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Listed below are comments made by therealhotairmail between Monday, 28th July 2008 and Wednesday, 21st January 2009.

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Mervyn and leverage 10:44pm on 21 Jan 2009 We're all stuffed.
A bank insurer, not a toxic bank 10:33pm on 17 Jan 2009 None of you get it do you, including Robert.

It's the asset stupid.

Doesn't matter how much money someone has, if the price is going South they'll put off buying.

Everyone knows that is the fear about deflation that people will put off buying...so why don't they understand that in the context of assets...like houses?
A bank insurer, not a toxic bank 10:32pm on 17 Jan 2009 None of you get it do you, including Robert.

It the asset stupid.

Doesn't matter how much money someone has, if the price is going South they'll put off buying.

Everyone knows that is the fear about deflation that people will put off buying...so why don't they understand that in the context of assets...like houses?
Our banks 'have to lend more' 4:32pm on 04 Jan 2009 In the long run, the only way interest on debts can be serviced is by profit on trade.

Increasing the money supply (credit) increases the debt burden. In the short run, any additional government spending helps some people and some businesses to trade their way through the recession and continue to service their debts. Plus, increasing the money supply this way also helps erode the value of debts by inflation (but also savings of course).

The drawbacks of this approach of expanding the money supply to get out of our problems are that the debt burden on society as a whole worsens unless the additional money is invested to make more profits than it costs in interest - although it can appear to work in the short term.

In the long run, the only satisfactory approach is for additional profits and savings to service and pay off debts. Then to use the financial resources freed up to invest in new, profitable projects.

Gordon Brown and Labour as a whole cannot fundamentally understand this as they see PROFIT as a DIRTY WORD. Gordon Brown shows this ignorance by classifying any SPENDING he wants to undertake as 'INVESTMENT'.
Varley: credit to shrink for up to two years 11:36am on 20 Dec 2008 A word of warning.

Has anyone heard an insurance company confess to holding any of these falling assets in endowments or pension schemes?

Thought not.

Beware. Make sure you know exactly what your money is invested in. Or you could live to regret not doing so.
Five-year taxpayer help for banks 09:01am on 17 Dec 2008 Robert, you said previously that about $1 trillion of overseas debt needs to be repaid this year and next, with some $800bn falling due next year.

Can you possibly confirm what currency this debt is in?
Will HBOS stay independent? 7:49pm on 09 Nov 2008 Remember the Darien venture?

That too ended up with the Scots being bailed out and subsumed within English institutions.

Oh and the debts being paid off by the English too!
Will HBOS stay independent? 09:46am on 09 Nov 2008 Before these two came along, I too thought it no longer made sense to put HBOS and Lloyds together - given that it is the government that is saving HBOS, not Lloyds.

But Burt and Mathewson have now turned this into a nationalistic issue.

I would prefer the Halifax and Natwest head offices come back to England where they belong, and leave the RBS and BoS rumps with their disastrous corporate lending to the SNP.

I despair there is no equivalent English grouping to match the Scotish mafia.
Momentous Monday 10:34am on 13 Oct 2008 I wrote to you December 2007 (see below) when you weren't quite as savvy as you are now. The 'Brown' plan seems to be to try and keep lending going - but what we've not heard about are the lending limits and transparency we require from our regulators to set so this doesn't get out of hand again. Brown may have saved the world but he is complicit in the problems being experienced. Ask Angela Merkel.

17. At 01:27 PM on 21 Dec 2007, harry e wrote:
Robert, the link between all these disasters was the prolonged low interest rate environment boosting demand for credit with a limitless supply of it - without the restriction of either a reserve ratio (the ratio of deposits needed to be kept back by the banks to repay depositors) or a properly functioning capital ratio (the ratio of lending that needs to be kept back in the event of default).

How? Off balance sheet funding. It is a little known fact that money is created by private banks when a loan is made. The money supply hugely expanded in this credit bubble has fed house prices to the point where everyone is now saying the Emperor has no clothes.

Easy credit leads always to loose lending. Falling house prices are revealing the true extent of default. But the default now being experienced is unprecedented for the lack of capital reserves to cover it - the banks don't even have enough to put the damn stuff back on their balance sheets never mind write off bad loans!

As capital is destroyed this will be hugely deflationary. Far lower bank rates and increased Government spending will be inflationary. And we seem to be seeing a flight by investors from mortgage bonds into commodities (food, oil) - the next bubble before that too pops with the footsie with it. In the meantime this too will be inflationary.
Bank balance sheets become focus of scrutiny 2:10pm on 28 Jul 2008 I don't think anyone knows what they are doing.

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