Clash for civilization

Line of the Day

Line of the day:

“Facebook is literally filled with master baiters.”

Between the possibly unintended “double-entendre” and the superb analysis of the evolving dichotomy on the Interwebs between social and functional mass participation, the above linked piece is my ‘pearl of the day’. Enjoy.

NAMA ‘Dead on Arrival’, say Ministers

One tires of wading through so much bullshit from the various ‘leaders’ of what passes for ‘society’ in this damp corner of the planet. There is very little perspective on offer from these people and, as the 24-hour news cycle intensifies with all the blogging, tweeting and wiki-ing, all we ever seem to get are reactions to reactions to eruptions of events.

Last year, we, the people, were sold a pup called ‘NAMA’. There were several reasons advanced for so doing. Among them were “the EU approves”, “there is no alternative” and also “our reputation will be mud”.

The principal reason advanced however was that

“our banks are broke and this is the only way to get them lending again so that we can restart the economy”.

I am too pissed off to bother searching out links to instances of these but you all know that that was what was said.

Now, Minister Ryan and Minister Lenihan are announcing a program to ‘force’ the AIB & BoI to lend €12bln over the next 3 years. So before all of the loans are transferred to NAMA, they are admitting what the majority of independent observers said at the time would be the case; that NAMA would NOT regenerate lending in this economy.

Further, this new program of lending has no incentive and no enforcement and no punitive measures attached, so that there is no way to make this lending happen. There is just a new ‘nodding dog’ of a quango to repackage the lies of Ministers. The pronunciations of the ‘Credit Review Office’, which is as underresourced as it possible for ‘one man and his dog’ to be, flies in the face of the quotidian experience of every accountant, credit officer and small business operator in the land.

It’s not so bad to have a politician lie to us. We are well used to it, by now. But that they are setting up quangos using our taxes to pay civil servants to lie to us is a new twist to our ‘Wonderland’.

Addendum – What has a new lending program, however fictitious, got to do with Minister Ryan’s portfolio of Communications, Energy and Natural Resources?

NAMA will not recoup €4.8bn for taxpayer.

“Beauty is truth, truth beauty,” – that is all
Ye know on earth, and all ye need to know.

There is nothing more to be said on this subject.

Iceland’s victory

For most of last year a common refrain was the line about the difference between Ireland and Iceland being one letter and six months. I was in a minority, a very small minority, in suggesting that although Iceland looked to be in terrible state that they chosen the wiser path of short term pain for long term gain.

The ‘solution’ being tried in Ireland is mainly one of throwing good money after bad in the hope that the global economy recovers before FF/GP have to face the electorate and that, by then, a ‘rising tide’ will have the appearance of being able to lift all boats.

The shine is rapidly coming off that ‘solution’ as the varying stimuli run their courses into the buffers of debt overhang and artificially high prices for everything from stocks to wages and including houses. The only thing that is not overpriced is the oil we are still consuming at an unsustainable rate.

Meanwhile, Iceland is already suffering less pain than the Irish and the have managed to do so by sticking it to the ‘entrepreneurs’ who took most of the profits and are now taking the losses.

“How different from the home lives of our precious bankers”.

For a snapshot of these remarkable events see the estimable PKrugman’s article here.

Aphorism ‘du jour’

“Life happens in parallel but is experienced serially”

People and their constructs (politicians, markets, organisations, etc) can only concentrate on, react to, and cope with one thing at a time. Sadly, the planet, and physics in general, is oblivious of this constraint, which may explain much of the misery attendant on the human condition. The phrasing I have chosen is a reflective of my exposure to the world of computing. I would appreciate a more general formulation, if anyone is troubled by my draft and can suggest one.

Thanks for visiting.

Signals and Noise

Greetings dear reader.

The signal to noise ratio on the Internet and other mass communication media has decreased recently, sometimes in direct proportion the rapidity of the change in our economic circumstances. Amid the welter of quick fire “opinion-ation” and simplistic reasoning the voices of considered and consistent analysis are often drowned out.

One of the few people to have been prescient, consistent and prescriptive has been Nouriel Roubini. In this article for the FT he sums up the recent evolution of the crisis in context with the long term prognosis. He does this so well and with such clarity and simplicity that there is nothing more your humble scribe can add, other than a heartfelt recommendation that you should read it – twice (as I did).

We are still in the middle of this unfolding crisis and despite what our own leadership might say, there is no guarantee that the worst is over.

NAMA revisionism.

Once again another ‘firm commitment’ by the Government has been allowed to slide away, this time in the form of a re-statement of objectives for NAMA by its chairman.

In a speech at the end of last week he said that , instead of making a return on the taxpayers money and on pursuing the lenders for every last penny of what was owed,the

“core objective will be to recover for the taxpayers whatever it has paid for the loans in addition to whatever it has invested to enhance property assets underlying those loans. It is expected that Nama will have a lifespan of seven to ten years and when it has achieved its core objective, it will be wound up”.

Frankly, even this seems ambitious at this stage. NAMA has been allowed to pay 11% over the odds for these assets by the EU. The time scale for NAMA is now envisaged as 7 to 10 years rather than the 10 plus originally stated. The residential property market is in the doldrums and being constantly, if more slowly now, marked down. The commercial property market has imploded and is dominated by the stock taken into NAMA’s care where it will be subject to decision by committee and political manipulation. Dominating these two domestic travails are the continuing concerns about the prospects for the sovereign debt markets of the appropriately monikered ‘PIIGS’.

Where anyone can reliably forecast 11% growth in large scale commercial property prices when we have contracting demand, serious oversupply, medium term macro economic uncertainty and disruptive technological developments to cope with is beyond optimism and bordering on fantasy.

It is interesting to note that the chairman’s restatement was descriptive rather than assertive; in other words he gave no undertakings and made no promises, he just described what the job was.

We could do with a few more honest men like that.

Germany’s Gift – Part One

At last  the German government has started behaving like a grown up govt. should.

Taking decisions, tough ones, on its own privately, thoroughly and announcing them firmly to the markets on a ‘like it or lump it’ basis.

A good summary is to be found here.

The Germans (militarily, anyway) used to be the masters of strategic retreat. They will be in the frontlines, fighting their cause, tooth and nail, striving to go forward right up until the minute they decide that the game is no longer worth the candle. After that they will be gone, completely entirely and cleanly, having moved back to the next well prepared line of defense.

Europeans with an overdeveloped sense of entitlement and ‘market forces’ types should tread carefully around this rediscovered German talent for ‘strategic retreat’.

I would like to remind the reader of the British Army aphorism

“He who has not fought the Germans does not know war”

F’book, Again!!

This will be the last post on this subject (I hope….)

This is a very clear, cogent article on this subject written by someone much better qualified than I to speak on this subject, which is why I will now shut up about F’book.

Sleep tight, y’all….