'm trying to come to terms with it [my comments in brackets]. I'd love to start a conversation about this:

The current financial crisis pummeling the United States and beyond is a sign that the so-called "new economy" and its risky investments have failed, the Vatican newspaper said. [I think what failed was unsound speculation, widely practiced and condoned.]

The booming growth of financial markets did not correspond to real growth or concrete development for society because it created an artificially robust gross national product, said a Sept. 24 article in L'Osservatore Romano. [I don't know about this one way or the other, but I'm prone to admit it.]

The only real growth registered in this crisis has been "the commissions, profits of the banks and bonuses for the managers," it said. [That's fairly obvious.]

The article, with the headline "A costly illusion," was written by Ettore Gotti Tedeschi, an Italian economist and professor of financial ethics at the Catholic University of the Sacred Heart in Milan, Italy.

The U.S. financial meltdown has been blamed on "the greed of managers and lack of regulations. But curiously, no one ever refers to the indirect responsibility of the government's economic policy" which, he wrote, tried to cover the lack of any real economic development with a booming Wall Street. [I agree with this.]

He said the U.S. government's proposed bailout may stave off any worst-case scenario for its troubled financial markets, but it will not repair the root causes of the crisis. [Well sure, that's apparent.]

"Despite various attempts, the Western world does not know how to map out a model of development that is capable of guaranteeing stable wealth," the article said. [I disagree with this. I think we did very well for quite some time. It was departing from free market principles and introducing heavy government regulation that turned things sour.]

The West has "not succeeded with its new economy project, it did not succeed with accelerating growth in Asia by transferring low-cost production (there), and it did not succeed after inventing a boom in the GNP through risky financial models that were poorly conceived and badly regulated," it said. [Sure, but that does not mean the West doesn't know what it's doing, it's just losing its way, and badly.]

"In order to maintain this sham GNP, the banks financed things that were not guaranteed" and that should not have been financed, like the subprime loans, it said. Financial institutions created an "economic growth out of debt and, therefore, (created something) very risky," it added. [Yep, I'm with this.]

The article said the lesson to be learned is that nations cannot build a healthy economy or experience real development if it is not based on "balanced demographic growth." [Ah, now that's an excellent point. Demographics are hugely important - but what would the author say about the situation in Italy/Europe?!]

It said the world economy also needs to be run responsibly and transparently with precise rules. [Sure, sure, but good luck.]

Okay, it's Friday. If anyone has some time on their hands, feel free to educate the rest of us.