The Square Mile

If ever you needed to have proof about the matter that David Cameron finds the most important, then you don't need to look any further.  It isn't the continuation of a Public Health Service.  It isn't a recognition of the growing wealth gap.  In fact his policies have nothing to do with fairness for the vast majority of the Public and everything to do with his support for the so-called 1%.  He has just staked our reputation on safeguards for his backers and cronies in the square mile, whose activities have been responsible for the mess in which we now find ourselves.

From my point of view, it is almost impossible to believe that his loyalty is so intense that he is prepared to forsake not only his own countrymen, but all the other people of Europe.

International Bribery

At all points in history, the rulers have, on most occasions, used the weapon of financial bribery to maintain and control their interests in various parts of the world.

In recent history, think about some of the most vilified names, Sadaam Hussein, Gadaffi, The Taliban, Osama bin Laden and General Pinochet.  At one time or another they were all funded and supported by the U.S/ Western alliance.  Part of the price was the killing and control of unwanted factions in their respective countries.

What is happening in Europe at present?  Those countries that do not bend over backwards to do the will of Europe's Paymasters get their leaders removed and then replaced by "ministers" of the church of "Europe".  In the case of Italy, the new Prime-minister is a former E.U Commissioner, while Greece's new P.M is a former vice-president of the European Central Bank.  Spain have elections this weekend and will dump Zapata and replace him with yet another "minister".

The Paymasters ability to protect themselves and surround themselves with acolytes is not surprising, but they put themselves in a dangerous position.  If the catechism of their Church turns out to be unacceptable, and it will if Germany doesn't allow the indiscriminate printing of new money, then they will be exposed as a failed religion that must be removed.

Surely a better option is for these countries to leave the Euro and escape the downward spiral of endless austerity and rediscover some national pride and identity and some degree of control over their own affairs.  We should be looking for a new accommodation with the paymasters, recognising that sooner or later the Euro in it's current format is doomed.

The Yin and the Yang

The Yin and the Yang

Every idea has its opposite and like a walking figure silhouetted by the sun, there is a shadow.  This shadow is as attached to its figure as are the opposing poles of a magnet.  Nature has provided that there will always be opposites and that they will attract each other.

Society is no different, with the young showing the abandon and rebellion of a fast flowing mountain stream, while the old show the conservatism and lethargy of slow meandering lowland rivers.  In time of course, the one will become the other.  Life was given a finite span to ensure that each generation could make both its own mistakes and show its moments of brilliance without obligation to the past or the future

At present, it is as though our world has been dammed.  There is a dangerous difference between the old and the young.  The old have everything and the young have nothing.  The young see our politicians as irrelevant.  They have nothing to say and have failed to do the most important job that parents have:  to make the world a better place for their children. 

This is not sustainable in any terms, least of all wealth, home ownership, pensions, health or education.  It is another example of the vast inequalities that characterise the rich 1% and the rest of the world.  Everywhere, the young are questioning the world order, the twin horrors of greed and selfishness and are considering the contribution they can make.  They demand recognition in a peaceful manner, as has been shown in protests seen in the last six months from Tahrir square to the streets of Athens.

They need to be heard and not patronised and ignored.  They are our immediate future and should have a chance at this critical time to set the world on a different and sustainable path.

The Day of the Beast

Jesus turning over the tables in Jerusalem, affronted by the excesses of the money lenders, is as much in the news as the protection of the Status Quo by the Pharisees.  What has changed?  Clearly not a lot, but let me remind you of Revelations 13 and the number 666, the sign of the beast; perhaps after all it was a prophetic number.

The recent meeting of European leaders was meant to save Greece, the Euro and other indebted European countries.  But has it?  Ther first test was the market's reaction on Thursday, which was favourable.  The acid test was the market's reaction on friday after the sale of Italian Bonds.  This was a disaster.  Italian bond sales werre made at a much higher rate than hitherto, with the interest rate rising from 5.86% to 6.06%, blowing a hole in the rescue plan.

I appreciate that I'm being melodramatic, but when the rate rises to 6.66%, then perhaps the beast will devour the Euro.

The nature of Bubbles

I’m into week three of writing a blog and as I look into other blogs I become more aware of how much I don’t know, but I guess that is the nature of knowledge.  I need to simplify the problem, so that I have some clue about what is taking place, and what I see is a fairly simple equation.  The banks don’t print money; they lend money to people and organisations with the intention of making profit.  They aim to lend to people who can themselves make profit or service their debt.  At present, they have been seen to be guilty of making terrible lending decisions and their portfolio is riddled with potential bad debts from people, organisations and countries who cannot meet their obligations.  As regards lending to countries (and Greece is very much in the news at present), Germany says that the banks must allow for the majority of their loans to Greece as being bad.  The sticking point is that the French banks have lent more to Greece than anybody else and as such are against this proposal.

And so we come to the solution that will be agreed upon this week at the meeting of European leaders.  The banks will be asked to increase their reserves, which effectively limits their lending and at the same time increases their cover against bad lending decisions.  At the same time a European fund will be set up to help countries that have problems in repaying their debt.  And how will this be achieved?  The countries, Europe and the World will print more money so that Bank’s ratios can be improved and rescue funds set-up.

This is nothing less than another bubble that can only delay the inevitable and which is a continuation of the reason why the problem appeared in the first place.  This problem is not being solved; it is being passed forward without thought to the future.  The only way that a policy of this nature could possibly work would be where growth was equal or greater than the amount of money being invented.  In the current climate, we are entering a recession, and the money created will end up, down the line, as further bad debts to the banks who made the loans in the first place.

If we have a soft landing now, then the ultimate landing will be that much harder.

Willie Giles 25/10/11

What's a Dodo?

John Vickers, Chair of the Independent Commission of Bankers, suggests that Investment banks should be ring-fenced and separated from the Lending/Saving bank function.

The banks say that this will seriously impair their ability to lend.

Vince Cable says the banks are being "disingenuous"

The decision on ring-fencing is being delayed until 2015.

With many others, I watched the tent village grow outside St Paul's Cathedral in support of the 99%.  Whatever your beliefs, St Paul's is a potent symbol of National defiance and of hope for the future and there is a subtle difference between the "People" championing a cause by hijacking a symbol and betwen a government or state doing the same thing "In the name of the people".  In fact, it is not even that subtle, many people just don't trust the government to say or do anything that is honest, because they are seen to be corrupt, egotistical and selfish.

To be fair, the bankers have their own perception of the world and may believe that they are doing an invaluable job in oiling the wheels of Industry and providing employment in the City of London.  However, it is easy to be cynical and there is undoubtedly an element of self-interest.  It was interesting to see on television the bewilderment from protesters and bankers, when trying to understand each other's point of view.  It was in this vein that William Hague made condescending remarks about the importance of the Banking System and the time-wasting being shown by the protesters who would achieve nothing with their actions.

How difficult is it to understand?  The Investment Banks are corrupt, greedy and discredited and should be outlawed.  Their retention will surely lead to the collapse of the Banking System.  It is in few people's interest to see a massive collapse in the world's financial systems with the related and inevitable social unrest and displacement and so action is needed now.

Another image that I liked was of a Chartered Accountant standing in solidarity with the protesters, showing the extent of the consensus of the 99%.  There is a clarity of well-reasoned thought behind the bitter objections to the excesses of the Banking System that cannot be denied.  Unless our Governments can come clean and "Change their spots", then like the Banking system they will become Dodo's.

What a mess

Lets have a little question and answer session.

Why doesn't Barak Obama support a Palestinian State?  Because he is seeking reelection next year and has caved into the Jewish lobby.

Why did the western world save the banks from collapse?  Because the banks are an integral part of the globalized economy and the politicians take the view that the system should be saved at the expense of the people.

Why are the people in North Africa and the Middle East rebelling against their leaders?  Because the leaders are corrupt and greedy and give the common man no chance to live a life without fear and with the possibility of pride in their achievements.

Why are the people of Greece going on strike?  Because they are being made to pay for the mistakes of the banks and their political masters.

Why do our political leaders hold such store by Economic Growth?  Because growth is an integral part of the globalized economy.

The western world is run by rules and systems that preserve the political and economic elite in their ruling position.  They will not countenance a change to the system, despite the illogicality of many of their pronouncements.  Clearly growth cannot continue for ever as resources are finite- fact.  Equally Empires do not last for ever- fact, despite the leaders clinging onto their power for as long as possible.

An analysis of the reuirements of the International Economic Model, needs to address in the first instance, the systems that should support our requirements.  Only in this way will sensible progress be made.

1.  Economic growth cannot continue unabated.

2.  Each country should have its own manufacturing base.  China cannot continue to provide the world with cheap goods that they cannot afford and probably dont need.  Production should not be exported by the West to the East because they have a lower unit cost of production.

3.  Differentials of Pay between the top and the bottom should not only be reduced, but should reflect an accepted sense of worth, such that the Poor are not exploited for the benefit of the Rich.  Within this narrowing of the wealth spectrum the powerful should become the servants of the weak and actively seek equality so that compassion can replace greed and humility replace power.

4.  Education should emphasise helping others.  Academic attainment has been too closely related to financial worth.

I think that economics should become a byword for the fair distribution of wealth and that commodities are only used where their environmental, social and economic benefit have been assessed by an elected panel that fairly represents these relevant interests.  While the world players try to fiddle about with an Economic System that is broken and discredited, all they are achieving is a bad repair job that will inevitably break sooner or later.  These breaks tend to be cataclysmic and unexpected and whilst they cannot be predicted , that they will occur is as certain as the fact that there will one day be another earthquake of Richter magnitude 9.5.