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cromer46

Listed below are comments made by cromer46 between Wednesday, 8th October 2008 and Sunday, 27th September 2009.

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Brown and bonuses 4:45pm on 27 Sep 2009 The financial crisis just passing blew up because 1). Too much money sloshing around led to excessively low interest rates which prolonged a housing boom which prolonged an economic boom too long. This left all banks with too much money and decreasing sources of profits. Thus banks and some insurers (mainly AIG) chased ever riskier profits, firstly in Sub Prime loans and then CDOs. 2). The length of the boom led people to forget previous crises and almost everyone believed it would go on for ever, and spent accordingly, using the excessively easy credit available from point 1. 3). Following on from points 1 & 2 we ended up with a collective madness where governments companies and people spent madly mainly on credit and it all blew apart. 4). Much of the underpinning for all this was the globalisation boom which moved so much manufacturing to China and other cheap labour areas that kept inflation and interest rates too low; it also led to the massive trade imbalances that allowed exporters to create vast amounts of stored money to support the western credit booms.

Bankers bonuses were at most a tiny element of all this. Government is primarily to blame because they all encouraged the madness, because it provided them with easy votes through constant economic growth, and provided vast sums of money to spend spend spend.

resolution of the current crisis, sustained and sustainable growth and reduced probability of another mess in 5-10 years when the trade imbalances are recognised and serious efforts made to change them.

At the end of the day however any free or free-ish market system that allows people to make their own decisions will end up in some kind of boom/bust. NO matter what we do now to constrain things will be bypassed in a decade or 30 years or 80 or so years, as people forget and the desire for more money engulfs society once more.

Government cannot stop these events, just recognise them, work to reduce the impact and hopefully not get so caught up in them that they save in the good times.

The criticism of Banker's bonuses could just as easily be applied to politicians rewards (kudos, news coverage and votes) as they respond to short term events. Government just thinks of the next vote or news headline, not even as far as the next election. So when we have a boom like recently, they don't manage it, they encourage it... and thus we come to the bust .
A note of caution 10:07pm on 01 Jul 2009 "Don't believe all the Orwellian propaganda. He was a Trotskyite - he would have loved New Labour probably. "

He would have detested them because of their murder of the English language through use of cliche, euphemism and other linguistic torture designed to obscure everything they say - read "Politics and the English Language".

Most sensible people knew that what Brown was doing to our economy would eventually explode in all our faces. What none of us know was when it would happen, how it would happen or that it would coincide or be triggered by a global credit crunch. Many of us commented about some of the issues that led to this mess, but I don't think anyone foresaw the whole horror. And in reality we all got caught up in the extraordinary delusions and madness of crowds.
Pushing string 12:46pm on 06 Feb 2009 Where is this deflation people keep talking about? Petrol is rising agan,, car manufacturers are putting up prices, food is rising and the latest is some other commodities are rising. Are we not at severe risk of stagflation?
Was Daschle irreplaceable? 09:57am on 06 Feb 2009 Its not surprising Obama is being hit. 1). American politics is extremely corrupt. 2). The culture wars are not over yet, it will take years of cooperation form both sides to sideline them, and there is no reason to believe the extremists will stop. The republicans showed with Clinton that they put their own grandstanding ahead of the nation's interests.
Protectionism wasn't the problem 09:47am on 04 Feb 2009 I thought economic theory was clear that free trade delivered large economic benefits. yet you are saying that tariffs and other barriers to trade don't do any harm. Seems a contradiction.

But if what you say is correct and given the US has a massive trade deficit, then logically they should impose tariffs - they will bring jobs home and get rid of the deficit, tax revenues would improve and the budget deficit could be eliminated too.

Same fro Britain.
Nationalising Tories 8:28pm on 10 Jan 2009 "##1 "Labour have been left with NOWHERE to go, they are O.U.T, and you?ll be lucky if they EVER get in again Peston!""

A week is a lolng time in politics. the probability of labour losing the next election is sadly not as certain as you believe, and the probability of them disappearing altogether is sadly even further away from reality. Still, we can but hope.
Banks' rescue plan: Good or bad idea? 09:38am on 08 Oct 2008 "Bail-outs on the hoof using taxpayer's cash again to write blank cheques for Brown's banking buddies are not the way to run an economy."

Maybe so, but what IS the answer? Currently the global economy is in or heading towards meltdown. The comparisons with the depression may be overblowm, but only insofar as we are at the start - the Greta Depression had to start somewhere. We have a chance tio avoid one, or to fall into it.

I for one have no desire to lose my job and home and live on state handouts in a tent city, so until someone can come up with something better to at least avoid total collapse, what the government offers is the best we can expect.

No one is offering anything better.

I despise Brown and especially Darling who have clearly put their own political future ahead of the country's needs, but in the meantime we should support them until something better is clearly there.

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