Comments for Debtonation: The Global Financial Crisis

Comment on Why EU Summit futile: this is a global banking crisis by Nancy Bonney

2011-12-19T23:06:38Z

This is a really interesting piece of information,but it confirms all that I picked up from reading Joseph Stiglitz’s book Freefall. What can we do about it?

Comment on It’s not the public, but the private finance sector, stupid. by tombstone001

2011-12-19T04:22:57Z

If you ( everyone) understood that all this money never existed it would be a different story altogether, the problem is that as this money disappears ( whether by paying it down or writing it off the coming years will require the austerity unimaginable proportions . The governments will fail, the governments will fall and the people will starve, as the economies will grind to a halt. It was all predictable, but everyone wanted all the toys, and no one cared. Either way, those who created this imaginary money will have to win to let us live, as I said in 2004, we are being sold in to slavery we just don’t know it yet. say this, but I told you so, tombstone001.blogspot.com

Comment on My graph of 2011 – along with top economists by Jeff Cuffe

2011-12-16T00:20:13Z

Hi I thought your chart was the best in the Newsnight show, because it reflected what I have been campaigning about for over 10 years that is Personal Debt. Which the political parties and governments have all failed to understand. I was the chairman of a Residents Association in Cardiff for over 20 years and was also the editor of our free newspaper and in all the issues I used to campaign about personal debt.

I am firmly of the belief that the only way out for most people now is the total scrapping of Council Tax which is a massive burden on people and government now and does not work. Should be replaced with a hike in VAT of 2% which should be ring fenced by the Customs & Excise and used exclusively to fund local authorities. Local Authorities have been allowed to get out of control and need serious pruning. IN Wales we have 22 local authorities with all the heads and deputy heads and different departments plus all those councillors and then all the stuff underneath this. They are unco-ordinated and extremely wasteful. We also have a National Assembly with all those governments officials AMs and the whole cost of this. Then we have those MPs and all that goes with them. We only have a population of 3 Million which is about the size of Birmingham or Manchester, yet these cities would be up in arms if they had this much governance. If a new structure in Wales was built where all the departments were run by one body with very much reduced elected representation based on a new mapping then we would start to get better efficiencies and maybe more accountability and transparency. I currently feel Wales is a doomed nation if it carry s on like this. I also forgot all those MEPs as well and the sooner were out of the corrupt EEC which cannot even get its accounts signed off for the last 15 years. the better of Great Britain will be.
Jeff Cuffe

Comment on Reining in Public Debts or Challenging Democracies? by spiritofjubilee

2011-12-15T03:00:24Z

Dear Debtonation,
In addition to your post I was wondering, The United States National Debt is also knows as the total public debt. It is the total sum of money the United States government is indebted to the public due to the federal spending of states, foreign governments, corporations, and individuals. The National Debt includes Treasury Bills, Bonds, Notes, US Savings Bonds, and the local and state government Series securities.
Cheers
In America: governments, businesses, individuals are now buried under a mountain of debt. A mountain of debt that will never be repaid.

Who will borrow when they can’t make the payments on the debt that they have already? The math alone calls for a system reset, a debt jubilee.

Investors are already losing… in a rigged monetary casino that rewards usury, speculation, and currency manipulation while looting main street.

There is a moral principle that debts should be honored. That is, debts between businesses that buy and sell real products, not bundled ponzi schemes, debts between individuals, between friends and businesses that know each other to be rational and moral, debts based on investments where there is a rational expectation of return.

There is also a moral principle that unjust debts should be cancelled, and usury legislated against. Debts that are ‘odious’, debts based on fraud, debts to dictators, debts arranged by oligarchs without the consent of the general population (the 99 percent who have been left out of the equation), debts based upon compound interest upon compound interest, that should have been written off long ago, the debts need to be cancelled in a general jubilee. Think outside the box. It’s time for a jubilee.

Comment on Why EU Summit futile: this is a global banking crisis by Jeffrey Lam

2011-12-14T22:03:11Z

Hello Ann,
may I also ask a question? Can you expand on what the “shadow banking system” is? My understanding is they are players who trade in “dark pools” rather than through the main exchanges, so no-one can see what is being bought or sold?

Comment on My graph of 2011 – along with top economists by nathan matthew

2011-12-14T14:16:33Z

I was really pleased to see both you and Gillian Tett on newsnight. I thought you did brilliantly , and came across as confident and astute.You did what I havent seen many ‘progressive’ economists do and interrupt the flow of the discussion when it was fading back into the usual neo liberal comfort zone.
It’s normally the ‘washington conmsenus’ lot that do this on TV debates so its great to see someone who’s views I respect also being able to hold their own in a TV studio.
I hope you get onto more TV !

Comment on My graph of 2011 – along with top economists by Strategist

2011-12-14T00:06:08Z

Good chart, and I thought you “won the battle” of the all-female Newsnight – in terms of getting your points across the most clearly. Congratulations, if that’s the appropriate thing to say in this post-patriarchal context!

Comment on Why EU Summit futile: this is a global banking crisis by Ann

2011-12-13T09:21:25Z

Brady, as Kartik Sharma of Seeking Alpha explains (http://seekingalpha.com/article/138047-how-cds-spreads-affect-equity#comments_header): “The spread of a CDS is the annual amount that the protection buyer must pay the protection seller over the length of the contract, expressed as a percentage of the notional amount. For example, if the CDS spread of Citi (C) is 60 basis points or 0.6% (1 basis point = 0.01%), then an investor buying $10 million worth of protection from JPMorgan (JPM) must pay the bank $60,000 per year.”

The spread therefore is effectively the price of the insurance against default. Where the risk of default is higher (as in the example of US banks in the chart above) the spread is higher……

Comment on Why EU Summit futile: this is a global banking crisis by BradyDale

2011-12-12T21:40:51Z

This is really compelling, but can I ask a rudimentary question: what’s a CDS spread? Is that the price? Otherwise, I don’t really get what this graph is showing.
The wikipedia entry on CDS’s seems to suggest “spreads” are the same as the regular “fee,” so I guess so. Weird term.
http://en.wikipedia.org/wiki/Credit_default_swap

Comment on Standard & Poor is right, ‘austerity’ has no economic clothes by Giovanni Leonardi

2011-12-08T10:47:13Z

Yes, but can politicians be “encouraged” to see “it is not complicated”? Might it be that politicians are able to understand the option you describe of making banks work in the public interest, but are unwilling to support that option? Might it be that they are falling back to a default position of trusting their advisers, and see themselves as serving the public interest that way? If you believe in trickle down, then cutting jobs now might be justified as you would believe it will lead to job creation later. Might it be that voters also believe in this general explanation, “suffer now to enjoy prosperity later”, however foolish it is?

I agree with your analysis, but what is the political vision that you encourage? Tearing out EU treaties that established the Euro will not just stop the banks, it will destroy the EU as a political idea. I might agree that banks need to serve the public interest, but this could be achieved with a new statute for banks, without a need to destroy the EU. It is easy for a UK person to say “tear out the EU treaties on the Euro”, but you need to explain a bit more what would work politically for Europe, and by the way UK is in Europe geographically and in terms of UK trade.

I personally think the lack of an economic development model that internalises the energy, ecological, and social aspects of human activities is the key aspect of the economic crisis. Therefore recognising this is the key aspect of the solution. In other words, banks can never be established to serve the public interest, whether in the Eurozone or outside, unless a statute for the banks constrains them to activities within a political framework firmly focused on realistic management of social and ecological issues with a fair allocation of energy/carbon resources to essential needs. In the absence of this type of statute, scrapping EU treaties and making a new statute for banks “to serve the public interest” will be just a laborious way to establish financial institutions that will still destroy society.

A concerted effort to provide politicians with a demand that these political ideas are taken forward, in Europe and elsewhere, will allow politicians to redesign statutes for the banks. Perhaps it will be politicians different from those in power now, but it may be that many of those already in power can be recruited to this effort. Before their attention can turn to the banks properly, they need to have popular support for the direction of travel. High level statements of desirable social and ecological goals need to be identified (they are available already) and translated in operational plans not only for banks, but also for industry (many drafts are already in existence but they lack detail). Then, reduced profits now will really lead to prosperity later.