Monthly Archives: October 2008

Excited Delirium Book: Chapter 62 (888 Tremors) – reposted

Author’s Note: The following is Chapter 62 of the my online book "Excited Delirium". Please post comments. Please tell your friends about this story. If you’ve missed a chapter, please click here for Chapter 1 (Prelude) or here for the full index .

August 7, 2008

Those with very little experience with Chinese culture, but with significant influence in the West – people like Griffith Garamond – make accusations that the Chinese are unable to innovate. People like Garamond have lead themselves to believe that this mass of population exists to serve the West.

The common suggestion is that intellectual property related to operating system software is stolen and repackaged on a regular basis, or that goods that are normally manufactured in North America are copied and redistributed elsewhere in Asia and Europe at substantially lower prices, exchanging quality and value for a lower price and undermining the economic benefit for the original manufacturer that would like to keep a lock on the distribution of its products. Continue reading

Iceland: A Victim of Economic Larceny

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I don’t think the little nation of Iceland entered the news much before September 2008.  When it did, it was depicted as iconic in its efforts to purchase hydrogen buses, run everything on geo-thermal energy and the home land of Bjork.

Now, it’s the victim of economic larceny .

The people of Iceland are being forced to pay 18% interest on their debts in order to stave off further meltdown in the value of their currency and their economy in general.

We are now applying IMF and World Bank rituals to ‘First world’ countries, much like we did in the 70s to Latin American, Asian and African countries.  Soon, we’ll all be fighting for clean water and bags of rice to sustain ourselves.

THIS is the cost of letting the inmates run the insane asylum.  If you’re not already worried about tax rates shooting up at various levels of governments in order to maintain the status quo, you’ll be subjected to interest rates that go well beyond the definition of usury.

We need a better and different solution to this crap or the world is going to plunge into chaos.  Throwing the neo-con book at humble little countries like Iceland are going to do nothing to boost the fate of the international economy.

This does nothing to break the yoke of debt from small economies and only ensures that they are indebted to the end of time again, much like less-developed countries in the south.

Now, what happens when it’s the US that starts defaulting on a couple of loans and they have to hike interest rates in order to attract cash (so that they can continue to print more)?  The interest rates of neighbouring countries will be driven to the stratosphere in order to ‘compete’ with this stupidity.

Ugh.

How pirates fashioned our financial crisis

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For those of you who don’t read the Star, I thought this was a great piece , as it added a very unique spin to the whole financial crisis and why our corporations are the way that they are.

After seeing The Corporation several years ago, I understood their point that there was some kind of psychosis that was driving this institution.  However, when you approach the corporation from this historical context, it’s easier to understand why they have a manic anti-social pathology to them!

I’d be curious to know if anyone has more context or research related to this idea.  If so, please post links below.

JP Morgan Responsible for Financial Crisis?

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Please note that any of these blog posts or opinions do not reflect investment advice and any action that you choose to take related to investing should be done so after discussing your ideas with a professional investment advisor.

Original link

This piece is pretty deep in its accusations concerning the financial crisis that we have had no choice but to become obsessed with.  I also found it a little cumbersome to read.  Let me know your thoughts if you review it.

In the interim, it re-confirms my belief structure, in that I believe we are being manipulated on two fronts:

  1. This financial ‘crisis’ is a manufactured crisis
  2. The media isn’t reporting on why this is happening, just that it is happening (of course, I have found a couple of mainstream examples of people being pretty pissed – on mainstream media – about why we’re bailing out a bunch of pirates).

My favourite quote from the piece (and what that seemed a little chilling):

The top-down approach used to date aids the wealthy bankers, while the homeowners are denied aid. That aid is promised but rarely arrives. The fundamental problem here is that billion$ are devoted to shore up insolvent banks, to redeem their worthless (or nearly worthless) bonds, and to give a giant pass to the executives. Trust has eroded throughout the system. Banks distrust each other’s collateral. The result is that eventually the US Economy will enter not a recession, not a depression, but a DISINTEGRATION PHASE . Despite Bernanke’s studious efforts, borrowing from revisionist history, his liquidity is nothing more than bailouts at the top for the perpetrators of the housing bubble and mortgage debacle. The bank system benefits little inside the US walls of finance. A bottom-up approach might have had a chance to succeed, but a top-down approach is a sham. To expect a top-down solution that actually relieves the housing inventory logjam is insane. That is like feeding a teenager with meals placed inside the human rectum, expecting nutrients to find their way to the rest of the body! The credit mechanisms do not travel upward within the pyramid, but rather in the downward direction, starting with a borrower, a good collateralized risk, and an underwritten loan, when plenty of lending capital is available. The US public has bought this stupid ‘Trickle Down’ philosophy for years, learning nothing. The US Economy is on the verge of collapsing. Short-term credit is being denied at key supplier intermediary steps, soon to result in recognized disintegration.

The primary practical objective of this corrupt trio (JPM, GSax, FDIC) is to avoid Credit Default Swap fires, which would bring an end to their reign of terror. This US Economic failure is in progress and is unstoppable. The 1930 Depression resulted after monumental credit abuse from the bottom up, as hundreds of thousands of people leveraged investments 10:1 with stocks primarily. The 2008 Depression will come after monumental credit abuse from the top down, as hundreds of big financial firms leveraged investments by 7:1 and 20:1 with bonds primarily. The most absurd of all is the CDO-squared, leveraging upon leverage. Total seizures have crippled the banking system. Short-term credit has largely vanished, as letters of credit are routinely not honoured at ports in the United States. The panic will continue, especially when supplies dry up.

Unite the Left – Lloyd Axworthy

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I’m always loathe to quote from Canwest Media, but Lloyd Axworthy posted this op-ed in the Ottawa Citizen that you might be interested in.

I have issue with the notion that the opposition parties have to unite, mainly because their views are too disparate.  As I’ve said before, this is the inevitable ‘long tail’ of politics, where fragmentation of power occurs as a result of fragmentation of different voting ‘blocks’.

What I’d prefer to see the opposition parties pursue is a platform devoted to proportional representation.  Nearly 70% of the population is getting a government that they didn’t vote for and this must end.

Here’s the text of Axworthy’s article:

Lloyd Axworthy . Unite the left

Progressive Canada again has a very conservative government — we need a major political realignment

Lloyd Axworthy, Citizen Special

Published: Tuesday, October 28, 2008

More than 60 per cent of those who cast ballots in the last election did not support the Harper government. If you count in all those who did not participate out of choice or indifference then you likely have a much larger cohort of Canadians who are not in favour of the agenda espoused by this government.

One small piece of evidence to support this assertion comes from a recent BBC poll taken in a variety of countries on preferences in the American election. Sixty-seven per cent of Canadians surveyed support the election of Barack Obama in the U.S. presidential stakes, a candidate who clearly espouses a "progressive agenda."

The problem of course in our recent federal election was that the votes of the majority were split between four other parties. Due to the vagaries of our election system it gave the Conservatives enough seats to return to power, albeit in minority status.

So for another two years or more, Canada will be subject to policies and positions that reflect a point of view out of sync with most Canadians. It also means that if Mr. Obama wins the U.S. election, as it appears he will, Canada will be very offside with our closest neighbour.

What to do?

First, the opposition parties must begin immediately to have direct conversations about the forthcoming parliamentary session. They must discuss how to combine and co-operate to ensure that Stephen Harper does not take advantage of both a split opposition and an imminent Liberal leadership race to force through measures that reflect his particular ideology, which is clearly very conservative. This de facto parliamentary alliance, while troublesome for partisans, is a must and is clearly mandated by their electors who were asked to vote Liberal, New Democrat, Green or Bloc to stop Mr. Harper. To return to the gamesmanship of the last Parliament would be a repudiation of those election vows.

There is an even more fundamental reason for a progressive parliamentary alliance to prevail — the times call for it. We are entering into a perilous period where all the conventional wisdoms about the market, the state and globalization are being ruptured. Yet we have a government that still closely adheres to the old 1980s Thatcher-Reagan view of the world — deregulate, cut taxes and trust entirely in the private sector. The Conservatives have shown a marked disinclination for working in a multilateral, international context and eschew innovative efforts in trade and foreign policy. So they will need help in adapting to a world that will require major reforms, both domestically and globally, that begin to rebuild the notion of a public domain in both spheres.

I am not suggesting that a combined opposition can quickly give birth to a new progressive agenda . This is going to take time and the involvement of a lot more Canadians than just the political parties. But, if one looks at the platforms of the opposition parties from the last election, there was significant convergence on many issues that reflect a different outlook from the Harper government. They should use Parliament to gain a much better, broader and more intelligent discourse than was apparent in the campaign and push for an agenda that stimulates the economy, protects people, jobs, the environment and our human rights, and restores a sense of public stewardship to the federal level.

Standing in the way, of course, will be the eternal quest for power, with each group strategizing toward the next election. However, it should be clear by now that the present mathematics are against any of the individual alternatives attempting to overcome the unified position of the right.

It is the mirror image of the politics of the 1990s when the Reform-PC split gave Liberals a built-in advantage. This is compounded by the shifts going on in the diverse demographics of the country and the advancement of a new generation that does not have the same political loyalties of old. So, as uncomfortable as it may be, there will have to be realignments, along with a serious look at electoral reform.

There is some precedent for this. After the 1980 election, Pierre Trudeau and Ed Broadbent had such discussions, only to be turned down by their respective caucuses. It seems even more imperative today for those who desire a return to progressive governance in Canada to engage in such dialogue.
One major question mark in all this will be the Liberal leadership contest, already under way in sub rosa fashion. Will a leader emerge who is willing to take a chance and be ready to embrace, indeed take a lead in forming, a different kind of political constellation? Or will there be a push by that faction of the party that believes a return to right-of-centre politics will offset the present Conservative advantage.

To this death wish, I am reminded of the comment of Keith Davey, renowned Liberal party organizer, who said that Canadians given a choice will always vote for a real Tory, not a pseudo-Tory in Liberal clothing.

Over the next several months there will be lot at stake in the politics of Canada. Fashioning a credible and unified alternative to Mr. Harper’s government and his committed goal of transforming this country into a conservative state needs serious work, not befogged by the personality-driven politics of the last decade. The present parties that profess to be on the progressive spectrum of politics have tough and far-reaching judgments to make. At the very least, they have to actively explore a basis of partnership of progressive forces and how to translate that into political action. If this can be done, then it may be the most important result arising from the last election.