Over the last week in Britain there has been a parliamentary festival "what to do with the public debt". The government is arguing that it must cut the public debt very quickly, and harshly, or otherwise the UK will lose its credibility to the markets, its rating will go down and costs of servicing the debt will eventually skyrocket. The opposition is putting their point across that if the public spending is cut then the economy will not get a necessary investment in order to guarantee future tax receipts that will eventually bring the public debt down. It is an argument between "cut and save" now and "spend, invest and earn more". There are merits to both arguments: but they are both missing the point how to solve the existing financial mess that the last Labour government financially engineered for the UK.
Let us deal with credit rating, and its possible downgrade, for the UK. Originally when credit ratings were invented some years ago they were meant to be an objective tool of assessing the risk of default of a debtor. As long as they were done by creditors, at no conflict of interest situation, they played their objective role.
In the last decade or so, the sense of credit rating has changed. The financial institutions that were selling the financial products (thereby getting into debt themselves) started commissioning the ratings for their own products. The higher the rating the lower the costs of the debt. Ultimately many products that were clearly of no value whatsoever were sold with the highest possible credit rating. Credit rating does not mean any more what it used to mean. Now it is a crude tool used by the financial players to make money and very frequently it has nothing to do with the underlying credit worthiness.
The current public debt has to be seen against this backdrop and the fact that the banks are still full of the financial instruments which they cannot cash on the open market. The massive UK debt means that the government is unable to borrow any more money and pump into the banks. If the banks executive turned up now on the Number 10 doorstep and requested yet another cash injection into the financial system, like they did in September 2008, for example in order to prop up massive bonus schemes for the bankers, they would have had to be turned down. The government simply would not be able to hand over more money. But the bankers need it so they are not going to give up easily.
Now the credit rating is used. The UK is threatened by the financial institutions that unless it cuts its pubic debt its rating would go down and the costs of debt servicing would increase thereby increasing the annul spending by the government. There is nothing far more from the truth. If the rating were cut and the debt could not be serviced, then the government would have to take emergency steps and the banks would not get any more money. The whole Greece saga only happened because the banks assessed that there would be a bailout. If there had not they would not have done anything as they would not gain anything by putting a pressure on Greece. This is a rational economic behaviour. Now they try the same basic crude method with Spain and are testing the ground with the UK.
However the game with the UK is a bit different. The financiers know they cannot risk bringing UK economy down. In fact they are unable to do so as the government would have introduced emergency measures to prevent it, and many financial institutions would have come out as losers from it. So using a crude tool of "credit rating" (which has nothing to do with real credit rating) they are trying to force the UK government to cut the debt, thereby increasing the government capacity to borrow more – at the taxpayers’ costs – in the future. Once the government makes all the big savings, of hundreds of billions of pounds or more, cutting many public services and making everyone feel it, the bankers are very likely to turn up again at Number 10 doorstep with begs of toxic waste that remains in the system and will demand another bailout (or else the banking system will collapse). At that point it will be too late. Like Gordon Brown, David Cameron will have little choice but to cough up another few hundreds of billions to the bankers. All those money saved by savage public spending cuts.
However as there is more than one way to skin a cat (sorry, taxpayers), the process of the bankers skinning (again) the taxpayers may actually be not that conspicuous as asking for another multi billion rescue package. It may also take a form of continuous dripping of money from the Exchequer into the banks (by, for example, so called market operations). In which case we will never see any savings made and the pundits who tend to protect the bankers are likely to comment that even the savings were not sufficient to reduce the public debt. They are also likely to peddle a nonsense how much worse it would be if the cuts were not done.
These scenarios and their mechanisms were presented in the first article of this blog, "The largest heist in history" over a year ago. It is astounding that neither the government nor the opposition, then and now, can foresee such glaringly obvious very high risk scenario.
What could and should the government do to bring to order the financial system that became a vampire squid on the face of taxpayers? How can the government remove a risk of taxpayers being treated by the financial industry in the same way as loan sharks treat their victims? It is not a rocket science. There is a basic five point action plan that deals holistically with the current crisis: resolves the current mess and prevents it from happening in the future.
1. Banks must be broken up so none of them is "too big to fail".
As explained before on this blog a "too big to fail" bank enjoys free insurance against failure. This is anti-competitive and is also a continuous burden on public finances by carrying risked costs of the potential failure, hence this is a free public subsidy. For both reasons such behaviour is completely unacceptable under free market rules and should be, if it is not already, made illegal.
2. Separation of high street consumer banking from investment banking.
In the process of breaking up the banks into businesses each of which is not "too big to fail" consumers banking, typical high street deposit and lending activities must be separated from the high risk investment banking. Under Glass-Steagall Act there has been such a rule and it worked for over half a century. It did not take even a decade after it was repelled and we ended up in the current crisis. Therefore whilst theoretically it may not be necessary, the experience strongly indicates that it is a good practice to separate high street consumer banking from investment banking.
3. Deleveraging of the financial system and write downs of toxic waste (i.e. liquidation of the financial pyramid).
As Mr Will Hutton observed on the Dispatches programme last Monday, the banks leverage is around 50. I.e. around £50 of banks liabilities are covered by £1 real cash. Such leverage is unsustainable. A typical sustainable leverage is 5 – 10, 10 only in times of good market confidence. Therefore between 80% - 90% of so called assets are simply toxic waste. The financial assets must be ring-fenced and the proper orderly process of write downs must be done. The aim of this process is to reduce the leverage to a sustainable level between 5 – 10.
The crux of solving the current crisis is the reduction of unsustainable leverage (50 or more) to a sustainable level (5 - 10) and who are going to be losers of this process.
As there will be losers: i.e. people and companies whose assets will be destined to be written down, the government must find a way to deal with it in form of providing a limited security. The ultimate test of the government guarantees and how they are discharged should be of a public interest. For example if a pension fund goes bust as a result of such assets write downs and ultimately the pensioners are the losers, the government must consider taking over a liability for these pensions (at a level, e.g. 50% or 80%, that it can afford or with a possible cap). Another example is if a bank goes bust. Then the government, through one of the nationalised banks would take over accounts and operations and guarantees individuals and businesses their interest. This will no doubt require some government spending but it is likely to be far cheaper than propping up the entire system with no limits as is happening now. Any new government stimulus package that may be necessary will not end up in the financial institutions black hole of toxic waste but in a newly healed banking system, as described in this point and two proceeding points. The banks will not have a problem to start lending again as they will not have an issue of dealing with massively excessive historical leverage. The losers of such operations whose assets were ring-fenced to be written down will be able to resort to private litigation against all those individuals (bankers, regulators) who brought such misery on them.
There is nothing unusual in this step: write downs are typical actions in corporate restructuring and recovery. However in case of the financial industry it is the sheer unprecedented global scale that is daunting. In that respect banks that hang on to bogus assets, which are in fact toxic waste that should have been written down or significantly valued down, and present them as genuine assets on their books, are no different in their accounting practices from Enron. Whilst Enron was using such "creative" approach to extort money from the banks and private investors, banks are extorting money from the taxpayers. Hence banks must be dealt with as decisively as Enron was: it is far better to pick up the pieces now than to allow such a scam to keep on growing.
4. Setting up an effective deterrant against a future crisis happening (i.e. prosecuting the fraudsters).
This crisis is a result of a massive pyramid scheme whose fraudulent mechanism has been lending with loan to deposit ratio greater than 100%. As it has been argued already on this blog, the financiers, bankers, regulators and some politicians that engineered or are responsible in any other way for this financial crisis must be prosecuted. They must end up in jail and their wealth (or any wealth that was "generated" by them as a result of this crisis) must be confiscated. This is not only a basics fairness, the scammers and fraudsters are not allowed to get away with their crimes and spoils of their crimes, but it will help to fund any compensation resulting from the assets write downs as described in point 3 above. Ultimately there is no better way of preventing the next crisis than prosecuting perpetrators of the current one. Enforcing the law is the best regulator.
5. Reducing the public debt.
The last point will be reconciling the public debt against what is recovered from the scammers, as described in point 4 immediately above, and also against any liabilities of the institutions to the government that resulted from orderly dealing with assets ring fencing and write downs as described in point 3 above. For example if the government owes debt to an investor (e.g. bank, financial institution) but at the same time due to a write down (as described in step 3) such an investor ends up owning money to the government (directly or indirectly, e.g. pensioners, individuals, businesses who lost in such write down and were taken care of by the government), then the government subtracts such write down from its debt to the investor. This is likely to reduce the government debt, possibly quite significantly: it seems that a good portion of a near trillion pounds rescue package can be offset against the government debt. And only then if it is not enough the government must do necessary cuts in public spending to balance the books and bring public finances into black.
Desperate times call for well-thought through measures.
Let us deal with credit rating, and its possible downgrade, for the UK. Originally when credit ratings were invented some years ago they were meant to be an objective tool of assessing the risk of default of a debtor. As long as they were done by creditors, at no conflict of interest situation, they played their objective role.
In the last decade or so, the sense of credit rating has changed. The financial institutions that were selling the financial products (thereby getting into debt themselves) started commissioning the ratings for their own products. The higher the rating the lower the costs of the debt. Ultimately many products that were clearly of no value whatsoever were sold with the highest possible credit rating. Credit rating does not mean any more what it used to mean. Now it is a crude tool used by the financial players to make money and very frequently it has nothing to do with the underlying credit worthiness.
The current public debt has to be seen against this backdrop and the fact that the banks are still full of the financial instruments which they cannot cash on the open market. The massive UK debt means that the government is unable to borrow any more money and pump into the banks. If the banks executive turned up now on the Number 10 doorstep and requested yet another cash injection into the financial system, like they did in September 2008, for example in order to prop up massive bonus schemes for the bankers, they would have had to be turned down. The government simply would not be able to hand over more money. But the bankers need it so they are not going to give up easily.
Now the credit rating is used. The UK is threatened by the financial institutions that unless it cuts its pubic debt its rating would go down and the costs of debt servicing would increase thereby increasing the annul spending by the government. There is nothing far more from the truth. If the rating were cut and the debt could not be serviced, then the government would have to take emergency steps and the banks would not get any more money. The whole Greece saga only happened because the banks assessed that there would be a bailout. If there had not they would not have done anything as they would not gain anything by putting a pressure on Greece. This is a rational economic behaviour. Now they try the same basic crude method with Spain and are testing the ground with the UK.
However the game with the UK is a bit different. The financiers know they cannot risk bringing UK economy down. In fact they are unable to do so as the government would have introduced emergency measures to prevent it, and many financial institutions would have come out as losers from it. So using a crude tool of "credit rating" (which has nothing to do with real credit rating) they are trying to force the UK government to cut the debt, thereby increasing the government capacity to borrow more – at the taxpayers’ costs – in the future. Once the government makes all the big savings, of hundreds of billions of pounds or more, cutting many public services and making everyone feel it, the bankers are very likely to turn up again at Number 10 doorstep with begs of toxic waste that remains in the system and will demand another bailout (or else the banking system will collapse). At that point it will be too late. Like Gordon Brown, David Cameron will have little choice but to cough up another few hundreds of billions to the bankers. All those money saved by savage public spending cuts.
However as there is more than one way to skin a cat (sorry, taxpayers), the process of the bankers skinning (again) the taxpayers may actually be not that conspicuous as asking for another multi billion rescue package. It may also take a form of continuous dripping of money from the Exchequer into the banks (by, for example, so called market operations). In which case we will never see any savings made and the pundits who tend to protect the bankers are likely to comment that even the savings were not sufficient to reduce the public debt. They are also likely to peddle a nonsense how much worse it would be if the cuts were not done.
These scenarios and their mechanisms were presented in the first article of this blog, "The largest heist in history" over a year ago. It is astounding that neither the government nor the opposition, then and now, can foresee such glaringly obvious very high risk scenario.
What could and should the government do to bring to order the financial system that became a vampire squid on the face of taxpayers? How can the government remove a risk of taxpayers being treated by the financial industry in the same way as loan sharks treat their victims? It is not a rocket science. There is a basic five point action plan that deals holistically with the current crisis: resolves the current mess and prevents it from happening in the future.
1. Banks must be broken up so none of them is "too big to fail".
As explained before on this blog a "too big to fail" bank enjoys free insurance against failure. This is anti-competitive and is also a continuous burden on public finances by carrying risked costs of the potential failure, hence this is a free public subsidy. For both reasons such behaviour is completely unacceptable under free market rules and should be, if it is not already, made illegal.
2. Separation of high street consumer banking from investment banking.
In the process of breaking up the banks into businesses each of which is not "too big to fail" consumers banking, typical high street deposit and lending activities must be separated from the high risk investment banking. Under Glass-Steagall Act there has been such a rule and it worked for over half a century. It did not take even a decade after it was repelled and we ended up in the current crisis. Therefore whilst theoretically it may not be necessary, the experience strongly indicates that it is a good practice to separate high street consumer banking from investment banking.
3. Deleveraging of the financial system and write downs of toxic waste (i.e. liquidation of the financial pyramid).
As Mr Will Hutton observed on the Dispatches programme last Monday, the banks leverage is around 50. I.e. around £50 of banks liabilities are covered by £1 real cash. Such leverage is unsustainable. A typical sustainable leverage is 5 – 10, 10 only in times of good market confidence. Therefore between 80% - 90% of so called assets are simply toxic waste. The financial assets must be ring-fenced and the proper orderly process of write downs must be done. The aim of this process is to reduce the leverage to a sustainable level between 5 – 10.
The crux of solving the current crisis is the reduction of unsustainable leverage (50 or more) to a sustainable level (5 - 10) and who are going to be losers of this process.
As there will be losers: i.e. people and companies whose assets will be destined to be written down, the government must find a way to deal with it in form of providing a limited security. The ultimate test of the government guarantees and how they are discharged should be of a public interest. For example if a pension fund goes bust as a result of such assets write downs and ultimately the pensioners are the losers, the government must consider taking over a liability for these pensions (at a level, e.g. 50% or 80%, that it can afford or with a possible cap). Another example is if a bank goes bust. Then the government, through one of the nationalised banks would take over accounts and operations and guarantees individuals and businesses their interest. This will no doubt require some government spending but it is likely to be far cheaper than propping up the entire system with no limits as is happening now. Any new government stimulus package that may be necessary will not end up in the financial institutions black hole of toxic waste but in a newly healed banking system, as described in this point and two proceeding points. The banks will not have a problem to start lending again as they will not have an issue of dealing with massively excessive historical leverage. The losers of such operations whose assets were ring-fenced to be written down will be able to resort to private litigation against all those individuals (bankers, regulators) who brought such misery on them.
There is nothing unusual in this step: write downs are typical actions in corporate restructuring and recovery. However in case of the financial industry it is the sheer unprecedented global scale that is daunting. In that respect banks that hang on to bogus assets, which are in fact toxic waste that should have been written down or significantly valued down, and present them as genuine assets on their books, are no different in their accounting practices from Enron. Whilst Enron was using such "creative" approach to extort money from the banks and private investors, banks are extorting money from the taxpayers. Hence banks must be dealt with as decisively as Enron was: it is far better to pick up the pieces now than to allow such a scam to keep on growing.
4. Setting up an effective deterrant against a future crisis happening (i.e. prosecuting the fraudsters).
This crisis is a result of a massive pyramid scheme whose fraudulent mechanism has been lending with loan to deposit ratio greater than 100%. As it has been argued already on this blog, the financiers, bankers, regulators and some politicians that engineered or are responsible in any other way for this financial crisis must be prosecuted. They must end up in jail and their wealth (or any wealth that was "generated" by them as a result of this crisis) must be confiscated. This is not only a basics fairness, the scammers and fraudsters are not allowed to get away with their crimes and spoils of their crimes, but it will help to fund any compensation resulting from the assets write downs as described in point 3 above. Ultimately there is no better way of preventing the next crisis than prosecuting perpetrators of the current one. Enforcing the law is the best regulator.
5. Reducing the public debt.
The last point will be reconciling the public debt against what is recovered from the scammers, as described in point 4 immediately above, and also against any liabilities of the institutions to the government that resulted from orderly dealing with assets ring fencing and write downs as described in point 3 above. For example if the government owes debt to an investor (e.g. bank, financial institution) but at the same time due to a write down (as described in step 3) such an investor ends up owning money to the government (directly or indirectly, e.g. pensioners, individuals, businesses who lost in such write down and were taken care of by the government), then the government subtracts such write down from its debt to the investor. This is likely to reduce the government debt, possibly quite significantly: it seems that a good portion of a near trillion pounds rescue package can be offset against the government debt. And only then if it is not enough the government must do necessary cuts in public spending to balance the books and bring public finances into black.
Desperate times call for well-thought through measures.
Agreed.
ReplyDeleteIam tired of listening to politics on this issue.The situation we are in is now just governed by simple MATHS.and MATHs is not capable of political maninipulation..it just IS.
We have a long and painful journey ahead and its time to take the right decisions with a long ternm view.There willbe much squealing from the banksters but screw them.
I fully support your view for prosecutions and asset confiscations of senior bankers.Their greed and stupidity wil hit decent people hard.I don't think this the pols yet understand just how angry people are.Its is why NuLab lost..even after therir scare tactics .Peopleknow the existing system is rotten and needed cleansing. I hope Cameronand Clegg ( who I find both surprisingly impressive)have the courage and integrity we need to move us forward on the right path
Interesting view, and one that is certainly not implausible. We will see.
ReplyDeleteI do entirely agree that the "whole Greece saga only happened because the banks assessed that there would be a bailout". This is quite obvious when one notes that Greece now has more debt than it would have had without the bailout. Without the bailout the banks would have had to negotiate, but with the bailout they walked away with maximum returns and in addition get to lay the blame on the "lazy spoilt Greeks". It's nothing short of a scam.
With a proposed 425 quadrillion short fall in the world economic system (and constantly rising) - it seems rediculous that our focus of attention is being so easily diverted from the massive black hole to the tiny hole of 200 billion short fall of public spending. The unemployed, sick, elderly and workers who's jobs are by no means secure, are being terrorised by every subsequent government including the newly elected tories. They are like a dog let back out in the yard again, going straight for the same old bone. Running a system with too few houses to prop up house prices is courted with too few jobs to prevent disgruntled workers from saying - get lost, i quit, when the job is being turned into a danger zone for fear of not finding the all elusive decent job. As always the real problem is overlooked and the majority cheer on and join in with the witch hunt.
ReplyDeleteIt appears to me the system is paying tooo much to tooo many and is not earning any real money. The cash cow has been milked to death and now the wish is to opress the poor and blame them for the mess caused by the greedy. The British seem to have forgotten how to share the work and share the rewards.
The EU and USA shouldn't be trading with the likes of China and India who pay pittances and provide little or no welfare, instead the gold is worshipped and lives are destroyed, soon we will have a crime rate comparable to the US, a caste system like the indians, and slave labour like in china. Look closely and the new schemes forcing the unemployed to work for less than their bus fare and oh?? we are already there.
Clegg and Cameron are cowards who have targeted the vulnerable least able to defend themselves whilst protecting their own wealths from the massive black hole that is sugggested will swallow us all up in debt.
Is this the illuminatri's new world order?? truth is I dont think any one is in control - it's out of human hands, and most of what we have read here and elsewhere is mere hindsight, dare you to look at what is really staring us in the face??
God Bless
4 Setting up an effective deterrent
ReplyDeleteAs I've mentioned, the possibility of prosecution is virtually nil as it depends on clear evidence of specific laws being broken. The existence of this well stated theory is never going to constitute sufficient evidence even though it may have moral value. It actually remains quite hypothetical. In my opinion there is enough basic law on the statute books to prosecute most cases of overt wrongdoing but it should be noted that breaking the law can often be quite different to meeting one's moral obligations, however desirable or undesirable that may be. I suspect it may be quite difficult to legislate for ethical behaviour in business.
One does have to look very closely at the regulatory industry and it seems reasonable to suggest that there may have been significant regulatory failures. Regulatory bodies need both foresight and teeth and the will to use them. I think it's probably fair to say that the whole world has been beguiled by the recent activities of the global financial industry but I would suggest it's also fair to say that cynical suspicion of a reasonably sudden boom should have triggered objective consideration of the potential results of what was happening. Maybe we have too much 'can do' attitude circulating in the world today?
I must say, having worked in many aspects of the financial industry for many years, I can certainly look back at the many activities which one would have to say were completely wild and reckless and were all steps on the road to our present situation. Much of my criticism would be directed at the property finance market, but not exclusively. It's debatable whether one should leave a nation's property portfolio in the hands of the 'free market' but it's notable how successive governments have chosen to do so. The result is quite outrageous for ordinary people who need somewhere to live.
As far as deterrent goes, reckless activities need to have the potential to end in failure and loss but such loss cannot be allowed to fall on end consumers who have acted in innocence. It must be placed on institutions who have instigated or have chosen to become party to such reckless activities. However, prudence tends to fall into a similar category to ethics, very difficult to legislate for.
It has always been my opinion that the Financial Services Act introduced by the Thatcher government was really quite useless for managing the financial industry and, irrespective of such amendments and improvements which have subsequently been applied, perhaps that has now been proved to be the case?
We need a completely new approach to legislation, and it should have international consensus, ideally, which is genuinely targeted to the excesses of the industry, and I include the ability of markets to hold governments to ransom. It¡s one of the most complex problems facing the world today. It probably must start from a series of general international accords.
5 Reducing the public debt
ReplyDeleteHere, some basic arithmetic can help us once again, balance the books for both current account and projected budget. Absolutely the government has to end it's open ended commitment to the financial industry and points mentioned above are steps on the road. As a continent (Europe) We have made a commitment to a socially sympathetic society. But we can only be as socially sympathetic as we can afford to be, which is moreso in good times and less so in bad times.
Well, cancelling bond debt in line with the toxic assets the government has bought back? Greg, you are an optimist haha. It's a grand idea but the practical issues of doing so are immense. Unfotunately, the financial markets tend to be quite mobile and, in reality, bond holders are likely to be quite different entities to the traders of toxic assets. But, it's true, it certainly seems like the government is paying the financial industry twice for the same thing :)
I think that's probably why the bank levy has been proposed. Sadly, the bank levy proposed by the present government has left a reasonably satisfied smile on the face of Britains banking community. They were expecting to be hard hit but they weren't hit too hard. However, it would not be unreasonable for the UK population to demand from government that they claw back from the markets the equivalent of what it's going to cost the taxpayers. Of course, the government may be expecting to impose a second levy when they have a reasonable idea of what it's going to cost them. However, as you have noted, the financial industry has a method of applying sanction to the government via rating agencies. It's kind of quid pro quo. As an alternative, the chancellor could choose to have an annual bank levy in each of his budgets, a kind of standard and expected tax as they do for smoking and drinking. Spreads the load, give's bankers something to complain about but not so onerous it will hit them too hard, they'd get used to it and just factor it in to their accounting activities. Another opportunity is to have a standard annual bank tax applied to profits on top of normal corporation tax, similar effect. I believe this possibility has been mooted already.
The problem is that skimming the industry too hard will have it's own negative impacts. They need to squeal, not die, it's quite a difficult balance to achieve and absolutely needs to be achieved in concert with other activities. The end objective must be to sanction the industry without causing hardship and distress to the general population. UK PLC needs to be able to provide sympathetic social support to those who genuinely need it, which is generally not members of the banking industry.
Finally
You have raised too many issues in this particular blog entry to respond to in one go, because the situation is truly so complex. However, I'd say there were two populist issues that need to and can be addressed immediately which would make a marked improvement to the present situation, asset separation on bank balance sheets and genuine commitment by government to a (maybe temporary) special bank levy. I'd have thought they were both bandwagons the UK population could easily jump on and, frankly, I believe the present government needs to be heavily pressured to take these kind of actions. People should never be deceived, Tories are for the rich and business and not for the general populace. They will need immense pressure to move. Also bear in mind that the Libs are only in it for electoral reform. Once they've got that they'll almost certainly jump ship anyway.
This is just my personal perspective, obviously, but I hope it represents an intelligent and objective observation and provides some potential insight into what possible solutions could be. I will be hoping to look at some other areas of your blog and, maybe, comment, as I think you raise some important and interesting issues.
Many thanks
As mises.org states, the only way to fix this mess is to have money based on fixed value, not fiat money based on leveraged debt and usury.
ReplyDeleteProper money must be backed by a fixed value (e.g Gold and Silver), fractional reserve banking must be made illegal, and the Bank of England must be abolished, because central banks are the drivers/enablers of private fractional reserve banking.
Also any sales or purchases of foreign money must be based upon the same fixed value (e.g. Gold or Silver), to stop either side playing destructive political games, at the expense of their respective populations!
Whilst I find your posts illuminating, I find it utterly incomprehensible that you can appeal to the PM to 'sort this mess out'. The whole crooked international financial situation is not rocket science when you can see what's happening, and Cameron knows this full well.
ReplyDeleteI quote from above:
'It is an argument between "cut and save" now and "spend, invest and earn more". There are merits to both arguments: but they are both missing the point...'
This is where I take issue with your perspective in appealing to Cameron to sort the mess out. Do you really think he's just 'missing the point'? How accommodating of you towards him! What's criminal is that his right wing privatisation ideology prevents him from criticing the criminal banking system and he is clearly pandering 100% to these perpetrators of the pyramid scheme. You seem to imply that perhaps he's just a bit dull and doesn't quite get it? It's this that I cannot accept. He is no better than the view that middle and low level banking workers are African child soldiers. Cameron is just a wealthy privileged child soldier in my view with no intention of EVER criticing the financial system we are now faced with and that's what makes me so mad. I would really appreciate a response to this comment if you have the time.
Thanks for all your hard work anyway! Very enlightening.
Hi Shiningrain
ReplyDeleteThanks for your comment (and for reading my blog). Please pass its link around if you think it's OK.
To answer your point: please note that I wrote this comment just after Mr Cameron took over the office of the PM. So it was a matter of politeness to give the incoming PM the benefit of the doubt and good will. Whilst I really wanted that to happen I really did not believe in any positive effect of my appeal. I am not that naive however I always hope to be "disappointed".
Best
Greg
Hi Greg,
ReplyDeletethanks from Germany for your island views on the coming armageddon:-)
exceptional angles sure...but aren´t you as i am suspicious for 10 years already that western civilisation as a whole is a great ponzi and could go on for a further 10 years as a pyramid..as long as at least in Germany everybody still feels comfortable in the armchairs..apreciating your optimism about Mrs Merkel but she is as your establishment a puppet of the perpetrators ....comparing to Albania, do you really think four years after the alleged pyramids bust, its still concievable that your maths applies ??
in logarythmic evolution it feels a bit long in the teeth
if so, we as humans must change the money system in as an exponential way as it will go bust then ( even Greeces non solution will not end the heist neither will just a changing to " he who has the Gold makes the rules ")
from a deap thinker as i see you it sounds funny that you just want to reestablish Glass Steagal, cut leverage and replace old fraudsters with new ones to live in then proportinal growing slavery again.....??
did you ever consider Silvio Gesell ...
and ideas how to transform the current one technically and peacefully?
Germany once again is helpless...
this time the hooligans must unite to shape the world for our children without debtslavery:-) are you interested in some bloglinks? am linking you of course...
Keep thinking
yours Tilmann