All those claims and yet it appears, no one is cashing out! Taking their assets and quitting their claims. Why not?? One answer is that the msm is saying that things are fundamentally sound! Your readers all know this is false but may not continue the line of logic: cash out now! No investment is safe, even currency! Farm land if cheap and productive is OK. We are in the K winter now. Deflation is king and is only beginning to bite. We are a few years along the Japan trail. They are twenty years along it. Facing "bankruptcy" ie their investors money has been lost!
Ireland can go this way or not.

Birgitta kicks with the other foot!

http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=6029

@ ahimsa

-Defecit easing- you should 'buy it', it's a good, workable idea. The only thing against it is that it doesn't come from a 'neo liberal' economist & therefore must be ignored. Btw, Richard Douthwaite has suggested for some time that brewing structural weaknesses mean that Ireland's continuing membership of the Euro – as the Eurozone is presently managed (well, not effectively managed) – is not our best option.

Thanks for the reference to your Undead Heart series of articles. Glad to see that there’s someone on the same wavelength!

I hadn’t thought of Securitisation in terms of promoting / facilitating Leverage. This certainly rings true and the excessive addiction to growing debt creation certainly points to an inevitable breakdown of the model (almost as if it were designed in!).

We both seem to share the view that risk hasn’t actually been tamed. If we can dismantle this myth then the whole edifice comes falling down. This is the focus of my ICB submission. Risk can’t disappear or qualitatively change form. Banks either avoid, absorb or transfer risk. Securitisation gave the impression of reducing the extent of risk, but this was a catastrophic under-estimation (i.e. mis-pricing) of the risk. Instead it merely enables risk transfers, either to gullible counter parties, or to the tax payer. The quotes from the Fed about “polishing” the quality of loans show them to be complicit in the scam. We have a saying at work that goes along the lines of “you can’t polish a turd” – how apt!

Banks have always been able to control the money supply. They create credit through loan origination. However this always used to be a private arrangement. A bad extension of credit would come back to haunt the bank that created it. Securitisation now enables this to become monetised, and therefore a public problem. This is related to the notion that money is just a special form of credit, a unique subset of credit that is fungible / highly liquid. My main beef is that the banks take the upside profit, but then leg it on the downside, leaving society to pick up the pieces.

Like you, I suspect that there is a tidal wave of credit risk that hasn’t been fully recognised yet. And you can guess who will be left holding the turd! As you say, this is indeed the very heart of the problem.

It's hard not to be cynical & feel like this is what the dumb proles want to hear, and that they're sitting in front of their TV thinking "Yeah! They shouldn't have done that!" As if (supposedly) being shamed on the BBC really puts them in their place. They might as well have interviewed Captain Hindsight.

Granted, there's certainly more public awareness & pushback happening in the UK than here in the US. But this kind of drivel & splooge in the US is likely to work wonders in dampening down public anger, such as there is.

Anyone come across this idea, Deficit Easing (as opposed to quantitaive easing). Involves printing debt-free money.

http://smarttaxes.org/wp-content/uploads/2010/11/Douthwaite-Deficit-easing.pdf

I don't fully buy it but it's thinking outside of the pre-existing monetary box.

David thanks again for Undead Heart. I finally glimpsed an understanding of securities, the banker's black magick.

If you're reading would you drop me an email? I'd like a word if that's OK.

I absolutely agree with you about securitization. I don't know if you were a reader when I wrote the The Undead Heart . It was three parts about securitization. If you didn't and have teh inclination I would be most intersted to hear your thoughts.

I have spoken to various bankers about securitization and the whole bankers paradigm of risk management. It is, as I suspect you also think, the heart of the folly of modern finance.

If you're interested we could chat about it.

I will try to read your submission. I am just very short of time at the moment. Family and work combine to use up all the minutes and those I have left I try to use reading to the boys.

"U.S. Dollar Report:
The Dollar's Day of Reckoning is Here
"The government is printing money 24/7 to paper over the bad debts of the housing crisis and Wall Street bailouts. We're about to enter a cycle of hyper-inflation that will devalue every dollar you own… but there is a way to profit! Find out how in this free report.

As the year goes on, dollar is looking more and more like a colossal short… One that could wind up being one of the biggest moneymakers of the year – if you've got the guts.

Read on to find out why it's time to bet against the dollar… and how to do it for huge profits."

I wonder how many more of Google's 170 million users woke up to this same proposal.

Things are changing…