Saturday, 13 August 2011

bank recapitalisation, i.e. bailout #?

The book is worth reading, same for Simon Johnson's blog The Baseline Scenario. Yet, as for many economists if not for all the "turning in circles" is becoming a regular form of commenting as, really, this current crisis is now boiling down to the classical Catch-22 situation. I commented on Simon's blog post Should we expect another round of bailouts where he supports not another bail-out but "a full-scale recapitalisation program" for the banks...

“A full-scale bank recapitalization program is required, along with management changes at almost all major European financial institutions.”


I disagree; this “full-scale bank recapitalisation” you suggest will be nothing else but another bailout!

Why would any private third party recapitalise any bank, if the bad debts (and any trailing Bad Bank) wouldn’t be taken over by who else but the tax-payer and how would you recapitalise and sort out e.g. the ECB, the Worst Bank next to the FED, I guess, sitting and whining on stacks or call it bombs of worthless PIIGS bonds?

And, what you call “management changes” – I suggest you replace the “almost” by the term “all” and add a “complete” – is what James K. Galbreith put into simple words in March 2009 , already – nobody listened, the Banksters got bigger and even more successful, since:

…as long as the old management is in place, there are no incentives to cooperate in the evaluation you need to make.

There was clearly a systematic failure. But that does not mean there was no criminal energy around.

When a bank is insolvent, the incentives for normal banking practice disappear. They become perverse.

“Perverse” might sound inappropriate, but it hits the nail on the head of a trade that lost its function, purpose and dignity – long ago.

One more point: even bailing out the banks again would not take us anywhere if at the same time this EURO problem wouldn’t be solved. It is a Catch 22 situation; call it a Gordian knot which according to the myth needs one hard swing of a sword to cut it, only; but then there is the Dollar, the YEN, China, peak everything and anything.

All in all it is going to be one long da.. hard touch down!

There is not much I could add at this point other than there will be no easy or simple solution for what Mr. Kohl and friends created when they played gods of all currencies and installed a completely immature EURO and at the same time there is no easy way forward for our world that is peak-almost-everything including coming up to 8 thousand million people living beyond its, our habitat's means on a finite and insolvent planet.

Carpe diem.

Thursday, 11 August 2011

our culture of denial

...obviously comes with peak Man. Sigmund Freud would agree, even more so his daughter Anna:

The concept of denial is particularly important to the study of addiction. The theory of denial was first researched seriously by Anna Freud. She classified denial as a mechanism of the immature mind, because it conflicts with the ability to learn from and cope with reality.

Two examples:

Should you dislike the combination "climate" and "denial", may be it is easier to understand paired with the latest on Britain's Riots. There is lots of denial again and the fact that David Cameron has been brutally  ill-advised by his marketing boys, at least, I would like to believe he did not come up with that stupid idea himself; this, his, mission about this "Big Society" is pure rubbish and always sounded to me like the sales pitch of  a "double glazing window sales man" trying to distract from the truth by all means avoiding reality.

Obviously, I am not alone:

British politicians have espoused neo-liberal dogma for the best part of 30 years. A dogma based on consumerism and selfish individualism over shared responsibility.

And Britain, after 30 years, is a society more divided than at any other time since World War II. The haves have grown in wealth while the have-nots have grown in number.

... Social dissonance is no coincidence. Cameron's nebulous ideal of "Big Society" - that communities are stronger than the government in sorting problems out - has yetto prove of worth.
And so, in a time of austerity and a global recession lasting years, when people see their opportunities narrowing, services cut and the disappearance of the things they have for decades been told to expect, this is what happens.

Graeme Baker, NZHerald's news editor

The Big Society concept is not big enough to deal with the chronic problems that scar so many of our cities (and also some of our rural areas – extreme rural poverty is a growing problem). Throughout Britain, not just in London, not just in England, our society is virtually broken.

We have lost religion, we have lost economic power, and we are now in danger of losing social cohesion and social responsibility. This goes well beyond party politics. It will take, at least, a generation to put the pieces together again. The task will be doubly difficult against the background of a prolonged global financial crisis.

The key component in renewal must be better education. A decent education is something that far too many young people in Britain are still denied, despite the mind- bending sums of public money that have been spent on the education service in the past 20 years or so.

If better education is the key to progress, to self respect and to aspiration, it is still of no use if it just leads to frustration because our society cannot provide enough meaningful work, and, equally important, the motivation to undertake such work.

Harry Reid
, Herald Scotland

And in case you need a reminder on that great picture marketed under the term Big Society (BBC):

David Cameron says it is his "mission" in politics to make the Big Society succeed - amid claims it is being wrecked by spending cuts.

This Big Society issue needs much bigger ideas than cuts (the worst are those and any into eduction)  with a huge emphasis on Society. We will never hear a "mission accomplished" by David Cameron the way things are dealt with now.

So, should you see him, tell him!

Carpe diem!

Wednesday, 10 August 2011

next winter might be a cold one...

...saw Germans putting up snow poles in the Highlands last night...

Carpe diem hiems!

Tuesday, 9 August 2011

Hey, architect(s)!

What about change (-ing sides)?

While the word's currencies and finances tumble we are looking for recruitment? 
Unbelievable? No!
Passiv Haus
We are looking for (an) enthusiastic architect(s), fluent in English and (hopefully soon in) German, to join our HANSE HAUS team based in Oberleichtersbach, Germany.

To apply, you must be a highly proficient AutoCAD user, with fast and precise drafting skills. You must have strong technical construction knowledge. Experience of drawing coordination with engineering consultants and statutory authorities would be an advantage. Good communication skills, in English and (soon) in German, are required as it will be necessary to work closely with the rest of the HH team, clients and consultants, both in Germany, the UK and probably beyond.

This is a full time position with accommodation, 30 days holiday and some return flights to the UK per annum; while the salary is negotiable it is depending on experience and on you meeting the challenge of the position's tasks.

To apply for this job you must be a UK citizen, have EEA right of residence or already have a valid UK working visa > e-mail

HANSE HAUS, in case you did not know, is a leading supplier of off-site pre-manufacturered highly energy efficient constructions; we regard Passiv Haus Technology as the leading way forward towards sustainable and affordable living.

It might help if we shared similar humor; mind you, the above is no joke!

Carpe diem!