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Listed below are comments made by Straightalk between Wednesday, 9th September 2009 and Sunday, 25th October 2009.

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The fight over a Blair presidency 1:34pm on 25 Oct 2009 Despite the current demise of the USA, it can at least look back on its history of development with some pride on the character of its founding fathers. What legacy does it create with the likes of President Blair as Europe's first president?
Secondly, whoever is appointed it seems an insult to the ordinary people of the European Union that such a potential powerful post, whose voice will represent us as much as our Prime Minister should not be a directly elected representative of the people. We appear to be on phase two of creating the police state of Europe where bureaucrats choose the leader. It is time the people of Europe were given a voice and removed this Brussels based elite with their overpaid jobs and crony jobs for the boys and girls mentality. They are almost as bad as the bankers. Almost, but not quite.
The fight over a Blair presidency 1:02pm on 25 Oct 2009 Is Europe so impoverished for political leadership that it has to stoop to scrape the barrel with the likes of Tony Blair? This is the man who seems to have been distinctly economical with the truth regarding the 'weapons of mass destruction' in Iraq, who endorsed the policies of his then Chancellor, Gordon Brown which has led to this country being in the worst economic hole since the Great Depression. Remember Blair left at a time when many thought his continuing leadership of New Labour would ruin their next electoral chances given his celebrity spin and shallow comprehension of economic or social criteria. Nice timing, given his hefty compensation package with JP Morgan and his media business activities on the lecture circuit or advising countries like Kuwait on political leadership at $1million a pop!
So far his role as Middle East peace envoy for USA, Europe and Russia has achieved nothing tangible except large hotel bills for his entourage visits to Tel Aviv and other places.
If Europe wants a celebrity President like Obama, then Blair may be the ticket, if you exclude all the "B and C rate celebrities" on reality TV. However, Obama (excluding his ludicrous acceptance of the Nobel Peace Prize) is still relatively untested in his presidency and is probably far more capable than Blair at an intellectual level. Blair on the other hand has been tested and found very inadequate.
No doubt, spin, celebrity and PR will win the day. Thus if Blair is elected, then Europe will learn why so many people wanted to get rid of this man as our PM. Unfortunately, his successor has proved equally inadequate.
It seems that failure in politics and banking is simply rewarded by even more cushy jobs for the boys and a few girls. Time that things changed and Europe sent a clear message to Blair and his ilk, that failure is not a qualification for promotion, however you try to spin it.
Brown and bonuses 1:25pm on 27 Sep 2009 The focus upon the issue of bankers' bonuses is another case of "deckchairs on the Titanic." This is not to suggest that the sheer greed expressed in the investment banking community should not be curtailed; however, whilst I personally think the levels of bonuses achieved have been immoral, the real issue on bonuses is how to create a bonus scheme which creates responsible attitudes towards risk-taking. This is essentially an issue about using incentive schemes to discourage casino behaviour with other peoples' money.

That said, the real issue centres upon the way in which the banking system in the USA and parts of Europe has happily gone about creating a huge 'shadow-banking' system, which sits outside any kind of external regulatory environment. When major commercial banks get involved with investment banking activities we should be concerned. But when those same investment banking activities set about creating various structured investment vehicles (SIVs) and their associated financial 'innovations', then we should be outraged.

Bankers will always regard themselves as being the essential oil that greases the capitalist system; this is true up to a point. What politicians and indeed some economists and policy makers appear to forget is that for bankers, they are running a business. For bankers, the name of the game is to make a profit - the bigger the better. This not only provides some of the 'turks' with fat bonuses, but it creates a healthy return for their shareholders. Customers, generally come somewhat further down the list, especially if they are not rich and simply represent the masses in retail banking. Of course, any intelligent person (and their are plenty of intelligent people in the banking industry) will look to seek the development of markets which create a healthy return. Retail banking is the boring part of the business. Therefore, to say to bankers involved in the more esoteric parts of the business that they should not innovate is rather like telling engineers at IBM, Boeing or Apple that they should not innovate new products. This would plainly be ridiculous.

The problem is not that bankers create risky and innovative products. The problem is when bankers create such products with excess leverage and/or misrepresent the real risks associted with such products. The caveat emptor defence does not wash here, since many of the exotic products created during the past ten years simply were non-tranparent and virtually impossible to verify in terms of risk. Hence buyers depended upon the ratings agencies (whose clients were the banks) such as Standard and Poor's, Moody's and others. Unfortunately, these agencies were way behind the curve.

The real issue is about separating commercial banking from investment banking activities, so that if the 'turks' run excessive risks which blow up in their faces, then they can simply go bust and most will be none the wiser. The problem at present and going forward is that nothing is being done in the legislative reform (so far) to separate these two activities. Indeed, quite the opposite, since Goldman Sachs and Morgan Stanley have so conveniently registered themselves as banks to benefit from the bail-out package last year. Until the commercial banks are banned from setting up SIVs, which are financed at arms-length with funds from within the commercial banks, then nothing will have changed.

Sadly, this kind of reform would been seen as reverting to the world created through the Glass-Steagal Act in the aftermath of the 30's crash or the more regulated environment prior to the financial 'Big Bang' of 1986. However, when speculation becomes the dominant part of the financial system and virtually every major bank in the USA and UK was looking at technical insolvency last year, then our politicians are under a duty to the people to protect the interests of ordinary people, over those of the elite banking community.
New world order, deferred 11:08pm on 26 Sep 2009 At 9:28pm on 25 Sep 2009, GrecianWebb wrote:
"to no. 5 - last time I checked we voted a party in and not an individual - other countries do different but this is our way, so to say he has no mandate is not entirely accurate as he has the Labour party mandate...until the election at least!"
Agree with your comment above. However, in reality most of the elections in the UK over the past 50 years have created governments whose parties actually attract less than 50% of the popular vote. Our anachronistic 'First past the Post' system, as opposed to Proportional Representation means that the British people are usually governed by a party which is wholly unrepresentative of the marjority of UK citizens. In the last election (2005), Labour won 35.3% of the popular vote, yet gained 55% of parliamentary seats. The Lib-Dems won 62% of the number of votes cast for Labour, yet ended up with only 10% of the parliamentary seats, i.e. one fifth of Labour, despite having gained more than 50% of Labours votes! Enough said about the sham of democracy!
Gordon Brown's monuments 09:41am on 25 Sep 2009 Agree with the comments that this article by Peston reads like a government briefing paper.
Where is your analysis and opinion Robert? The only point you make of interest is that "In a way, she's his personal investment banker . . . " Love to know where she advised Gordon to invest his prudently earned funds over the past few years. Presumably Goldman Sachs.
Sorry, but this was a boring article.
The market price of cutting airline emissions 8:14pm on 22 Sep 2009 Listerdiesel wrote:
"What about the engine and aircraft system running checks that are carried out during the time between start-up and take-off? You either do those between leaving the gate and arriving at the take-up hold, or you sit at the hold and do them, you cannot just leap away into take-off without running those checks first."

Agreed. However, back in the 1950s, Britain's V-bomber force were equipped with a high-speed start-up system that allowed them to become airborne within minutes (before an atom bomb hit their base). Surely, a similar system could be devised with modern systems that was sufficiently safe and reliable. For example, the APU (auxiliary power unit) could be driving key systems, until main engine start-up. This is simply a suggestion to "think outside the box" to try and reduce engine idle time. I am sure most of us have sat at busy airports with a line of 10-15 aircraft ahead. This can take 20 minutes or more to clear. Completely inefficient use of time and fuel.

If this is so fanciful, then somebody should tell Richard Branson who has suggested this kind of scheme. Presumably somebody from Flight Operations at Virgin would be wise to the feasibility of such ideas.
The market price of cutting airline emissions 10:08am on 22 Sep 2009 Even an acknowledgement by the airline industry that they should be included in calculations regarding atmospherica pollutants is to be welcomed. The airlines have managed to evade this since Kyoto.

However, in the case of airline pollution, one should recognise that this should not simply be about CO2 emissions. Even modern aircraft jet engines belch out some very nasty toxins at their cruise altitudes whose chemical reactions are not fully understood; suffice to say, they are not considered benevolent. As certain aviation players have pointed out, a considerable amount of ground level pollution could be reduced simply by towing aircraft out with electric tugs to their 'holding points' before engine start-up and subsequent take-off. On a global scale this could help enormously with immediate effect.

The industry faces some real challenges in trying to meet reduction targets in pollution for a number of reasons. Firsty, the technology path to create very low polluting engines will not easily be achieved. Secondly, the rising levels of demand for air travel in Asia and South America look set to significantly increase global aircraft movements; at the same time, air traffic in Europe continues to grow as more point to point services are introduced for short and medium range routes. Such growth is of course a reflection of rising demand, which is driven by the insanely low air fares available. Whilst the carriers like Southwest Airlines in the US or Ryannair and EasyJet in Europe may have cost and pricing structures to sustain a viable business model, most of the traditional carriers do not: hence the ongoing waves of mergers, acquisitions and alliances in the industry.

The reality is that most governments (advised by their ever so impartial industrial economic advisors) see air travel as "good for the economy". The jobs created around airport hubs and their impact upon the surrounding local economies are seen to be worthy of more growth. At a purely local level this is probably true, except for the fact that the economic cost/benefit calculations take little account of the pollution effects (not only around the airport, but also on the flight path of departing and arriving flights). Economists call these factors 'externalities', which effectively neatly wraps them in a little black box marked 'unknown'. Furthermore, politicians rarely challenge the 'jobs card' and are usually too ignorant of the overall system to grasp what is happening in the bigger picture. For example, very few politicians, except those of the green parties or persuasions are going to come out and address the real underlying problem: that is how to reduce demand for air travel. All those millions of people demanding cheap travel to their holiday destinations are unlikely to vote favaurably for such draconian measures.

Thus the aviation industry, including the manufacturers such as Boeing and Airbus, the airports and the airlines can rest easy in the knowledge that they are unlikely to see any serious pollution controls in the near future. There will be more discussion and jaw-boning on the topic, but the industry knows that its ultimate consumers (ie the general public) are only going to respond to one thing: price. If air fares were signficantly increased to reflect their true costs to the environment and tax subsidies on aviation fuel were removed, then there would be a significant drop in demand. However, the chances of this happening are as remote as 'flying pigs'. Are they environmentally friendly? Probably not - too much methane exhaust!
The what and when of spending cuts 1:58pm on 14 Sep 2009 The timing of the cuts won't make much difference in the longer term. Whoever is governing the UK in 2010-11 will have to make significant cuts in the public sector. In parts of the country, where public sector workers account for over 50% of the workforce (e.g. NE England) the impact will be devastating. This is why the markets have not yet hit bottom in this economic slump. Last 2010-2011 should see a slide below the March 2009 lows. Next year, when commercial property goes belly up, when the US, Chinese and UK government spending stimuli are over and taxpayers are faced with rising taxes and balooning government debt, then things will get pretty unpleasant. All the money thrown at the banks has been a complete waste of time, which has simply made a few people filthy rich and prolonged the agony even longer. The "green shoots" are likely to turn out to be "green weeds" which will eventually strangle this economy.
What US healthcare means for the world 11:05pm on 09 Sep 2009 "One of the big findings of behavioural economists is that people suffer from "status quo bias". They fear change and hold on to what have, even if what they have is pretty flawed."

Stephanie - Please spare us from this ridiculous notion that behaviour economists are somehow breaking ground with such findings. Yes, they may come up with some fancy new buzz word or phrase "status quo bias", but actually this is nothing more than saying that people resist change. Surprise, surprise. This is a fact well known to mainstream psychology and management consultants for many decades. Unfortunately, the relatively new field of behavioural economics seems intent on trying to con everyone, including many economists who are less well versed in psychology than in mathematics or accounts that these are breakthrough findings. Most of the time its simply plaguriarism from another discipline.
Generally, social psychology and managerial/organisational psychology shows that people will often proclaim their love of change (e.g. the Obama brigade, now followed so originally by Cameron). However, when asked to make changes in their own lives, many will then reconsider their position. Indeed, the organisational behaviour literature is full of examples of cases within companies where resistance to change is a problem, whether in its passive or more so in its active mode.
So one should hardly be surprised that when the majority of Americans within their healthcare system are asked to make changes, which will probably involve their either losing some benefits or paying more for existing benefits to help those outside the system, then the mood shifts towards a more reactionary stance.
In many respects, this is simply human nature. The world is littered through history and inhabited by such examples at present. For example, many people may support a grand idea or principle such as "combat climate change". However, when asked to make the necessary sacrifices, the numbers tend to decline. This is because when individuals are asked to make the changes, they suddenly realise that the sacrifices are more than they want to make. Sure, they can still see the benefits, especially if everyone participates. However, the notion of relative contribution comes into play. So in this example, some people might say I support change in policy to protect the climate, but I cannot make major sacrifices such as changing the SUV, foregoing holidays overseas on long-haul flights, etc., especially if there are one billion Chinese who are increasing their relative levels of pollution. Unfortunately, these kinds of sentiment are also fuelled by a lot of misinformation (sometimes provided by courtesy of the government or business interests), so the person in the street is quite frankly not really aware of the true facts. Indeed, today's world seems to increasingly revolve about soundbites based upon faulty science, bad reasoning, distorted statistics and political spin. People will therefore end up desparately wanting change, but then getting hopelessly confused when presented with the options and alternatives; hence reverting to the status quo as a "better the devil you know alternative."
What US healthcare means for the world 8:56pm on 09 Sep 2009 Sadly, I don't think Obama has a cat in hell's chance of getting half his healthcare reforms onto the statute books. There are too many powerful business interests in the US which are working to ensure this does not happen. Look at the number of lobbyists employed by the healthcare industry in Washington who are against this bill and you get a pretty good idea about why this is doomed.
I agree with you Stephanie that this is important to the world. Largely, because of where it will lead the US natianal debt over the next twenty years if it is not sorted out. Economists and forecasters in the US talk about the coming national debt cruch in about 20 -30 years, when if things are not sorted - Medicaid, Medicare, Social Services and of course interest payments for the trillions of dollars currently growing the national debt will take up most of the National Debt at that time in the future. Other public expenditure on education, defence, homeland security, transportation infrastructure will have to be paid out of further borrowing. However, I guess the dollar will no longer be the reserve currency by that stage and our world's resources will be so depleted by our return to unsustainable growth, it will probably not matter! Mind you at least the climate will be warmer!

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