Bailouts and protectionism

Bailouts, bailouts, bailouts. A scary proposition if you ask me. Ok, fine, the banks that are critical for a countries banking system and with very far reaching global exposures might have to be bailed out. Fine, but bailing out other industries? Ehhh nope. This is my reasoning; The world wants free trade since this optimizes the worlds potential GDP growth. Hence, the globe is striving for global free trade agreements. By subsidising=bailing out various industries, there is, per definition no free competition anymore. How will these companies not getting subsidised get compensated then? The answer is; by getting compensation subsidies by their homecountry. You see where I am going with this. We are on the road towards protectionism. This will drag the global GDP down further, threatening the world to get sucked into a global depression. Any surplus country will benefit, the others will sink. Before running to the keyboard also remember that todays surplus countries might not necessarily stay that way, leverage exposure is the key here as well as how it is financed. Russia is a good example on a very swift shift. Six to nine months ago, this was a nobrainer buy of the currency and shares. Today it is a nobrainer sell of ditto, mainly for the above reasons and the very high dependence of the value of one single commodity. What makes it even worse is that politicians are increasingly getting a bigger say in how markets will be run going forward. Meddling by politicians has historically never been a hit and will definitely not be one this time around either. My suggestion; The record high global leverage has to be reduced. This will be painful. Politicians can try to soothen this pain without meddling in the markets. There are always opportunity and in this case the opportunity for restructuring is the one that stands out. This is a good time to restructure dinosaur industries and making the other ones leaner and meaner. This will benefit globalgrowth and rebound. Increasing infrastructure projects is another one that will have the same positive effects, apart from also creating more jobs.