MONDAY, OCTOBER 13, 2008
Mandy's Chinky Drinky Kidney Linky
Peter Mandelson drank Chinese milk 9 days before his kidney problems surfaced. He flamboyantly drank a glass in front of the Chinese media to "show his support for the Chinese dairy industry"which has been hit child poisoning contamination disasters.Premier Wen Jiabao said he was very moved when he saw Peter Mandelson drinking a cup of Chinese milk on Friday to show his trust in China-made products. “It's because he not only sees the present, but the future as well,” Wen said. Oh dear...
Hat-tip : Shanghaiist
Good Morning Shareholders
How is that Lloyds, a seemingly well run and conservatively managed bank, has in the space of few weeks gone from being solid and unexposed to the U.S. mortgage market to being nationalised by the government? One wonders if the chairman now regrets meeting Jonah Brown at that party...Trevor Kavanagh this morning points out that the collapse of Britain's banks was not inevitable, "it hasn’t happened in Canada, Australia or Sweden". So much for Britain being uniquely placed to weather the financial storm. Gordon designed the regulatory system, Gordon allowed the property bubble to inflate.Gordon's bubble has now popped.
Gordon is spinning that he is leading the world, either he is delusional or deliberately lying, in Europe they are calling the EU-wide rescue plan the "Sarkozy solution". If any country can honestly claim leadership, it is actually Sweden, the EU plan being based on a nineties solution to a Swedish banking crisis. Gordon, for some reason, needs us to believe he is saving the world.
SUNDAY, OCTOBER 12, 2008
Hutton & Polly v Mises & Milton
Listening to Will Hutton and Polly Toynbee you would think they were actually monetary economists when in reality they are just soundbite savvy talking heads spouting the latest fashions of the metropolitan media elite. Both property millionaires in their own right, three-houses-Polly and Hutton have substantial family stakes in the property market. If they had such great economic foresight would they have got so badly caught out? Rumours circulate as to the viability of Mrs Hutton's extensive property portfolio.Toynbee has now realised that Gordon is staying and that her flirtation with David Miliband was just a passing fancy. Her tune has changed, now saying (once again) that Brown is the man for our times when only weeks ago she was telling the cabinet they were spineless not to get rid of him.Laughable.
Polly's advice and economic genius is as suspect and as reliable as her loyalty to whichever politician she is championing this month. At the beginning of the year she was still loyal to Gordon and chiding Cameron for his new year message which she claimedsmacks of callow point-scoring, with his five repetitions of "Labour's hopeless" - and it will look even thinner in retrospect in a year's time if Brown has steered through economic rapids without most voters feeling any adverse effect.She was confidently predicting
A minor slowdown with neither inflation* nor unemployment rising will see Brown's old "no boom or bust" boasts triumph this time next year.
Guido suggests we leave Polly and Will to their studio soundbites and ignore their siren voices - they have been advocating their brand of redistributive social democracy as the solution to everything for decades. If policy makers are looking for guidance on avoiding a depression (alas a recession is upon us already) they should dust off the works of Ludwig von Mises and Milton Friedman - Mises wrote the seminal "The Theory of Money and Credit". If this book had been read by more central bankers outside the Bundesbank we would not be in this mess. Guido once listened to an LSE lecture by a Bundesbank board member speaking in reverential tones about Mises' thinking. He is the high priest of monetary theory.
If history is not to repeat itself then reading Friedman's "The Great Contraction, 1929-1933"should be a priority. If you think this is irrelevant to the state we are in you should note that the current Federal Reserve chairman, Ben Bernanke, pays tribute to this work and is quoted in the introduction to the current edition. Whereas Mises is heavy going, Friedman and Schwartz are essential reading. Guido can summarise the primary policy response to the situation we are in succintly : cut interest rates.
*Polly was half right about inflation, it won't be a problem now we are heading for recession.
SATURDAY, OCTOBER 11, 2008
Guardianistas Frozen Cash
The Guardian Diary mocked the Daily Express for recommending investing in Icesave last week on the very same day that the firm collapsed. Those in ice-houses should be careful, for only a fortnight earlier where was the so smug and told-you-so financial pages of the Guardian telling readers to put their hard earned savings?
Harvey Jones picked ten of the best places to put your cash, guess which was his number one destination?
Do you need a clue? You're getting colder....
Is Brillo Hitting the Bottle?
Guido is a close observer of BBC2's the Daily Politics and The Week, both fronted by Andrew Neil. Recently it has been noticeable that Brillo's hair seems to have undergone a renaissance. Could be a trick of the light, Mrs Fawkes agrees that is more likely a dark bottle of dye that has done the trick.Judge for yourself from these photos. Like a before and after advert?
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