what we thought was good about capitalism was the freedom to work for
it rather than some kind of dire government - to be able to get away
and make new starts, actually earn our corn and so on. Greece is
stuffed by corruption called fakilaki - this is called wasta in the
rest of the Middle East. I fear we are now in this corrupt circle
with our politics and banks. The real political key is full
employment and a living wage as right and minimal interference in this
possible. The hideous thing about capital is the way it still seeks
to exploit workers after all the advances made in some of the West.
Democracy needs people who are secure in their living
On Feb 28, 7:06 am, Allan H <allanh1...@gmail.com> wrote:
> The whole system is a mess.. they make loans to pay for private wars..
> (like Bush's)
> Europe needs to concentrate on rebuilding industry like the electronics
> they need to stop worrying about the cost to customers and wealth and
> governments responsibilities is to care for its people.. I see no problem
> with governments owning stock.. especially if the people have a say in
> things like bonuses.. like they have to have a 60% majority saying yes to
> them and the amount of each bonus being listed.
> Just loaning money for greed is not right
> Allan
>
>
>
>
>
>
>
> On Tue, Feb 28, 2012 at 2:05 AM, archytas <nwte...@gmail.com> wrote:
> > Greece put collective action contracts into the latest "bailout" after
> > it was announced by the Fuhrer-country now in charge of continental
> > Europe. If we were personally holding Greek bonds they would be
> > asking us to take a 65% loss. We might have those bonds hedged via
> > CDS and be able to take 100% on this insurance should Greece default.
> > We might not decline the offer, but hedge funds like bought these
> > binds at discount and hedged via CDS. They will want a Greek
> > collpase. Standard and Poor has just announced it expects this.
> > Should we worry? I think so. The question is who 'owns' the
> > obligation to payout CDS and how much of that there is. Ridiculous as
> > it sounds Allan this is very much like insuring your house 100 times
> > over and being able to burn it down and collect 100 times value
> > (impossible with real insurance, but allowable in derivatives).
> > Sadly, loans have for long not been issued on ability to repay, but in
> > the hope of asset inflation. This started years ago when banks
> > started to loan to countries like Argentina. There are many questions
> > in this mess that defy your sensible thinking mate. It seems to make
> > no sense for banks to make loans they know are likely to fail - and
> > certainly not to kleptocrats like the ones who ran Argentina and still
> > run Greece. They piss the money up their own wall (Swiss bank
> > accounts etc.) - but what do the banks get in exchange. The answers
> > lie in knock-down prices in the fire sales and derivative hedges that
> > pay out on collapse. It's all to do with an excess of capital seeking
> > high returns. We need a return to high incomes related to work.
>
> > On Feb 25, 8:07 am, Allan H <allanh1...@gmail.com> wrote:
> > > Call it what you want. You can not loan money with out creating a way to
> > > repay the loan. And creating poverty is not a way to repay the loan.
> > > Allan
> > > On Feb 24, 2012 7:20 PM, "archytas" <nwte...@gmail.com> wrote:
>
> > > > It's a strange thing that there is no problem bailing out the banks
> > > > who caused most of this misery - but the kind of thing Allan puts
> > > > forward immediately falls foul as 'subsidy'.
> > > > Assets are now being seized from Greece - something that once took
> > > > force of arms. My guess is we will see a communist revolution there -
> > > > it was only the stationing of British troops that stopped this after
> > > > WW2.
>
> > > > On Feb 24, 9:39 am, Allan H <allanh1...@gmail.com> wrote:
> > > > > Bail out money well it is poorly spent and the banking panel is
> > totally
> > > > at
> > > > > fault. the bail out negation is simple.. all loans are put on hold
> > > > > no interest and no pay back, a no gain no loss situation. the total
> > > > > bailout funds need to be used to create employment and permanent
> > jobs..
> > > > > maybe manufacturing smart phones,, or other products.. now those
> > holding
> > > > > the paper well they have a simple choice either wiat till Greece
> > > > > is economic stability or lose all of their money..
>
> > > > > As for the negotiators demanding austerity measures. they to should
> > face
> > > > > the music also with wage cuts equal to those faced by the poorest,
> > also
> > > > > that their shopping bills must meet the inflation they have created
> > and
> > > > > they must pay equal tax rates.. no choice. They need to face first
> > hand
> > > > > the hardship they have intentionally created. with their lives and
> > cost
> > > > > based on the hardship they created and it ends when the hardship they
> > > > > created.. Let them hear and face the music they have composed..
> > Time for
> > > > > the banksters and negotiator to pay the piper.
>
> > > > > When bail out funds are used to create permanent employment and those
> > > > that
> > > > > have not paid their taxes,, collect them no matter where they hid
> > their
> > > > > money. then the bail out will start working..
> > > > > Allan
>
> > > > > On Fri, Feb 24, 2012 at 3:17 AM, archytas <nwte...@gmail.com> wrote:
> > > > > > This situation has come about before. Prior to the Great
> > Depression,
> > > > > > the Greek economy experienced years of growth, a healthy commercial
> > > > > > activity spree, and like today, a stark increase in
> > (less-leveraged)
> > > > > > bank loans to finance it. When the Depression struck, banks and
> > local
> > > > > > businesses faced unpayable loans and declining asset values.
> > (Stop me
> > > > > > when this sounds familiar).Credit constricted immediately, choking
> > > > > > internal economic activity. In 1928, the Greek Drachma was tied to
> > > > > > the gold standard, but pegged to the British pound. When Britain
> > > > > > devalued its pound in 1931, the Greek government responded by
> > raising
> > > > > > public investments and pegging the Drachma to the US dollar.
> > > > > > But by early 1932, central bank reserves had fallen so much that
> > they
> > > > > > only backed 40% of Greek bonds. Even without the slow drip of
> > rating
> > > > > > agency downgrades to highlight this leveraged debt situation
> > (which is
> > > > > > nothing compared to say, today's US reserves vs. debt leverage),
> > the
> > > > > > lack of reserves caused foreign speculators to fleece the Drachma/
> > > > > > dollar exchange rate. Bond yields blew out. Borrowing costs shot
> > up.
> > > > > > So in March 1932, the League of Nations (the precursor bank bailout
> > > > > > entity to the ECB/IMF) agreed to provide a loan to service Greece's
> > > > > > debt in return for – wait for it - austerity measures. Unlike
> > today,
> > > > > > the government said 'hell no.' Instead, in April, 1932, it floated
> > the
> > > > > > Drachma - which devalued quickly. It also declared a public debt
> > > > > > moratorium, and increased infrastructure spending to strengthen its
> > > > > > economy. It negotiated repayment terms with creditors for overdue
> > > > > > interest. By 1934, agriculture and industrial production rose, the
> > > > > > currency was more stable, employment increased, and the budget
> > > > > > balanced.
>
> > > > > > Greece would have faired better if it had got out of this by
> > default.
> > > > > > Don's point on the frustration we aren't doing enough generally is
> > > > > > what scares me. UK GDP has actually fallen more than that of
> > Greece
> > > > > > since 2009! But what scares me is that I believe banks essentially
> > > > > > caused WW1 and its replay and seem even more in control now.
>
> > > > > > On Feb 24, 1:19 am, archytas <nwte...@gmail.com> wrote:
> > > > > > > Back to the Greeks, it appears they are being bailed out, but as
> > far
> > > > > > > as I can see the money is going much like a version of TARP to
> > > > > > > European banks. Somewhere in all this some mighty big crooks
> > have
> > > > had
> > > > > > > the original cash and we should be chasing them.
> > > > > > > I don't believe manufacturing can bring the jobs back though
> > anything
> > > > > > > is welcome. We need new thinking on work and reward - though in
> > the
> > > > > > > meantime we could introduce international service at decent
> > wages to
> > > > > > > soak up the young and unemployed.
>
> > > > > > > On Feb 24, 1:08 am, archytas <nwte...@gmail.com> wrote:
>
> > > > > > > > What the banks did was lend money they didn't have - which
> > perhaps
> > > > > > > > weirdly isn't wrong in-itself - if the demand for loans for
> > > > productive
> > > > > > > > purpose is there then why not make the loans in due diligence
> > - we
> > > > all
> > > > > > > > benefit from the increased productive capacity produced. The
> > > > snag
> > > > > > > > was fraud and the banks were clearly incapable of resisting
> > this
> > > > and
> > > > > > > > bribed politicians of all kinds to deregulate (the UK is worse
> > than
> > > > > > > > the US on this) and allow massive leverage through fractional
> > > > > > > > banking. This happened everywhere once the ball started to
> > roll.
> > > > It
> > > > > > > > all works if most of the investment is sound - but there is no
> > > > Black-
> > > > > > > > Scoles equation behind any of this. The problem with leverage
> > was
> > > > > > > > well-known - the more fractional your capital (less of it in
> > ratio
> > > > > > > > with what you lend) the more likely you end up insolvent if
> > > > anything
> > > > > > > > goes wrong. A few bad deals screw up your whole company.
> > This is
> > > > the
> > > > > > > > truth - the rest is fraudulent accounting.
> > > > > > > > The idea stems from a business practice called 'discounting
> > > > cashflow'
> > > > > > > > - which is largely about talents story from the bible - you
> > don't
> > > > just
> > > > > > > > bury your talents but employ them to purpose - good as far as
> > it
> > > > goes
> > > > > > > > - but the ultimate source of 'talents' is the tax-payer and
> > they
> > > > > > > > started to deploy our talents without asking. Indeed this was
> > a
> > > > dodge
> > > > > > > > used to goldsmiths who lent money on the basis of other
> > people's
> > > > gold
> > > > > > > > kept in their vaults. Fine as long as you never hit trouble
> > and
> > > > have
> > > > > > > > to hand over the gold (tax-payers' money). At the micro-level
> > I
> > > > can
> > > > > > > > tell you about companies so dumb they didn't bank money
> > overnight
> > > > and
> > > > > > > > thus missed the interest this gleans. But all this went beyond
> > > > good
> > > > > > > > housekeeping.
> > > > > > > > The story would take a couple of pages to write even at this
> > level
> > > > -
> > > > > > > > so I won't
>
> ...
>
> read more »
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