Well, bank recapitalisation is here

SimpleSam06

silverharp wrote: »

As for the Keynes quote, that lacks any content, how do you apply that to for instance Aerlingus v British Airways or Ryanair

How do you apply it to Microsoft or turn of the century rail Barons?

silverharp wrote: »

How will it change? State agencies are not going to come in one day and vote that they close themselves down in the public interest. And the “people” will always lobby to vote themselves more goodies or defer cuts or push the cuts somewhere else.

Nobody is saying that state agencies have to close down, and I'm not sure where you picked that up from. Streamlined yes, but it would be a huge mistake to say that everybody in the public sector is a timewaster. Also I'm not sure where you are pulling the concept of direct democracy from what I was saying.

silverharp wrote: »

Not getting in the way of profits, you will need to convince me that wage increases during a depression does not afect the total hours worked in the economy.

We're not talking about wage increases, we're talking about minimum wage. And do not try to say that social security has a net negative effect, unless you are proposing some sort of Darwinian culture, where the devil takes the hindmost.

silverharp wrote: »

Hmmmmm... if thats a definition of sucessful policy , I'd hate to see if it went wrong.

Heres a graph since a picture paints more words than I am willing to commit to this debate:

As you can see, there was a consistent drop in unemployment from the peak of the depression, spiked slightly during a mini recession towards the end, which was actually caused by Roosevelt cutting back government spending, but overall the trend is clear.

You also seem to miss out on the fact that government cutbacks in 1920 led to a savage recession at that point. Over the decade, about 1,200 mergers swallowed up more than 6,000 previously independent companies; by 1929, only 200 corporations controlled over half of all American industry. This is the source of Roosevelt's ire against monopolists.

By the end of the decade, the bottom 80 percent of all income-earners were removed from the tax rolls completely. Taxes on the rich fell throughout the decade. By 1929, the richest 1 percent owned 40 percent of the nation's wealth. The bottom 93 percent experienced a 4 percent drop in real disposable per-capita income between 1923 and 1929. The conservative Supreme Court struck down federal child labor legislation during this decade. More than half of all Americans were living below a minimum subsistence level.

The high taxes which you seem to be so completely opposed to were largely levied on the rich, redistributing the grotesque imbalance in capital income between the very few wealthy and the very many poor.

These are the triumphs of laissez-faire economic policies, before the Wall Street collapse.

Sweden, which followed a policy of Keynesian deficit spending, became the first country to recover from the great depression.

In 1936 the top tax rate was raised to 79 percent, and economic recovery continued; GNP grew a record 14.1 percent and unemployment fell to 16.9 percent. From 1945 to 1963, the top tax rate was 91 percent. It stayed at least 88 percent until 1963, when it was lowered to 70 percent. During this time, America experienced the greatest economic boom it had ever known until that time.

Regardless of these minor skirmishes fueled by apparently pro libertarian blogs and whatnot (although the vast majority of economists support the New Deal as an effective response to the Depression), I'm not saying to mimic everything that was done then. The policies I suggested were very clear, and if you would clarify exactly what your issue with them is, that might ease things along.

silverharp

SimpleSam06 wrote: »

Regardless of these minor skirmishes fueled by apparently pro libertarian blogs and whatnot (although the vast majority of economists support the New Deal as an effective response to the Depression), I'm not saying to mimic everything that was done then. The policies I suggested were very clear, and if you would clarify exactly what your issue with them is, that might ease things along.

There is an article in the August 2004 Journal of Political Economy entitled "New Deal Policies and the Persistence of the Great Depression: A General Equilibrium Analysis," by UCLA economists Harold Cole and Lee Ohanian which comes to a different view, the JPE is arguably the top academic economics journal in the world. For now there maybe near consensus but maybe this whole area might be looked at again

As for Sweden in the 30's , I dont know what that proves one way or the other, they were a very creative people that had also stayed out of WW1. And to draw lessons from the past , alsolutely you can use a country's "reserves" to create jobs during a depression, but the risk is that you create ineffiencies in the economy which by any reasoning will have knock on effects
As for whats going on now, the USA is several magnitudes in worse shape financially and resourse wise now then in the 1930's , the amount of debt per person/GDP is unparalled so it will be fascinating to see what policies are pursued in the years ahead and how the global markets will deal with this.





http://newsroom.ucla.edu/portal/ucla/FDR-s-Policies-Prolonged-Depression-5409.aspx


FDR's policies prolonged Depression by 7 years, UCLA economists calculate
By Meg Sullivan| 8/10/2004 12:23:12 PM
Two UCLA economists say they have figured out why the Great Depression dragged on for almost 15 years, and they blame a suspect previously thought to be beyond reproach: President Franklin D. Roosevelt.

After scrutinizing Roosevelt's record for four years, Harold L. Cole and Lee E. Ohanian conclude in a new study that New Deal policies signed into law 71 years ago thwarted economic recovery for seven long years.

"Why the Great Depression lasted so long has always been a great mystery, and because we never really knew the reason, we have always worried whether we would have another 10- to 15-year economic slump," said Ohanian, vice chair of UCLA's Department of Economics. "We found that a relapse isn't likely unless lawmakers gum up a recovery with ill-conceived stimulus policies."

In an article in the August issue of the Journal of Political Economy, Ohanian and Cole blame specific anti-competition and pro-labor measures that Roosevelt promoted and signed into law June 16, 1933.

"President Roosevelt believed that excessive competition was responsible for the Depression by reducing prices and wages, and by extension reducing employment and demand for goods and services," said Cole, also a UCLA professor of economics. "So he came up with a recovery package that would be unimaginable today, allowing businesses in every industry to collude without the threat of antitrust prosecution and workers to demand salaries about 25 percent above where they ought to have been, given market forces. The economy was poised for a beautiful recovery, but that recovery was stalled by these misguided policies."

Using data collected in 1929 by the Conference Board and the Bureau of Labor Statistics, Cole and Ohanian were able to establish average wages and prices across a range of industries just prior to the Depression. By adjusting for annual increases in productivity, they were able to use the 1929 benchmark to figure out what prices and wages would have been during every year of the Depression had Roosevelt's policies not gone into effect. They then compared those figures with actual prices and wages as reflected in the Conference Board data.

In the three years following the implementation of Roosevelt's policies, wages in 11 key industries averaged 25 percent higher than they otherwise would have done, the economists calculate. But unemployment was also 25 percent higher than it should have been, given gains in productivity.

Meanwhile, prices across 19 industries averaged 23 percent above where they should have been, given the state of the economy. With goods and services that much harder for consumers to afford, demand stalled and the gross national product floundered at 27 percent below where it otherwise might have been.

"High wages and high prices in an economic slump run contrary to everything we know about market forces in economic downturns," Ohanian said. "As we've seen in the past several years, salaries and prices fall when unemployment is high. By artificially inflating both, the New Deal policies short-circuited the market's self-correcting forces."

The policies were contained in the National Industrial Recovery Act (NIRA), which exempted industries from antitrust prosecution if they agreed to enter into collective bargaining agreements that significantly raised wages. Because protection from antitrust prosecution all but ensured higher prices for goods and services, a wide range of industries took the bait, Cole and Ohanian found. By 1934 more than 500 industries, which accounted for nearly 80 percent of private, non-agricultural employment, had entered into the collective bargaining agreements called for under NIRA.

Cole and Ohanian calculate that NIRA and its aftermath account for 60 percent of the weak recovery. Without the policies, they contend that the Depression would have ended in 1936 instead of the year when they believe the slump actually ended: 1943.

Roosevelt's role in lifting the nation out of the Great Depression has been so revered that Time magazine readers cited it in 1999 when naming him the 20th century's second-most influential figure.

"This is exciting and valuable research," said Robert E. Lucas Jr., the 1995 Nobel Laureate in economics, and the John Dewey Distinguished Service Professor of Economics at the University of Chicago. "The prevention and cure of depressions is a central mission of macroeconomics, and if we can't understand what happened in the 1930s, how can we be sure it won't happen again?"

NIRA's role in prolonging the Depression has not been more closely scrutinized because the Supreme Court declared the act unconstitutional within two years of its passage.

"Historians have assumed that the policies didn't have an impact because they were too short-lived, but the proof is in the pudding," Ohanian said. "We show that they really did artificially inflate wages and prices."

Even after being deemed unconstitutional, Roosevelt's anti-competition policies persisted — albeit under a different guise, the scholars found. Ohanian and Cole painstakingly documented the extent to which the Roosevelt administration looked the other way as industries once protected by NIRA continued to engage in price-fixing practices for four more years.

The number of antitrust cases brought by the Department of Justice fell from an average of 12.5 cases per year during the 1920s to an average of 6.5 cases per year from 1935 to 1938, the scholars found. Collusion had become so widespread that one Department of Interior official complained of receiving identical bids from a protected industry (steel) on 257 different occasions between mid-1935 and mid-1936. The bids were not only identical but also 50 percent higher than foreign steel prices. Without competition, wholesale prices remained inflated, averaging 14 percent higher than they would have been without the troublesome practices, the UCLA economists calculate.

NIRA's labor provisions, meanwhile, were strengthened in the National Relations Act, signed into law in 1935. As union membership doubled, so did labor's bargaining power, rising from 14 million strike days in 1936 to about 28 million in 1937. By 1939 wages in protected industries remained 24 percent to 33 percent above where they should have been, based on 1929 figures, Cole and Ohanian calculate. Unemployment persisted. By 1939 the U.S. unemployment rate was 17.2 percent, down somewhat from its 1933 peak of 24.9 percent but still remarkably high. By comparison, in May 2003, the unemployment rate of 6.1 percent was the highest in nine years.

Recovery came only after the Department of Justice dramatically stepped enforcement of antitrust cases nearly four-fold and organized labor suffered a string of setbacks, the economists found.

"The fact that the Depression dragged on for years convinced generations of economists and policy-makers that capitalism could not be trusted to recover from depressions and that significant government intervention was required to achieve good outcomes," Cole said. "Ironically, our work shows that the recovery would have been very rapid had the government not intervened."

-UCLA-

SimpleSam06

silverharp wrote: »

the JPE is arguably the top academic economics journal in the world.

Heh.

silverharp wrote: »

And to draw lessons from the past , alsolutely you can use a country's "reserves" to create jobs during a depression, but the risk is that you create ineffiencies in the economy which by any reasoning will have knock on effects

Your concept of efficiency seems to mean "maximising profits regardless of the social consequences, ignoring the overall market environment and leading ultimately to a medieval style stalled and barely productive economy". Laissez faire capitalism isn't the hidden hand of the market, its the unlubed fist of impending corporate feudalism.

silverharp wrote: »

As for whats going on now, the USA is several magnitudes in worse shape financially and resourse wise now then in the 1930's ,

Ironically the situation in the US deteriorated (and by that I mean it began the course of events that left us where we are) at an enormous rate when the regulations put into place to control the flow of capital, the Glass-Steagal act, were repealed. The situation we are in at the moment is not a poster child for less regulation; quite the opposite.

silverharp wrote: »

the amount of debt per person/GDP is unparalled so it will be fascinating to see what policies are pursued in the years ahead and how the global markets will deal with this.

Are you talking about private or public debt here? And keep in mind, it wasn't until controls on banks were removed that things really started to get out of hand.

silverharp wrote: »

http://newsroom.ucla.edu/portal/ucla/FDR-s-Policies-Prolonged-Depression-5409.aspx

Just because its economists saying it, doesn't mean its not partisan bollocks. I can throw ten articles back for every one you dig out of the sordid trenches of stateside political point scoring, but I seriously have no time for that nonsense.

And that article failed in its entirety to respond to the points which I made in the last post, in particular the ruinously skewed distribution of wealth, and the fact that half of US citizens were living under the poverty line before the depression even began, plus consistent and sustained growth in GDP and reduction in unemployment brought about by New Deal policies.

Your point of view has been entirely blown out of the water.

book smarts

The general debate in economics at the moment seems to be Keynesian vs Austrian, roughly. Both are wrong. Econophysics is the only area that has showed any progress in years, and even that's not right. Bernanke himself studied the Great Depression and swore it would never happen again...

SimpleSam06

book smarts wrote: »

The general debate in economics at the moment seems to be Keynesian vs Austrian, roughly.

Only in so far as Darwinism vs creationism is the general debate in science, roughly.

book smarts wrote: »

Econophysics is the only area that has showed any progress in years

Yes, the geniuses behind the quants that proved so pivotal to avoiding this economic crisis.

silverharp

SimpleSam06 wrote: »

Your concept of efficiency seems to mean "maximising profits regardless of the social consequences, ignoring the overall market environment and leading ultimately to a medieval style stalled and barely productive economy". Laissez faire capitalism isn't the hidden hand of the market, its the unlubed fist of impending corporate feudalism.

I disagree, you are ignoring the fact that technology moves on and countries rise and fall. I would be hard pressed to name more then a dozen companies that existed from the 19th century and in another 100 years no doubt most household names today will be relics of the past. Corporate feudalism in this context is a strawman argument, work and corpoate structures are changing to rapidly for any dead hand stasis to set in.
My concept of effeciency has more to do with stabilty of the overall financial system in the context of a global economy that is always twisting and turning faster the any centralised authority can possibly control. Also the profits that you dont see to like so much dont exactly go to aliens on another planet. What is not paid out as dividends gets reinvested and dividenda are as likely to end up in pension funds as anywhere else, what is feudal about that?

SimpleSam06 wrote: »

Ironically the situation in the US deteriorated (and by that I mean it began the course of events that left us where we are) at an enormous rate when the regulations put into place to control the flow of capital, the Glass-Steagal act, were repealed. The situation we are in at the moment is not a poster child for less regulation; quite the opposite..

You have moved your microscope too close in here , the repeal of that act happened in the context of a Fed that had demonstrated that it would bail out the system at every little hiccup that came its way. If at the same time you have little regulation and risk insured away in an artificial manner then absolutely chaos is guarantted , even Greenspan got that one wrong.

SimpleSam06 wrote: »

Are you talking about private or public debt here? And keep in mind, it wasn't until controls on banks were removed that things really started to get out of hand..

Both, since the 70/80's there has been an unhealthy increase in non self liqudating debt, this is indicative of a system that is not allowed to self correct or the consequences of artificial growth polcies by big gov.

SimpleSam06 wrote: »

in particular the ruinously skewed distribution of wealth, and the fact that half of US citizens were living under the poverty line before the depression even began, plus consistent and sustained growth in GDP and reduction in unemployment brought about by New Deal policies.

Again you are obsessed with income dstribution in a very young country that was going through massive change. Are you suggesting that by the 1980's people in the IT industry for example would all be on subsistance wages. Recessions come and go, in the US there was one in 1910/11 , 1920/1921 and then the one in 29/30 kicks off. There was no reason why the 29 crash had to last more then a decade, compared to say Japan in the the 1980's alot of the pain was front loaded so no doubt a recovery should have been occuring in the mid 30's anyway.


now for the comedy moment

The Nazi Party newspaper, the Völkischer Beobachter, "stressed 'Roosevelt's adoption of National Socialist strains of thought in his economic and social policies,' praising the president's style of leadership as being compatible Hitler's own dictatorial Führerprinzip."

That has to be up there with the Head of the Zimbabwe central bank praising other central banks for follwing its policies ;-)

Time Magazine

book smarts wrote: »

The general debate in economics at the moment seems to be Keynesian vs Austrian, roughly.

That's not rough, that's wrong.

Econophysics is the only area that has showed any progress in years

That's also wrong.

Bernanke himself studied the Great Depression and swore it would never happen again...

I'll listen to that argument when unemployment reaches 25% mmk?

SimpleSam06

silverharp wrote: »

Corporate feudalism in this context is a strawman argument, work and corpoate structures are changing to rapidly for any dead hand stasis to set in.

Did you miss the fact of half of all US citizens living below the poverty line at the end of the roaring 20s? That is laissez faire capitalism at its finest.

silverharp wrote: »

My concept of effeciency has more to do with stabilty of the overall financial system in the context of a global economy that is always twisting and turning faster the any centralised authority can possibly control.

To be honest at this stage I have no idea what exactly you are advocating. Are you trying to say that industry and commerce should be entirely unregulated, because thats what I'm picking up.

silverharp wrote: »

Also the profits that you dont see to like so much dont exactly go to aliens on another planet. What is not paid out as dividends gets reinvested and dividenda are as likely to end up in pension funds as anywhere else, what is feudal about that?

And again we go back to the state of wealth distribution in the 20's US economy.

silverharp wrote: »

the repeal of that act happened in the context of a Fed that had demonstrated that it would bail out the system at every little hiccup that came its way.

It happened in the same context that naked shorting happened, under pressure from financial executives complaining about "inefficiencies" in the system, words which you are parroting.

silverharp wrote: »

Again you are obsessed with income dstribution in a very young country that was going through massive change.

Not in the least. It was you who decided to make the great depression your primary example of the ills of regulation, not my fault you were wrong. Now that you mention it though, Ireland is a very young country going through massive change. Quite a coincidence, that.

silverharp wrote: »

Are you suggesting that by the 1980's people in the IT industry for example would all be on subsistance wages.

There was no IT industry worth speaking of in the 1980s.

silverharp wrote: »

Recessions come and go, in the US there was one in 1910/11 , 1920/1921 and then the one in 29/30 kicks off. There was no reason why the 29 crash had to last more then a decade, compared to say Japan in the the 1980's alot of the pain was front loaded so no doubt a recovery should have been occuring in the mid 30's anyway.

Bad example there. The asset price bubble in Japan popped in 1990, and its collapse lasted more than a decade, with stock prices bottoming in 2003.

silverharp wrote: »

The Nazi Party newspaper, the Völkischer Beobachter, "stressed 'Roosevelt's adoption of National Socialist strains of thought in his economic and social policies,' praising the president's style of leadership as being compatible Hitler's own dictatorial Führerprinzip."

Yeah, he was best pals with Stalin too, before he invaded Russia. And yet funnily enough, the Nazi-built autobahns are still in use. Once again and I hope finally, I'm not advocating doing everything exactly the same as FDR. The core policies used in all of these recoveries would be great value in this country, however.

Time Magazine

SimpleSam06 wrote: »

I'm not advocating doing everything exactly the same as FDR. The core policies used in all of these recoveries would be great value in this country, however.

I'm not so sure.

SimpleSam06

The Economist wrote: »

[url=]http://www.marginalrevolution.com/marginalrevolution/2008/12/fiscal-policy-a.html]I'm not so sure.[/url]

From the article:

The bottom line is this: we are being asked to believe that a big, trillion or even multi-trillion fiscal stimulus can boost the current macroeconomy. If you look at history, there isn't good reason to believe that.

I would agree in that refinancing the banks in an effort to reintroduce liquidity is a bad idea on an ongoing basis. I would agree that trying to pull FDR part II in the US or Japan is not the best idea, although Obama is attempting to overcome the relatively mature infrastructure issue with major technological leaps (investment in battery tech for example).

I would however juxtapose that against Ireland's third world infrastructure and zero domestic industrial base; we are in a similar position in ways to the pre crash US, or Germany after Weimar. The solutions I am suggesting would not work in those countries or globally today. They are tailored for Ireland.

We are getting into massive public debt regardless, so we may as well something out of it.

Time Magazine

SimpleSam06 wrote: »

we are in a similar position in ways to the pre crash US, or Germany after Weimar. The solutions I am suggesting would not work in those countries or globally today. They are tailored for Ireland.

I'm confused here but I think you're rebutting the article I linked to without exactly specifying why. The fiscal stimuli you mention (the New Deal and Nazi Germany) didn't really work. Why would you tailor failed historical examples to Ireland if you think we are in a similar position to where they were?

We are getting into massive public debt regardless, so we may as well something out of it.

I agree; I'm not sure a fiscal stimulus is the best thing we could get from it.

SimpleSam06

The Economist wrote: »

I'm confused here but I think you're rebutting the article I linked to without exactly specifying why. The fiscal stimuli you mention (the New Deal and Nazi Germany) didn't really work. Why would you tailor failed historical examples to Ireland if you think we are in a similar position to where they were?

Eh first off, the article doesn't specify why the author feels they were not applicable, unless he is some sort of unquestionable authority on the subject - improved infrastructure and public works do offer tremendous demonstrable long term advantages to a country. Not to mention that all of the countries where these policies were executed are now some of the most powerful economies on earth.

Secondly what I took from the article was that he was saying that applying enormous amounts of money in the manner it is being applied at the moment is a bad idea (hence the quoting of the "bottom line"), which I agree with.

You can't just wave a hand at poorly targeted fiscal stimulus and say it represents all stimulus, that would be a fatal generalisation.

The Economist wrote: »

I agree; I'm not sure a fiscal stimulus is the best thing we could get from it.

What would you suggest to put Ireland on a sound economic footing for the mid to long term?

silverharp

SimpleSam06 wrote: »

Bad example there. The asset price bubble in Japan popped in 1990, and its collapse lasted more than a decade, with stock prices bottoming in 2003.

Indeed, despite every keynsian trick thown at the Japanese problem it managed to stay in recession for more then a decade despite a growing international economy. Surely this demonstrates that actively trying to prop up past bubbles extends the recessions beyond what would naturally have occured.

SimpleSam06 wrote: »

Are you trying to say that industry and commerce should be entirely unregulated, because thats what I'm picking up.

Absolutely not, I've no opinion on that , all I'm interested in for now is there a causal relationship between past gov intervention in a market and that market behaving in a disfunctional manner or will the policy reponse to a "crises" make matters worse. I'd argue that based on experience regulation is not the be all and end all , it seems that either the regulation is pi88 poor for example Sarbanes Oxley or the regualtions are the problem in the first place for instance the rating agency cartel created by the SEC.

SimpleSam06

silverharp wrote: »

Indeed, despite every keynsian trick thown at the Japanese problem it managed to stay in recession for more then a decade despite a growing international economy. Surely this demonstrates that actively trying to prop up past bubbles extends the recessions beyond what would naturally have occured.

Thats a false corollary, its not Keynesian=trying to prop up bubbles beyond their lifespan. It would be of course foolish to attempt to do so (or even more foolish to allow yourself to be put in a position where your economy can be wiped out by a bubble in the first place).

silverharp wrote: »

I'd argue that based on experience regulation is not the be all and end all , it seems that either the regulation is pi88 poor for example Sarbanes Oxley or the regualtions are the problem in the first place for instance the rating agency cartel created by the SEC.

I agree that regulation is not the be all and end all, but a sufficient balance needs to be found. Left to its own devices the market tends towards massive consolidation and locking out of smaller players; conversely, drastic government intervention wipes out economies. Right now we need more regulation in financial circles, and growth policies to lay the groundwork for domestic export based industries - put the tax money where it will do the most good.

thebman

rrpc wrote: »

And letting these housing stocks go at fire damage sale prices would create a negative equity situation for thousands of people who bought at the height of the market. Maybe that's not you Dave but you proabably know lots of people who are already there.

That has to happen anyway, the market has to correct itself, does it not? There are too many empty houses. The value of a house isn't that important as long as the owners intend to live in it. People will earn and pay off their mortgages that they have which they are going to have to do anyway. I wouldn't mind helping people in some way that have lost their jobs and can't afford their mortgage for the house they live in, I'm just against protecting investors that invested badly.

The only people affected would be investors in the housing market. People that invested in an overflooded market. There is no way to protect them IMO. The market is overflooded. Unless you want to go demolishing the empty houses in which case, the property developers will be hit hardest. Although the investors and property developers are the same people in many instances.

Can you outline how the over supply will correct itself without having a negative affect?

Lending is a risk assessment activity. On a micro scale, if you borrowed 300k to buy a house two years ago, would you have believed then that it was a bad investment? Yet now, this kind of borrowing is described as irresponsible

Irrelevant IMO. What does it matter that it looked like a good investment then? It wasn't and tough luck to the person that invested in it. In a single isolated case, nobody would care. People only care because of the number of people affected.

Well the housing market is still going to have to correct itself so the money invested will most likely be lost at some point anyway unless someone can show me some plan that prevents that happening. I'd be for anything that would actually work and solve the problem and not just prolong the inevitable.

Obviously many people didn't, but they are now in possession of unsaleable houses whose value has dropped below the price paid at the time.

Most people live in their houses and aren't really intending to sell so the value of the house isn't all that important to them as long as they can afford the repayments. Investing in property with empty houses all over the place (which everybody could see) was inevitably going to be a bad idea. That market is screwed and the people that bought have lost their investment same as if they had invested in a company and its share priced collapsed.

I wouldn't entirely be against the government helping out people who can't pay off their mortgages on the residence they live in. It would obviously need to be worked out so there are no loop holes people could take advantage of though. I don't want to see people homeless but people that made bad investments can't really be bailed out by the taxpayers. Why should the people that didn't make bad investments bail out those who did? Especially when those who made bad investments, borrowed the money to make bad investments. It just doesn't make sense to me.

Personally I agree in investing in infrastructure hugely at the moment. You could probably retrain a lot of the unemployed construction sector to work on the projects so they could afford their mortgages. The projects are required anyway. Name one person that thinks public transport is adequate or that broadband is adequately provided in the country or even that we have enough roads. We absolutely need (actually desperately need) to invest in infrastructure in this country. Infrastructure has been ignored for too long in this country.

I'm very tired writing this so apologies if I've written b*ll*cks or come across as cranky. I'm pretty reasonable and could never declare myself an expert on these issues so if you show me I'm wrong, I won't have a problem with it, I'll just consider it a lesson learned

silverharp

SimpleSam06 wrote: »

Thats a false corollary, its not Keynesian=trying to prop up bubbles beyond their lifespan. It would be of course foolish to attempt to do so (or even more foolish to allow yourself to be put in a position where your economy can be wiped out by a bubble in the first place).

Ok then in your opinion did japan "generally" do the right thing from 1990 onwards, where did they go wrong?

SimpleSam06 wrote: »

Right now we need more regulation in financial circles, and growth policies to lay the groundwork for domestic export based industries - put the tax money where it will do the most good.

I doubt if regulation will be a problem for many years given a falling asset price environment.

do you trust gov. to "pick" winning industries or to spend borrowed money in a way that it will generate a positive return? this economy is going nowhere until private debt in the economy drops to Euopean averages at least, and the public sector by some miracle becomes more efficient then our European neighbours. Tax cuts and a balanced budget would help.

silverharp

brim4brim wrote: »

Personally I agree in investing in infrastructure hugely at the moment. You could probably retrain a lot of the unemployed construction sector to work on the projects so they could afford their mortgages. The projects are required anyway. Name one person that thinks public transport is adequate or that broadband is adequately provided in the country or even that we have enough roads. We absolutely need (actually desperately need) to invest in infrastructure in this country. Infrastructure has been ignored for too long in this country.

It comes down to what do you need and what can you afford? we may need new school buildings or more roads but borrowing to build them may create more problems in economic terms. All things being equal we are unlikely to be in a situation where we can borrow our way out of this like the 70's

SimpleSam06

silverharp wrote: »

Ok then in your opinion did japan "generally" do the right thing from 1990 onwards, where did they go wrong?

I'm not here to analyse Japan any more than I am here to dissect the New Deal, these seem to be your fortes.

silverharp wrote: »

I doubt if regulation will be a problem for many years given a falling asset price environment.

So you would be perfectly happy to continue with the existing fairly unregulated financial environment, even though it has brought the world economy to its knees?

silverharp wrote: »

do you trust gov. to "pick" winning industries or to spend borrowed money in a way that it will generate a positive return?

If you distrust "government" so much, vote in a new one. Long live democracy.

silverharp wrote: »

this economy is going nowhere until private debt in the economy drops to Euopean averages at least, and the public sector by some miracle becomes more efficient then our European neighbours. Tax cuts and a balanced budget would help.

The economy is always going somewhere. The prudent move right now would be to use what we have to do what we should have been doing all along, promoting export based domestic industry and weaning the country off the teat of FDI. How exactly do you propose to balance the budget without said domestic industry and without riots in the streets from the unions? Or are you just spouting low taxes and deregulation on all sides, a fine populist sentiment but in terms of practicality its somewhat lacking.

silverharp wrote: »

It comes down to what do you need and what can you afford? we may need new school buildings or more roads but borrowing to build them may create more problems in economic terms.

We'll be borrowing any way you slice it. Unless the ravenous public sector is brought to heel, we'll be borrowing to our great detriment.

silverharp wrote: »

All things being equal we are unlikely to be in a situation where we can borrow our way out of this like the 70's

Its not so much how much you borrow, its what you put it into.

silverharp

SimpleSam06 wrote: »

I'm not here to analyse Japan any more than I am here to dissect the New Deal, these seem to be your fortes..

if you dont learn from history you are doomed to repeat it

SimpleSam06 wrote: »

So you would be perfectly happy to continue with the existing fairly unregulated financial environment, even though it has brought the world economy to its knees?..

in response to your "right now" I'm just saying you are in a barn door and bolted situation, I'd worry about regulation a few years out from now. Market participants will be more conservative now then any new regulations could introduce

SimpleSam06 wrote: »

The economy is always going somewhere. The prudent move right now would be to use what we have to do what we should have been doing all along, promoting export based domestic industry and weaning the country off the teat of FDI..

Aspirational stuff, I wait with baited breath

SimpleSam06 wrote: »

We'll be borrowing any way you slice it. Unless the ravenous public sector is brought to heel, we'll be borrowing to our great detriment..

yes that is set in stone I'd say

SimpleSam06 wrote: »

Its not so much how much you borrow, its what you put it into.

and it will be used for day to day spending or pet projects that wont give any long term financial benefits. we will see debt to GDP heading for 150% of a much educed GDP and rising interest rates

SimpleSam06

silverharp wrote: »

if you dont learn from history you are doomed to repeat it

The irony of that coming from a laissez faire capitalism advocate is overwhelming.

silverharp wrote: »

in response to your "right now" I'm just saying you are in a barn door and bolted situation, I'd worry about regulation a few years out from now. Market participants will be more conservative now then any new regulations could introduce

Actually I wouldn't underestimate the damage that financial institutions are capable of doing even at this late stage. The sooner controls are brought to bear, the better.

silverharp wrote: »

Aspirational stuff, I wait with baited breath

Wait for what, you already know the bones of the policies I suggested.

silverharp wrote: »

and it will be used for day to day spending or pet projects that wont give any long term financial benefits. we will see debt to GDP heading for 150% of a much educed GDP and rising interest rates

Unless something is done about it.

SimpleSam06

silverharp wrote: »

Aspirational stuff, I wait with baited breath

Just to save further debate on the issue, here are the original policy ideas I laid out back in September.

What I would do is:
Step 1:
Go on a rampage through the public sector, cutting off dead weight left and right without fear or favour. The problem with beaurocracies is that eventually the people that rise to the top end up caring more about the organisation than about the organisation's goals, so start at the top and work your way down. Healthcare reform, top of the agenda.

The unions would protest, weep, and threaten to bring the country to its knees (and they could do it too), so they need to be broken good and hard. I'm thinking along the lines of eminent domain for threatening the country, do your jobs or go to prison. Harsh yes, but needed, the purpose of the public sector is to support and maintain the nation, not the other way round.

That would more or less help the economy to balance the books, then we move along to

Step 2:

Finance and build eight or ten world class educational institutions, with a difference, which is that they would be quite specialised. I'm think along the lines of

• Marine engineering and technology- We are an island ffs
• Chip fabrication- Chip fabs are high expense but low ongoing cost, and there is no reason we couldn't do it as well as people in Taiwan
• Robotics and Automation- If you want to compete with slave labour conditions in the third world, you need free labour, to whit automation
• Pharmaceuticals- Again another soft market, once you have the result you can reproduce it for half nothing
• Bioengineering- Biofuel algae, marine life, hydroponics, the list goes on and on
• Materials science- SOme very interesting things going on in this field at the moment
• Energy physics- Batteries and supercapacitors, these will be vital components no matter what happens in the future
• Cultural and artistic- We have a rich culturaltradition here, which needs to be developed centrally, and turned into tourist bobs as well as reflected in a variety of ways throughout society
• Software and media- More high initial cost, low ongoing cost industries, also vital for marketing for any other industries founded

Plus a few others.

The mandate of these institutions would be not just to educate but to research. Also they would provide a massive cash boost to any town or city they are placed in, ongoing.

Step 3:
While your institutions are being built and start pumping out graduates, the overall aim of government would be to improve infrastructure, roads, rail, electricity, telecomms, basics like water, and generally prepare for industrial growth.

You can then create and fund domestic industries for each group, much more private than semi state, and each of those would then lead directly on to subsidiary industries, and so on.

I am aware that a plan like this would put us badly in the hole to the tune of tens of billions, but we're going there anyway, so we may as well get something out of it. Not to mention that if even one or two of these groups successfully produce industries, we'll have that paid back smartly.

When I posted that in AH, it received tremendous popular support. I posted it in accom/prop after someone asked about it, and it was the first time ever that those perennial duellists, the vested commercial interests and the pro-consumer advocates, stood up in support of an idea. So there is demonstrable widespread support for the approach.

AARRRGH

SimpleSam06 etc., you're ruining this thread. Can you accept you're all sort of right/sort of wrong and get back on topic?

SimpleSam06

AARRRGH wrote: »

SimpleSam06 etc., you're ruining this thread. Can you accept you're all sort of right/sort of wrong and get back on topic?

If you had bothered to read the thread you'd realise it is all on-topic. Failing that complain to a mod, although they have been participating in the thread as well.

dresden8

Impose Martial Law on public servants and jail them?

Are you for real?

There are things said on this board about public servants that would get you put in jail if you said them about "the blacks".

Get a grip on reality will you.

AARRRGH

SimpleSam06 wrote: »

If you had bothered to read the thread you'd realise it is all on-topic. Failing that complain to a mod, although they have been participating in the thread as well.

I have read your posts - they're full of childish tit for tat nonsense. That kind of crap just derails topics.

SimpleSam06

dresden8 wrote: »

Impose Martial Law on public servants and jail them?

I didn't say anything about martial law. However if any group or organisation represents a threat to the well being of the nation as a whole, then that organisation must be removed, end of. The public sector unions have made a habit of threatening to hold the entire country to ransom (and they could do it / have done it) unless their unreasonable pay demands are met, under the false umbrella of first the dot com boom and now the construction boom, a situation which has lead to enormous deficits and the removal of funds from areas which should be catered for.

It is you who should get a grip on reality.

AARRRGH wrote: »

I have read your posts - they're full of childish tit for tat nonsense. That kind of crap just derails topics.

I love these posters that come into the discussion, read the last three posts and can't draw a line between that and the original topic, before spoiling the thread for everyone else by complaining about their deficiencies. Discussion is why we are here and why we are posting, if you can't deal with that, start a blog.

silverharp

SimpleSam06 wrote: »

The irony of that coming from a laissez faire capitalism advocate is overwhelming.

dont think so, the Austrains washed their hands of the current system when the Fed was created in 1913. A centralised fractional reserve banking system is the anthetitises of laissez faire. The lesson that everyone has to learn is that you cant inflate your way to prosperity. The irony is that in an age where the state controls or regulates just about every economic activity that you think that any of the problems we have today are related to laissez faire. frog in slowly boiling pot comes to mind.



I read your other piece while agreeing with take a hatchet to the civil service and other state agencies (which in itself would be a demanding exercise) I think your solutions may have been a suitable for the 1990's. Looking forward into the next 5 or 10 years when the global economy will be contracting at its biggest clip since the 1930's is not the time to be expanding the educational sector or picking sectors for future development, if anything our educational sector is probably bloated and has probably lost its way like many countries.

if you read the following bloomberg articles on how the chip sector is doing you may want to scrub it from your list of preferred sectors to invest in. gov. bailouts in the sector etc.

http://www.bloomberg.com/apps/news?pid=20601204&sid=aURD9YHSZ.KE&refer=technology


http://www.bloomberg.com/apps/news?pid=20601204&refer=technology&sid=aphIFVYMrAhA

http://www.bloomberg.com/apps/news?pid=20601204&refer=technology&sid=aF_K_4jTKMxE

AARRRGH

SimpleSam06 wrote: »

I love these posters that come into the discussion, read the last three posts and can't draw a line between that and the original topic, before spoiling the thread for everyone else by complaining about their deficiencies. Discussion is why we are here and why we are posting, if you can't deal with that, start a blog.

Yawn. :rolleyes:

SimpleSam06

silverharp wrote: »

dont think so, the Austrains washed their hands of the current system when the Fed was created in 1913. A centralised fractional reserve banking system is the anthetitises of laissez faire.

Please don't tell me you are an Austrian adherent.

silverharp wrote: »

The lesson that everyone has to learn is that you cant inflate your way to prosperity.

If your currency is the default global currency, you actually can. The rest of the world is screwed of course, but hey.

silverharp wrote: »

The irony is that in an age where the state controls or regulates just about every economic activity that you think that any of the problems we have today are related to laissez faire. frog in slowly boiling pot comes to mind.

The lack of control left us in this position, and frogs leap out of a warm pot.

silverharp wrote: »

Looking forward into the next 5 or 10 years

I'm looking forward to the next century, as it turns out.

silverharp wrote: »

if you read the following bloomberg articles on how the chip sector is doing you may want to scrub it from your list of preferred sectors to invest in. gov. bailouts in the sector etc.

The final analysis is that chipfabs are neccessary to future technological growth. They are so expensive that there might only be one per country, but the governments of said countries feel they are valuable enough to bail them out, for a good reason.

So overall, you are in agreement with the ideas laid out, or would you go a different route?

dresden8

SimpleSam06 wrote: »

I didn't say anything about martial law. However if any group or organisation represents a threat to the well being of the nation as a whole, then that organisation must be removed, end of. The public sector unions have made a habit of threatening to hold the entire country to ransom (and they could do it / have done it) unless their unreasonable pay demands are met, under the false umbrella of first the dot com boom and now the construction boom, a situation which has lead to enormous deficits and the removal of funds from areas which should be catered for.

It is you who should get a grip on reality.

As I recall your idea for public servants was

do your jobs or go to prison

Where will you put this public service concentration camp? And what's the colour of the sky there?

SimpleSam06

dresden8 wrote: »

Where will you put this public service concentration camp? And what's the colour of the sky there?

Actually I would reserve the most serious penalties for union leaders. So tell me, o fount of limitless wisdom, what would you do with the public sector, or would you just let the rest of the population languish for the next few generations until private sector wages catch up with public sector, or perhaps you would have public sector wages with permanent jobs stay forever ahead of the private sector, and the public deficit on a permanently growing spiral?

What a joke.

Économiste Monétaire

There's no need to be overly-dramatic with accusations of SimpleSam's implicit desire to put employees, working in the public sector, into concentration camps.

dresden8

Économiste Monétaire wrote: »

There's no need to be overly-dramatic with accusations of SimpleSam's implicit desire to put employees, working in the public sector, into concentration camps.

I digress, I realise I was over the top.

Only Union Leaders would be liquidated for the common good.

I realise the errors of my ways.

Commie scum.

It's a pity stupidity is not a reason for a perma-ban.

SimpleSam06

dresden8 wrote: »

It's a pity stupidity is not a reason for a perma-ban.

I take it you work for the public sector then?

And as a sidebar, you continually refer to them as public servants, which given their actions and general attitude, is the last thing they are.

Come to think of it, reading back over your posts, you have thus far compared the public sector to pre-civil rights black people, Jews under Hitler, and some sort of reference to Communists, I'm guessing witch hunts are your general gist here. These jaw droppingly poor comparisons are not only par for the course for public unions (one clown actually used the holocaust thing in a press release), they are a grotesque insult to the people that had to go through these struggles.

Its not particularly surprising however, the circus-like mindset, divorced from anything even vaguely resembling reality, of the unions is astonishing to put it mildly.

I recall I was waving a report at one individual highlighting pay differences, and he started telling me that half the authors of the report had resigned, and one had tried to commit suicide. He then linked to some article which had nothing to do with what we were discussing, I mean at all. So he literally invented, wholesale, his half of the argument and waffled around in circles for pages while he was called on it. Its hard to argue with people that will look you straight in the eye and spout deliberate freewheeling bollocks. We used to call that sort of carry on trolling, but these lads actually mean it, in a warped and convoluted way.

rugbyman

Silverharp and Simple sam

I am completely bogged down in your type of debate, I know little of the topic, and arguing whether the after the great depresion measures were any good or whether they are applicable today. I am a strong admirer of Thatcherism,whose era I lived through. She is said to be Keynesian.


However the one point on which you seem to agree is that this country is top heavy with public servants. Their salaries come from the taxes on the wealth produced by the economy. It seems clear to me that swinging cuts need to be made there,unfortunately laying out more money to cut out those who are not productive or not needed at all., and reducing salaries of those remaining.

To be fair to the Govt., they have been edging towards efficiency for some years by giving out work to private contractors(whose pension,and sick days they dont have to fund.)

readers, look around you and see how many of your family and friends work for the state. Its incredible.

Some poster on one of these threads commented that benchmarking should be revisited. Surely in a well operated Benchmarking operation there would be salary reductions, with no argument from the Unions because the same comparision process would be used.


Quote
"the population languish for the next few generations until private sector wages catch up with public sector, or perhaps you would have public sector wages with permanent jobs stay forever ahead of the private sector, and"


Somewhat surprised at you Sam, the problem is not the differential between sectors, its the bloatedness of the public sector. Though admittedly the difference is now getting out of proportion.





Quote
" if anything our educational sector is probably bloated and has probably lost its way like many countries."

I agree with this line,from my distant observations. In our local Institute of Technology, bloated is not the word.
It seems to me that if a would be pupil walked in and and enquired about Courses in Afghan Hound rearing, there would be an half page advert in a national newspaper the next week for Lecturers in Afghan Hound rearing, oh and a secretary for same,and a technician.


regards, Rugbyman

ThermalBER GUY

Well David McWilliams says that Lenihan is a muppet and he is going to prolong this recssion by not cutting to the chase and making the tough decisions so we are all SHAGGED!! I believe him to be correct

silverharp

rugbyman wrote: »

I am a strong admirer of Thatcherism,whose era I lived through. She is said to be Keynesian.

I'd say she was more of a Monetarist, here is a glowing piece about her.


Thatcher’s Defense of the Free Market


by J. R. Nyquist
Weekly Column Published: 12.12.2008
Print
G oethe once said, “I hate everything that merely instructs me without augmenting or directly invigorating my activity.” The political teachings of right and left, for the past thirty years, constitute a sort of sleepy and repetitive humbug. We hear the words, we repeat the words, and we shuffle along like sleepwalkers. If the left is disappointed by Obama’s centrist appointees, or the right is disappointed at the emptiness of Republican politicians, then perhaps today’s ideologies are more sedative than stimulant. “Here is the truth,” they promise. “Now you can rest because everything is settled.” For an exhausted modernity, ideological instruction is like a pillow. It is a place to rest one’s head.

Goethe would argue that an idea (as opposed to an ideology) is not a resting place, but a point of departure. The case of former British Prime Minister Margaret Thatcher offers a good example of someone whose activity was directly invigorated by instruction. Instead of using ideology as a comfortable corner to defend, she challenged the world. We see this in Claire Berlinski’s biography of Thatcher, There Is No Alternative. According to Berlinski, “It is critical to appreciate that Thatcher’s enthusiasm for free markets can’t be reduced to an enthusiasm for economic efficiency – this is a charge often made, but it simply isn’t so. A moral society, not an efficient one, was her ultimate goal.”

It is my theory that today’s gross materialism is a corollary of our collective sleepwalking. Our political and economic ideas are merely convenient, and adapted to meet the needs of a hedonistic shopping mall regime. Our society has lost its way, forgetting the values that made us strong and prosperous. In 1977 Thatcher noted: “The main issues are moral. In warfare, said Napoleon – the moral is to the material as three to one. You may think that in civil society the ratio is even greater. The economic success of the Western world is a product of its moral philosophy and practice.”

As America turns to socialism (i.e., the government allocation of economic resources) it is interesting to consider the immorality of what is done. The rich want to keep their wealth. And they seem perfectly willing to exhaust public funds to do so. But the wealth that many want to preserve was never real. The boom that made this wealth was false – and corrupting. At bottom, the market is now trying to correct the immorality of self-deceptive practices. Many participants don’t accept this correction, and so they reject the market just as the ancient Israelites rejected the prophets.

“Choice is the essence of ethics.” said Thatcher, “If there were no choice, there would be no ethics.” If human beings are free to choose, then man must reap what he sows. This is what is being denied today. Therefore, many financiers and industrialists turn to the government. “Bail us out,” they cry. “If we go down, everything goes down.” In answer to this, precious resources are diverted by the state in support of the worst malpractices of the previous era. Here is the essence of socialism, the core of a rotten policy. “The socialists,” said Thatcher, “would take away most or all of [our] choices. A man would do what he was told by the state and his union, work where work was ‘found’ for him, at the rate fixed and degree of effort permitted. He would send his children to school where the education authority decided what the children are taught and the way they are taught, irrespective of his views, he would live in the housing provided, take what he could get, give what he was obliged to give.”

Even if the U.S. government could save Detroit, the banks and Wall Street, consider Thatcher’s warning: “This doesn’t produce a responsible or a moral society. This doesn’t produce a classless society; on the contrary it produces the most stratified of all societies, divided into two classes: the powerful and the powerless; the party-bureaucratic elite and the manipulated masses.” The result is disastrous: economic inefficiency, national demoralization and schlubocracy. (Speaking of which, we see the future promise of this type of government in Illinois Governor Rod Blagojevich’s attempt to solicit bribes in exchange for the president-elect’s senate seat.)

Politicians believe that government spending can save us from catastrophe. Berlinski calls this “the wickedness of profligacy.” Such spending marks a return to inflation. As Margaret Thatcher explained, “For many years we have been told that a little bit of inflation is good for you. Many economists assured us … that inflation is necessary to maintain full employment, to facilitate growth and keep the economy moving. The message was: spend your way to prosperity, and when the economy faltered, spend and spend again.” History shows that the policy doesn’t work. By debasing the currency, the government breaks the trust between government and the governed. According to Thatcher, “Once the people lose their trust in money, the freedom of … society will be diminished or even, eventually, destroyed.”

Thatcher was confident in her conclusions because she had historical sense. She saw that the West was the most advanced civilization. She looked at the values and ideas that held sway as the West advanced from feudal squalor to modern prosperity. When these values were discarded, she saw that progress turned to stagnation. Quite logically, the solution was to rediscover the old values. Invigorated by this instructive insight, Thatcher turned her country around by defending the free market as a moral principle.

SimpleSam06

rugbyman wrote: »

To be fair to the Govt., they have been edging towards efficiency for some years by giving out work to private contractors(whose pension,and sick days they dont have to fund.)

I've noticed that too. Its not enough to cut back on the public sector though, if the country as a whole is to progress we need a roadmap for the future. Is the current government able to provide that? I have my doubts.

rugbyman wrote: »

Somewhat surprised at you Sam, the problem is not the differential between sectors, its the bloatedness of the public sector. Though admittedly the difference is now getting out of proportion.

The private sector is the yardstick by which public sector salaries must be measured. It needs to be, since the private sector pays for every penny of the public sector. Everything.

The problem with benchmarking is that the process is flawed from the get-go; public sector salaries began at parity with private sector when benchmarking was first introduced, now it outweighs private sector entirely. This was achieved by union strongarming and bully boy tactics.

The difference is they aren't strongarming some greedy corporation, they are strongarming you and me, the taxpayer, and they aren't going for equal pay and conditions, they want as much as they can take, and then some. If we let them they'd be on 10 hour weeks with a bonus for any time worked over that. Add to this the bloat you mentioned and you have a millstone around the country's neck.

If this were a company it would have gone out of business long ago. A country can't go out of business, although it can come very close.

silverharp

SimpleSam06 wrote: »

So overall, you are in agreement with the ideas laid out, or would you go a different route?

You seem to be suggesting building an "elite" post grad system of top of the existing structures, I'd say we cant afford it. I'm guessing our 3rd level system is bloated and needs to be restructured. I've lost count of the amount of admin assistants I've interviewed over the years with "communications degrees":rolleyes:

I will be suspicious of any measures that leaves us among the highest cost countries to do business in, the economic base will be eroded before we have a chance of being the "Israel" of Europe

SimpleSam06

silverharp wrote: »

You seem to be suggesting building an "elite" post grad system of top of the existing structures, I'd say we cant afford it. I'm guessing our 3rd level system is bloated and needs to be restructured.

I'd say we can't afford not to have it. It is insufficient to produce run of the mill general graduates, we need specialisation and expertise that feeds back into the education process. Many existing courses are half "filler", where lecturers need to put something in the blank time slots, and the information they have is often out of date or not applicable to modern work practices.

Rather than trying to shoehorn them in on top of existing educational facilities, it might be better to view them as alternative educational facilites.

silverharp wrote: »

I will be suspicious of any measures that leaves us among the highest cost countries to do business in, the economic base will be eroded before we have a chance of being the "Israel" of Europe

What economic base? We're already deep in hock and getting deeper, the public sector unions are going to bring the country to a halt at any attempt to change that, and we have an incumbent president on the US who by all accounts isn't going to do FDI any favours. And FDI is really all we have. We need to get the finger out and become more self reliant immediately.

silverharp

SimpleSam06 wrote: »

The lack of control left us in this position, and frogs leap out of a warm pot.

the way I see it there has been an unholy alliance between big business and big gov. for decades the end of the process is some form of socialism lite or 3rd Reich economics without the storm troopers.

to take a non economic analogy, a fly by wire plane is always on the verge of crashing, it is only the quick thinking computers that can adjust and keep somthing that is fundamentally unstable flying. Statists are in the position that they think that can adjust the "Levers" and keep the economy going on in a stable manner. I dont buy it

Économiste Monétaire

dresden8 wrote: »

I digress, I realise I was over the top.

Only Union Leaders would be liquidated for the common good.

I realise the errors of my ways.

Commie scum.

It's a pity stupidity is not a reason for a perma-ban.

How am I "commie scum"?

dresden8

You're not.

Public sector Union leader's are.

But it's ok, Sam is going to lock them up.

SimpleSam06

silverharp wrote: »

the way I see it there has been an unholy alliance between big business and big gov. for decades the end of the process is some form of socialism lite or 3rd Reich economics without the storm troopers.

Well, if you think we're living in the third reich, theres not much more that can be said, really.

dresden8 wrote: »

Public sector Union leader's are.

But it's ok, Sam is going to lock them up.

Heh, why not, throw them in with the rest of the gangsters, they'll feel right at home.

dresden8

SimpleSam06 wrote: »

Well, if you think we're living in the third reich, theres not much more that can be said, really.


.

You're the one who wants concentration camps for public servants.

Freak.

silverharp

SimpleSam06 wrote: »

Well, if you think we're living in the third reich, theres not much more that can be said, really.

I said the END of the process , anyway you are the one that mentioned somewhere that at least they had built the Autobahn's. Do you want the job of benevolent dictator?

BenjAii

Interesting article in The Telegraph speculating that there are further huge losses for UK banks in 2009 due to commercial property write downs, possibly in the order of £70 billion, and necessitating further taxpayer bailouts.

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/4000183/UK-banks-face-70bn-property-bombshell.html


Wonder if BOI & AIB will face the same dilemma ?

The_Minister

dresden8 wrote: »

Freak.

Infracted.

Personal Abuse is not permitted in this forum.

Économiste Monétaire

BenjAii wrote: »

Wonder if BOI & AIB will face the same dilemma ?

There was a recent paper, only just over a week ago, from the ECB on the state of commercial property markets; Ireland was not placed in the optimistic column, so to speak, if I recall correctly. I have no idea what the proportion of AIB and BOI's loan books are based on commercial property, but I would hazard a guess that it's a bleak outlook, yet further, for Anglo.

It's here for anyone who is interested.

Edit:Just for some, out of context, graphical amusement:

BenjAii

Économiste Monétaire wrote: »

I have no idea what the proportion of AIB and BOI's loan books are based on commercial property, but I would hazard a guess that it's a bleak outlook, yet further, for Anglo.

I might have missed it, but am I right in saying none of the banks have disclosed the details of loans on their books ?

Given the risk they are putting tax payer money at, especially in the case of Anglo Irish, if that state of affairs is allowed to stand it is extraordinary.

I can see there is an argument that full disclosure at this time might invite even more catastrophe for them, but as the taxpayer is bailing them out with such vast sums we have every right to know; they are the ones placing us in vast peril if they end up taking write downs of this order on commercial property.

I can imagine as the government now effectively owns Anglo Irish it knows, but I haven't seen those details publically reported, and in the case of BOI/AIB - I haven't even come across any info that they have let anyone on behalf of the gov independently look at their books.