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Alien 2010: will this toxic spillage burn through the Euro?

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Paul Mason | 16:49 UK time, Thursday, 25 November 2010

Alien metaphor graphic

(c) Paul Mason 2010


In the original Alien movie (1979) there is a scene that illustrates the problem we've been facing since September 2008, and which is coming to a head now (I've produced a handy graphic opposite).

Somebody stabs the alien: but its blood is acid. It burns through the floor of one deck and one character realises: "that cr*p's gonna burn through the hull!"

They run to the next floor, but it's already burning through to the next deck. Finally it stops: the acidic properties neutralised through interaction with the metal decks, the air, the demands of Hollywood storytelling.

In the global financial crisis the acid is toxic debt. The first thing it hits is the real economy: output, trade and the stock markets, which tank in the last two months of 2008 at the same rate as during the post-1929 crash. The acid quickly burns through here.

But then it hits a much stronger barrier: the state. From the April 2009 London G20 to the Pittsburgh G20 six months later the state holds. Fiscal stimulus, monetary stimulus, stealth bank nationalisations - and above all global solidarity all work to stop the destructive power of this toxic liquid. The world economy stabilises and even begins to recover.

But the state is not uniformly resilient: everything that is not well constructed begins to get burned again. Bipartisan politics in the USA does not survive; nor does British social democracy; and the Euro begins to disintegrate. The weakest parts of the state could not take the strain and begin to fragment.

The next floor down is globalisation: and in the trade and currency wars of mid-2010 you begin to see the first deadly drips of acid begin to smoulder there as well, testing the multi-lateral defence mechanisms of the WTO, IMF, Asian dollar pegs.

One problem with this analogy is, going back to the movie, we never know why the alien's blood stops burning. Is it the strength of the final floor or the burnout of the blood's acidic properties? (Acids after all work by giving off protons to the materials they dissolve, and each molecule has only so much burn.)

But with toxic debt you have a substance more volatile than alien acid blood - because toxic debt can get more toxic during the burning process, because by destroying growth and promoting deflation it can make bad debts worse.

So Ireland's banks realised in 2008 they were sitting on massive toxic debts; but the toxicity got worse because a) deflation and austerity collapsed the value of the property that had been bought with the loans and b) the banks standing behind the loans began to go bust. Now the state (Eire) standing behind both the loans and the real economy has begun to crack under the strain. And finally the superstate that is supposed to stand behind Eire (the ECB and IMF backed EFSF) is so weakened that it has to call on its members to double its resources in the face of the crisis - which it is reportedly doing this afternoon (see WSJ ticker).

Bad debts and toxic debts are, really, stored up stupidity: dead decisions that can never be revisited but must now be paid for. Once the toxicity is unleashed it may be an unsolveable problem: we're not used to these in the modern world, shaped as our thinking has become by the plotlines of Hollywood movies, where there is always a solution, a hero (or heroine) and the baddie gets blasted out into space during Act V.

Or, worse still, it may be a problem that you could have solved if you had acted earlier. That is, if they had let Greece go out of the Eurozone in May, or decisively bailed it out in late February.

Right now, with interest rates rising on the sovereign debts of Spain, Portugal and Belgium, and on the eve of a more or less total nationalisation of the Irish banking system, it is becoming possible to believe that the Euro governments' failure to decisively stem the 2008 banking crisis - to rely on temporary liquidity in the hope that returning growth would sort the problem out, to carry out "stress tests" which failed to test for the one thing they are now facing - that all this may have put the unity of the Eurozone in jeopardy.

The fact that we are not in the middle of a rapid contagion event, but rather a slow one, with critical moments ahead for Ireland, Portugal and the ECB, makes this crisis different to the week of chaos after Lehman, or the days of panic in May 2010 over Greece.

One mitigating factor is the German recovery, which is real; and the launch of US QE2, which has already begun to depress the cost of borrowing in the USA; also the strength of the Asian economic rebound. What people in the markets are waiting for is a decisive act of leadership from Germany.

When I explored the issue of a potential two-tier Eurozone on Newsnight, Tuesday, it was in the knowledge that, by the end of the week it would be the "de nos jours" idea going round the City.

It is certainly being contemplated in Berlin. Contemplated and dismissed: you can never break the Eurozone, Bundesbank boss Alex Weber warned the bond vigilantes last night. But on credit ratings, bond spreads, CDS and many other measures the Eurozone is already two completely different blocs, with different dynamics.

Angela Merkel as Sigourney Weaver? We'll see.

Comments

  • Comment number 1.

    Germany wants the bond vigilantes to share the pain in neutralising the acid and drive part of the problem back to source. Some semblance of morality is then re-established.

    Not sure where the bank creditors who stoked the boom fit in to your script.

  • Comment number 2.

    The real question is, Paul, why the doctors (politicians and central bankers) are being allowed to give the alien unlimited blood transfusions directly from the crew's (taxpayers') veins.

    The disease won't be cured by injecting fresh blood any more than a cancer would. No more blood, no more morphine - cut out the malignant tumour, treat the poisonous blood and although it'll be painful in the short-term at least the recovery can begin.

  • Comment number 3.

    The pound is Ripley, the dollar is the cat and the Euro is the Alien which has just been expunged from the mothership...whilst the pound is in sleep mode she will be picked up near earth whilst the Euro is nuked and in a year will be an awful...but distant...memory...

  • Comment number 4.

    The State should not have guaranteed toxic debts and should have protected the public first, to a rational level through deposit guarantee schemes. The badly run banks would have then fallen. Their assets be bought cheaply by well run banks (or new entrants to the banking sector - why have there been so few?) and most people with some savings would have not lost a penny.

    Our Government was too close to the banking sector and sought to protect it in preference to protecting the public *from it*.

  • Comment number 5.

    Mr Weber IS too late. The Eurozone could have worked if it had been commonwealth in the genuine sense, But the North looked down on the South, and to an extent used the superior financial power of their organised manufacturing industry to enjoy the fruits of the south on the cheap. By which I mean agricultural products and holidays. They funded the building boom which has destabilised parts of the south, but are resentful about paying (or thinking that they're paying) to sort out the mess.

    In general, people who are affluent tend to think it's because they are deserving rather than lucky, and that the poor are poor because they are undeserving, rather than unlucky - or lacking in firepower. One need only look at several members of HM Govt, and our PM's soon to be ennobled friend, Mr Flight.

    Which brings me to Paul Krugman's hilarious blog today:

    http://krugman.blogs.nytimes.com/2010/11/24/wednesday-for-thursday

    I'd forgotten that scene - it cheered me up no end!

  • Comment number 6.

    The Irish government has decided that more austerity/deflation is needed so that for domestic debts more people will now default on payments and the value of assets will further fall together with postponing or frustrating the recovery and no certainty of reducing the deficit. It is a fine experiment for us all to analyse to see if the coalition path is the same but not so advanced and whether similar consequences follow.

    On the other hand the Irish addiction to austerity may simply reflect Einstein's definition of madness.

  • Comment number 7.

    THAT SHOULD BE REQUIRED VIEWING IN THE OBAMA HOME (#5 link)

    In his inaugrural speech, the Indigenes never got a mention. But I do remember a Turkey . . .

  • Comment number 8.

    On a more serious note, Krugman again compares Ireland and Iceland.

    http://krugman.blogs.nytimes.com/2010/11/24/lands-of-ice-and-ire/

    His previous blog on Iceland:

    http://krugman.blogs.nytimes.com/2010/06/30/the-icelandic-post-crisis-miracle/

    Krugman concludes:

    "....notice that wonderful line from the IMF, above, about how “private sector bankruptcies have led to a marked decline in external debt”. Bankrupting yourself to recovery! Seriously.

  • Comment number 9.

    yes toxic acid. yes stored stupidity/greed

    Have you noticed that while wholesale interest rates are near zero you can't get a loan for less than 7%? and they quickly ramp up to over 20%. The current return from the stock markets is 10% if your lucky and those are far riskier bets than lending out free money. Given loans for risk are the engine of growth it hardly looks like the banks are breaking their back to kick start the economy?

    if the banks were charged 20% for all these govt loans they would go bust.

    on loans to business we read

    ....In September, high street banks provided £564 million of loans to SMEs, the same level of lending as was approved in September 2009.

    However, the BBA issued words of warning against an over-optimistic interpretation of the figures.

    Although the value of the loans arrested the persistent decline of recent months, the number of loans still showed a fall.

    David Dooks, the BBA's statistics director, said: "It's too early from September's data to say things have bottomed out. The number of new loans is more instructive than the value.

    "I would be surprised if we saw a significant increase in the number of new loans coming through this year."

    http://www.creditman.biz/uk/members/news-view.asp?newsviewID=12733

  • Comment number 10.

    8

    ..Bankrupting yourself to recovery! Seriously...

    yes that is what has to happen. the question is to whom is it going to happen. currently it happening to viable businesses starved of working capital.

    its going to happen to everyone [via state debt] just so the inner empire can keep their wealth.

  • Comment number 11.

    The economic theory of toxic debt.
    Well, it's better than any other offering from mainstream economists as to the causes of the crisis.

    But what has caused the toxic debt?

    Why are the Irish banks effectively bust?
    Are the British banks really bust?
    What about the rest of the world's banks, are they bust as well?

    Can/should taxpayers save the banks?

    What is going on? where's the economic theory to explain it all?

  • Comment number 12.

    The Chancellor may find that her biggest problem is domestic sentiment. There are growing signs that the view they were better off with the all powerful DM and that the Eur is simply a mechanism for getting Germany to bail out failing economies is gain currency. There are signs of nervousness at the top as well. The Chancellor's comments today will if anything lessen confidence.

    In the meantime, I am trying to get the image of Angie in a wet tee shirt out of my mind.

  • Comment number 13.

    Alien

    to survive do we not have to kill the 'mother' alien who keeps laying these creatures of toxic blood [debts]?

  • Comment number 14.

    WHAT IS GOING ON? (#11)

    Well might you ask duvinrouge.

    The headless chickens are coming home to roost. But for some reason that they just can't fathom, they all have a different idea of where they are now, and all have a different idea of which direction is 'home'. Roosting will be a computation too far methinks.

  • Comment number 15.

    "Bad debts and toxic debts are, really, stored up stupidity: dead decisions that can never be revisited but must now be paid for. "

    I hardly ever see financial commentators confirm that the money has already been spent and that no amount of accounting can recover it. Although this ought to be obvious, I thank you for mentioning it.

    taxman -

    "Their assets be bought cheaply by well run banks (or new entrants to the banking sector - why have there been so few?) and most people with some savings would have not lost a penny."

    Ah - so you have either got no pension or a pension that invests solely in Asian companies? I don't so it would have lost me quite a bit.

    So much of this is interconnected. If banks go under we have to stop with "pretend and extend". Pensions invest in banking shares. Banks employ tens of thousands, most of whom aren't traders. What happens to all the ridiculously low mortgages that people are dreading renewing in 2 years time?

    jaunty:

    "Have you noticed that while wholesale interest rates are near zero you can't get a loan for less than 7%? and they quickly ramp up to over 20%. The current return from the stock markets is 10% if your lucky and those are far riskier bets than lending out free money. Given loans for risk are the engine of growth it hardly looks like the banks are breaking their back to kick start the economy?"

    They are pricing in risk. Do you really think banks would hesitate to undercut each other if there was easy money to be had? Or are we back to the favoured scenario on BBC blogs of all bankers meeting up in a big room with doctor evil and colluding on rates? Banks want big deposits for houses as the believe house prices are on the way down so they want a buffer as negative equity means they take on the loss. Interest rates reflect the expectation of an imminent rise in rates coupled with a bleak economic outlook. The last thing we need is another artificial credit bubble! Plus there are loads of offers on here for well less, even after the initial rate expires: http://www.moneysupermarket.com/mortgages/

    Or should we all go back to 95% mortgages as that worked so well? I'd rather the government stopped underpinning housing by getting the rates up and allowing greenfield building.

  • Comment number 16.

    I take it Lehmans was Kane (John Hurt), RBS/HBOS/Lloyds are Brett (Harry Dean Stanton), Iceland is Parker (Yaphet Kotto), but remember, Ripley (Sigourney Weaver) gets impregnated with an alien Queen... so is she the Eurozone?

    But then who/what is Ash (Ian Holm)...?

    Big Immolation Scene to come then?

  • Comment number 17.

    This crisis can move along slowly with seemingly little happening... or it might even appear over to some... but do not underestimate how quickly and how severe a future crisis can spring up.

    In fact, it won't be a future crisis but just the continuation of the one that started 8 or 9 years ago when the US Fed, BOE, ECB and other Central Banks loosened monetary policy, dropped interest rates and made vast sums of paper money available in order to allow a massive propety - read credit - boom.

    The so-called Doomsters on sites like Dailyreckoning, Zerohedge, MarketOracle, Housepricecrash, etc, have proved to be uncannily correct so far. They said that the banks were insolvent and were proved right in late 2008 and early 2009.

    They said that US, Irish and Spanish property prices would collapse - they have. They said that the UK property bubble will follow - it is, albeit slowly for now. Next year will be the year of the crash for UK property.

    They said that Iceland would go bust 12 months before it did - and it did.

    They said that Greece would be next, then Ireland, then Portugal and then Spain - Spain being the biggie. They were ridiculed but have been proved to be 100% spot-on in just how broke these countries truly are.

    Months ago posters on housepricecrash were talking about Belgium when the mainstream financial Press were not even considering it as a potential failed state to come.

    A two-tier Euro is yesterday's news on such sites.

    The above are now talking of the global economy simply not being capable of bailing out another Eire let alone Spain or France. Or the UK.

    What benefit would there be for any of the PIIGS to be tied together in a second-tier Euro? They would be in the same position as they are in now - tied into an inflexible currency, unable to control their own financial affairs and yet perceived by the global markets to be not just in a second-tier Euro but a second-rate one?

    The political will might be there. The snouts-in-the-Euro-trough grey suits will want it, the bond markets might even warm to the idea but what about the People?

    Everyone ignores the People in this. Foolish grey suits.


  • Comment number 18.

    "Right now, with interest rates rising on the sovereign debts of Spain, Portugal and Belgium"

    You could add the 10 year german bund, 30 year US Treasury and the 3 month LIBOR rate to the list:

    http://www.thisismoney.co.uk/libor

    The trend is for rising rates despite the efforts of quantitative easing to keep them down. This will lead to more loans going 'toxic' if the trend continues.

  • Comment number 19.

    If you are in one of the PIIGS which is preferable?

    Being in hock to the Germans - effectively giving your sovereignty to the EU/Germans/IMF - for the next decade or two?

    Or bringing about a collapse in the Euro which effectively puts the Germans, and everyone else, in the same life-boat as yourself?

  • Comment number 20.

    hi tawse57

    "Months ago posters on housepricecrash were talking about Belgium when the mainstream financial Press were not even considering it as a potential failed state to come."

    Lots of financial sites were too. I feel that saying it wasn't in the mainstream financial press is not a big deal. You say everyone ignores the people. Most people I know don't give a monkeys how the recession started, they just want things to kick off again so they can carry on as before. Maybe you know a different type of people to me.

    Most people do not demand finance news because it's quite complex. If the opposite were true the Sun, which has a reading age of about 13, would not be Britain's biggest paper. Even the Guardian and other "quality" dailies don't have much. If people sought out high-quality journalism even McDonald's would start dispensing it. The ball is in the people's court, as it always is.

    Whilst the vast majority refuse to engage in attempting to understand finance issues, which in a capitalist system are nearly as important as free speech, politician's are behaving rationally in maintaining the status-quo.

    ps I think every single permutation on every single day from now to 2050 has been posited on HPC :-)

  • Comment number 21.

    As long as you have your doomsday stock of baked beans Ben you will be fine.

    Perhaps not the best company to get too close too in a small room... but you will be fine...

    Don't forget a tin opener.

  • Comment number 22.

    A useful site for comparing economic data by country:

    http://www.tradingeconomics.com/World-Economy/Bonds.aspx

    The German 10 year bond hit a low in september and has been rising since then. Greece, Ireland and Portugal top the chart for increases on the year.

  • Comment number 23.

    'The next floor down is globalisation: and in the trade and currency wars of mid-2010 you begin to see the first deadly drips of acid begin to smoulder there as well, testing the multi-lateral defence mechanisms of the WTO, IMF, Asian dollar pegs'.

    There is something wrong with your analogy at this stage, the assumption that this is part of the damage. Surely this is the source of the toxic, not what it destroys.

    'Defence mechanisms'? Defending what against what? The overcoming of what you misappropriately name 'defence mechanisms', is the glimmer of hope. Dont forget WTO forced 'liberalisation' of financial services marks out a future of many Irelands, including for countries where most people stand to lose their means to survive.

  • Comment number 24.

    15

    ...Do you really think banks would hesitate to undercut each other if there was easy money to be had?..

    how quaint. some people still believe in efficient market theory and competition as setting 'the right price'. It doesn't work in the energy market. it doesn't work in the financials. The easy [no risk] money is taking the govt cash at 0.1% and putting it in a building society in australia at 6.5%.

    why bother with the plebs and their problems? its just too much hassle.

  • Comment number 25.

    banks not lending to business

    http://www.guardian.co.uk/business/2010/oct/25/cbi-conference-bob-diamond-banks

    http://www.dailymail.co.uk/news/article-1315340/Bournemouth-Barclays-bank-bricked-businessman-furious-refusal-lend.html

    its no secret the banks are just sitting on the cash because they know what the real problems they have are and that the easy money is elsewhere.

  • Comment number 26.

    #13

    "to survive do we not have to kill the 'mother' alien who keeps laying these creatures of toxic blood [debts]?"

    Securitisation = Toxic debt

    "The reliance on markets to be a reliable determiner of credit risk has been shown to be theoretically and empirically false. Instead, the turning over of banking functions to a seemingly competitive market has at best yielded superficial hopes of improved customer choice, but more importantly has masked a more serious issue of the mis-selling of credit and gargantuan risk transfer to the public purse. To accept that securitisation is necessary for modern banking is to implicitly condone the continued growth of debt levels of potentially deteriorating quality."

    http://forensicstatistician.wordpress.com/2010/11/19/is-modern-banking-fundamentally-flawed/

    But, only a fool would lance that boil, surely?

  • Comment number 27.

    On a lighter note, has anyone seen this?

    http://www.newsbiscuit.com/2010/11/23/new-years-dishonours-list-to-acknowledge-worst-and-most-annoying-of-society/

    Who would bloggers like to nominate for the New Years Dishonours list?

    What should be the ranks of the honours and categories of service?

  • Comment number 28.

    #27 Sasha
    Carthorse of the British Empire(CBE) Ann Widdecombe for services to dancing.
    Orifice of the British Empire (OBE) to Simon Cowell for services to entertainment
    Queezer of the British Empire (QBE) to Mervyn King for services to inflation
    Commander of Most of Germany(CMG) to Angela Merkel for services to bondholders

  • Comment number 29.

    The analogy is unsuitable, it infers there is an outside to bad debt. What does " space " represent in your idle scrawl ?

    How about this as a counter analogy : The bad debt represents a huge pond of very caustic waste which needs vast amouints of acid to neutralise. The banks did not have the necessary protons, so dragged in public finance to provide the protons. In turn the public finances have become exhausted and so governments are dragging in taxpayers to provide the protons.

    The question is will the taxpayers be able to synthesise enough "acid" by the repspiration of work before the pool swamps them ?

  • Comment number 30.

    ''But with toxic debt you have a substance more volatile than alien acid blood - because toxic debt can get more toxic during the burning process, because by destroying growth and promoting deflation it can make bad debts worse.''

    That to me in anutshell is what the ruling elite are in denial about.

    Couple that with the idea (in my opinion) that growth globally is no longer possible (locally it is possible but globally it is already comodity constrained by geological, political and population growth reality) and you get the slow motio progressive collapse we are all witnessing. Yelling from the sidelines, or to ue your analogy.. the vacuum of space.

    To use the films strapline 'in space no-one can hear you scream'.

    Nice cartoon by the way, musician, economics journalist, cartoonist, union leader, crikey ! What else can you do?

  • Comment number 31.

    Ash is Nick Clegg, the robot who obeys his master and renages on his crewmates...the one problem is..he won't die...

  • Comment number 32.

    Ad to 29 Here's Krugman on the lack of an exteriority to bad debt:

    http://www.voxeu.org/index.php?q=node/5823

  • Comment number 33.

    @28 Tony :-D I especially liked the Cowell one which I've already plagiarised!

    My own nomination is Rupert Murdoch for the Légion de Déshonneur, for services to democracy, public information and international understanding. (He and various of his minions won your OBE years ago.)

    @30 You're right about Paul's cartoon Jericoa - well worth enlarging! :-D

  • Comment number 34.

    #32 "the lack of an exteriority to bad debt"

    Not fully sure I understand the term. My guiding principle has always been the sage words of Soddy:

    "debts do not rot with old age and are not consumed in the process of living. On the contrary, they grow at so much per cent per annum, by the well-known mathematical laws of simple and compound interest"

    Which leads me nicely on to my relentless quest, which is to establish whether there are any academic schools of thought which fully demonstrate how preposterous it is to assume that credit Quantity can keep growing without impacting on Quality:

    http://www.debtdeflation.com/blogs/2010/11/15/why-credit-money-fails/comment-page-2/#comment-27693

    ------------------------

    P.S. Certainly don't want to steal Paul's thunder on the cartoon front, but also saw this yesterday and I think it captures the situation perfectly:

    http://picasaweb.google.com/lh/photo/u_bD3oQ_fJr3ux8tVMkFLw?feat=embedwebsite

  • Comment number 35.

    @32 Thanks for the link - I hadn't seen that one.

    Much as I respect Krugman, he seems to keep clear of discussing the fundamentals of the finance and banking system - possibly because of the political realities in the US. His proposals usually seem to be a way of getting round the system rather than reforming it.

  • Comment number 36.

    Update from Krugman on Ireland v Iceland. He too borrows from Swift:

    It's entitled "Eating The Irish"

    http://www.nytimes.com/2010/11/26/opinion/26krugman.html

    TTFN gotta rush!

  • Comment number 37.

    The exposure of the UK banking system to home mortgages has increased sharply from 2000 to 2010:

    Average household income up 41% from £25,000 to £35,250

    Average house price up 96% from £85,000 to £167,000

    Net mortgages outstanding up 136% from £525 bn to £1,241 bn

    With austerity measures due to start in 2011 and interest rates likely to rise the pressure on the disposable part of household incomes is negative.

    http://www.bankofengland.co.uk/statistics/bankstats/current/index.htm#1

  • Comment number 38.

    I await Paul's next blog liking the current global financial crisis with that of the Borg assimilation process.

    If we are lucky some mention will be made of the hope that Seven of Nine will come to our rescue.

  • Comment number 39.

    This is one of the best and easiest to understand summaries I've yet seen of how the development of the banking crisis of 2008 has ebbed and flowed.

    Like King Canute they tried to hold back the tide but the force they were trying to turn back was always going to be far too great.

    I remember Mervyn King saying that the necessary deleveraging had not taken place but in the end those trying to hold on to their phantom wealth will see it disappear in a puff of smoke.

    Whether its through CDO's or printing more and more paper money or any one of the other problems in the system.

    They are gambling everything now for there is ultimately nothing to lose and nowhere else to go.

    It's all a matter of how much time it will take before the debt needed to keep banks and countries going becomes too great to be paid back.

    You refer to the acid. I would refer to the water leak. It will always find the weakest point to find its way through and that could be in the most unlikely place.

  • Comment number 40.

    Hawkeye 34,

    yes I appreciate the point, my feeling is that their are two language games taking place simultaneously.

    1) the mathematical language game of the credit system.

    2) the materialistic language game of commodities consumption and exchange.

    I personally do not think there is a way to reconcile the two, despite Soddy's attempt, and it is this dichotomy which lends the impetus to the effect observed and described as Kondratiev waves, credit cycles etc.

  • Comment number 41.

    PARADING NINNIES

    Something for the weekend: The frequency of approbation (but dearth of opprobrium) in blog comments is both revealing, and true to type.

    The problems which we face are, some have astutely pointed out, critically related to the prevalence of these self-centred behaviours in our European populations.

    Is that (no doubt unpopular with many ninnies) analysis correct?

  • Comment number 42.

    PARADING NINNIES
    A little something for the weekend:
    The frequency of approbation, but dearth of opprobrium and insight, in blog comments here, is both revealing, and sadly true to type.
    The problems which we face, some have astutely pointed out, are a function of the prevalence of self-centred behaviour across European populations.
    Is this (no doubt unpopular with many) analysis correct?
    Whilst some can see their language changing, do they, themselves? Or is it all just for the sake of appearance? For approbation?

  • Comment number 43.

    #40

    Ah… Kondratiev… now there’s a name I haven’t heard for a long while.

    The two best explanations I have come across are this article:

    http://www.southerndomains.com/SouthernBanks/p2.htm

    And the excellent book by Carlotta Perez:

    http://www.amazon.co.uk/Technological-Revolutions-Financial-Capital-Dynamics/dp/1843763311/ref=sr_1_1?s=books&ie=UTF8&qid=1290790087&sr=1-1

    Both written before the current crisis. Both pretty much spot on in explaining the long wave credit cycles as created by the exuberance of technological revolutions.

    However, both a little premature in declaring that information technology / the knowledge economy can propel us forward once more.

  • Comment number 44.

    A critical comparison between financial crisis and environmental hazards has been made in this article, it is truly a brain storming one. best buy to let mortgages

  • Comment number 45.

    Best buy to let mortgages rates have positive effect on ,German financial recovery has struck the USA economy recent times and Asian markets geared up, when such a situation can occur in global economy, can we dream of a pollution free environment in near future?

 

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