Posts by stephen walker
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Stiglitz: The globalization agenda has been closely linked with the market fundamentalists -- the ideology of free markets and financial liberalization. In this crisis, we see the most market-oriented institutions in the most market-oriented economy failing and running to the government for help. Everyone in the world will say now that this is the end of market fundamentalism.
In this sense, the fall of Wall Street is for market fundamentalism what the fall of the Berlin Wall was for communism -- it tells the world that this way of economic organization turns out not to be sustainable. In the end, everyone says, that model doesn't work. This moment is a marker that the claims of financial market liberalization were bogus.
and this is before the last-gasp desperation and panic of Friday morning's announcement...stopping short selling of all these financial shares is pretty much the end of the line...a huge short-covering rally followed by the death spiral...IMHO
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the SEC ban on some short selling looks like it could signal a total meltdown within a couple of months.
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@ Matthew:
http://news.yahoo.com/s/ap/20080915/ap_on_bi_ge/lehman_brothers_bankruptcy
Lehman said that as of May 31, it had assets of $639 billion and debt of $613 billion.
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If you are only going to ride on the road (and the road needs to be quite good without potholes, etc.) get a road bike. but if you are going to ride a bit off-road too (unsealed tracks, grass in the park, gravel, etc., or on pretty dodgy roads) get a light but strong cross-country (XC) bike.
and i think bikes are overpriced in NZ. as Jason says, wait for the sales.
Japan is much cheaper. probably has the largest cycle market in the OECD, which means economies of scale for manufacturers. there are 33 million people in greater Tokyo (incl. saitama/kanagawa/chiba) and probably 20 million bicycles. and my new one arrives tomorrow. after my good bike got ripped off last year. even in Japan there are international bike-stealing gangs with very large bolt cutters. arseholes.
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Is ours a better system?
no, but it is a lot smaller and more personal.<only half joking>
but seriously, what went on in the housing markets and mortgage-backed securities markets in the US over the last 10 years makes even NZ's own little South Seas Tulip Mania seem cute and harmless in comparison.
i point you to a nice, scary-but-true story...(actually, two connected stories)
The Alchemy of Mezzanine-CDOs: “One of the Biggest Financial Illusions the World has Ever Seen”
from top to bottom, from the house buyer to the pension fund contributor, the whole thing is a scam. Multi-trillions, disappeared, into the ether. or someone's pocket. take your pick.
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Economy? Ha. Hope you're all working on getting those veggie gardens in. Beans go alright this time of year, as do some varieties of carrot and a few other bits and bobs.
best advice ever.
and Kyle: on yer bike, too. -
woops. got that wrong.
http://news.yahoo.com/s/ap/20080915/ap_on_bi_ge/lehman_brothers_bankruptcy
Lehman said that as of May 31, it had assets of $639 billion and debt of $613 billion.
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my initial conclusion is that the AIG thing is not the beginning of the end, but signals the middle phase of the end. of the wall st system, that is.
i just found it funny (???) that the total (book value) "assets" of Lehman is so similar to the amount AIG is trying to borrow to remain solvent. US$75b.
As for the Chinese, when they stop buying US$ debt, the whole system really is toast. and they know it. so if they kill the US$, it's sort of like murder-suicide. alas, it looks like they are running out of time to solve this insoluble catch-22.
Krugman hasn't written anything of substance yet...
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Back to the small matter of the end of finance capital...
So, NZers think a dozen finance companies going belly-up and the house market falling 10% are not so good...well, the news is unlikely to get better a few months down the track.
Between Lehman and AIG, the whole securitised debt instrument (including derivatives thereof) cupboard is being exposed as, um, bare. As in, empty. As in, make-believe. As in, scam-a-trillion.
Nouriel Roubini says all the Wall Street independent broker/dealers are "toast". Great NY turn of phrase, eh? But no worries, two down, two to go, only GS and MS are left. BTW, he said that in July.
Just for a taste of how corrupt the US financial "system" is, take a look at this take on AIG's attempt to save itself by stealing US$20b from its own subsidiaries. All with the proper approval from the "regulators":
http://globaleconomicanalysis.blogspot.com/2008/09/crime-in-buying-aig-time.html
Hat tip:
http://cryptogon.com/?p=4095#comments
(comment no. 9)Let's just say that this is not just an American problem. When the default global currency becomes worthless, there could be some flow-on effects even in far-off NZ. IMHO, of course.
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WTF???
http://www.nzherald.co.nz/section/1/story.cfm?c_id=1&objectid=10529828
Women's Refuge missed out on thousands of dollars from a charity luncheon to honour rugby league star Ruben Wiki as fallout continues over the Tony Veitch affair.
Wiki had wanted to donate some of the proceeds from a $170-a-head gala luncheon held in Auckland in his honour last week to Women's Refuge, but organisers put the kibosh on that proposal because of a potential conflict with the event's main sponsor, Radio Sport - Veitch's former employer.