Midas

The world which made debt into a commodity to be bought and sold at a profit was one which efectively brought to life the wish of King Midas. Everything he touched turned to gold - the dream of every desperate American Blue-collar worker trying to put at least one of his kids through college, pay for health insurance for all the family, and be true to the American Dream he had voted for. The magic formula for wealth and happiness had apparently been discovered.
But the lesson of the Midas parable is that golden food and drink are poisonous. The commodification of debt turned the tables on the global capitalist system just as surely as Dionysus tricked the mad king.
Cityphobia: John Lanchester
crash08

'When The Lights Go On Again - All Over The World...'

The day after Gordon Brown saved the world - according to Nobel Economics Prizewinner - Paul Krugman, the first local councils have decided to save money by turning off their streetlights, and the Daily Mail is solemnly warning Gordon Brown not to turn into Josef Stalin. This is the hiss of a tory snake with its head in a forked stick.
While nobody knows what is going to happen next, it does seem that the fever has passed, and the patient is taking nourishment. The excitement of the most exciting month since 1968 is over, and now the long hard job of creating a different world begins.
Some smartalecs on the New York Times came up with a graphthis week tracking the use of key words during the Crash Crisis of 2008. 'Recession' 'depression' 'inflation' etc. The one word noticeably absent was 'co-operation', which I've been seeing a lot of lately, in one sense or another.
On the grand diplomatic scale there has been the usual predictable assurances of co-operation between banks to release credit, co-operation between nations to set the 'level playing field', and between leaders to play the game.. But it has also come nearer to real people in the debate over the crash in building society credibility, and the whole problem of 'de-mutualisation'. Various academics are now being given fresh space to put forward their angle on the simple agenda that at this stage in our history we need to co-operate more than compete. We have nothing to compete for other than an excess of luxury which we can't enjoy, knowing that any day it may be snatched away by another global crisis of capitalism. Calls for 'People's Banks' cannot be far off. And the internet does make such a thing a possibility, just as it helped secrete the virus of toxic debt into the remotest lymph nodes of global capitalism.
The Credit Unions could see a massive boost from this, as could all kinds of de-globalising projects which would return services and production to a more local, sustainable market. As all sane commentators were demanding all along.

crash08

'Greed Is Good' Is Bad

That's one thing settled at least. The ideology of the free market is a dead dog.The future's down to social altruism and common sense. And if Britain can gamble a third of its GNP to save a banking industry which still might collapse, it can devote as much energy into creating a society in which toilet cleaners are treated with as much respect as merchant bankers used to be. We need to look for new definitions of respect, success, and happiness. Granting status according to wealth was never going to work.
The Bill.
125,000 hospitals.
£16,000 / person
33% of GNP
Total including Northern Rock & Bradford & Bingley

= £640 billion.

Meanwhile.
The parallels with the 1930's keep emerging. The Special Investment Vehicles of today mirroring the submerged parallel banking system which collapsed in the runs of 1930 and 1931. Then, banks were simply allowed to fail, as Lehman 's was.
It remains to be seen whether the expensive remedies since then mean we have learned the lessons of history.
crash08

Anniversary of Munich Agreement. Chamberlain's Shame.

General quivering optimism from television experts that Congress republicans have had their bit of fun, and will come to heel on Thursday, possibly voting for the same bill they rejected yesterday. And all will be well, after a fashion. 
Even if they do perform this backflip, McCain is now a dead man walking and the Republican Party has lost the election, so what's in it for the renegades? In fact, if they have judged the mood on their reservations correctly, this might be the only way they get to keep their jobs. It's all very well for the American Chamber of Commerce to speak in general terms about those responsible being punished by the electorate:

"The US Chamber of Commerce said the vote had caused "uncertainty and turmoil" in the markets, destroying billions of dollars of household wealth. "Make no mistake - when the aftermath of congressional inaction becomes clear, Americans will not tolerate those who stood by and let the calamity happen," it said."

But if the local electorate is as stupid as their chosen representative, which is likely, the culprits will be rewarded, not punished.
The other words being used are 'failure of politics' - not politicians, or policies, but politics itself, as opposed to business, the military and the church. Is it any wonder? One of the many lessons which may or may not be learned is that politics is not a tap which can be safely turned off for years and still do its job, it is a muscle which has to be constantly used to stay useful.
It would seem that this principle would be second nature to the Thatcherite self-improvement-manual-consuming gymnauts of the sadoku generation. 'Use it Or Lose It' is their dreary motto. But only as far as maintaining the machinery and instincts needed to be an efficient, ruthless, consumer and colleague backstabber, which are the opposite of those needed to maintain and advance a modern society. Fine for a nomadic hunter gatherer tribe, but obsolete since civilisation began in pre-historic Babylon and the Indus delta.
Societies have to keep making decisions which matter, or they lose the ability. The dictatorship of the markets has reduced politics to the status of a desk-clerk in the corporation. A nobhi in Human Resources addressing envelopes and running the stationery trolley; which is yet another echo of 30's Britain, especially, when a series of inert governments and shameless capitalists made the rise of militaristic authoritarianism inevitable.
Then, Britain had to look back two generations to find a politician who still had political blood in his veins, and the cavalry-era Churchill only knew how to wage war, which was why the sensible British people got rid of him once it was won. But who are the politicians of today who still remember how to govern from the front? Who will take the market bunko artists by the hand, take away their snake oil, and find them a desk where they can lead useful lives, with suitable rewards for their efforts and talents? Why should an expert on money be a hundred times more valuable than an expert on curing cancer or an expert at cleaning the sewers? Which is more important to the basis of civil society?
 Another term being used is 'market free-fall'. Namely, the gap between now and any decision by Congress when marketeers and politicians will be doing what they need to do, assuming that there is a decision in Congress. If not, the Rosh Hashanah Massacre will be a fact, and a new economic Ice Age will return - according to most experts, of all political persuasions. (All news of any optimists extremely welcome.)
China is being suitably Confucian at the moment. Deng Xiao Peng He say:-

"Confidence Is More Precious Than Gold."

Fat lot of use that is.


crash08