Here’s a ‘take’ on the poisonous fetid atmosphere that surrounds all
politics `and finance right now.
What is noticeable is that all commentators that I read in many
papers say that once the bank paralysis has been unlocked to some
extent and the financial threads of our country are moving again,
then the reaction in the ‘real world’ will come and this recession
which may even become a depression is likely to be around for 3 to 5
years.
EG:- Roger Bootle in the Telegraph “How long will the troubles last?
It is impossible to tell. But a sensible approach is to imagine that
once GDP has stopped falling we may be in a condition of stagnation
for four or five years.” - - - – “not an ordinary recession but a
drawn-out, though possibly shallow, depression, caused by massive
greed interacting with a huge bubble and compounded by catastrophic
institutional failure, resulting in a collapse of confidence, so that
the burden of the past hangs for years over the present like a toxic
cloud. - - - - if there is to be a significant price danger over the
next few years it comes not from inflation, but from its equally
sinister twin – deflation.”
xxxxxxxxxxxxx cs
The FTSE 100 started at +6,7% fell to +4,71% at 11 am, at 1.15 pm
+3,46 and at 3pm +5.17 again. Germany’s which was +5.76% at 11 am,
reached+ 6.63% at 1.15 pm. Dow Jones at 3pm BST near to its opening
was +4.54%
===========================
TELEGRAPH 13.10.08
If the Left has its way the bad times will be even worse
By Janet Daley
The Left is on a roll. Just when you thought it was safe to go back
into the political debate - free forever from time-wasting
ideological arguments about why the state rather than the individual
was the source of moral good - back it all comes. And this time it is
rampant with sanctimonious self-satisfaction.
In all the chaos and the confusion, the Big State merchants are
managing to sell two contradictory propositions: the first is that
democracy as we have known it will have to be suspended for the
duration and the second, that elected political leaders must have
more power than ever over the economy because only they have the
mandated authority to defend the interests of the population.
Democracy in its proper sense - the principle that the legitimacy of
government derives from the consent of the governed - has been
getting pretty short shrift from the outset. In the United States
imminent congressional elections succeeded in keeping it in the game
but in the rest of the world it has been cast to the winds.
This is a "global crisis" which requires a "global solution", intoned
Gordon Brown, who is riding a wave of triumphal recovery as he
attends to a crisis that was created under his stewardship of the
economy. This is a "global crisis" which requires a "global solution"
chorused all those solemn leaders of the G7 as they met in
Washington. Now at least some EU governments are planning to emulate
Britain's bail-out plan, even though it showed precious little sign
of working here last week.
So the consensus is that we must achieve a consensus: we must not
show ourselves to be divided by adopting individual national remedies
that might damage another country's interests. "We are in this
together," said George Bush, and added: "We will come through it
together."
Short of launching into a chorus of Kumbayah, they could scarcely
have presented a more heart-warming tableau of togetherness. But hang
on a minute. I don't recall having had a hand in electing the
President of France or the Chancellor of Germany, let alone the
leaders of Canada and Japan. They have no mandate from me. They are
not accountable to me. Quite suddenly, we find that we are being
governed by an international club that is vowing to take decisions
(or, more likely on their past record, failing to take decisions) not
necessarily in our interests but in what it sees as the world's
interests.
But what is the world other than a collection of individual nations
with quite separate and differing needs and imperatives? And if all
those nations agree to take no step that might damage the others,
isn't that a recipe for paralysis and platitude - which have been the
chief by-products of all these grand international summits?
But the banking and finance systems are now global, it is said: they
transcend national boundaries and therefore the remedies for this
debacle must also transcend them. Ergo this is a crisis not just for
the world economy but for the very concept of nationally sovereign
democracies. (Whoopie, say the Euro federalists who can see their
moment coming at last.)
How very dangerous - and familiar - this talk is. It sounds like
another rendition of the apologia for totalitarianism that
underpinned the infamous criminal ideologies of the last century,
this time in the internationalist rather than the nationalist form.
But so paralysed and platitudinous are the consensual arrangements on
which all of these diverse governmental leaders can agree that they
serve only to draw attention to the gravity of the problems and the
helplessness of governments, thus letting everybody down and leading
the markets to believe that running for the exit is the only rational
course.
The real revelation of this past week has been the impotence and
irrelevance of government policies and packages. The politicians and
their accomplices have, in fact, managed to produce the worst
possible concatenation of effects: they exacerbated the hysteria by
shrieking "doom" (the head of the IMF, Dominique Strauss-Kahn,
described the global financial system as being on the "brink of
systemic meltdown") and then looked nonplussed when their belated
remedies failed to stem the panic that they had helped to engender.
But, by the laws of perverse outcomes and political hubris, the
ineffectualness of government intervention has created a
justification for even more government intervention.
Now there is an outright threat of take-over to the private banks
that are simply refusing to regain confidence in their own system: if
offering to put in capital and guarantee debt doesn't do it for you,
well then, we'll just seize control of you through nationalisation.
Or something. It is all terribly unclear.
Alistair Darling hinted at a move to wholesale nationalising of the
banks last week, but Yvette Cooper carefully pulled it back in a
television interview on Sunday: there might be a case for placing
politicians on the boards in the short-term, but we would not want
"governments running banks".
There would have to be "strings attached" to the money that the
Government would provide, and these might involve such matters as
regulating remuneration and bonuses to bankers - but, on the other
hand, government would not "set down conditions" for every detailed
decision. So what exactly does it all amount to? Pretty much what we
announced last week. Which didn't work.
But however useless the political remedies may be, it does not stop
politicians from going on a self-aggrandising free ride. America may
be about to elect to the presidency the most inexperienced man who
has ever run for that office on the grounds that he sounds
reassuring, even though his party promotes higher business taxes
which would destroy what remains of the chance for economic recovery.
In Britain, the man who presided over the economy during the "decade
of irresponsibility" has been brought back from a near-death
experience because he, too, manages to sound reassuring. What they
have in common is that they are both politicians of the Left, and
Left-wing parties always prosper in economic bad times because they
are thought to be more compassionate and concerned for ordinary
people, while the Right is associated with the ruthlessness of the
free market.
This economic crisis will come to an end because it must - because
people will eventually decide that they must start doing business
again. We may find out today whether that process has begun. But when
it ends, we may find that it has brought with it a new, and
dangerous, political settlement that threatens the most fundamental
principles of political and economic freedom.
politics `and finance right now.
What is noticeable is that all commentators that I read in many
papers say that once the bank paralysis has been unlocked to some
extent and the financial threads of our country are moving again,
then the reaction in the ‘real world’ will come and this recession
which may even become a depression is likely to be around for 3 to 5
years.
EG:- Roger Bootle in the Telegraph “How long will the troubles last?
It is impossible to tell. But a sensible approach is to imagine that
once GDP has stopped falling we may be in a condition of stagnation
for four or five years.” - - - – “not an ordinary recession but a
drawn-out, though possibly shallow, depression, caused by massive
greed interacting with a huge bubble and compounded by catastrophic
institutional failure, resulting in a collapse of confidence, so that
the burden of the past hangs for years over the present like a toxic
cloud. - - - - if there is to be a significant price danger over the
next few years it comes not from inflation, but from its equally
sinister twin – deflation.”
xxxxxxxxxxxxx cs
The FTSE 100 started at +6,7% fell to +4,71% at 11 am, at 1.15 pm
+3,46 and at 3pm +5.17 again. Germany’s which was +5.76% at 11 am,
reached+ 6.63% at 1.15 pm. Dow Jones at 3pm BST near to its opening
was +4.54%
===========================
TELEGRAPH 13.10.08
If the Left has its way the bad times will be even worse
By Janet Daley
The Left is on a roll. Just when you thought it was safe to go back
into the political debate - free forever from time-wasting
ideological arguments about why the state rather than the individual
was the source of moral good - back it all comes. And this time it is
rampant with sanctimonious self-satisfaction.
In all the chaos and the confusion, the Big State merchants are
managing to sell two contradictory propositions: the first is that
democracy as we have known it will have to be suspended for the
duration and the second, that elected political leaders must have
more power than ever over the economy because only they have the
mandated authority to defend the interests of the population.
Democracy in its proper sense - the principle that the legitimacy of
government derives from the consent of the governed - has been
getting pretty short shrift from the outset. In the United States
imminent congressional elections succeeded in keeping it in the game
but in the rest of the world it has been cast to the winds.
This is a "global crisis" which requires a "global solution", intoned
Gordon Brown, who is riding a wave of triumphal recovery as he
attends to a crisis that was created under his stewardship of the
economy. This is a "global crisis" which requires a "global solution"
chorused all those solemn leaders of the G7 as they met in
Washington. Now at least some EU governments are planning to emulate
Britain's bail-out plan, even though it showed precious little sign
of working here last week.
So the consensus is that we must achieve a consensus: we must not
show ourselves to be divided by adopting individual national remedies
that might damage another country's interests. "We are in this
together," said George Bush, and added: "We will come through it
together."
Short of launching into a chorus of Kumbayah, they could scarcely
have presented a more heart-warming tableau of togetherness. But hang
on a minute. I don't recall having had a hand in electing the
President of France or the Chancellor of Germany, let alone the
leaders of Canada and Japan. They have no mandate from me. They are
not accountable to me. Quite suddenly, we find that we are being
governed by an international club that is vowing to take decisions
(or, more likely on their past record, failing to take decisions) not
necessarily in our interests but in what it sees as the world's
interests.
But what is the world other than a collection of individual nations
with quite separate and differing needs and imperatives? And if all
those nations agree to take no step that might damage the others,
isn't that a recipe for paralysis and platitude - which have been the
chief by-products of all these grand international summits?
But the banking and finance systems are now global, it is said: they
transcend national boundaries and therefore the remedies for this
debacle must also transcend them. Ergo this is a crisis not just for
the world economy but for the very concept of nationally sovereign
democracies. (Whoopie, say the Euro federalists who can see their
moment coming at last.)
How very dangerous - and familiar - this talk is. It sounds like
another rendition of the apologia for totalitarianism that
underpinned the infamous criminal ideologies of the last century,
this time in the internationalist rather than the nationalist form.
But so paralysed and platitudinous are the consensual arrangements on
which all of these diverse governmental leaders can agree that they
serve only to draw attention to the gravity of the problems and the
helplessness of governments, thus letting everybody down and leading
the markets to believe that running for the exit is the only rational
course.
The real revelation of this past week has been the impotence and
irrelevance of government policies and packages. The politicians and
their accomplices have, in fact, managed to produce the worst
possible concatenation of effects: they exacerbated the hysteria by
shrieking "doom" (the head of the IMF, Dominique Strauss-Kahn,
described the global financial system as being on the "brink of
systemic meltdown") and then looked nonplussed when their belated
remedies failed to stem the panic that they had helped to engender.
But, by the laws of perverse outcomes and political hubris, the
ineffectualness of government intervention has created a
justification for even more government intervention.
Now there is an outright threat of take-over to the private banks
that are simply refusing to regain confidence in their own system: if
offering to put in capital and guarantee debt doesn't do it for you,
well then, we'll just seize control of you through nationalisation.
Or something. It is all terribly unclear.
Alistair Darling hinted at a move to wholesale nationalising of the
banks last week, but Yvette Cooper carefully pulled it back in a
television interview on Sunday: there might be a case for placing
politicians on the boards in the short-term, but we would not want
"governments running banks".
There would have to be "strings attached" to the money that the
Government would provide, and these might involve such matters as
regulating remuneration and bonuses to bankers - but, on the other
hand, government would not "set down conditions" for every detailed
decision. So what exactly does it all amount to? Pretty much what we
announced last week. Which didn't work.
But however useless the political remedies may be, it does not stop
politicians from going on a self-aggrandising free ride. America may
be about to elect to the presidency the most inexperienced man who
has ever run for that office on the grounds that he sounds
reassuring, even though his party promotes higher business taxes
which would destroy what remains of the chance for economic recovery.
In Britain, the man who presided over the economy during the "decade
of irresponsibility" has been brought back from a near-death
experience because he, too, manages to sound reassuring. What they
have in common is that they are both politicians of the Left, and
Left-wing parties always prosper in economic bad times because they
are thought to be more compassionate and concerned for ordinary
people, while the Right is associated with the ruthlessness of the
free market.
This economic crisis will come to an end because it must - because
people will eventually decide that they must start doing business
again. We may find out today whether that process has begun. But when
it ends, we may find that it has brought with it a new, and
dangerous, political settlement that threatens the most fundamental
principles of political and economic freedom.
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