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from wall st to main st to coronation st

as the de-leveraging goes on among the financials based on that credit model it is bound to impact among highly leveraged non financials [most of them].

Bank of American cannot lend to McDonalds.


With uk mortgages in aug at only 2% of aug last year the credit lake like the aral sea has shrunk leaving everyone's boats stranded miles from the water.

if it couldn't get any more bizarre the americans say nothing can happen this side of the jewish holiday and given the collapse of the plan over 'offensive' political speeches i'm beginning to think the economic astrologers and their mercury retrograde might have a case.

mystic meg anyone?

A few of us on these postings have mentioned one cause of the problem as being demutualisation. i.e. the banks moving away from a cash safety to that of speculating on the market to raise funds.

Is there a possibility for one of our economic experts to examine this?

I know the man who is going to save us all, Mr.Cameron wants cross party talks (has he any ideas of his own?) but as he has been the one to constantly blame Brown for this mess, forgets that demutualisation was a Tory idea of the 80's in the Thatcher "let's get rich quick" city tycoon era.

Some of us have long memories. No wonder I heard today that many at the Conference beiing young do not know what the Blessed Margaret" did and the Tories are hoping that they never will.

Whenever I hear Cameron making these so called conciliatry noises, I tend to "reach for my gun" as they say in the Westerns.

Has it been identified objectively WHEN the extra regulation of the finance sector should have been introduced?

Also I keep hearing that there will be new regulation but how will it affect new instruments? Once/if derivatives and CDS are under control do we get whammied by a new instrument?

Should new instruments be "licensed" so that the public knows thought has been given to their impact?

Can that be done globally?

Apologies to bookhimdano if he explained this the other day and I did not take it in.

As it is not only banks but insurance businesses (e.g. Fortis) that are being caught out through greed and dodgy deals, some controls seem needed in this market.

Some months ago there was a TV documentary in which one of the 'fatcats' explained a growing practice in which any person can insure property that is owned by anyone else. If and when the property is lost, destroyed or whatever, then the hundreds more who have it insured) will all be eligible for payout, in addition to the actual loser, thus making the true cost of a building, yacht or whatever, multiples of it's real value.

I've just turned down a Travel Insurance policy from Fortis as there may be hundreds of other 'ghost passengers' travelling on my booked holiday package.

Maybe the House of Representatives was not as irresponsible as it might have seemed. Maybe they were the victims of a political coup which hi-jacked the vote.

Almost all the members were pulled by two opposing forces; regardless of their personal position. On the one hand they wanted to behave responsibly by ensuring the motion was passed. They knew what would happen if there was no bail-out.

On the other hand, they well knew that their constituents hated the idea; it was opposed to everything the US political systems believed in. For the republican voters it was pure socialism and for the democrats it was bailing out the fat cat bankers. Even worse, the representatives were facing the toughest election; just 6 weeks away. Any vote was needed – and alienating any voter was the last thing needed.

The solution was to hope that others would vote the resolution in, so that you could put on record your vote against it. So, they watched the voting as it progressed; and heaved a sigh of relief when it was obvious the motion would pass, albeit by a small margin. They were free to vote against.

The coup was managed by holding back the core conspirators, those determined to wreck the bail-out, until the very last minute and then piling in their ‘no’ votes. Thus, it was obvious, as the voting record progressed, something like 30 core votes were added only at the last minute; so many, indeed, that the voting record continued until several minutes after the close of the vote.

In this way, the careful calculations of the majority were undermined by the few. It highlighted one of the risks of a representative democracy; and brought US democracy into ridicule. Simultaneously destroying the bail-out and pushing the US into an even more extreme position vis a vis the rest of the world, this was yet another brilliant coup for the neocons.

Paul Mason's blog mentioned that he'd just got an e-mail from Michael Moore? Given that the US elections are only 4 weeks
away it would be good to build on the
'remember Gettysburg' angle in Paul's
blog. Is Ralph Nader saying anything
of interest - and/or does that matter?

I see too that Willem Buiter in today's FT is keeping his money in an old sock ..............
And that there is a similar debate going on in Ireland (today's Irish Times) about moral hazard versus systemic risk and bailouts ...

There was also an interesting discussion last night on Newsnight Scotland - with
Alf Young (Policy Editor of The Herald and
friend/work colleague of Gordon Brown) -
and a couple of discreet Scottish bankers.

THW PRICE OF SNAKE OIL AND SNAKES IN SUITS

Immigration: and any talk of racial or sex differences which suggest that parting people and their money may be a function of their cognitive ability is not only politically incorrect but may even be (see ref 13).

After all, others have sub-prime loans to make and package and pass on as SIVs very quickly, which, like immigration and dysgenic differential fertility, is good for banksters' bonuses which in turn is 'good for the economy'.

Except it's not good for everyone else in the long run.

BRIGHT BUT NOT SHINING

Thanks JJ - I read a bit about Jensen. Reminds me of what the 'scientific community' in USA did to maverick Immanuel Velikovsky in the 50s when he had the temerity to offer well reasoned enquiry on their hallowed turf.

Velikovsky stuck to his guns and gave rise to the alternative cosmology of 'The Electric Universe'. 'They' still don't like it, but the day is coming when they will have to lump it.* Scientists are regarded as bright, but their juvenile response when threatened by left-field constructs is no shining example.
And the vaunted peer review system works hard to maintian the status quo - regardless.

*Perhaps the same is true of genetic IQ?

WHAT MOST PEOPLE THINK MAKES NO SENSE?

Barrie (#9) You wouldn't believe how many people take think it's 'obvious' that being educated increases intelligence. They don't seem to grasp that whilst having long legs increases one's chances of being good at the high jump one doesn't grow long legs by practising at the high jump. They confuse correlation with causality.

Genes and their selection largely drive both, and just as one can't train folk with short legs to excel at the high jump, schooling doesn't increase intelligence, it just selects and equips it. Given that about half of the population now goes to university and more females than males, but that there are twice the number of males as female even at an IQ of 120 (1.33 SDs above the mean and the male:female ratio goes much higher as one moves further to the right), what's going on, and what does that say about higher education today other than that it's a business, has been seriously devalued, and is, by delaying more of the brighter young women from becoming mothers longer, dysgenic?

APPLE PIE ORDER (#10)

Dave is all for families JJ - we are saved! AND he is proud that his wife is an entrepreneur.

In passing: taking as read that IQ relates to ancestral stock/geographic location, how would selection for anything but the highest work? Is it inferred that selection for other attributes (say early motor skills) is done at the expense of IQ. Hmmm, reasonable I suppose. Famine proofing. malaria resistance. Hey I am cooking with gas!

I wonder if that bright lot (no names) used to bump off all their dullards before puberty.
Not another ceremony!