If you are new to this blog, you are invited to read first “The Largest Heist in History” which was accepted as evidence and published by the British Parliament, House of Commons, Treasury Committee.

"It is typically characterised by strong, compelling, logic. I loosely use the term 'pyramid selling' to describe the activities of the City but you explain in crystal clear terms why this is so." commented Dr Vincent Cable MP to the author.

This blog demonstrates that:

- the financial system was turned into a pyramid scheme in a technical, legal sense (not just proverbial);

- the current crisis was easily predictable (without any benefit of hindsight) by any competent financier, i.e. with rudimentary knowledge of mathematics, hence avoidable.

It is up to readers to draw their own conclusions. Whether this crisis is a result of a conspiracy to defraud taxpayers, or a massive negligence, or it is just a misfortune, or maybe a Swedish count, Axel Oxenstierna, was right when he said to his son in the 17th century: "Do you not know, my son, with how little wisdom the world is governed?".

Friday, 10 December 2010

UK's 21st century democracy

Today we could read in London's Metro that a gym fan was tried for 2p (two pence) fraud. He used his friend's pass to gain access to the gym and do some exercises.

Only several days ago we could have read that the inquiry into the former Royal Bank of Scotland CEO, Sir Fred Goodwin's behaviour who was ones of those who caused the current financial crisis was dropped by the Financial Services Authority. Little surprise, as expected, since the FSA was at best effectively complicit to the bankers' behaviour.

The ongoing financial crisis is a result of primitive and conspicuous fraudulent practices of the financial industry, regulators and some politicians either by direct involvement or by allowing such a primitive and conspicuous fraud to run for years. The type of this fraud has been well-known for centuries. It is a pyramid scheme. How the pyramid method was implemented by the financial industry in the context of this crisis was described in detail in the first article on this blog: "The largest heist in history". It is nevertheless ironic that for years the crudest of financial crimes has been described by the pundits and the mainstream media as "sophistication of the modern financial industry". This has been public deception on a par with 17th century Dutch tulip mania. This is how historians will judge it in the future.

Thus far the crisis resulted in massive global economic downturn and economic near-collapse of some countries. In Britain it led to massive public spending cuts, increase of taxes and payment obligations by the public (such as the current tripling of the university tuition fees), demolition of traditional pensions schemes and, in fact, savings. And much more is still to come. Don't jump over yet, it will get worse.

Coming back to 2p gym fan's fraud story: if we contrast it with the financiers, regulators and some politicians multi-trillion pound fraud, we have to ask a question: is this what the 21st century British rule of law and democracy is all about? (Ask your local MP.)

Wednesday, 1 December 2010