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150 comments on DrumBeat: October 11, 2008

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mcgowanmc on October 11, 2008 - 11:14am Permalink | Subthread | Parent | Comments top

Sounds like Germany failing to pay UK/France who then failed to pay the US.

Who then brought in Smoot Hawley:

The Smoot-Hawley Tariff Act of 1930 was considered by many economists to be the single factor that transformed the U.S. recession into a global depression. The legislation was enacted on June 17, about 8 months after the collapse of the U.S. stock market. It quadrupled import tariffs on 20,000 goods, particularly agricultural products. Countries immediately retaliated, bringing international trade to a halt and depressing global demand. Ironically, the U.S. economy was showing signs of recovery by the spring of 1930. Unemployment stood at 7.8%, but the decline in global trade doubled the rate by 1931. The unemployment rate in the U.S. continued to climb, peaking at 25.1% in 1933. Although the decision to shelf the Free Trade Agreement (FTA) with Colombia should not be considered to be a return to U.S. protectionism, the growing restrictions against food exports could be the start of a dangerous trend.-Roubini

but this time Russia waits with open arms and gas/oil
for the cold winter coming.

We've got til Sunday PM for something/

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DaveMart on October 11, 2008 - 11:32am Permalink | Subthread | Parent | Comments top

Has anyone got any insight on the other concern mentioned in the article?
Trying to run an international equivalent of the UK guarantee on LIBOR rates is apparently vastly complex, and since risk is effectively taken out of the equation and loaded on to the taxpayer, there would seem to be no effective mechanism left to differentiate good and bad risk.
Judging by the record of management of nationalised industries, one can't be very confident of a good outcome.

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souperman2 on October 11, 2008 - 1:00pm Permalink | Subthread | Parent | Comments top

Hey Mc did you see this one?

"A new dawn for Iran"
By Chris Cook

http://www.atimes.com/atimes/Middle_East/JJ09Ak01.html

"I have been working for some seven years, with a background in global financial services at the highest level, to assist Iran in developing a coherent financial system fit for the 21st century."

"It is ironic that Iran has been protected from being infected by the "Anglo disease" by the very sanctions which were aimed at damaging it."

"This currency would be created by unitizing energy as units redeemable against energy within the "PetroTrust" framework I am presenting in Tehran at the International Oil Refining Conference on October 11-12. Such units would then circulate globally, subject to mutual guarantees, within the framework of an International Clearing Union similar to that proposed by the great economist John Maynard Keynes at the first Bretton Woods conference in 1944"

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Zadok_the_Priest on October 11, 2008 - 1:26pm Permalink | Subthread | Parent | Comments top

I believe that Iran should examine - from first principles - how a market economy might operate collaboratively to develop Iran's productive economy, rather than being operated as a casino for the benefit of financiers at the expense of the productive economy.

I look forward to working with my Iranian friends to achieve an economy fit for the 21st century.

Chris Cook's comments are not so much provocative as loaded with irony.

The mother of all ironies. Babylon falls and the land of the Medes (Persia) rises again. Cyrus the Great rocks on.

Ça plus change, ça plus la même chose.

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mcgowanmc on October 12, 2008 - 10:49am Permalink | Subthread | Parent | Comments top

Exactly. From SuddenDebt:

"Finance as practised in the last 30 or so years has no place in this brave new world. There is no room - or any need whatsoever - for chop-and-shop LBO strippers, asset pumpers, market operators, derivatives designers, financial engineers... No, this gallery of rogues has seen the end of their days. Instead, relationship finance will fast make a comeback, if only because the manufacture and placement of unprovenanced securities to faceless "investors" is no longer possible. From now on real investors - the only ones still left standing - will ask for every detail and reason behind their potential investments.

And the market knows... The collective wisdom of millions acting in their self-interest has ground market prices of old-style financial companies into dust. That's no coincidence and no "crisis", either. It's the most obvious sign that the Pony Express is no more... And like all major turning points there will be plenty of opportunity for those with foresight, once the dust settles.
Posted by Hellasious at Thursday, October 09, 2008 "

No economy, no Empire.

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WNC Observer on October 12, 2008 - 8:49am Permalink | Subthread | Parent | Comments top

We've got til Sunday PM for something

Oh, D@MN!!!!! I am coming to hate those Sunday PM announcements.

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150 comments on DrumBeat: October 11, 2008

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