h2g2 The Hitchhiker's Guide to the Galaxy: Earth Edition

And, rather less hysterically http://www.bbc.co.uk/news/business-17549970

I see your BBC and I raise my Guardian: (Read after I wrote my "hysterical" post. Thank you, btw for your sensitivity)

http://www.guardian.co.uk/commentisfree/2012/jun/10/spain-and-euro-crisis-editorial

<< Spain's bailout does not draw any line under the eurozone's crisis. There is no allusion to eurobonds or a banking union or any of those other ideas that float up in ministerial speeches and thinktank pamphlets. Nor is there any commitment to a serious continent-wide growth strategy. This merely invites shell-shocked financiers and wary business people to speculate on which other nations will land up in the euro sick bay.<<<<

aside/
I wish more people would join to this thread. I´d love that someone could show me that I shouldn´t worry so much.
<<<Spanish taxpayers will eventually have to pay for it. In other words, the population with the highest unemployment rate in the EU will have to spend decades repaying a debt incurred to rescue feckless savings banks, often run by useless managers and their crony directors. How that's taken by the nation that kickstarted the protest movement that went on to become Occupy is an open question, but the most likely answer is: badly.<<<

<<<The more one looks at this bailout – which doesn't seriously address the restructuring of Spain's banks – the more it seems an unwitting invitation to speculate on which other eurozone members might soon be in the markets' firing line. Spain's financial situation is in some respects better than France's and very close to that of the Netherlands. Pessimistic?

It may surprise you, but I don't think all this money should be going to banks either. IMO, Northern Rock should have been allowed to fail, as the market dictates badly run companies should fail. Instead, the government rode in with huge amounts of taxpayer's money and effectively told *every* other bank - "Do what you want, governments will back you up". Once Gordon Brown set this precedent, every other country had to follow suit to safeguard their own banking industry.

State interventionism in the shape of the Labour Party combined with the political project that is the Euro has led us to this mess. It's daft to blame the banks - they were given a blank cheque.

<>


Utter, utter bullshit.

You don't agree the state intervened?
You don't agree that the Euro is a political project?

Oh my

Not that either got banks hugely overstretched, no. They did that all by themselves, and to pretend otherwise is just crap. And US banks did that because of the Euro? wtf?

I agree that the source of the overstretch started with sub primes in the US, but the Government bailed out Northern Rock in 2007, nationalising it a few months later. This state under-writing of private debt led to the US passing emergency legislation bailing out their financial institutions such as Goldman Sachs in 2008. Once you have one bank backed up by the State, every other overstretched bank in a globalised system becomes a bigger risk relatively speaking and has to also be backed by the state to maintain the competitiveness of the whole.

Yes the banks overstretched themselves, but if Gordon Brown had kept out of it we wouldn't have seen the mass transfer of private debt to the public sector that we have now.

>> I´d love that someone could show me
that I shouldn´t worry so much. <<



There ya go.


~jwf~

I would love to think you don't need to worry and that this will all turn out well but I think you do have to worry and I think that it won't turn out well.

People borrowed money to buy things that simply weren't worth what they paid: land, cars, railways etc. The trouble is that the debt remains but the assets are unsalable.

I don't _just_ blame the banks and I don't _just_ blame the money markets. The underlying ecconomy is real too. Wheat, oil, fish, cars, electronics all have a real value. The gamblers are guessing the value of these things and they make or loose money when the real values of these things are known.

It can seem reckless to gamble on the size of the Spanish wheat crop but there are people who need to book bulk carriers, trucks etc and some of these things need to be booked 6 months in advance. Book too few 120,000 ton ships and the wheat doesn't get moved and you lose money; book to many and you also lose money. You have to get it right and the banks are there to make sure that you get the value and size of the crop right. They will research the value, lend money, borrow money and transfer money to make sure it all happens. Getting this right is good banking and good business.

Getting all of this wrong on a massive, massive scale is what created this mess, along with hiding the nature of the gueses from the people providing the cash to keep it going.

There are two ways to fix it: pay off the debt or increase the value of the real ecconomy to match the old valuations. The former requires "austerity" and the latter requires lots of very, very hard work by lots of people.

swl, your (quite touching in its own way) blaming of Gordon Brown is like blaming firefighters for flooding a basement. If the global financial sector had tanked, and a *huge* proportion of it in the West would have, the situation would have been markedly worse than it is now.

I have had a dream:
A87762333


~jwf~

Niall Ferguson is delivering the Reith Lecture this year.

"As our economic difficulties have worsened, we voters have struggled to find the appropriate scapegoat.

We blame the politicians whose hard lot it is to bring public finances under control, but we also like to blame bankers and financial markets, as if their reckless lending was to blame for our reckless borrowing.

We bay for tougher regulation, though not of ourselves."

http://www.bbc.co.uk/news/world-18456131

Bravo! That song is repeated over and over again: Let´s blame the citizens.

A hit regardless of the country. Everywhere is just the same, here and in US.

It´s the half truth that repeated ad nauseam become the convenient lie.

It´s just a tiny part of all this mess. I and many others I know are haven´t borrowed any money to buy eccentricities, but we are suffering the consequences of this situation.
There are a few that bought flats to speculate, but that is not the majority of the population. And in any case, those people debt is just a tiny bit of the big problem. The banks have received lots of millions since 2009, and where is all that money? they are speculating with it. Even there, in the City, they get bonuses in billion of pounds and yet they are going to receive more money!!!

However,
I agree, let´s not blame bankers, nor even financial markets, because the whole problem has a political solution. And that is the big big problem: politicians are part of the gang of gamblers or are their servants. In the case of Europe, only when Germany can´t export its goods, then things will start to change.

It seems that history teaches nothing. The crack of the 29 should have taught a few lessons by now. Let´s hope that someone considers what the New Deal of Roosevelt meant.

..............

that Niall Ferguson is a pearl.

From that link, he says that if northamerican youth knew what is good for them, they would vote Tea Party.

Then I´ve googled him... and vaya! what a pearl really, he´s a revisionist of history who tries to paint rosy the colonialism and imperalism.

I feel sorry for his pupils. It must be very hard to listen to this "arse-whole"

Maria: Perhaps this thread would be a good place to keep your "international banking conspiracy" stuff. Then people would know where to look.

Gracias Xan,

You´re right, I´ll re-post what I´ve written an hour ago in the News thread. That way you can tell me here why what I´ve said is false.

the post:

Finally the warnings that the neoliberals media and other groups have been doing in order to scare the Greeks has succeed.

The "extremist" left, whose victory would bring the collapse to Europe, has not win.

However the gambling party is going on today and the ECB do nothing.

If Zyriza is extremist, so are the nobel Prize Krugman, Stiglitz or lots of economists like Weisbrot, Baker... or that man considered an authority , Simon Wren-Lewis, at the university of Oxford.

Zyriza and all those who aren´t blind following a failed dogma claim just the same:

A Financial reform, which in the case of the GIPSI countries, Greece, Italy, Portugal, Spain and Ireland, can fix the huge social inequalities.

The goverments could stimulate the economy. Growth means more jobs, more jobs more richness...
All that is backed empirically by economical research, or if you can´t read it , look at Scandinavian countries.

On the other hand, is Greece completly responsible of its huge debt? Is current Greece responsible of the debt made by the dictatorship and that it benefited Germans banks?

The spanish housing bubble wouldn´t have happened without the money of German banks. Aren´t they also responsible for all this debt?

The conservative forces in the Gipsi countries are facilitating all this sacking, looting of these contries. The IMF, the ECB could put a stop, but wont´ do it. They are having their share from all this.

A last thing,
Lagarde is protagonist of a paradox:

She, who doesn´t pay taxes, critisizes the fraud made by the rich Greeks, but at the same time, she, her organization, the IMF support them and criminalize Zyriza, who want to put a stop to that fraud.

Today´s article of Krugman in the NYT:

http://www.nytimes.com/2012/06/18/opinion/krugman-greece-as-victim.html?src=me&ref=general

Cristal clear facts about Greece and this situation.


aside/

why do you use the word conspiracy? I haven´t said anything like that. I´m just exposing la puta realidad. Or is it you echoing what neoliberal media thinks convenient to say?

That's what I get from your descriptions, that you think there's a conspiracy by people who all seem to share the label neo. Not that this isn't possible, conspiracies do happen.

Yes they do. And the big one is the International
Banking Conspiracy which has been going on for longer
than anyone can remember. Hitler had a few words on
the subject but blamed it on a specific race rather
than a more deeply rooted human condition of greed,
power and selfish self-interest. Funny though how
it's now the German banks that are central to the
manipulations.

I replied to Maria in the News Thread (not realising
it wasn't this one) rather bitterly saying how shocked
I was to learn that Greece has a population of only
11 million - less than many cities around the whirled.

11 eleven million holding 7 billion hostage.
Talk about the tail wagging the dog.
11 million is quite a nuke-able number really if you
think about it. Go on, you know you want to.

~jwf~