Comments on: Reading Evening Post http://johnredwoodsdiary.com/2009/06/25/reading-evening-post-11/ Incisive and topical campaigns and commentary on today's issues and tomorrow's problems Thu, 09 Feb 2012 11:18:17 +0000 hourly 1 By: Harry http://johnredwoodsdiary.com/2009/06/25/reading-evening-post-11/#comment-17884 Harry Fri, 03 Jul 2009 14:06:24 +0000 http://www.johnredwoodsdiary.com/?p=3799#comment-17884 Well, boom and bust is simple to erase. All that needs be done is for the government to issue its own currency. Private banks issuing currency for bonds along with money creation through credit is basically a Ponzi scheme thereby doomed to repeat boom and bust forever so drawing ever more wealth out of the population. A bad arrangement for the populations served so badly, but wonderful for the dynastic bankers tha reap rich rewards up and down the cycle. Douglas Alexander did a talk at the RIIA; last year I think it was: I have it archived. In this talk he mentions that there had occurred a contraction of the money supply to the tune of £30 billion. A contraction that could only have happened through the design and action of central banks, likely in concert with the world bank and BIS. This sum is equal to a full half of the GDP of the entire world. Here is your financial crisis. Created quite deliberately by the banking elites. We are witnessing the same events as occurred in America in 1833. (I have deleted a long historical example, based on allegations about a named bank which could cause offence -ed) Reply: £30 billion is far smaller than half the world's GDP. I do agree that Central banks lurched from easy money to money which was too tight, which is why we are in the mess we are in. Well, boom and bust is simple to erase. All that needs be done is for the government to issue its own currency. Private banks issuing currency for bonds along with money creation through credit is basically a Ponzi scheme thereby doomed to repeat boom and bust forever so drawing ever more wealth out of the population. A bad arrangement for the populations served so badly, but wonderful for the dynastic bankers tha reap rich rewards up and down the cycle.

Douglas Alexander did a talk at the RIIA; last year I think it was: I have it archived. In this talk he mentions that there had occurred a contraction of the money supply to the tune of £30 billion. A contraction that could only have happened through the design and action of central banks, likely in concert with the world bank and BIS. This sum is equal to a full half of the GDP of the entire world. Here is your financial crisis. Created quite deliberately by the banking elites.

We are witnessing the same events as occurred in America in 1833. (I have deleted a long historical example, based on allegations about a named bank which could cause offence -ed)

Reply: £30 billion is far smaller than half the world’s GDP. I do agree that Central banks lurched from easy money to money which was too tight, which is why we are in the mess we are in.

]]> By: Steve Hemingway http://johnredwoodsdiary.com/2009/06/25/reading-evening-post-11/#comment-17883 Steve Hemingway Sun, 28 Jun 2009 09:52:42 +0000 http://www.johnredwoodsdiary.com/?p=3799#comment-17883 I am confused by your question "Is any regulator worried about a bond bubble"? The prospect of raging inflation and credit weakness both of corporates and governments (particularly in the Euro area where the Italians no longer have the option of devaluing) are going to prevent any irrational exuberance in the bond market. As for regulators worrying about this, it seems to me that regulators were largely to blame for the bubble in sub-prime lending. You didn't see many unregulated hedge funds loading up on SIVs and CDOs; in fact their shorting of the equity in banks that were eventually punctured the bubble. Predictably enough the EU seeks to hobble these very hedge funds by increasing regulation of them. I am confused by your question “Is any regulator worried about a bond bubble”? The prospect of raging inflation and credit weakness both of corporates and governments (particularly in the Euro area where the Italians no longer have the option of devaluing) are going to prevent any irrational exuberance in the bond market.

As for regulators worrying about this, it seems to me that regulators were largely to blame for the bubble in sub-prime lending. You didn’t see many unregulated hedge funds loading up on SIVs and CDOs; in fact their shorting of the equity in banks that were eventually punctured the bubble. Predictably enough the EU seeks to hobble these very hedge funds by increasing regulation of them.

]]> By: sm http://johnredwoodsdiary.com/2009/06/25/reading-evening-post-11/#comment-17882 sm Thu, 25 Jun 2009 19:48:37 +0000 http://www.johnredwoodsdiary.com/?p=3799#comment-17882 Of course in a democracy one expects the government to answer properly legitimate questions. However the limits of parliament to require proper answers are all to obvious, but perhaps not to all the electorate. What should the speaker of the house do? or the house do to remedy this issue in the future? Is this a constitutional issue? Of course in a democracy one expects the government to answer properly legitimate questions. However the limits of parliament to require proper answers are all to obvious, but perhaps not to all the electorate.

What should the speaker of the house do? or the house do to remedy this issue in the future? Is this a constitutional issue?

]]> By: Kit http://johnredwoodsdiary.com/2009/06/25/reading-evening-post-11/#comment-17881 Kit Thu, 25 Jun 2009 17:20:41 +0000 http://www.johnredwoodsdiary.com/?p=3799#comment-17881 Today we mock those Soviet planners that thought they could decide the price of bread. How we laughed at the empty shelves, the queues or the mountains of unwanted loaves. And yet we still believe a committee room of planners , the Bank of England, can choose the right price of money. The financial system is too complex for even our most talented to control by pulling a few crude "levers". Even Gordon Brown failed and, as we were repeatedly told, he was our greatest Chancellor ;) Today we mock those Soviet planners that thought they could decide the price of bread. How we laughed at the empty shelves, the queues or the mountains of unwanted loaves. And yet we still believe a committee room of planners , the Bank of England, can choose the right price of money.
The financial system is too complex for even our most talented to control by pulling a few crude “levers”. Even Gordon Brown failed and, as we were repeatedly told, he was our greatest Chancellor ;)

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