Friday, July 17, 2009
Negative Equity
Krugman points out that the net effect of Goldman Sachs on the American economy is negative. I've been saying something like this for a while so he must be right. At the weekend Will Hutton said the same thing about hedge funds and, of course, it's also true of private equity operations which specialise in ruining perfectly decent companies like Boots. Why anybody should ever have thought that an insane proliferation of financial 'instruments' or 'products' was in any way a good thing is a mystery. I dimly recall some City type telling me it was a way of 'smoothing' markets but, when pressed, he couldn't explain what this meant. Anyway, it's all starting up again. Having seen Sir David Walker on television last night, it seems pretty clear that nothing will change and, in another few years, bankers will once again lose every penny they ever make. Smoothie Walker went further than Joanna Bourke when it came to the little people in places like Bromley. He came right out with it and said they wouldn't understand. I mean they haven't even got jobs have they?
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A blog about, among other things, imaginary ideas - What ifs? and Imagine thats. What if photographs looked nothing like what we see with our eyes? Imagine that the Berlin Wall had never come down. What if we were the punchline of an interminable joke? All contributions welcome.
Krug and Mutton, a classic combination.
ReplyDeleteI suppose the warning, past performance is not to be taken as a guide to future performance needs to be reversed for these two.
Paul Krugman says that he was attracted to economics because it seemed to him to reveal “the beauty of pushing a button to solve problems”
says it all about the mindset of the liberal left.
Everything changes, nothing changes, we are still a nation of pussycats led by donkeys. Ironically Earl Haig died this week aged ninety three, the son of the old louse who's incompetence led hundreds of thousands to a pointless death. The son, a good man who was unable ever to come to terms with his fathers crimes.
ReplyDeleteIn years to come what will be in the minds of Goodwins children.
Well look on the bright side Malty, less money in the kitty will lead to less donkeys being groomed in our university social science depts.( no doubt they will put a strong fight, monopolies often do)
ReplyDeletein the long run Goodwin might have done us all a favour and brought us all back to Bromley from planet prediction.
We do appear to be suffering from a form of capture. The vampire squid strikes again.
ReplyDeleteSimon Johnson (former IMF economist so he should know) put it into context.
I can't see any way out either - how does one remove a vampire squid?
"You don't understand" has become the catch-phrase of the elite. So far as I can see, it simply means "Tough. We do what we like." I guess the analogy with WW1 is that catastrophes happen when a ruling class becomes so remote and arrogant that it no longer sees the rest of us as entirely human. A good argument for capping the banksers, imho, lest in future they decide to send more than our savings over the top.
ReplyDelete"Insider supports home team then slaps own wrist" seems to be the story of this report. What a surprise.