OneGuyFromBarlick

Stanley wrote:no problem because the banks can always print more money if availability of capital becomes a problem

This is exactly what we did during the 'Banking' collapse in 2008. Re-capitalized the banks by handing over phantom money. The real root of the problem was that the banks had been lending money to people who had no chance of ever repaying their loans. This had been hidden on a merry go round of offloading the liabilities to other banks. A nice little earner as far as bonuses were concerned but not a very good business plan. A game of 'pass the parcel' until the music stopped. If the man in the street had been doing the same thing with his credit cards he would have been condemned as an idiot and given a substantial gaol sentence. Making statements about covering capital shortfalls using the same approach suggests that the banks are up to their old tricks. No wonder the stock markets are getting jittery.

Couldn't agree with you more P, all we can do is keep shouting and hope that someone somewhere is listening! At the moment it is very hard to see any glimpses of light in what seems to be the gathering gloom. When I first read Piketty I immediately compared his book to a grenade lobbed into the financial systems. I still think that it is just that, the problem is that the juggernaut of modern capitalism is so entrenched in its own theories on how to survive and prosper and so powerful in today's world, that it is hard to see any correction of course.This is of course made worse by dinosaurs like the Tory Party running amuck in the china shop and smashing down the advances made to support poor people in the last century.
This got me to thinking the other day about the basic structure of our systems. The constant refrain of the Lords of the Universe and the politicians is that life would be impossible without them and their 'management skills'. Any change is regarded as anarchy. Looking at the track record of both of them I can't help thinking that a bit of anarchy could be a good thing. Of course a subject this size is so massively complicated that it is difficult to formulate a rational argument against. So, in order to make sense in my own head I have to over simplify to cut through the undergrowth.
Take the arms trade.... We are always told that we need a healthy armaments business in order to support employment, manufacturing capacity, technological advance and our own defensive capacity. 'Arms Race' has become a metaphor. What would the result have been if we had been brave enough to invest half the capital put into arms into basic education in Britain? Which would have been the better investment?
Apply the same logic to the money spent in the Middle East on war.... I said many years ago that we had done enough meddling and should apply the money that aggressive incursions costs on aid to the people in the region. Fat chance! But what would the result have been in the long term?
Is anyone anywhere applying this thinking or are they all in thrall to the old belief systems. Corbyn might be on the right track but when he goes off piste and suggests ludicrous actions (To protect employment in Scotland) like removing the warheads from Trident subs and sending them out on patrol with no purpose I despair.
That's right, I am pessimistic and when I see trends like the rise of Fascism in Europe triggered my the flood of migrants and listen to the rantings of Palin and Trump in the States I begin to suspect that we have collectively lost the plot. If anyone can see a bright spot in the gloom, please let me know....
Look at THIS BBC report of the travel ban on A BBC journalist with dual British-Iranian nationality who has been prevented from flying to the US after falling foul of changes to visa rules. Rana Rahimpour was told by US authorities she could not travel under a visa waiver scheme. Is this the brave new world we have all to expect from now on? How long before they exclude Jews, Gypsies and homosexuals?

It would appear that the evident fact of a general global recession is sinking in with the markets and some of the more alert 'expert' commentators. Whilst some are still attempting to minimise the risk in an effort to 'talk up' the market others recognise that investors are puzzled and worried because the speed of slow down is so much faster than was expected. The one thing investors value above everything else is the safety of their funds. The effects are hitting the UK economy now in depressed exports and the latest failures in the steel market. Port Talbot is expecting complete shut-down and Sheffield is next on the list, expect reports of redundancies there very shortly. The IMF has revised forecasts for global growth downwards to 3.4% which theoretically is OK as the danger point is seen to be the 2.5% growth necessary to keep up with rising population. However, all these forecasts lag behind events and it's a good bet that the actual rate of growth is lower. As Harold said "Events Dear Boy".
What this means for the UK is that no matter how the Tories spin this, the bottom line is that the already threadbare 'economic miracle' is melting away. I heard a lady spokesperson saying yesterday that the employment market was strong, wages were rising and the overall picture was still one of growth. Does anyone really believe this? The plain fact is that a policy of austerity automatically means contraction and low growth and this is still the main plank of the government's policy. More cuts are coming through even while the indices point to the fact that economic activity is slowing down to the point where the market will regard it as a 'sell' situation to avoid the melt down.
I know I'm a pessimist but how much longer can this go on?

For anyone who didn't hear it, `Donald Trump and the Politics of Celebrity' is a very good insight into both the current Trump situation and also the history of similar people who might have become US President (Hearst, Ford and Lindbergh). You can hear it on iplayer and it will soon be available as a podcast. Very worth listening too. Trump

I listened to it Tiz. Only comforting thought is that most of them failed....
I heard an interview on R4 yesterday with a financial person who seemed to know what he was talking about. He said that whilst it was true that the market volatility we are seeing is worrying the real problem he sees is the complacency in the system whereby the measures taken to increase bank's levels of capitalisation are seen as a guarantee against another 2008. He pointed out that this was a false hope because the position of most of the central banks is totally different now. They have no ammunition left in the locker for countermeasures. With interest rates worldwide at historic lows and nowhere near as much capital to use to bolster markets, all they have left is quantitative easing, printing phantom money, and this in itself is an added danger as it is devaluation actually.
The 'market' has no answer to the real problems facing us. Falling levels of global trade and the myriad of 'Events Dear Boy' that crowd in on us. All the signs point to the fact that we are on a knife edge and depending solely on which side of the bed the traders get out of in the morning. In that sense, they are indeed to Lords of the Universe and have only one driving force, protecting their own capital. Tin hats on lads.....
By the way, I thought it was quite telling when yesterday I heard a market trader refer to the slight recovery in the market as 'A dead cat bounce'. I haven't heard that particular phrase sine 2008.

It's time for a complete rethink of how the world of finance, stock markets and business is oriented. It's meant to allow business enterprises to obtain funding to set up, continue and expand but instead it has been hijacked by the money makers and twisted to suit their purpose with detriment to others. We need to find a way to prevent `day trading' and the algorithmic second by second trading. Buying stocks and shares should be for the longer term, not for selling a few seconds later to make a profit. It's meant to be for investment, not gambling. So we have to find a way of ensuring that shares are bought for a reasonable minimum length of time and that investors have to take the rough with the smooth; stop them selling at the first sign of a change in sentiment. Make them keep shares for the long term. But the moneymakers would fight such a change tooth and nail. Have any politicians got the will to force through such changes?

You are quite right in my opinion Tiz and the short answer to your question seems to be 'NO'.
As for the reasons.... Their has always been an hierarchy in society, if you look at anything from a hive of bees to a modern political system you will find evidence of hierarchies. One of the things that has struck me when looking at history is that smaller versions crop up in any tight knit society, prisons, slums and ghettos have the same trait.
In the beginning, position in such a system was simply a question of the possession of the means to force people to do your will, this gradually changed to the possession of land or kinship with Royalty, the Feudal System. With the rise of the great manufacturing industries it became possible to scale the heights of society by success which was the entry card to the highest levels of society. Today the equivalent of that entry card is the ability to possess or control wealth. Through all these changes one element, the aristocracy, monarchy and 'establishment' maintained their position by emphasis on 'tradition' and deference in the general population. Looking overall at this progression one thread runs through all the high strata of society, power and the mechanisms to use it. Today that power is firmly in the hands of the capital holders and those with their hands on the levers of power in the financial system. Politicians are subservient to them because without their cooperation they cannot maintain a tax system which is the basis of their share of this power. Therefore, they are not going to attack the system which supports them, it would be like the captain of a ship cutting a hole in the bottom to control the crew....
So, the question is, is their a greater power on the horizon that can change the status quo? I believe there is and over the ages we have called it revolution. We can see it happening in the Middle East at the moment, some are benign and some are vicious. In the end, even though they are brainwashed into not realising it, the real seat of power in any society is the wealth creators and despite the rhetoric employed by the Masters of the Universe this is still what we used to call the 'working class', today they are the consumers who support economic growth. The wealthy would have us believe it is them, hence the old canard of 'trickle down' economic theory. In truth the real levers of power are innovation and value adding by the lower echelons. Piketty recognises this and forecasts that in the absence of a global wealth tax to bring capital down from the frozen heights of the super rich into the mainstream where it can generate the multiplier effect as it circulates among the consumers, there will inevitably be unrest. This is what is happening in the Middle East at the moment. It explains much of the Sunni/Shia schism in Islam. The next system to topple could well be the Saudi absolutist royal family who are coming under increasing pressure. The process of revolt has started and is spreading and at the moment our leaders seem to be blind to this. Instead of seeing these processes as symptoms of a wider ill in society they continue to use a 19th century model and use their power to suppress the lowest in society. This is all going to eventually end very badly.
All the signs are there, an increasing disparity between the wealthy and the rest of society (which is now degrading even the 'middle class') and the locking up of real capital in the upper strata where it is not employed but hoarded off shore so it doesn't even produce tax revenue never mind investment. This syndrome has spread to many large manufacturing and trading companies who hoard their capital stocks instead of re-investing them. There is no reason for them to take risks when the rewards are so small and precarious. Their sights are set on market share as this is the only sure insurance today, being a monopoly. Hence the rise of entities like Google, Amazon etc. Would you invest in steel or manufacturing?
End of boring lecture......

I know you think I am a bit of a Jeremiah on the economy but have a look at THIS report in the Yorkshire Post about the increase in mandatory profit warnings in the 4th quarter of 2015. Does anyone think the number will reduce? Will Ossie be shouting about this?

Is this really the best time to attack Putin accusing him of being corrupt?

I am still exercised over Cecil Parkinson. THIS article in the Guardian says everything I feel about the affair. Because of political considerations he was allowed to steamroller Sarah Keays and her disabled daughter, a disgrace that reflects badly on him and his party. At the same time Thatcher was condemning single parents and infidelity. Angry? Of course I am....

The House of Lords rejection of part of the disability bill to reduce benefits to new applicants. The general consensus was that it was an attempt to reduce the the costs to the treasury rather than to help the needs of the disabled person. Link. What is rather disturbing it the perverse language and logic used to justify the reduction. Quote '
'Lord Lansley defended the changes, insisting they would encourage people with a capability to work to find employment.
"The bigger the gap between income in work and income through benefits, the greater the likelihood for people seeking work and finding it.
"It is effectively a kind of economic law of gravity. We should be assisting people into work," the Tory peer said.'

The fact that people have been independently assessed as being in need of benefit because of their condition appears to count for nothing. We now see that the best way of assisting them is to give them less help.

I agree P and it is cruel and immoral to deny the needy basic support. End of story.....
I see Michael Gove has scrapped many of the modifications made to Legal Aid. See THIS. Do you think Chis Grayling is still speaking to him? Grayling was a complete disaster as Justice Secretary. (As was Lansley on benefits) I can remember Baldwin's words, 'Hard faced men who had done well out of the war'. Same syndrome....
Breaking news not on the web yet. The navy's latest destroyers are in trouble, their engines keep breaking down. The MOD admit that they are all going to have to have a major refit to install another generator to rectify the problem.
See THIS for more disturbing news about the 'economic miracle'. It's worse than it looks because it's service sector figures that are keeping the average up, construction and manufacturing industry are falling due to lack of activity and investment. The global markets are looking even more nervous and the general opinion is that the US Fed has badly miscalculated their interest rate rise.

News also that the decision has been made to spend billions on refurbishing the Palace of Westminster. For a small portion of what they are proposing to spend they could do anew build fit for purpose complete with accommodation facilities for all the members. They could put it on a brownfield site further North in the middle of the motorway and rail networks, we have plenty of them. This in itself would lend a bit more credence to the "northern powerhouse" promise that as it stands will never materialise. Fine words and lots of money but still no mention of how they are going to stop it sinking into the Thames.

Ooh, are you really sure you want all those politicians moving closer to you? Wouldn't it be better to put them on the Isle of Wight. Or buy one of the old cruise liners, convert it and anchor it somewhere well offshore!

I haven't seen it written down yet - but is it emergency 'brake' or 'break' ?

Either would suit.

I'm old enough to remember that in the early 1970s with the building of the M62 which serves the largest proportion of the population of England, there was a proposal to build a new administrative centre around Rocking Stones on the summit of the moors to the East of Rochdale. Not surprisingly the London based Establishment decided that this wouldn't do at all even though it made perfect sense in terms of economics and transport infrastructure. Don't hold your breath if you are expecting any change in the hide-bound 'traditions' surrounding the present Houses of Parliament. The London based establishment is far too strong and resistant to change.
As for the 'Northern Powerhouse', forget it. The plan was never serious, it was simply a pre-election bribe to attract the attention of those ignorant clog wearing denizens of the far North.... 'North of Watford there be dragons', Nothing ever changes. As far as the Chipping Norton Set is concerned 'The North' is a remote colony. Their version of integration is to make it easier and faster to get from there to London. They never consider it from the other way round. HS2 will make London even more central.
As for Scotland, same disadvantages X three!

As Bill Bryson said, what do people do if you build HS2 and get them to their destination 20 minutes earlier? They use the extra time to go into Starbucks for a coffee while looking up their friends on Facebook and Twitter (and he could have added OGFB)!

If there really was a serious plan to improve communications inside the 'Northern Powerhouse' the HS2 money would be better spent on the much needed East to West rail links inside the region but this would not contribute anything to London. Policy made in London will always favour the Capital's interests. That applied to the proposals for Rocking Stones as well. The logical route to a true improvement in the North would be a form of secession.....

Democracy according to Plato the Greek philosopher should follow a rigid format. Citizens should be split into three separate divisions. The elite leaders, the soldiers and then the workers. The working class was by far the biggest at well over 70% of the population. These divisions were fixed for all time and any movement between them resisted. The cultivated few would then control the desires of the 'vulgar' classes and make sure that they didn't move out of the place that nature intended. Plato thought that education was important but only to the extent that is was the reserve of the elite such that they could continue rule in the time honored manner.
Now where have I heard this before?
I can't believe that the proposed referendum on the Brexit hinges on being able to stop paying benefits to a 'bunch of immigrants', to paraphrase Cameron's words. This whole thing is getting out of hand. The whole idea of removing ourselves from our nearest trading partner to appease a few loud mouthed extremist is reminiscent of the start of the American War of Independence. Fortunately for the Americans their country was big enough to survive the split but it should be remembered that at the time the outcome was far from certain. Lets hope that common sense will prevail and any decision being based on what is best for the country as a whole and not on the interests of a few ruling elite.

We seem to be heading back to Platoland with our Eton Boy government but also because we're allowing a new aristocracy to form, this time based on super-rich celebs and the leaders of giant companies. As one commentator said this morning on the radio, "Google believe they shouldn't have to pay any taxes". These big organisations are going to face up to the EU Commission. We'll soon reach a point where they simply ignore laws, regulations and conventions knowing there nothing we can do, they've taken over, we need them too much because there are no alternatives.

Re HS2...Bill Bryson also said instead of knocking 20 minutes off journey times we should give travellers those minutes to allow them to better appreciate the beautiful countryside they are passing through!

Well done P! Exactly the considerations that trouble me. What we have is an artificial issue argued in many cases by people who aren't experts on the issues and whose intelligence (if they have any) is obscured by dogma and outmoded notions of patriotism and empire. In days gone by quiet diplomacy would have been the order of the day but now loud-mouthed, attention seeking politicians are in the driving seat. My impression is that it is an internal dispute in the Tory Party because we have no effective, coordinated Opposition. I'm not sure whether it is plutocracy or kleptocracy, it sure ain't democracy!
Tiz, this is exactly what Janet was telling me at Xmas. She can see four international firms two of them Amazon and Google and two others I can't remember gaining more and more power because of their technological lead to the point where they are, in effect, world monopolies and by definition, policy makers. New developments in mass data and the ability to handle it are such powerful weapons. The team she works with are working on programmes that unlock mass data for smaller firms as part of the fight back against what is rapidly developing into a hegemony. They see this as the only effective response.
One thing is certain, because of their built in short term mind set, politicians are the people least able to take a long view like this and recognise the dangers. Their tiny brains can only deal with the disposition of tax liabilities, the least part of the problem.

Good for Janet! I hope her team is successful. These giant companies are going to end up like the extreme religious sects, shrouded in secrecy and believing themselves set apart from the rest of us, with their own version of morality and ethics.

Janet told me that they were exciting a lot of interest because evidently they are the first to crack handling the data in such a way as to allow interpretation. Previously this has been such a barrier that no attempt was made by the originators to protect the data from public view as the mass is so big it needed specialised IT operations on a massive scale to allow meaningful access. Therefore the barrier wasn't getting hold of the data but handling it and this is where they have scored. Janet has a track record in handling this sort of problem by coming up with innovative ways of handling data. When Harry and she were at Nautronix they laid the foundations for NASNET and all the uses that spin off it. I remember her once being very excited about a way she had found of interpreting a string of bubbles rising to the surface from great depths. I know, it's beyond my ken as well as to why this was important!
The point is that there are people out there who have realised that using mass data is a way of gaining some control over our more and more restricted lives and in the end this is an important factor in politics..... Fewer mysteries and more transparency. It's long term but in the end far more influential than the ephemeral view of short termist politicians looking no further than the next election.

I think we need both HS2 and a decent northern east-west link. HS2 is a solution to capacity problems on the West Coast Mainline. It is quite simply full. A dedicated fast line will remove all current inter-city-type trains, dramatically improving capacity on a line currently restricted by having inter-city trains vying for space etc. with the commuter/other trains. Our existing rail infra-structure is essentially Victorian and it simply cannot cope with demand, with ‘upgrades’ (costing themselves billions) simply sticking plaster – witness the last billions of pounds upgrade to the West Coast, which simply hasn’t solved the problem. But as I say, it should not be one or the other. The North is crying out for a decent link. So are many other parts of the country. We’re crying out for all sorts of things for goodness sake. But best of luck. As we have noted, the country has essentially voted for a Government that quite openly abdicates its responsibility to the country’s infrastructure and has no interest at all in maintaining the services etc. available to future generations. I’d like to think people would wake up to this but sadly too many take too long to appreciate this will impact on them as well and when they do, they cry about it on Question Time………

Good to see that when the country applies its emergency brake on EU migration, all will be well. It won’t of course. There’s no serious analysis available that provides empirical evidence for this migration being a burden on services and/or the coffers. Still, if you can’t get a house it’s easier to blame a migrant than successive Governments who have done very little on building the houses we need for example. When you can’t get a GP appointment it’s easier to blame a migrant than think about the ill-health burden of an aging population etc. and the resources and so on needed for that. And if you can’t get a job it’s easier to blame a migrant than successive Governments that have taken little interest in the education, knowledge and skills of its workforce.

I seem to recall the internet and the world wide web being developed with significant chunks of public (i.e. taxpayer’s) money, the latter famously being given away free ‘for everyone’ by Sir Tim Berners Lee as he reminded the world in a tweet at the Olympic opening ceremony. You’d like to think the likes of Amazon and Google and Facebook would express at least a semblance of gratitude for this. But no. From the pig comes the expected grunt. ‘Twas ever thus.

Richard Broughton

Noticed that Cameron and Trump are both using the same technique to spin failure. 'Everyone said before the event that we would achieve much less.'