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New world financial order. What would your plan be?

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Paul Mason | 11:21 UK time, Thursday, 23 October 2008

We now know the leaders of the G20 nations are set to meet on 15 November in the vicinity of Washington DC. I am told the UK Treasury may be preparing a plan to take to that meeting to kick-start a new world financial order. But what about the ordinary Joe: the people who don't get access to the agenda-setting pre-meets on people's yachts?

In the name of networked democracy I am inviting you to submit your plans for a new world financial architecture here. The rules are: 5 bullet points only and each of less than 100 words. If we get a decent response I will send it all to the Treasury and see if they will respond.

Once we've narrowed the plan down I will try and synthesise alternatives and do a SWAT analysis...


  • Comment number 1.

    To have a game you must have

    1. rules

    2.a ref

    3. enforcement.

    problems occur [in any part of society] where there are none of these. So where there are no rules makes some where there is no ref make one and where there is no enforcement enable it.

    Leaving national strategy to the 'markets' is just another way of saying leaving national strategy to the financial oligarchs. To make people believe the financial oligarchs is actually something called 'the markets' has been the jedi mind trick.

    "Let me issue and control a nation's money and I care not who writes the laws." Mayer Amschel Rothschild

  • Comment number 2.





    ....YES MONEY IS FRESH AIR!!!!!!!!!


  • Comment number 3.







  • Comment number 4.


    Has it not been shown that greater complexity embodies greater instability? Thus: World Money, all joined together and run, in part, by 'rubbish in rubbish out' computers, rides a tiger.

    We need compartments - like the Titanic - no - like a submarine. Better still, let's stop trading in money (let alone debt - absence of money) until we really understand what money is. . . Meanwhile, if we create a world of mature individuals, then priorities and goals will change completely - job done.

    The place to start. is that bit stuck in the bottom of the wheelie-bin.

  • Comment number 5.

    1) return banking to a "utility" system, replace i-bankers and ratings agencies with accountants, abolish or heavily restructure incentives and bonus pools.

    2) outlaw leverage for commercial banks, and limit i-banks to 10:1

    3) Give the national regulator real teeth, (there can be only one) and give them money to be able to employ decent analysts who understand what's going on. Make sure the banks maintain proper capital adequacy ratios, 10:1 minimum, 12:1 preferred.

    4) Resurrect Bretton Woods but with a neo-Keynesian slant, and without the peg to gold.

    5) Everything goes through an exchange, no dark pools, no excuses. No off balance sheet accounting. You break the spirit of the law you go to jail.

  • Comment number 6.

    The recent world financial order featured highly mobile money with a limited mobility workforce. How about low mobility money with a highly mobile workforce?

    Restrict money moving between countries. This reduces the will of economic migrants. People only move if things are really dreadful.

    Relax immigration controls but ban all international trade. Arms trade dries up overnight, everyone buys British. Left and right are thrilled.

    Responsibility and possible extent of responsibility through financial organisations disappears at a stroke. We no longer have to worry about foreign powers buying up our national assets.

    It might sound stupid. How much wronger than the last system can we go?

  • Comment number 7.

    1. Can't afford heat or light. Cold and miserable. No money No job.
    Probably find thousands of people leave this country for warmer climes I would if I could. This leaves less people to use scarcer resources,

    2. Open up the coal mines. This will guarantee a supply of cheap fuel and create thousands of jobs. Might be temporary until technology catches up .Recession or slump as Paul had the courage to say will guarantee that falling emissions will counteract negative effect on global warming.

    3. Make those on benefit work for it. Look at what they receive on benefit and divide this into the hours they should work at the minimum wage level. This will take their right away to use benefit as a life choice.
    Many voluntary and charity workers will be needed to help the poor in a recession. Better if they are being paid to do it via benefit system. Could even stamp out benefit fraud. They can't be in two places at once.

    4. Get rid of outdated and unaffordable final salary pension scemes in local and central government. These are the biggest drain on this country's resources. Bring them into line with everyone else.

    5.Keep the NHS and privatise everything else.

    That was fun!

  • Comment number 8.

    my blueprint would be to look at history and take the best bits out and bin the crappy bits. Take the two main ideologies, capitalism and socialism (the last one hasn't been tried, it doesn't work at the point of a gun)1. Factor out collective farms as nobody wants to work on one besides Pol Pot, and give everyone their own patch of land thereby you don't stifle enterprise (so common in socialist societies) and we could becom self-sufficient. 2. Stop all that insane quotas thing, so beloved by the EU which is anti-competitive, binning food in harbours to keep th price up...what's that all about. 3.Return to what was comfortable, you cannot force people to intergrate, Eastern Europeans should remain that....Easten, they don't understand the Western way, it's not a racial thing but a culteral thing. 4. Outlaw all religious dogma, just think no more Iraq adventures because God told George Bush it was the right thing to do 5. Have an elected assembly of citizens to decide monetery policy and exclude the Bank of England as they ballsed it up 6. Keep politicians off yachts who seem to decide economic policy whilst pissed in wine bars 7. You can take the best out of each system and make it work, they must have some plusses, like the top five per cent have everything and the rest of us skint and the beneficiaries will be no more war, we have lived through all the mad bits, it doesn't have to be the same for our kids. 8. Have a free press that is only allowed to print truth not according to very rich Australians......sorry, Paul, it's never gonna happen is it?

  • Comment number 9.


    listening to cranks on youtube isn't "real" news either.

    Also, please STOP SHOUTING!

  • Comment number 10.

    Sorry I didn't read the narrative properly.

    7. Virtualsilverlady

    Solve the world's financial problems?

    What a question to ask. I'd be worth a fortune if I knew that.

  • Comment number 11.

    with the forced liquidations in the oil market moving price down over 50% means over 50% of the oil price was speculation driven. Not the 10% people claimed.

    'belief in the markets to set the right price' upon which much of uk energy and finance policy is based [unlike most countries who know better] is nothing other than belief in oligarchs setting the price which suits them.

    the uk politicians have been fooled. It is this financial illiteracy that needs to be addressed.

    national uk strategy in energy, finance what have you should not be 'left to the markets' [code for oligarchs]. Which is why most countries don't do it.

  • Comment number 12.

    Here’s five things that they should give serious consideration to:


    1) Set "targets" on consumption reduction rather than economic growth (which is actually consumption increase)
    2) Work towards consumption equality by targeting highest offenders first
    3) Heavily regulate usury
    4) Create an aspirational measure of socio-economic maturity based not on GDP per capita, but some other Index (one that accounts for activities more worthwhile and less prone to manipulation– I’ll give further thought to these over the weekend)
    5) Spell out to people that our voracious appetite for material goods and cheap travel around the world has turned us into nothing more than mere consumnivores – a most pernicious offspring of homo sapiens that is unwittingly victim, perpetrator and bystander all at once

    As a bonus, can I add three things that they should NOT do:

    - Try to convert "externalities" into economic tangibles (e.g. Carbon Credit Trading schemes), this is just free market fundamentalism
    - Try to press ahead with the Doha round, claiming that this will solve our problems
    - Encourage efforts to borrow more money (perhaps this Economic forum is nothing more than a "oh, so we’ve promised a load of state bailouts, so where’s the dosh really going to come from?")

    I suspect they will agree to "do" all of the above Don’ts, leaving us with an illusory respite that will just about keep the peace for some 30-40 years until the real crisis and economic (+environmental) collapse occurs in Kondratieff wave no. 6!

  • Comment number 13.

    Surely a SWOT analysis ?

  • Comment number 14.

    leftieoddbod (#8) "sorry, Paul, it's never gonna happen is it?" I was impressed that you got beyond 3 without that kicking in! Thanks for making me smile.

  • Comment number 15.

    #4 Barrie Singleton

    In my opinion understanding what money 'is', and how it relates to the real world is the first and most fundamental thing to do.

    So have to agree with you on that.

    Stability is directly related to complexity in thermodynamic, ecological systems.

    So we would have to present what we mean by these terms before we could discuss this relationship.

    We seem to have different meanings ascribed to these terms.

  • Comment number 16.

    In the first instance, the five rules should be primarily designed to completely break the current stranglehold of the historical actors which have signally failed to match up to the new needs of the global financial systems:

    1: AGREED CONSENSUS – any approach has to be completely acceptable to the global community in general; and in particular to the 20% of nations which account for 80% of financial transactions. Any narrow-based agreement can now be destabilised by even small nations, such as Iceland, which decide to bat above their weight. The agreement(s) should cover the model(s) used to form the basis for control.

    2. BELIEVABILITY – Almost any model will do, as long as it is agreed. The Chicago School’s models, even the patently silly monetarism, worked. However, the best starting point now could be Keynesianism; since it was designed for the recessionary environment we now face. The models must be seen as sensible, now by ordinary mortals as much as by economists, if they are to be believable and believed. They will only work if they meet the expectations of all the actors; but if the expectations are widely believed they will become self-fulfilling.

    3. ACCEPTED ENFORCEMENT – there has to be some means of generally ‘enforcing’ the agreement. In the absence of any real ‘force’ this probably will have to be public opinion – or at least that of the opinion-formers – worldwide. In this context the IMF and World Bank, still stuck in the Bretton Woods time-warp, are no longer options. Somehow or other alternative institutions, perhaps taking on their key staff and infra-structure, must take over the key international roles. Perhaps even relocating them to other parts of the world might be necessary to break the mould.

    4. ABILITY TO DEVELOP – the new model(s) must be dynamic, changing with the times; and with suitable processes for agreeing the changes needed. They cannot, like the IMF, remain frozen in time.

    5. SOCIAL DIMENSIONS – in addition to the economic and financial bases the institutions – and the models they use – the new replacements must also take into account the massive social forces which now drive the global infra-structures.

  • Comment number 17.

    #12 Hawkeye


    Do I now need to bother posting?

    Apart from minor perspective differences.

  • Comment number 18.

    #13 lordBeddGelert's not SWOT either.

    I think Paul made a mistake on one of the other letters....he typed an S instead of a T.

  • Comment number 19.

    Celtic yes, I agree, Hawkeye seems entirely sensible and unobjectionable on the surface. BUT, what he proposes is precisely the opposite of capitalism needs to carry on, let alone overcome its problems. Like Woody Allen's relationship shark, capitalism MUST constantly expand in order to keep alive and cannot survive just on the basis of Engels' "freedom is the recognition of necessity" (which is what Hawkeye's menu amounts to). Trying to limit its rates of consumption and production will simply kill it. Now, personally, that sounds fine to me but the social consequences will be, literally, revolutionary. Again, ok by me. What someone has alluded to above is that what we are going through is simply one of the long downward waves inherent in capitalist development. There are only two choices: 1. Spend our way out of it. 2. Let it collapse and pick up the pieces.

  • Comment number 20.

    New World Order ?

    Isn't this what James Bond villians are always trying to impose !

    My bet is on more of the Old World Order. Here's an example from 1864 -

    Policies of Machiavelli in the Nineteenth Century ( Dialogues in Hell )

    What forms of government would you apply to societies in which corruption has stolen everywhere, in which morality has no guarantee save in repressive laws, in which the sentiment of patriotism itself is extinguished by I know not what universal

    I see no salvation in these societies, veritable giants with feet of clay, except in the institution of an extreme centralization, which puts all public force at the disposition of those who govern; in a hierarchic administration resembling that of the Roman empire,

    which rules mechanically all the movements of individuals; in a vast system of legislation which takes up in detail all the liberties
    hat have been imprudently bestowed; in a tremendous despotism, in short, which could immediately and at all times strike at all who resist, all who complain.

    The Caesarism of the Lower-Empire seems to me to realize quite well what I desire for the well-being of modern society

    . Thanks to these vast aparati which, I have been told, already function in more than one country of Europe, they can live in peace, as in China, as in Japan, as in India

    . A common prejudice should not make us condemn these oriental civilizations, whose institutions we learn to appreciate more
    each day.

    The Chinese people, for example, is very commercial and very well administered. "

    So there you have it - Power to a Plutocrasy, with lots of regulation on Chinese lines .......all as advocated in 1864 !

  • Comment number 21.

    An Economic Tsunami: I don't think so.

    To start in producing a new world plan, I would like to refer to Paul's post of Weds 15th October 'This is An Economic Krakatoa'.

    First I would like to build on and refine his analogy used there.

    In the posting Paul refers to the Tsunami wave which followed the eruption. A Tsunami similar to which we saw pictures of on Boxing Day 2004. Indeed some reading this may have been there.

    Some economic commentators have referred to this present situation as an "economic Tsunami". I maintain this is incorrect-dangerously incorrect.

    Go back to the pictures prior to the destructive wave breaking on the coastline.

    The sea disappeared and moved away. It went into 'recession'. The effective sea level dropped, it was in 'depression'.

    People were seen on the beaches, asking questions like where has the sea gone, why has it gone? Remaining where they were, seeking solutions to a problems that had already occurred.

    What they were unaware of was, what was to come. They were responding to what had happened, not to what would happen?

    I refer to previous posts by various on Galbraith and Forrester.

    Kondratieff Waves to follow.

  • Comment number 22.


    Strength lies in the word FUN as used by Virtualsilverlady @ 7.
    Weakness lies inherant in humanity.
    Anomaly resides in the elevation to power of the least competent.
    Threat: 'I's not going to happen - is it!'

    Yeah - FUN!

  • Comment number 23.

    1. Transparency of exposure. Financial institutions and the regulating countries need to be transparent about risk factors. The former totally transparent with their regulators but not competitors and the latter with other countries regulators.

    2. License internationally used financial instruments. No more using the Caymans to concoct Credit Default Swaps etc. We can't have situations where there is not at the end of the day enough "real" money to cover liabilities.

    3. Risk analysis should be rethought and standardized so that everybody knows what the real risks are.

    4. Somebody - the World Bank (?) - needs to have a super-super computer based model that would allow them to plug in todays deals worldwide and then see how the picture looks when you change the factors. Derivatives seem to be like an unidentified time bomb at the moment. They raise the "tsunami flag" in the future. Nobody seemed to see this one coming.

    5. Have a Keynsian (in my world) "liquidity pot" where everybody chips in 1% of their global turnover for a rainy day when liquidity or severe regional recession creates problems. Then there is a no-cost liquidity available with no strings attached.

  • Comment number 24.

    what came out of the hearings today in the usa [greenspan et al] is the problem of a firm being 'too big to fail'.

    think about it. Competition means things should be able to fail. So if there are some players who are too big too fail they are effectively backed by the state.

    Such firms lock in market advantages that keep them in a dominant position e.g attracting investment and loans that smaller 'riskier' players [not too big to fail] would not.

    so the existence of firms too big to fail is a symptom of an unbalanced economy.

    No firm should be too big to fail ie drag down the state as well.

  • Comment number 25.

    A new world financial order, to order, as it were.

    At first I thought I'd accept Pauls challenge but then upon reflection, I realised that it would probably be a waste of time because :

    a) financially speaking, the world has 'speeded up ' and therefore any 'planned' global systems will probably be obsolete by the time they are implemented

    b) the world is more democratic

    c) the world is more interconnected e.g. the internet

    These three factors could combine to enable 'social lending' to eventually occur on a huge scale, effectively bypassing conventional institutions such as banks, central banks, World Bank, IMF etc.

    Better outcomes occur when people are enabled to directly interact.

  • Comment number 26.

    1. Get off debt based currency. It is a form of slavery.

    2. Wrestle control of the money supply away from private businesses (banks), dismantle the central bank system, let banks stand or fail on their own, and take away their powers of creating money out of thin air, and put control of the issuance of money back into the hands of the people where it belongs.

    3. Wean the system off fractional reserve banking. Look to the Austrian School for suggestions on how this might be done.

    4. Alternatively, switch over to an Islamic style of banking, or Tally stick system, or Colonial script, or any of the countless others that have been tried and have proven successful throughout history. In other words, any system that is not engineered to crash every ten years and completely implode every century, as this one is, is better than the current model.

    5. Do not look to the City of London for answers. Do not consult bankers for advice. They are the cause of the problem. Not the solution.

  • Comment number 27.

    #19 Citizen Thompson

    I understand what you are saying, but I believe there is another option, a third option or Third Wave. I bet someone could write a book on that.

    1) I believe undirected spending will not succeed.

    2) I believe we should just let it crash

    but 3) As it crashes (now) and is on the down phase. We bring another wave 180 deg out of phase with that one on the up phase. One down, one up the phasing creates stability.

    There has been a problem because the up phase of the replacement wave was not initiated before the down phase of the existing one. Even though it was known that it would enter a down phase years previous.

    Hope it is realised I do understand some philosophy of science, and I am using models to try and understand, explain and simplify reality, I understand the models are not reality.

    Instead of Paul's 5 bullet points I will do 5 specific posts. The first was #21 AN ECONOMIC TSUNAMI.

    My situation is I believe ecological systems with crash in 4 years. I have never been wrong in predicting such complex systems, (but I have had great teachers).

    I cannot save my life, that of my family, my friends or any ones on my own. So need to try and generate some consensus to solve the problem.

    Celtic Lion

  • Comment number 28.


    Certain mathematical procedures are fallacious. They can seem plausible but yield error.
    I suspect money, by virtue of its representational nature, has less degrees of freedom than pure maths, and manipulators have failed to comprehend its inherent limitations. This is why I ask: 'Do we know what money is?'

    I remember constantly being warned not to multiply apples by pears, but no one ever explained what happened if you did. Maybe now we know how it feels but still don't understand the mechanism involved?

  • Comment number 29.

    The king of the North (Ros, Rosh, Moscow), according to bible prophecy, is due to oppose Jesus' Jerusalem kingdom which does not now exist. We are told to watch for the thief in the night. The thief has been the U.S. financial schemes and we didn't know it. Flagging U.S. power & influence is lowering U.S. leadership while Moscow's aggressive foreign policy is moving it forward in prominence. Could it be that the U.S. is now on the slippery slope of decline, leading to the rise of Moscow to Kingship? If so, the return of Jesus to the vocal remnant of a defeated Israel is pending and the eventual uprising of Moscow against him leads one to expect these events to happen soon. Eyes open and understanding alerted should be acted upon by those who claim to be Jesus' own.

  • Comment number 30.

    Tell the fractional reserve oligarchs that they will be prosecuted and imprisoned for fraud.
    Then,force the politicians to:
    1.Ban political donations to MP`s.Politics should be about making everyone`s life better,not stuffing the pockets of the mega-rich with even more unneeded cash.
    2. Bring back control of money-creation to the people,and issue "labour certificates" for work done by the populace on public work programmes for renewable/clean technology/food/transport/housing,as well as other USEFUL occupations.
    3.Tear up the illegal European treaties(or simply ignore them!)and all the other "Alice in Wonderland" legislation.
    4.Write a new American-style constitution with guaranteed legal and territorial protections for our people.
    5.Disband all government departments that have been voted as "not fit for purpose" by public hearings.

  • Comment number 31.


    "As his jet criss-crossed the world east of Vienna, it must have seemed to Rothschild that he had been invited into an Aladdin's cave of hidden treasures. Witness his excursion into Kalmykia, a remote Russian republic run by Kirsan Ilyumzhinov, a charismatic leader who fought an election campaign on promises of providing a free mobile phone for every shepherd and a guarantee that Diego Maradonna would be signed up by the local football team.

    Ilyumzhinov confides in friends that he had been captured by aliens and has glimpsed a view of the universe not allowed most mortals. His political ruthlessness is combined with a sense of divine right and what rare visitors to his country call a shocking charm.

    Nat Rothschild certainly fell for it. On a trip to Tblisi he told the Georgian president Mikhail Saakashvili he wanted him to meet Ilyumzhinov. Rothschild's fascination for Kalmykia and its space-travelling president may, of course, have something to do with the fact that the tiny republic has vast resources of oil and gas."

    The Evening Standard 23rd Oct 2008

  • Comment number 32.

    As a citizen of a democracy who values the hard won freedoms and opportunities such a political system affords, I would hope to see a financial ordering which best underpins and protects the interests of free peoples Free people, if they are to remain free must know what is happening in the worlds of business and capital, be able to participate individually and collectively in them and have through their elected governments the capacity to regulate it in the community interest We have just seen what happens when markets are ill-regulated and banking practices opaque. We thus need a system based upon the need for maximum transparency of activity in both markets and capital and the application of effective, common regulatory and reporting systems across the democratic world. Such a system would build confidence, facilitate integration across boundaries and yet strengthen individual democracies.

  • Comment number 33.

    praxis22 @ 5

    pretty much spot on. i would rework them slightly as:

    1) systemic leverage. issue: excess leverage reduces the markets' ability to absorb losses when mistakes inevitably are made. remedies: direct regulation of capital adequacy of all financial entities (incl hedge funds, ins cos, spvs, etc) by central banks as a means of stopping asset bubbles, using a counter-cyclical target; overall limit on total debt/gdp ratio at say 150%; rework basel rules based on objective (if crude) non-market based criteria (can be ratings if rating agencies properly regulated), with heavy penalities for structured credit

    2) incentives. issue: massive moral hazard issues and excessive risk taking. remedies: reform of bonus system - bonuses to be paid out over 5 years, forefeited if an employee leaves their employer and if employer suffers losses; explicit criminal liability for irresponsible lending to unsophisticated borrowers; credit protection buyers must retain a stake in the underlying risk (except for cds market makers, who may trade within defined risk limits); reform of rating agency fees to delink them from volume of transactions

    3) balance sheet mismatches. issue: vulnerabilities that rapidly blow up in institutions' faces during a crisis. remedies: limits on (a) short term funding of illiquid assets, (b) asset/liability currency mismatches or lending in foreign currency to domestic borrowers

    4) transparency. issue: uncertainty about where losses exist mean that even sensible, solvent institutions suffer in a crisis. remedies: global adoption of ifrs with substance over form approach, central registry (and clearance) of all otc derivatives, strict rules on "off balance sheet" treatment including prohibition on bringing back on balance sheet; real-time (daily) registration of all transactions with national regulators.

    5) bretton woods 2. issue: need for more global cooperation to preempt crises and deal with them more rapidly. remedies: forums for central banks / regulators to regularly meet and exchange info (a la eu), global pact not to manipulate exchange rates and allow full flexibility, greatly strengthened imf, something needs to be done about hot money flows but not sure what

  • Comment number 34.

    #19 Citizen Thompson

    Just a quick one. I don't understand why anyone would have a problem with the end of capitalism.

    In America Goes Defcon 2 #17 Hawkeye gave the analogy of Copernicus proposing the earth orbited the sun etc.

    The paradigm of the State/Church was the earth was the centre of the solar system and the sun, planets and stars 'orbited' the Earth on crystal spheres.

    The state moved on. Governments will have to with capitalism, or when the ecological systems collapse, they will die along with everyone else.

    If a politician or industrialist came into work and a Commadore Pet or a ZX Spectrum was on their desk they would want the newest and best computer.

    I don't understand economics, I am an engineer/ ecologist so most of what is posted in these blogs goes right over my head.

    When I see economists or politicians on TV talking about it, it means nothing. We need to be talking about and making a better future, in my opinion.

    All I know is what ever is used for running the planet is not working. So we need a better way.

    If we get through the next 4or5 years, people in the future will look back and go "capitalism, what were they thinking".

    It will be classed along with crystal spheres as barking mad and barmy ideas.

  • Comment number 35.

    1. Allow Governments to take back control of essential services (especially in the third world).

    2. Encourage diversification and discourage agricultural monoculture in third woreld economies. Often these are "imposed" in order generate cash.

    3. Allow developed countries to "protect" inefficient but locally produced goods by restricting imports.

    4. Make international help dependent on controlling population.

    5. Abolish the WTO

  • Comment number 36.

    KISS (keep it simple ...). Here are some
    suggestions, in no particular order.

    1 Why continue with floating currencies? Instead just set all exchange rates at purchasing power parity (adjusted on a regular basis) and keep them there.

    2. Stop trying to use interest rates as a way of managing economies. Use things like fiscal policy, control of capital ratios, etc. Peg real interest rates in each country at a fixed amount (1 per cent?) above inflation. Note that this and (1) above are then self-reinforcing.

    3. Ban off-balance sheet accounting. And get rid of dodgy offshore tax havens.

    4. Ban CDOs, CDSs, and indeed any form of derivative that isn't absolutely necessary. Or if you can't ban them, then tax them as if they were a form of gambling (which they are).

    5. Nationalise the pensions industry and turn it back into something like SERPS (I can't help suspecting that the move from SERPS to private pensions is one of the causes of the excess liquidity in the past few years).

    6. Reverse the ever increasing gap between the rich and the rest of us by more progressive tax regimes. If ordinary folk were paid better, they wouln't get into so much debt.

    7. Force all the private equity firms to immediately re-float the companies they've bought. The private equity firms may then go bankrupt, but at least the floated companies won't be saddled with debt.

    8. Break up the banks into smaller units (separate commercial banks, mortgage banks etc), and don't let them develop interdependencies on each other, so if any one bank, or even any one sector, fails it doesn't cause the chaos we're seeing now.

    9. Forget the "financial services" industry. It never really created wealth - it was just a tax on the rest of the economy. Get back to creating real, useful goods and services.

    10. International trade should no longer be considered as an out-and-out good thing - especially considering the environmental impact. Also as almost any country now has the infrastructure to produce almost any manufactured good, there really isn't any concept of specialisation any more. We still need trade to buy the raw materials we just don't have, but that's really all trade needs to be for. Don't discourage trade, but don't treat it as something sacred either.

    11, Don't ever let a housing bubble like this happen again. If hose prices look like they are getting above 3-4 times income, override the planning laws and make extra land available for housing.

  • Comment number 37.

    'SWAT analysis'? Do you mean a Strengths (S), Weaknesses (W), Opportunities (O) and Threats (T) analysis? I'm not quite sure how one would do a SWOT analysis on a set of ideas, but I'm quivering with anticipation.

  • Comment number 38.

    Short term list:

    a neo-Bretton Woods, meaning

    - 'flexibly' fixed exchange rates = range
    - ban on 'break the bank' currency short selling (sorry mr Soros)
    - bonus payments for financial sector to be taken minimum of 5 years down the line and based on medium term analysis of their 'real’ performance; basic salary levels to increase to reduce proportion of income based on bonus culture
    - Domestic credit and lending to be curbed: consumption will suffer in short to medium term as Anglo-Saxon populations adjust but adjust we will over a 2-7 year time span

    Long Term single solution:

    Global level of governance-governance. Global economic management; Global currency; Global 'regional policy'; global minimum wage; Global senate or similar to take executive decisions; Global supreme court type mechanism.

    OK it is utopian in a Roddenberry kind of way but its the only way to deal with uneven global development/ disparities of income between continents and within Nations/ ecological crises and the potential for religious conflict and resource-dependent conflict: these last two quite probably the cause of wars in 20030- 2070.

    We are into age of trading blocs and global movements of both labour and money. The next logical step is the global governance step.

    I'd be very surprised if we don't have this by the end of the century.

    Now wait for the spiked/ Adam smith anti state libertarians to bite along with the unreconstructed class warriors and 'anti capitalists'...

  • Comment number 39.

    1 rule.

    #1 Practical common sense must be used at all times and in every situation.

  • Comment number 40.



    Strengths Weaknesses Opportunities Threats


    Special Weapons and Tactics

    Perhaps Paul has got a hidden agenda for a new world order.

    While on the subject as a resource.

    In 2004 the BBC did a weeks programming on climate change based on two pieces of work.

    One was the climate change is a greater threat than climate change risk assessment.

    They wheeled in the Government's Chief Scientist who they attributed the work to publicly.

    News planning accepted I was the original author but told me that it was all about ratings.

    I wasn't a media personality, but the News Editor accepted I knew more of the background etc.

    This was the other source a report to the President from the Pentagon.

    It is by West Coast scenario planners. I have been in touch with some of them and done some work on planetary engineering for them.

    Yes Barrie

    This is a a good resource if we are scenario planning. This is a background on scenarios the US military are looking at and advising the President on.

    If you haven't read it I can recommend it. If you don't want the written work, just go straight to page 17.

    An Abrupt Climate Change Scenario (PDF)

  • Comment number 41.

    1. Freedom - workers councils to take control of production, i.e. sieze the means of production

    2. Democracy - workers councils to take control of production, i.e. sieze the means of production

    3. Equality - workers councils to take control of production, i.e. sieze the means of production

    4. Community - workers councils to take control of production, i.e. sieze the means of production

    5. End of Wage Slavery - workers councils to take control of production, i.e. sieze the means of production

  • Comment number 42.

    Oh, come on chaps.

    It's not like a BBC economics editor and all his sub-editing colleagues on a business/news show can be expected to be familiar with every obscure financial industry term used.

    And maybe it is correct?

    'Spreading Whispers And Theories'?

    I wonder if they have read this yet?

    Actually, I am wondering if it's more SWAG:

    'So What, Anything's Game!'

  • Comment number 43.

    I think he meant CWOT, Complete Waste Of Time...

    It'll be business as usual in ten years.

  • Comment number 44.


    Paul or researcher

    Do you know what time Alan Greenspan spoke in Washington BST yesterday

  • Comment number 45.

    So, that's that sorted then. And what then?
    Don't get me wrong, I don't think you're wrong but first we need some workers to do the seizing and then some production to be seized. I don't mean to imply that you are living in the past but it perhaps needs a slightly less 1917ish response.

  • Comment number 46.


    Interesting link Celtic. Anything later than 2003? I love the title - almost a Koan.
    Very short on ocean and air navigability consequences.

    If we end up in small numbers, in the caves, fighting with physique, plus hand/eye weapons, our big brain will be better applied.

  • Comment number 47.

    Some good ideas are coming through, so some of my contribution picks up on them.

    But sending it to Treasury stuffed shirts? Better to air on Newsnight, or both.

    And how far are problems and solutions within or beyond Treasury?

    But here goes anyway:

    Nationalise all banks.
    Clearly banking is too important a part of social fabric to be left to shysters. Financial business profit is now made primarily in the unhealthy margins - information gaps, small time difference gaps, gaps between what a corp is worth and what it says it is worth, the difference between what Brown has on the books and off the books (what sort of model is that, in terms of business ethics, and (E) Community spirit?!??!). Its not good enough that banks are just being 'urged' or 'encouraged' to utilise the national support they've been given in the intended way. If that's the best that can be put on them, then nationalise them proper. This woud need a complete revision/abnegation of all international liberalisation commitments. Fine.

    Use this crisis to regain and reassert the social in social services.
    Social services like health and education are also too important to be left to profiteers. Reassert goverment control over the PFI schemes, without the heavy compensation penalty of contract breaking, that would normally prohibit this. If we own the lending banks, the loans for them can be foreclosed and the projects can be reasserted as public projects. Hardship in times of national cash shortage? Probably, but not as much as paying 4 - 5 times the cost through private profiteering.

    Expose the real nature of trade agreements and their purpose, and respond accordingly.
    They are not about trade, which can happen anyway, but about tying governments (ours is more than willing and leads the charge) into restrictions on their policy space, restricting regulation in the interests of people, in favour of legalised frameworks that hand all power, access and control to Multinational Corporations. Halt any advancement of this corporate-welfare trade agenda, and revise what commitments have been made - including the commitments extracted from other countries by the EU in favour of transnational corps.

    Either get out of the EU, or seek to change the rules.
    What we signed up to is not what is being progressed now. For one thing, we need to get control of migration and labour migration at the national level. This is not possible under EU rules. Importantly, EU membership also ties us into commitments on labour liberalisation from the rest of the world. Also make explicit the liberalisation continuum from EU directives to international trade agreements.
    The Lisbon Treaty allows for withdrawal from the EU (just remarking - not endorsing Treaty)

    Initiate Direct Democracy - referenda
    The 4 year orgasm of voting gets us nothing, especially with 3 big business parties. We need, and in the coming times, will really need, to be able to make national decisions through this mechanism - or else consider whose hands the decisions will be in! However, the referenda mechanism needs to be supported with opportunities for public debate to avoid a situation where referenda voting is informed by central (party) spin and a p-weak media. Everywhere has a town hall. All town halls should be public debate venues before referenda - and ongoing.

    I am sure the Treasury will have all this in place in the next few weeks.

  • Comment number 48.

    What is required for a New World Order?

    This depression is global not local and no country can find their way out of it by taking measures which are not matched by all the other countries. It requires a synergy of Free Market principles and Social Democracy which can mean that China/India can sit at the table with the USA/EU without the debate being poisoned by dubious human rights claims and double standards. The main sacrosanct rights are property rights where there needs to be proper compensation for confiscations for the public good and a rule of law to ensure that the weakest members of society can get redress for wrongs. All our western societies have failing in these areas – so we need to work for a new high common standard.

    My five points are not the conventional money supply type of points but are addressed at technologies which if universally deployed have the potential of transforming the world society:

    1.Biometrically secure identity for everyone. An international register based upon something which is totally unique and secure (e.g. retinal eye pattern) which enables local societies to give services to those that are entitled to them without “double dipping”. The freedom argument is overshadowed by the requirement to provide the services universally and fairly to those who are in need of them. (This plan would be particularly unpopular in parts of the north of England where the dependency culture is a way of life. But it is central to a universal global health service and social security systems).
    2.Real time accounting for businesses – posting of all business transactions and payroll in real time onto government websites so that the activities of the economy can be posted in real-time. With publication of personal tax returns.
    3.Deployment of GM crops and technologies – globally. This depression provides us with an opportunity of getting these technologies deployed without the ignorant clamour of the environmental Luddites. A new Green Revolution will place the world on its path to universal prosperity.
    4.Phased removal of immigration controls – As part of a global settlement there needs to be a removal of immigration controls which act as tarrif barriers between nations. This needs to be coupled with amnesties for illegal immigrants in the developed nations, linked to the deployment of universal identity services.
    5.Curtailment of unjust and inappropriate intellectual property rights – a “rowing back” from the granting of copyright for too long a period and for too extensive rights. Copyright clearance is a clog on the development of new technologies and products.


  • Comment number 49.

    44. Do you know what time Alan Greenspan spoke in Washington BST yesterday.

    it was on bloomberg radio [free on internet] from 2pm uk time. There are lots of such senate hearings broadcast with lots of interesting info on the back story that never makes it to the 'official' press.

    if anyone wants an education i'd say listen to those hearings.

    anyone who listens to bloomberg radio for a week is going to know more than your average politician. they don't dumb it down like broadcasters in the uk do. so one can get up to speed quickly.

    such a study would also expose why some of the ideas on this blog show a lack of understanding of what markets are for and how they work. Markets provide a service in society providing risk capital to business to create wealth. One part of the market had no rules and so crashed. Now there will be. End of story.

    All the 'sweep capitalism away' rhetoric is just swp wishful thinking hoping they can use the financial illiteracy of the public [and politicians] to deceive them with bogus ideas.

  • Comment number 50.

    stayingcool (#47) "Nationalise all banks."

    How? Some of them are international.

    As to Lisbon, as I see it, the UK and its Civil Service has been intentionally undergoing a fragmentation or regionalisation for decades (presumably to reduce the size of administrative regions to populations of ~6m (EU NUTS) so to make them more manageable?). Can this long-tem, planned destruction/anarchism/devolution be reversed? Is the administrative infrastructure still in existence to do so? Has the Civil Service been too weakened by Market Testing, PFI etc?

  • Comment number 51.

    I think we could help the UK economy by exporting all our problems.
    Set up old people homes in Gambia which is the only place that an old age pension is worth a lot of money. (This is not prejudice as I am over 60)
    Send the bankers to the Isle of Wight and destroy the ferry.
    Send our political elite to the International Space Station for a long period of meditation and contrition for their actions.

  • Comment number 52.


    They are going to teach the kids about tab 'A' and slot 'B' but until those kids learn that status is not ability, charisma is not integrity, might is not right and clever is not wise, it would be better if we applied plan 'C' en masse.

  • Comment number 53.


    Westminster is fundamentally without honour.
    Westminster politicians exhibit contempt for the electorate.
    The Westminster ethos deters individuals of stature and competence.

    Short of gunpowder, Westminster would appear to be a self perpetuating, unending, block to radical attention to Britain's plight. Since the Money Mess arrived, all manner of approaches to recovery have been posted here, but first we need to address the root problem - we are ill-governed, and can do nothing.

  • Comment number 54.

    Consider me a "me too" for most of what benagyerek (#33) said, at least his first three. My version :

    *Oversight, not regulation - move away from specific regulations to a more general oversight - it would have saved Northern Rock, at least for a while. And half the spending on internal compliance depts would be better as a levy to fund the FSA properly so that they could employ poachers-turned-gamekeepers who had a clue what they were about. Perhaps merge the regulation of high finance with the SFO, and leave the FSA to handle the more consumer-based stuff?

    * Only allow securitisation of mortgages of less than 3.5x the income reported on the tax return. The mortgage originator has to take the risk on anything more dodgy. This would allow some flexibility and innovation, but reduces the systemic risk. Might also increase tax revenues....

    *CDS transparency - someone needs to be in a position to take an overview. If the DTCC isn't willing to expand its role as a warehouse, perhaps the World Bank could sponsor an "anti-DTCC"? And we can't take an overview of stuff we don't know exists, so get rid of stoopid laws like CFMA that allowed vast quantities of stuff to exist beyond the realm of oversight.

    * Mismatched funding. Aiming for loan-deposit ratio of 70% in the first instance and then perhaps tighten that to 80% in time would be the quick fix, but perhaps the pointy heads could work out something more sophisticated. The danger is of creating something that could be gamed like VaR was.

    * Abolish currency/exchange rate regulations in the BRIC countries. The distorted value of the yuan has been a big factor in all this.

    * Castrate any City geek found using a normal distribution in a model. Actually just block their internet connection, that'll stop their sex life. It's always the black swans that get you, whether LTCM or CDS, they never model the systemic risks. Perhaps all versions of Excel in the City should have a special Taleb patch applied, modifying the shape of the normal distributions they generate?

    Just as a comment on the perverse incentives thing : we should (generously!) reward genuine outperformance rather than floating on a rising tide, long-term not short-term, make people suffer as well as benefit, they'll take fewer risks. No bonus or commission starts until a product/deal is 25% through its lifetime, it's tied to performance relative to a suitable benchmark, up and down. For instance PDMRs in listed companies should get shares not one-way-bet options, performance should be judged by shareprices relative to a suitable group of comparator companies over 3-5 years, each comparator company should be approved in separate sub-resolutions at the AGM to stop people taking the mickey.

    On leverage, abolishing the net capital rule for the Big Five/Two in April 2004 was clearly dumb, but it's more about the quality of what's levered rather than whether the leverage ratio is 8% or 10%. VaR doesn't work, mark-to-market doesn't work - I guess suspend Basel II until the pointy heads come up with something better, the devil is all in the detail and I'm not really qualified to comment on that.

    Finally Paul - an OT comment. Please can you stop your colleagues talking about the "falling oil price"? We're in Britain, we use sterling - and the soaring dollar means that the sterling oil price is if anything going up!!!! You might want to do a piece on that - massive amounts of money are being repatriated to the dollar bloc, although whether that is US money, Gulf money or Chinese money is moot, I suspect the latter two but we can't tell because of the fixed(ish) exchange rates.

  • Comment number 55.

    1) Listen to congressman Ron Paul.
    2) Listen to Austrian School Economists.
    3) Consider introducing new competing gold/silver backed currencies.
    4) Phase *out* the central banks (Fed, IMF, ECB etc.) and let the *market* set interest rates with a very restricted fractional reserve banking model (Muslim banking is not a bad model !)
    5) Allow and positively encourage *local* currencies and barter systems to be created to allow for local economies to become more robust to wider/global economic changes. This is a MUST, think globally, act locally - we must understand that globalisation across *all* markets is a risk (as we have seen), Yes to global trade, but such heavy global interdependence has shown itself to be rather problematic and of great risk to the whole world.

    No doubt the NWO plan is for world government, world fiat currency and a microchipped RFID tagged population. We must reject such a plan at *all costs*.

  • Comment number 56.

    1. The current financial crisis, like many before it, has resulted from too much debt. But when debt is assumed, the risk/reward balance is biased towards reward - there is no limit to the gains but the relative safety of bankruptcy on the downside. No debtors prisons these days!

    2. Money accumulated from earnings, either saved or invested, is indistinguishable from money accrued from borrowings.

    3. The risk/reward balance for investment of money saved is equal. You can make profits but can also lose your money. Contrast this with borrowed money where you are effectively losing someone elses money.

    4. This assymetry in the risk/reward balance between saved and borrowed money punishes savers in favour of borrowers - ultimately by either default or inflation.

    5. Possible radical solution - create two parallel currencies, one based on money accrued from past earnings. The other representing future earnings bought forward to today (borrowings). Then risk/reward can be addressed for each.

  • Comment number 57.

    Nick Lesson was able to drag Barings into the abyss because the greedy directors of that Bank, along with a BofE official, allowed the firewall between the retail (deposits) part of the bank and the investment part to be removed, thus allowing Lesson to extract a deady amount of wonga.

    In a similar fashion, the exotic derivatives part of banking activity was not ring-fenced from the rest of the bank thus again allowing them to side into near oblivion in a number of cases.

    Whilst at present, the conventional banking model still has enormous sway (although I believe its days are numbered), then the regulatory side must be beefed up, as indicated by the impressive Lord Turner.

    Or it will simply happen all over again and the 'little guy' will pick up the tab again ... as is happening now.

  • Comment number 58.

    Only 5 bullets, and so many politicians to choose from...

  • Comment number 59.


    benagyerek (#33) That all sounds good, but how can it ever be done in practice? Given that the FSA supposedly regulates something like 29,000 financial companies isn't 'light-touch' regulation (effectively hands-off self-regulation) inevitable? Recently they were cutting staff!

    Most people here write as if governments and agencies COULD do these things. But for years we have heard the arguments of the Austrian School anarcho-capitalists and Monetarsts of the Chicago School that regulation can't be done logistically and that one has to trust market-forces to set value. Isn't that's why Greenspan's recent urbane admission that his model was flawed is so alarming? The markets have all gone international and governments have ben elected which take a hands-off approach. Now people are taking as if Pandora's evils can somehow be put back in the box. How could that possibly be done without world government? National governments being largely 'hands-off' anyway (except for China, N Korea and other evil-doing states)?

  • Comment number 60.

    #27 My Post

    My apologies for omitting info. My weaknesses in JadedJeans verbal/spatial spectrum are most definitely at the writing end. I had sine waves in my head which I was using as the analogy.

    #23 Gang of One

    super super computer. Yes or linked to network.

    In the proposal to use the Dome as a global environmental centre this and the attendant environmental monitoring systems had a proposed budget of £400 million.

    It would be utilized slightly different than you suggest, but the out come should have been the same.

    The total budget over I believe 5 years for the UK climate models which contributed to the UNEP IPCC Nobel was only £25 million.

    Though its not just the processing it is the way the models and systems are created and set up.

    The present economic situation could have been done on the back of an envelope with the right models.

    #43 Book him Dano

    Re Greenspan. Thanks for the timing I was wondering if we got in here first with the Tsunami analogy. If this is an alternative option.

    The timing and negation could have given Paul some power to his elbow, in presenting our option.

    Neil Robertson made an interesting post (to me anyway) on the Newsnight 24 October Web team #18.

    This was from Greenspans evidence, which I picked up on but not as diligently as Neil.

    "Partially ... I made a mistake in presuming that the self-interest of organisations, specifically banks, is such that they were best capable of protecting shareholders and equity in the firms ... I discovered a flaw in the model that I perceived is the critical functioning structure that defines how the world works. I had been going for 40 years with considerable evidence that it was working exceptionally well. The overall view I take of regulation is, I took an oath of office when I became Federal Reserve chairman. I'm here to uphold the laws of the land passed by Congress, not my own predilections."

    As far as I am aware, and stand to be corrected Greenspan or at least economic policy was influenced by the work of John Nash. I believed his work was flawed, in that it could only work with infinite resources, which we don;t have.

    Any policy would automatically crash due to overshoot.

    This is from Limits to Growth, based on Forrester's earlier work.

    My view of Nash from last year

    #7 Virtual Silver Lady

    Double talkers, backstreet walkers
    At every turn
    Seedy motels and no star hotels
    Still I had to learn
    That the one shining thing in my life
    Was the sweet love I had with you
    And Honey, you're my last hope
    And who else can I turn to






  • Comment number 61.

    nice one Paul.

    By the way...its SWOT analysis. The other one is Special Weapons And Tactics....mind you with all this nationalism and false bonhomie about being serious on global coordination, maybe you will need the SWAT teams after all.

  • Comment number 62.


    "I'm determined we'll do everything that we can."

    That is about as far as you can get from: "If I fail to get us out of this, I will resign."

    Determination is subjective.
    'Everything that we can' has a minimum interpretation of 'nothing'.

    This is political-speak at its most insidious. The BBC should pounce on it whenever it appears, not let it slide as an acceptable response.

  • Comment number 63.


    barriesingleton (#62) I've asked this question several times and to date, nobody has answered it:

    Liberal-Democratic countries have been voting in 'anarchistic' governments for decades which have ... well, as mandated, been minimally governing. They have been shrinking (or otherwise disabling) the Public Sector whilst enacting deregulating legislation ostensibly to boost the free-market economy, and especially financial services. That being so, now that this light-touch approach has been revealed for what it is (i.e. corrupt, exploitative, socially divisive and internationally contagious/damaging), what is it that electorates expect their politicians to be able to do? The politicians are all free-market anarchists and hostile to statism. They don't know how to do it. These are the very same electorates which have spent decades vilifying authoritarianism as fascist whilst lauding political correctness.... Now some here may quibble with some of that, but it's largely true.

    Unless there is a dramatic change in the responsibility of the electorate for what it has tacitly asked for from politicians, nothing, CAN change.

  • Comment number 64.

    Pensions are going to be a big topic for the New World Order

    I think that early next month (November) the media are suddenly going to wake up to the new pensions time bomb which has just detonated on every stockmarket in the world. Here is the problem: Anyone on an final salary pension is going to find that their company cannot make a large enough investment to fund it AND stay in business at a reasonable level of profitability. It was already a problem with the stock market on a rising trend because people were living longer in all the developed nations. But with the stock market due to drop next month to 50% of its previous value and stay there for a protracted period the final salary pensions problem will become critical. In the UK and in the USA no-win no fee lawyers can demand compensation for their pensioner clients and, on precedent , they are entitled to get it. But to pay it's pensioners the company will have to cripple itself – possibly by Chapter 11 reorganisation or worse – by denying wages and dividends to its current workers and shareholders so that it can pay its pensioners.

    One solution – raise the pension age to 70 as part of a global emergency measure – with abolishing tax breaks for pensioners on early retirement and a cut-back in current pension benefits for young pensioners. Not popular with pensioners – but better than dying.


  • Comment number 65.

    AGE OF CHANGE (of name)

    Hi JJ! In your next incarnation please come back as 'Brutus' then I can say; "The fault dear Brutus, lies not in our stars but in ourselves."

    I know - I know. We are just going round in circles. I think someone said our only hope is some superior aliens turning up. But I have a feeling they would fall apart laughing like the ones on the Smash ad, and fly away.

    Everyone is having too much fun inventing levers to pull. All the best toys have lots of buttons and levers that don't really do anything.

    When IQ doom couples with nurturing/schooling doom and animal hierarchies win out over cerebral ones, the silk purse full of debt looks exactly like a sow's ear!

    Shall we count three and give up?

  • Comment number 66.


    Hey Shyster (#64) what do you know about being dead? That is my next career move, and you seem to be suggesting that being dead is somehow second rate. You're not one of those despicable deathists are you?
    I have a lot of time for being dead. I used to be a sperm and an egg, till my parents (allegedly) were careless. I have not had a moment's peace since. Cell division, DIY brain wiring, limb-bowel-and-language mastery, cowering from Hitler, institutionalised learning, work, parenting, diseases of old age . . . You check with those pensioners before you impugn dying!

  • Comment number 67.

    I would like to quote from Thomas More's Utopia written 492 years ago
    'When all property is private and the whole emphasis is on money, it is difficult and almost impossible for the republic to be governed justly and to flourish in prosperity'.
    Not bad for the man beheaded by Henry VIII nearly 500 years ago. Perhaps we never learn and never will.

  • Comment number 68.

    #47 Staying Cool

    What to do with it raises lots of options.

    What do we mean by the treasury?

    Is this the Government ministers or the civil servants.

    There are some good people within the Treasury. I was at one conference and taking on the Chilean Merlot after I mentioned my influence was Jacques Cousteau, the conversation ignited all were into marine ecology, scuba diving, oceanography etc. These I thought would be 'suits'.

    I agree with you about doing a piece on Newsnight as well. I would go further a make it into a reality series about the actually doing it.

    Going to the Treasury/Government should also go into Paul's SWOT analysis under threats.

    From years of experience and in the case of the Dome, 'insider advice' at various conferences. It is not always a good plan to go to an organisation with a good idea for something they should be doing.

    The better the idea the more likely it is to be crushed destroyed or buried. In order to protect the integrity of the organisation. It removes another datum of excellence to aspire to, or be compared to.

    I desperately tried to engage the BBC in the idea for the environment centre at the Dome. The media aspect was a major part of the proposal.

    I still believe the BBC missed an opportunity. They seem to have spent the years since reporting on the negative consequences.

  • Comment number 69.

    #46 Barrie

    First Barrie and JJ. I just posted some David Soul lyrics for Silver Lady. #60

    Here are some from the song next to that one.

    "Don't give up on us, baby
    We're still worth one more try
    I know we put our last one by
    Just for a rainy evening
    When maybe stars are few
    Don't give up on us, I know
    We can still come through "

    from Shakespeare to Soul.

    Thanks for the comment on the link.

    More modern stuff is the 2007 UNEP IPCC 4th assessment.

    Having worked on it and followed it through. I liken it to taking a car for an MoT, climate change being the tyres. Everyone got so obsessed with them they forgot the brakes or steering etc.

    I still maintain that ecosystem collapse with take us out before the climate only scenario.

    There is a steady drip feed slowly bring about the danger of climate change further forward.

    I don't really want to get into the debate as I believe ecosystem collapse is the clear and present danger.

    If you haven't seen this site it is highly recommended, it is presented in a humorous way but the concepts are serious.

    By resolving the threats to global sustainability, turns them into benefits.

    Whatever Paul does with Celtic Lion's contribution, Celtic Lion will seek to address these threats for the common good, or just because I love this planet.

    Whatever, I hope people will support the initiative, for their own benefit.

  • Comment number 70.

    Only 1 bullet point required:

    Once and for all make it ILLEGAL for any political entity to accept donations from anyone or anything. All political funding to be extracted from general taxation. It simply *must* be possible to work out an equitable system to achieve this. The WHOLE PROBLEM is one of bent politics / bent regulation / bent everything due to bent political funding. Both here in the UK and (especially) in the US. That's the core problem, and therein lies the core solution. No regulation will ever work in extremis until you fix the underlying corruption. Which is easy peasy - fund politics out of general taxation. No lobbyists, special interest groups, incentives to look the other way, etc, etc.

    Let me know if you want my hourly rate, it sounds like a fun problem to think on.

  • Comment number 71.


    barrie (#65) For years we've listened to commentators on Newsnight and elsewhere extolling the merits (if not necessity) of small-government and deregulation AS freedom and the formula for properity whilst we've also watched statist governments being either undermined politically through NGOs, presure groups and the media, or in some cases, militarily attacked. No impartial observer can disregard the fact that the anarcho-capitalists/monetarists/neoconservatives equate freedom with lack of regulation, or that they tend to come disporportionately from one small ethnic group which is historically notorious if not infamous for promulging what in former times was just regarded as predatory behaviour, subversion or sedition (rather than 'internationalism', which clearly requires de-nationalisation of states i.e groups and ultimately extended and even nuclear families). Note that I say disproportionately from, as it is not coterminus with the group per se by any means. What concerns me is that this minority groups' heterogeneity itself is exploited by those who subvert the interests of other groups by asserting that criticism of their predatory behaviour (which clealry has adverse consequences for others) is irrational hostility pointing out that they are protected against such discrimination by law.

  • Comment number 72.


    Your circumlocution a tour de force JJ. I can only wonder if you type through gritted teeth or playing-smile. Cleverly done!

    This state of affairs is just another indication of mankind's vulnerability (IQ aside) to mass-dominance by a variety of routes. Being competent is just too much to ask of beings born so incompetent, and tasked with wiring their own personality circuits, even before bowel and limb expertise.!

    You can see how the Cathars concluded that the Devil created us, and that God is having a hard time doing anything about it!

  • Comment number 73.

    There has to be increased democracy and a more informed public in this somewhere.

    As soon as its too far away, or with too many layers between the actors and accountabilty, or too complex for people to understand or perhaps for the media to understand and explain, or the whole lot - it is opaque, and we get fiddled.

    Mandelson's antics as EU Trade Minister have all these attributes. Trade negotiations, the lobbying and UK government input are all secret. Yet the results override all the busybody stuff in the UK parliament.

    We need more actual democratic processes - that eliminate any possibility of corruption, with transparency and with recall.

    Report back to the constituency periodically, whatever the constituency, and if they don't like it you are out.

    And stop the handing out of House of Lords seats like sweeties - another clear form of corruption. For goodness sake - it is part of the law making machinery!

    It should be a privilege to be a representative, not a gravy train.

    And we have to get rid of class as the great divider. We can achieve nothing divided by class.

    These rantings might seem remote from the price of shares in fish, but they underly the problem of the free hand of the market, and the corruption inherent in it. That's what it has been, though no one is using the C word, at this stage.

    As this country has been run for the benefit of financial businesses in London and Edinburgh, we need deep systemic changes to change that model.

    Our families made huge systemic changes in '47. Now we are the people.

  • Comment number 74.

    Its strengths and weaknesses
    opportunities and weaknesses

    I agree the layers should me reduced.

    I agree about the public being more involved.

    I think this is a crux. Do the public want to be informed, do they care, would they rather someone else just get on with it for better or worse.

    How are the public informed truthfully. Even programmes such as Newsnight only promote a very small bubble of ideas. A narrow perspective of political and economics, which to me relates very little to the real situation of the world.

    Solutions are sought within a paradigm, which to me as a member of the public, offers none that are workable or practical. Just an excuse for a self indulgent power play for protagonists divorced from the challenges of the real world dynamic.

  • Comment number 75.

    These are the times
    and we are the people

    And that is all there has ever been

    Everything is possible

  • Comment number 76.

    #75 Staying Cool


  • Comment number 77.

    1) Design a system that is pro-active and not reactive, that does not depend on public and private debt and that rewards long term gain, NOT short term paper profit.

    2) Create an economic system that recognizes the finite nature of natural resources, such as oil, fish, minerals and forests. Acknowledge that it is NOT a benefit to remove these resources simply to create a temporary paper profit but it IS beneficial to preserve such resources. For example, removing a tropical rainforest benefits a lumber company’s balance sheet, but it impoverishes the rest of humanity through loss of biodiversity, climatic disruption, soil erosion etc.

    3) Create an international “ Marshall plan” that will cure, once and for all, over-population, poverty and environmental destruction. Begin by creating an economic system that will reward consumption of renewable energy sources and penalize use of fossil fuels. Governments and banks should create a “moon-shot” program to develop self-sufficiency in renewable energy resources within a decade, for example by replacing conventional oil with oil from algae.

    4) Create an economic system that ensures finite resources are not exploited to destruction, for example fisheries. The answer to catching more fish for the long term is not more fishing boats (or quotas), but is based on an economic system that recognizes the in-situ value of the resource rather than the exploited resource.

    5) Above all, recognize that we can't go on the way we are. A return to the status quo is a recipe for long-term ruin.

  • Comment number 78.

    #77 Snodgrasse


  • Comment number 79.

    Avoiding the Next Wave or Learning to Surf

    In #21

    An Economic Tsunami: I don't think so.

    The analogy of a Tsunami wave was used. Economic assessments are using the Tsunami wave to describe what is happening.

    There views in the main are misleadingly dangerous. What we are experiencing now is recession or depression. This is the sea going out, disappearing.

    This is what happens prior to the destructive Tsunami hitting the coast. As far as I am aware no one was killed on Boxing Day 2004 by the sea receding. It may have stop some fishing boats working leaving them 'high and dry'. But didn't kill the crew.

    The killer wave is yet to hit our shore. When it does then there will be death and destruction.

    From 4 years ago fresh in the collective consciousness of the world, is the knowledge that before the destructive wave hits there is recession.

    The wave that will kill us is 4 years away in the future. There is a creeping event horizon being brought nearer to us regarding our 'extinction' due to the consequences of climate change.

    I was one of the scientists involved in the setting up of the new generation of UK climate models.

    Climate change is good for politicians and the media it is a small convenient sound bite that gives an impression that they know what they are talking about and are concerned for the environment.

    Climate change is like the tyres on a car. If that is the focus of your obsession regarding an MoT. You will miss the fact that the brakes not working will kill you as your car hits the truck ahead before the tyres give way on a wet corner.

    Economics in one simple aspect takes the stability of the Earths ecosystem and converts them into goods and services. This creates stability for the economic system under the current dominant paradigm.

    But at the same time destabilizes the ecosystem. This is reaching a point where the ecosystem which supports the socio-economic system is on the point of catastrophic failure.

    Some economists today criticsized Gordon Brown's spend spend spend as dangerous. In that, in the future it will create demand on top of demand, in having to pay back the borrowing. This they believe will cause future problems for the economy.

    In previous posts the comment by Einstein that you can never solve a problem at the same level
    of consciousness that created it, was used.

    I would say to Einstein that very often the problem at one level of consciousness is a consequence of causes at another level.

    What Gordon Brown's policy, of undirected Keynes type borrowing to spend, will do is increase the demand on ecological systems further still. Guaranteeing a catastrophic failure sooner than later.

    The economic earthquake Gordon Brown proposes will trigger an ecological Tsunami which will obliterate the socio-economic systems.

    The consequences will not be billions lost from stock markets, but billions dead. Not that there will be anyone to do the counting.

    This is the threat, but it is also the opportunity to build a new world order.

    It ain't what you do its the way that you do it.

  • Comment number 80.

    Celtic Lion,

    re: ...billions dead

    I was fortunate enough to meet a notable evolutionary biologist a few years ago, when the topic of impending environmental collapse came up. Asking him if he rated our chances of survival, he merely declared "oh, the human race will be fine, we may well see 90-95% of the world population wiped out, but to an evolutionary biologist that's still pretty good odds of survival".

    I'll drink to that.

  • Comment number 81.

    #80 Hawkeye

    Billions Dead: The Optimistic Scenario

    I was taught by a notable evolutionary ecologist, so I can deduce it was not the same person.

    I appreciate that many politicians and members of the public are willing to take the chance of being in the remaining 5-10%, but I feel this premise due to its importance needs expanding upon.

    With so few remaining and with a general collapse of the social economic system, those surviving will probably be living a subsistence existence. The 'Mad Max' scenario as I term it.

    Maintenance of existing structures with be near impossible.

    There are at present 1000's of nuclear reactors in various forms, whether for commercial power generation or for military purposes.

    Add to this toxic chemical plants, and dumps.

    What we have is the real potential, accompanying socio collapse, of massive poisoning of the bio-sphere.

    This could lead to the extinction of all higher life forms, with the possibility that life will have to evolve again possibly from bacteria in geo-thermal vents etc, in conjunction with the evolving biospheres ability to support higher life again.

    Life, on a cosmic scale, can drop in and out of existence rather like on a quantum sub-atomic scale Hadrons, Quarks, Strangeness etc can pop in and out of existence from the background fuzz of the multi dimensional probability matrix we could refer to as the Universe.

    What is concerning me is that economists such as Gordon Brown and other world leaders are willing to gamble making extinct all higher life forms on Earth for 100s millions years, just to try and stabilize the economy in the short term. Yet the media including Newsnight is strangely quiet on such a fairly significant story.

    We could resolve all the problems with effective win win win scenario planning, but this is up to now being ignored.

  • Comment number 82.

    5* and 9* praxis22





  • Comment number 83.











  • Comment number 84.





  • Comment number 85.

    Two suggestions either of which would transform the system and make it work for "the many not the few" if you'll forgive the expression.

    Network Banking

    Shut down the tax havens/secrecy jurisdictions.

    This is not about raising taxes on the middle class. Only corporate crooks and oligarchs benefit from the pirates of the Caribbean. There is no reason why conservatives with a sense of justice should approve of the working middle class having to pay a disproportionate share of the tax burden

  • Comment number 86.

    New world financial order what would my plan be?

    · Co-ordinate the world banking system, with the same set of rules for each nation in the world.
    · Each nation would have a certain amount of autonomy, to manage there own economy.
    · A co-ordinated response to world issues and events, so that major environmental disasters and wars could be avoided or dealt with more quickly.
    · Investment plan for poorer nations to allow equal access to wealth to create better living standards and to help the poorer nations through better education, better opportunities to improve their living standards and to eradicate poverty.
    · The International Monetary Fund could be the organisers and policemen of the more coordinated world banking system. Plus tighter controls on banking on the Internet to prevent further financial disasters like the credit crunch.

  • Comment number 87.

    In Post


    Avoiding the Next Wave or Learning to Surf

    The analogy was put forward that economic analysts who consider the present situation a 'Tsunami' are presenting a dangerously misleading scenario.

    In #79 we presented that the current situation is the sea receding or going into depression.

    The killer wave will occur in 4 years time. Other posters such as Hawkeye #80 are aware of similar scenarios.

    Barrie #46 made comment regarding our link to the advice to the US President from the Pentagon in post #40.

    In the Newsnight webteam blogs the matter of the DR Congo situation is being raised.

    This is one assessment of Africa from 4th February 2008.

    The killer wave is starting to form. Anyone have any interest in joining Celtic Lion to stop the deaths of over 6 billion people and the possible extinction of all life on Earth?

    See #81

    Paul, this is both an opportunity and threat.

    Our weakness, is will apathy and a lack of global response in time result in our termination.

    The strength is we have the ability to resolve the matter for our collective benefit.

    As we drew attention to in our assessment of the Democratic primary in Wisconsin 20th February 2008.

  • Comment number 88.

    Sorry the speed of light trigger on this laptop just posted before completion of #87. I note others have had the same problem.

    The final line was to be:

    The Fierce Urgency of Now

  • Comment number 89.

    5 Bullet points

    1)Reinvigorate Democracy by having local primarys to select the candidates who would stand at the general election. This cuts down the power of the PM as it removes a chunk of his patronage

    2)Remove central administration (not creation) of law from Westminister and return it to local communities (See de Tocquville on America)

    3)Remove quangoes and save a fortune

    4)Declare "war" on fossil fuels and use all your Keynsian investment in this area. This investment will give a long term return whilst stimulating the economy

    5)Get Frank Field to deal with the benefit culture

  • Comment number 90.

  • Comment number 91.

    Use of Ecologically Derived Optimum Development Strategies For thee New World Order

    This is an example of how advanced methods of analysis can produce optimum assessments of the future. From 15th February 2008

    Even in complex situations such as determining the two main contenders for the US presidency, ecological analysis can prove more accurate than traditional methods.

    Something to consider in developing a new world order.

  • Comment number 92.

    #91 I give up.

    What is the one important thing in a new world order?

    The clue is in the question.

  • Comment number 93.

    Dear Mr Mason

    CONGRATULATIONS to your Frontline event that led me to your fascinating blog. As a mathematician and system analyst who started her life at CERN in Geneva, I have organised the "Forum for Stable Currencies" at the House of Lords since 1998.

    Based on that experience, my bullet points are:

    1. Journalists as well as politicians need to learn to follow the money just as everybody else: who creates Stirling? who creates dollars? How many? For whom? On what terms and conditions? How have they obtained this privilege and monopoly? Why do people seem to think that the Government's money is "taxpayers' money"?

    2. Once people know that there are 2 kinds of money, Cash (created by states) and Credit (created by banks), then there could be ways of monitoring the ratio.
    This is the essence of our online petition "Stop the Cash Crumble to Equalize the Credit Crunch" on [Unsuitable/Broken URL removed by Moderator] which asks the Treasury Select Committee to investigate this issue.

    3. While politicians and journalists are clue- and powerless, the "Crash" is not a chance event. It is designed by unelected and unaccountable people who always have more money and thus more control. Why should they care whether banks go down as long as they achieve what they want?

    4. Talking, writing, blogging and videoing about the crisis won't make a difference. Making significant measures accessible and transparent would:

    -- the share of a Government's income in taxation and in borrowings
    -- the Cash : Credit ratio in the supply of a national currency
    -- the national debt per person
    -- the national income per person
    -- CO2 emissions per person.

    5. Convene a meeting with Central Bankers and the Bank of International Settlements and hold them to account by publishing key statistical indicators not only short, but also long term, e.g. in the UK, the Cash share has gone down from 48% after WWII to 3% now. But where is this published? We are bombarded by big numbers instead. But one-off payments are not nearly as important as trends.

    Good luck with following the money by following who issues national currencies!


  • Comment number 94.

    # 93 Sabine

    Thanks for the lead to the Frontline event. Paul kept quiet about that.

    I am pleased you introduced CO2 and trends etc.

    It is my opinion the credit crisis was easily predictable by incorporating C02 analysis as an indicator.

    It enters a world of non linear dynamics, soft and hard systems, thermodynamic etc.

    The agenda for the 2005 G8 climate change and Africa was derived from such analysis. Unfortunately the Government never took on board the warnings of credit and flaws in western economic policy the UN Environment and Development also supplied them.

    We have not even begun to appreciate the problem, let alone resolve it.

    Celtic Lion

  • Comment number 95.


    There is a legal conflict of interest for me involved in continuing this blog theme.

    In the 2001 Millennium Dome competition, had the environmental management centre been successful. There were provisional discussions on providing the start up capital.

    Had the proposal been successful it would have put £50 billion per year into the UK economy, as a public interest project.

    The business plan, research etc has been transferred to a limited company. So if 'our option' is placed here it creates that conflict.

    Celtic Lion

  • Comment number 96.

  • Comment number 97.

    Not a single politician, not one commentator or presenter (including you) and certainly not a single 'expert' in the news has correctly identified the two interlinked problems the world is facing today:

    1. The little financial difficulty: True, it started with sub-prime mortgages, BUT it is far deeper than that. After all the total of sub-prime mortgages is reported as being some $1.5 trillion, whereas Governments have so far pump close to $10 trillion into the banks. If the problem was just sub-prime mortgages, or 'banks not lending to each other', this $10 trillion cash injection would have solved in one go.

    No, the problem is 'derivatives'. These debts and bets are worth some $500 trillion. Compare that to the GDP of the whole planet of just $50 trillion and you get some idea why this fantastic burden of debt can NEVER be repaid.

    The only solutions are
    a) hyperinflation to degrade the whole of that debt (following Zimbabwe)or
    b) legal cancellation of all derivative contracts (!!) or
    c) collapse of the whole financial system incl just about all banks, and starting all over again.
    We need to choose one and go for it. The future is bleak whatever Gordon does, but pumping borrowed money into the economy in the utterly vain hope of recovery is just about the worst possible strategy.

    2. The little problem of Energy and Growth.
    Next year the world production of crude oil will, for the first time in history, decline for geological, not political or economic, reasons. Peak Gas will follow some 10 years later.

    2008 is the end of the Era of Growth (as growth is predicated on the availability of cheap energy) and the start of the Era of Decline.

    No matter what investment is made in oil or gas fields, the total production from 2009 onwards will decline every single year by perhaps 4%, thus our energy sources will halve every 20 years or so. This has already happened in 60 oil producing countries around the world, incl USA (1972) and UK(1999) and now, in 2009, global production will begin to decline.

    The 1930s depression was bad enough, but this decline will be on a massively larger scale. To start with, it will be at least 40 years long. 40 years will take us to about 25% of current energy usage, which is what we can expect from all renewable sources combined. So at that stage, provided Governments have been wise enough to have invested massively in renewable energy, renewables may be able to take over from fossil fuels and perhaps stabilise the world economy.

    So, the budget should
    a) embrace the Green New Deal (£50 billion per year invested in renewables)
    b) forget about tax cuts or other increases in current spending
    c) choose a strategy for the self inflicted financial crisis - and follow through

  • Comment number 98.

    Not a single politician, not one commentator or presenter (including you) and certainly not a single 'expert' in the news has correctly identified the two interlinked problems the world is facing today:

    1. The little financial difficulty: True, it started with sub-prime mortgages, BUT it is far deeper than that. After all the total of sub-prime mortgages is reported as being some $1.5 trillion, whereas Governments have so far pump close to $10 trillion into the banks. If the problem was just sub-prime mortgages, or 'banks not lending to each other', this $10 trillion cash injection would have solved in one go.

    No, the problem is 'derivatives'. These debts and bets are worth some $500 trillion. Compare that to the GDP of the whole planet of just $50 trillion and you get some idea why this fantastic burden of debt can NEVER be repaid.

    The only solutions are
    a) hyperinflation to degrade the whole of that debt (following Zimbabwe)or
    b) legal cancellation of all derivative contracts (!!) or
    c) collapse of the whole financial system incl just about all banks, and starting all over again.
    We need to choose one and go for it. The future is bleak whatever Gordon does, but pumping borrowed money into the economy in the utterly vain hope of recovery is just about the worst possible strategy.

    2. The little problem of Energy and Growth.
    Next year the world production of crude oil will, for the first time in history, decline for geological, not political or economic, reasons. Peak Gas will follow some 10 years later.

    2008 is the end of the Era of Growth (as growth is predicated on the availability of cheap energy) and the start of the Era of Decline.

    No matter what investment is made in oil or gas fields, the total production from 2009 onwards will decline every single year by perhaps 4%, thus our energy sources will halve every 20 years or so. This has already happened in 60 oil producing countries around the world, incl USA (1972) and UK(1999) and now, in 2009, global production will begin to decline.

    The 1930s depression was bad enough, but this decline will be on a massively larger scale. To start with, it will be at least 40 years long. 40 years will take us to about 25% of current energy usage, which is what we can expect from all renewable sources combined. So at that stage, provided Governments have been wise enough to have invested massively in renewable energy, renewables may be able to take over from fossil fuels and perhaps stabilise the world economy.

    So, what should we do now? I suggest:
    a) embrace the Green New Deal (£50 billion per year invested in renewables)
    b) forget about tax cuts or other increases in current spending, they won’t do any good anyway and just add more and more to national (mine and yours) debt
    c) choose one of the strategies above for the self inflicted financial crisis - and follow through

  • Comment number 99.

    nomorefakenews. we were led to believe foxnews was the only major broadcasting corporation that spread fear. we do not live in a democracy we live under a fascist democracy. we have been conditioned since birth to be affected by stimuli that leads us to believe we are in a free world, somewhere where we can make a difference. it doesn't exist. nwo will happen as it's been in process for 2008 years. all the trappings are there to be understood even by a pseudo-intellectual like myself. im using one of it's greatest tools.
    'economic slowdown' a 'new president' it's the gloss we all feel we are obliged to care about and emotionally respond to. the worlds getting smaller, no it was engineered that way.


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