Merry Monday.

Phew!
After a weekend's frantic international dealing and shinanegans, and a £35 billion buyout of key British banks, the stock market breathed a sigh of relief and recorded gains.
 People are naturally angry that their money is being spent on rescuing the banks, but the more businesses go bust, the cheaper they will be when the government buys them. So the choice facing capitalism is stop sulking and get back to work, or risk being an ex-company in a planned economy, bought at the global bargain basement bankruptcy sale. When the going gets tough, the rich go shopping. And at times of extreme crisis, only the nation state is rich enough. Any renounciation of power, any return to the days of the poisonous free market experiment, will then be seen as an act of charity which the electorates of most countries will not allow their governments to indulge in.
 Politics has a chance to redeem itself and get back to the job its voters want it do: provide them with security and the conditions to make a life worth living; not force them onto a lifelong hamster-wheel of debt, consumption, promotion-backstabbing, training, bonding, image-building, networking, property-worship and suspicion of everyone except their nearest family, while they last.
 And as the worst is far from over, any failure of the political classes we choose to take the reins from the money-men and give them back to the people will end up with us all carrying guns to the soup-kitchens. So we have to elect the right politicians.
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'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.
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Paddy Power

Calls for concerted european approach to bank crisis. Otherwise:

Step 1. Ireland guarantees all deposits in major banks.
Step 2. Nervous money flows into Irish banks courtesy of the internet. Grand.
Step 3. Other countries have to do the same or risk a drain on deposits when the banks need them most.
Step 4. Countries now in full competition for nervous money.

And so it begins.
At the conference, Ireland argues that its' need is the greater, being in a deeper property recession than most. Spain supports it.
Germany argues that Ireland should have thought of that before getting involved. It wasn't as if they hadn't been warned etc etc.
Result, lengthy impotent bickering in the style of the League of Nations instead of the decisive co-operation which is needed.

Meanwhile, the class war continues in America. Wall Street is now paying a nice visit to America saying

'This is a nice society you have here. It would cause us much distress to learn that it had been destroyed by an economic depression or whatnot. And when you consider that for a reasonable trillion dollars to our welfare fund, you will have complete peace and mind for yourself and your family. We are sure you will make the responsible decision.
We will be back on friday for our donation. We are not used to disappointment.'

It's the American way.

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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.


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