I have been away for a bit which has meant that I have neglected this site to an extent. However I don't think that I have been as negligent as some (in power and in finance) have recently been so I'm going to let myself off and er... what the hell, I'll give myself a sizable pay rise, bonus, fantastic perks and a holiday too!!!
Anyway, I have been going out of my mind with anger and rage recently about all this business to do with the economy and the stock markets. I have to say that I think that a great deal of the problem and the rising lack in confidence in the UK and world wide economy is a result of the constant 24hr jabbering of the media who appear to be in something of a feeding frenzy at the moment. However, irrespective of the media slathering at the prospect of planetary economic meltdown, governments actually seem to be panicking at the thought of recession and are running around like headless chickens trying to be seen to be "prudent" in solving the problem.
All governments including that of the UK who previously and apparently had no money are all bending over backwards to pump money into the banks to remedy the problem. This, I think is a fundamental mistake and should be avoided at all costs. Why? The money will disappear and it will not solve the problem. Regardless of any money old Gordon throws at this, we are going into recession and any attempt to stop the inevitable natural cycle of the economy can only be likened to attempts by King Canute to hold back the tides.
The fact is that the present government has for years, unnaturally prolonged the boom part of the cycle and in so doing have claimed economic mastery and genius. Gordon and Tony revelled in good figures like swine in swill for years and our current incumbent actually believes that he was and is a top economist. In his desperation to keep this reputation in tact he is in danger of pushing the UK into the worst and longest recession in history and instead of dealing with the problem logically and rationally he is addressing the problems from a popularity point of view.
Rather than looking at what caused the problem (and in truth a lot of the problems in our society) he appears to be set on reinforcing and restoring policies and practices that caused the problem in the first place. The problem is greed accompanied with a means. It's wrong to blame bankers for the problem because whilst they have undoubtedly been acting like wolves the whole time, it takes two to Tango and in fact it actually takes three. People without any financial security or appreciation have been exposed to cheap and readily accessible credit and have been allowed to borrow without full understanding of the risks and consequences. This has been encouraged by the banks absolutely and it seems encouraged too by the government who have allowed its people to live beyond their natural means and whose regulatory institution, the FSA has done nothing to fulfil their statutory mission. The fact is that all of the players involved have been blinded by greed and all are equally to blame.
This being so, if the banks are given cash to stimulate more borrowing then nobody will learn any lessons and the problem will crystallise in the future. The solution also goes against the laws of natural selection, capitalism and democracy. If banks have misbehaved then they should go to the wall. If people have irresponsibly over borrowed then they should also face the consequences and learn lessons. Government both central and the FSA should also be made to pay. Gordon and cronies will undoubtedly and finally face the firing squad over the next year and a half depending on how long they manage to stretch things out. The FSA in reality has failed, perhaps even worse than the Child Support Agency and should be scrapped, reinstating the statutory regulatory bodies that existed prior to its inception. We need to realise the extent of the mess that New Labour has left this country in and find a way to unpick the tangle that has been created. Not sure if Dave is the man to do it because he seems to be backing the government in some weird attempt to look as prudent as the PM perhaps (who got us into this mess in the first place).
All things said and done, we have to accept that the recession is coming. Like a snake sheds its skin to grow so too must the economy. What is vital is that we accept the loss of things dead in life. in order to go forward. If we don't then we will become constricted or worse become stagnant and infected. Nature must be allowed to take its course.
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Mr Dale's Diary: Starmer's Reshuffle, Gay Corrie, Nadine Defects &
DizzyThinks
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Reshuffle in haste, repent at leisure. I suspect that will be what people
conclude about Keir Starmer’s reshuffle. It bore all the hallmarks of being ...
2 days ago
Aye Graeme. You do indeed speak much sense. I have and have had a sense for some time now that we are caught up in an Orwellian nightmare where the ministry of truth feeds the populus an ever increasing diet of bullsh*t. I think that Marx may also have had some comments to make about what the Proletariat get fed. I know it as the Mushroom system, where you are kept in the dark and fed sh*te. The thing which troubles me most about it is that few people seem to either notice or care.
ReplyDeleteI must admit that I have been exceptionally troubled by several aspects of what has happened over the last few weeks. The near demise of HBOS and now, it would seem RBS really should not be a surprise. Both issued rights over the summer in an attempt to recapitalise themselves, rights issues which were not taken up by their shareholders. This would imply to me, at any rate, that perhaps both of these great banking institutions were infact skint!
The various local authorities who seem to have lost money by investing it in Icelandic Banks troubles me as well. On several levels: 1. WHo advsied them that an investment in an Icelandic Bank was a good idea in the first place? Those who did so should go. Now. I heard the leader of my local Council, South Ayrshire in Scotland, say on the Local Radio station that perhaps they were now going to have to start examining the credit rating of the institutions they were investing in before they make the investment. This means that they clearly did not examine the credit rating of the bank before they invested. This is lunacy with £5 Million of tax payers money. Those responsible should go now.
What funds exactly have they invested? How much is invested elsewhere? Local Authorities have to keep 10% of their annual budget available as a contingency fund. These investments are not a contingency fund. What are they then? Are they really taxing people so they can invest it? What an utter disgrace if this is happening. Shameful. Those responsible should go now. I am seriously contemplating issuing a Freedon of Information inquiry to find out exactly how much my Local Authority has invested, where and why. Why don't you do the same?
Ian.