Thursday, December 15, 2011

Define an english person, collective attack

Because so many people have linked define an english person with this link  to Google gives a wonderful result

Monday, December 12, 2011

The BRICs collapse

10 years ago the BRICs was an innovative idea by Jim O'Neill of Goldman Sachs. The idea that emerging grouping of India, Russia, Brazil and China would form a third well driving the global economy. That this would add a new economic engine to the global economy along with the United States and European Community. For the better part of a decade the concept has been the favorite of trendy talk on the developing world. But now with India and Brazil's economies entering hard recessions and Russia on the verge of chaos the entire BRIC idea just looks like another derivative sold by Goldman Sachs: utter trash.

Lets come out and say it right way.  Goldman Sachs bundled 4 utterly isolated economies in India, China, Brazil and Russia to sell emerging market stocks to consumers.  This was no different than how bankers bundled mortgage mixing good mortgages with subprime make Mortgage Backed Securities that would have been better called Mortgage Infected Insecurities.  Then bankers started loaning to EU nations seeing sovereign debt as a good investment, but again they mixed solid debts like Holland, Germany, France and the United Kingdom with higher interest subprime countries like Greece and Italy.

The pattern of bankers combining things that are unrelated, mixing trash with gold to try and make a commodity to push to other investors is well established.

Well I am going to say it here, the entire concept of the BRICs was just another case of this.  The member nations of the BRICs had NOTHING truly in common.  Their economies were all very different, facing different risks and advantages, and didn't really form a singular whole or reinforce each other in any way.  It was just another Goldman Sachs scheme to think people were buying in to something they were not.

China has had an impressive economic run for the past few decades and it makes sense that many investors would like to get in to China.  But bankers were not happy just selling China, they had stocks in India, Brazil and Russia (all growing and large as well) that they wanted to pass off to suckers, I mean investors.

Problem was while China had a solid record people had reasons to wonder about India and Brazil, and would have been crazy to want to invest in Russia.  So what was a firm like Goldman Sachs to do?  Honestly sell the stocks people wanted to the people who wanted them.  Okay seriously, Goldman Sachs simply stacked  the four together, mixing basket case societies like Russia and Brazil with China in order to create a new kind of investment instrument.

Well the BRICs are pretty much falling about.  Just check the news.

India is in an economic collapse right now.  India's production and mining sector has fallen over 5% from October 2010 to October 2011. For a developing country that still has as many poor people as all of Africa to lose 5% in industry is very weak.  The EU may have caught a cold, but India seems to have cancer.

Brazil, the most isolated of the BRICs is not doing much better.  In the last quarter of 2011 Brazil, which was growing at 7.5% in 2010 came to a complete standstill.  Again for a developing nation with major poverty that needs development just to crawl out of a hole a sudden period of 0% growth is a catastrophe.

But these nations seems golden compared to Russia, where core survival of civil society is in danger.  Brazil and Russia have had peaceful transitions of power and fair elections, Russia does not even have a civil society as the presence of over 50,000 protests to a rigid election shows that the system is more Soviet than anything else.

Even China is endangered to some extent by the collapse in Europe, but her economy is doing much better than the other 'BRICs'

So what can we conclude:

  • The BRICs is a meaningless useless concept for economics, joining unrelated and unlinked economies in to something trying to sound like NAFTA or EU.
  • The BRICs is an effort by banking community to sell equities is less stable nations like Brazil and Russia by someone making them seem linked to China.
  • The nations of India, Brazil and China are still heavily dependent on US and EU economies and are not some kind of third engine.  There recent growth has come at the cost of jobs lost in the west.
  • A new spirit of protectionism, which is certainly coming, will wash much of the recent growth away.
  • Russia is a fiasco, Brazil is a narco-democracy, India isn't even a nation at all, and China as a Fascist Uber Corporatist State that all reason says must be headed for a bubble burst.

But to sum up: One has to be an idiot to believe anything Goldman Sachs ever said. 

Sunday, December 11, 2011

Police turn innocent Occupy Melbourne protest in to ugly incident

In Australia the Occupy movement responded to the ban on tents with a clever protest.  They made outfits out of tents and expressed their protest in what can only be called a playful, harmless and utterly innocent fashion.

But in a world run by the banks their is no longer the freedom of innocent protest.  Any descent against the banking system will be meet by a violent response.  This fun, small innocent protest ended in a terrifying scene of the police disrobing on of the female protesters and leaving her in her underwear in public then walking off.


If anything is a wake up call to decent humans about what the banking system has done to their society it is these two movies.  This is Soviet Union kind of stuff, where women are violated and humiliated sexually for any act of opposition.

Clearly the banks and free market reforms of 30 years has produced a indecent uncivil world.  It is time to admit that the 'experiments' of Reagan and Thacher have not delivered prosperity and cost our society its core decency.

Reality check: Public debt caused collapse? No

There is a popular myth in the US and UK that someone nations that did not run big deficits during the 'good' years from say 1999-2007 condemned themselves to economic hardship and massive deficits.

This kind of thinking is often grounded in the kind of homespun folk knowledge that most false concepts are cluttered in.  An example from Twitter is pretty typical:

 doug de vos 

 my father's father used to say: in the good years, save; in the bad years, don't spend. the diff between uk & nl aside

The saddest thing about the Internet is how quickly people went front typing questions in to Google to typing opinions in to Twitter.  Because it is very easy to test ideas like this.   Above I graph the debt to GDP performance of 6 nations, 3 which are seen as doing well during the current crisis (Germany, Holland and France) and 3 of the worst PIIGS (Iceland, Ireland and Spain).

It is true that Ireland, Iceland and Spain have far higher debt to GDP ratios today than France, Germany and Holland.  BUT from 1998 to 2008 the OPPOSITE was true.  Iceland, Ireland and Spain not only balanced their budgets but also ran significant surpluses over much of the 21st Century.  On the other hand Holland was the only of the three non-PIIGs that was able to balance it books running a small surplus but nothing compared to the massive surpluses that Iceland, Ireland and Spain had.

So if you are the kind of person interested in facts the notion that governments surplus could have been stored away to avoid the current crisis is clearly false.  The sad thing is how few people are ever interested in facts.

Friday, December 09, 2011

Russian Twitter launches troll bomb

"Hijacked PCs may have helped drown out online chat about Russian election protests, say security experts.

The computers were used to disrupt Twitter as Russians chatted about ongoing protests in Moscow's Triumphal Square, said security firm Trend Micro.

Analysis of the many pro-Kremlin messages posted to some discussions suggested they were sent by machines.

Russian activists said thousands of Twitter accounts were being used to drown out genuine dissent.

BBC News - Russian Twitter political protests 'swamped by spam'

Government Debt and the economy

The above chart of Government debts for Germany, France, Spain, Portugal, Iceland, United States and United Kingdom makes clear some facts.

1. Running a surplus during the boom changed nothing, maybe even made things worse.  Iceland and Spain both ran large surpluses during the boom and neither economy benefited at all, in fact nations taht improved their balance sheet during this time tended to do worse after the 2008 bust.

2. Event is essentially global and everyone was impacted.

3.  Event was more a factor of exposure to housing boom and related banking sector, and not government spending.

Sunday, December 04, 2011

India ends shopmarket globalisation idea

Small shops throughout India keep 100,000,000s from falling in to povery, photo by Gail Orenstein
India's government is reported to have put on hold plans to open up the retail market to global supermarket chains.
Just days after approving long-awaited proposals to raise the limits on foreign investment, a government ally said he had been told the policy was suspended.
The decision to allow chains such as Walmart and Tesco into India has sparked fierce opposition.
Critics fear the move would destroy millions of jobs and businesses.

BBC News - India 'suspends' plan to open up to global supermarkets

In a promising sign about the death of the neo-liberal free market fetish and some sane thinking about globalisation India has decided to not throw millions of small shop owners out of business in order to allow massive public traded firms to do to India what has been done to shop owners in the UK and the US.

Tesco has essentially killed the smaller grocer in England, leaving an exploitative firm that produces few jobs, pushes 'express' stores on poorer communities that charge more money, and as I have learned even refuse to allow homeless access to food waste. Tesco is a sad case, but Walmart is perhaps even worse. Walmart has essentially made it impossible for a mom and pop shop to function in America.

India's common sense move should please both Occupy movement and right wingers. Occupy will clearly be happy about multi-national global public companies not being allowed access to India market which produces jobs for millions of small shop owners. But free market types have to start actually reading their Adam Smith. Adam Smith said that Monopoly always produces the highest price that could be had, where as heavy competition produces the lowest. The Indian small shop market is pure competition, with tens of millions of players entering the market. Tesco and Walmarts work towards Monopoly power.

As a strong supporter of Occupy I am not looking for a socialist regime, I certainly don't think one is possible. What I want to see is the break up of much of the monopoly power that has developed which has created risk and made our world rather sterile and dead.

Saturday, December 03, 2011

Occupy Rave in London

Occupy Portland Launches a Sneak Tent Attack

7 new tweets
 Matt Bors 
Police orders a tent to stop being built. 
2 bike cops walking up to 1st tent.  - 
2 bike cops walking up to 1st tent. 
 Sarah Morrigan 
We   (@ Shemanski Fountain)
 Liz Paulus 
Advice - get OFF of the frackin' monuments! Don't break stuff - fountain is damn fragile!Please!!  
PA at the new  being set up. Come to Salmon & Park to join the re-occupation!  
 Kathleen McDade 
Wayne Havrelly is here from 
Peace & safety meeting at blue tent now! 
RT : rt : Tents fly up in park blocks at Main St.