Investment Chart Kondratiev Wave

Investment Chart Kondratiev Wave

Wednesday 31 March 2010

Pakistan valt India aan over water Indus, India slaat terug




Ernstig watertekort Indus heeft geleid tot gevecht tussen Pakistan en India. India zette nieuwe terreurwapen in.
(http://online.wsj.com/article/SB10001424052702304370304575151591013994592.html?mod=WSJ_hps_InDepthCarousel)
India and Pakistan Feud Over Indus Waters
Fight Threatens Peace Talks
The countries have harmoniously shared the waters of the Indus River for decades. A 50-year-old treaty regulating access to water from the river and its tributaries has been viewed as a bright spot for India and Pakistan, which have gone to war three times since 1947.

Now, the Pakistanis complain that India is hogging water upstream, which is hurting Pakistani farmers downstream. Pakistani officials say they will soon begin formal arbitration over a proposed Indian dam. At a meeting that started Sunday, Pakistan raised objections to new Indian dam projects on the Indus River and asked for satellite monitoring of river flows.

"Water I see emerging as a very serious source of tension between Pakistan and India," said Shah Mehmood Qureshi, Pakistan's foreign minister, in an interview Friday. He said he has raised the issue with Indian Prime Minister Manmohan Singh.

A senior Indian government official denied India is violating the treaty. He blamed Pakistan's water shortage on changing weather patterns and the country's poor water management. He called the strident rhetoric from Pakistani officials a "political gimmick…designed to place yet one more agenda item in our already complex relationship." Indian officials declined comment on the record.

The latest dispute revolves around India's plans to build a 330-megawatt hydroelectric power project on the Kishenganga River, a tributary of the Indus. India says it is well within its rights to build the dam. The project has been on the drawing board since the late 1980s and is expected to cost about $800 million.

Pakistan says New Delhi's plans to divert the course of the river will reduce its flow by a third in the winter. That would make it unfeasible for Pakistan to move ahead with its own plans for a hydroelectric dam downstream.

Pakistan wants to put the Kishenganga project before an arbitration panel—the first time that mechanism of the treaty will have been used. If India agrees, a seven-person court of arbitration would include two members appointed by each country, and three outsiders. India hasn't yet responded formally to the proposal, according to the Pakistan delegation to the meeting.

"We're already a water-stressed country," Jamaat Ali Shah, Pakistan's Indus waters commissioner, said ahead of this week's meeting. India's construction of new dams is "aggravating the stresses."

The water dispute comes as the relationship between the nuclear-armed neighbors is at an inflection point. India last month invited Pakistan to discuss the resumption of regular peace talks, and the two countries' foreign secretaries met in Delhi Feb. 25. A water squabble could upset those peace efforts.



India deploys world's hottest chilli to fight terrorismBhut jolokia, or 'ghost chilli', to be used for teargas-like grenades to immobilise suspects, defence officials say
(1060)Tweet this (247)Stephen Bates
guardian.co.uk, Tuesday 23 March 2010 12.16
(http://www.guardian.co.uk/world/2010/mar/23/india-chilli-bhut-jolokia-terrorism)

(Farmer Digonta Saikia shows a bhut jolokia pepper plucked from his field in the north-eastern Indian state of Assam. Photograph: Manish Swarup/AP)

Ever since the Trojan Horse – and probably long before – men have bent their minds to developing the ultimate secret weapon. Now, at last, the Indian army just might have discovered it: the world's hottest chilli pepper.

The Indian army believes that the pungency of its ground seeds of the bhut jolokia – a capsicum hybrid, growing around the banks of the Brahmaputra river, that is reputed to be 100 times hotter than a jalapeño – could be harnessed in smoke grenades against rioters or to flush out terrorists in confined spaces. The army said the weapon could also be used in aerosol sprays by women warding off attackers.

Older readers who can recall The Goon Show's Major Dennis Bloodnok's frequent strangulated cry of: "It was hell, I tell you. No more curried eggs for me!" may wonder why it has taken them so long, for the vegetable is said to be powerful enough to deter a charging elephant.

The 3in-long stubbly red pepper has been measured at 1,041,427 units on the Scoville scale, twice as hot as the next fieriest pepper, the Mexican red savina, and 200 times hotter than Tabasco sauce, so much so that it gained a place in Guinness World Records. A jalapeño, by contrast, registers a measly 10,000 on the Scoville scale.

RB Srivastava, director of the life sciences department at the New Delhi headquarters of the Defence Research and Development Organisation, said: "This is definitely going to be an effective non-toxic weapon because its pungent smell can choke terrorists and force them out of their hideouts. It would literally choke them."

Noord Korea geeft het voorbeeld

The Consequences Of Policy Decisions (http://www.guardian.co.uk/world/2010/mar/18/north-korean-executed-currency-reform)
The Guardian (UK) – North Korean finance chief executed for botched currency reform
North Korea has executed a senior official blamed for currency reforms that damaged the already ailing economy and potentially affected the succession, a news agency in South Korea reported today. Pak Nam-gi was killed by firing squad last week, said Yonhap, citing multiple sources. The Workers party chief for planning and the economy had not been seen in public since January. The 77-year-old was put to death as “a son of a bourgeois conspiring to infiltrate the ranks of revolutionaries to destroy the national economy”, the agency said. But it reported that many North Koreans did not believe the explanation, citing one source who said: “The mood is the leadership has made Pak Nam-gi a scapegoat.”

Comment (bianco March 31)

When the UK breached its inflation targets last year, Mervyn King, head of the Bank of England, had to write a letter of apology to the Chancellor of the Exchequer Alistair Darling. If he thought this was demeaning, he should consider the alternative in North Korea.

Saturday 20 March 2010

De onvermijdelijke opmars van de asset economy

Door de Kredietcrisis is het vertrouwen in de markteconomie verloren gegaan. Rond 1980 was het vertrouwen in de sociale heilstaat in rook opgegaan en leidde tot de verkiezing van reagan en Thatcher.
De sociale heilstaat ging op alerlei manieren de fout in. Het werd een soort fuik waar je als arme niet uitkwam. Er kwam te veel onbuigzaamheid en starheid bij de werknemers en vakbonden, Zij waren een nieuwe gevestigde orde geworden volgens Mencur Olsen die hervorming tegenhielden. Daardoor bleef men zorgen voor afnemende productiviteitsstijging en dardoor uiteindelijk oplopende werkloosheid.
Daarna is men excessief op de markteconomie gaan inzetten en dat ontspoorde in de Kredietcrisis. Too big to fail rok te veel geld naar zich toe. Regionale banken werden te kwetsbaar in de VS door financiering van regionaal onroerend goed.
Het gevolg is een schuldsneeuwbal die maar moeilijk wegdooit.
Men klaagt over de onfinancierbaarheid van de kleine ondernemening. Ik kan me dat moeilijk voorstellen, dat was altijd al moeilijk en zo zal het wel blijven ook. Dat heeft goede ondernemers niet tegengehouden.

We hebben na 1995 een totaal andere economie.

the rise of the red tories

(http://www.prospectmagazine.co.uk/2009/02/riseoftheredtories/)
Philip Blond 28 februrary 2009 prospect magazine
The crisis is an opportunity to sweep away the rotten postwar settlement of British politics. Labour is moribund. But David Cameron has a chance to develop a "red Tory" communitarianism, socially conservative but sceptical of neoliberal economics

We live in a time of crisis. In such times humans retreat to safety, and build bulwarks against the future. The financial emergency is having this effect on Britain’s governing class. Labour has withdrawn to the safety of the sheltering state, and the comforts of its first income tax rise since the mid-1970s. Meanwhile, the Conservatives appear to be proposing a repeat of Thatcherite austerity in the face of economic catastrophe. But this crisis is more than an ordinary recession. It represents a disintegration of the idea of the “market state” and makes obsolete the political consensus of the last 30 years. A fresh analysis of the ruling ideological orthodoxy is required. Certainly, this new thinking isn’t going to come from the left. New Labour is intellectually dead, while Gordon Brown promises an indebted return to a now-defunct status quo. But, in truth, Brown’s reconversion from post-socialist free marketeer to state interventionist is only plausible because the Conservatives have failed to develop an alternative political economy that explains the crisis, and charts a different future free of the now bankrupt orthodoxies. Until this is achieved, Brown’s claim that the Conservatives are the “do nothing” party has real traction, and makes the result of the next election far from assured.

On a deeper level, the present moment is a challenge to conservatism itself. The Conservatives are still viewed as the party of the free market, an idea that has collapsed into monopoly finance, big business and deregulated global capitalism. Tory social thinking has genuinely evolved, but the party’s economic thinking is still poised between repetition and renewal. As late as August 2008 David Cameron said: “I’m going to be as radical a social reformer as Margaret Thatcher was an economic reformer,” and that “radical social reform is what this country needs right now.” He is right about society, but against the backdrop of collapsing markets and without a macro-economic alternative, Thatcherite economics has been wrongfooted by events.

Thankfully, conservatism is a rich and varied tradition, and re-examinating its history can provide the answers Cameron needs. These ideas are grounded in a conservatism with deeper roots than 1979, and whose branches extend into the tradition of communitarian civic conservatism—or red Toryism. This is more radical than anything emerging from today’s left and should be the way forward for the right. The opportunity to restore a radical, and progressive, Toryism must not be lost to the economic downturn.

To date, neither political party has offered a plausible analysis of the origins of the meltdown. Brown denies all responsibility while George Osborne and Cameron hold him wholly and uniquely culpable. Given that no reasonable person can think either position is tenable, both parties have surrendered the intellectual high ground. But the financial crash does provide an opportunity to think through a renewed “one nation” conservatism. Cameron says that Disraeli is his favourite Tory. Disraeli attempted to ameliorate a society destroyed by the rampant industrialisation of 19th-century capitalism, whereas Cameron’s chief target (until now, at least) has been a 20th-century creation: a disempowering, dysfunctional state. Nineteenth-century Tories criticised liberal capitalism, while 20th-century conservatives condemned the illiberal consequences of statism. But 21st-century Tories, especially against the backdrop of the current crisis, must inveigh against both in favour of the very thing that suffers most at the hands of the unrestrained market and the unlimited state: society itself. And conservatism, so imagined, could reject the politics of class—of “our people”—and the interests of the already wealthy in favour of a national politics that serves the needs of all.

It was Edmund Burke who famously spoke of conservative radicalism being founded on the little platoons of family and civic association. “To love the little platoon we belong to in society is the first principle of public affections. It is the first link in the series by which we proceed towards a love to our country and to mankind.” This is the true spirit of Cameroonian conservatism and, taken seriously, it represents a break with the monopoly logic of the market state. But to recognise this innovation for what it is we have to contrast the potential of Cameron’s civic communitarian conservatism with what it aims to transcend: the corrupt and rotten postwar settlement of British politics.

***

Since 1945 Britain has experienced two governing paradigms. The first—state sponsored Keynesianism—extended from 1945 through the oil shocks of 1973 to its death in 1979. The second—neoliberalism—ran from then until the global debt crisis of 2007-08. It is often assumed that these models represent genuinely different and mutually exclusive worldviews—yet, in spite of very real distinctions, they share important philosophical and economic assumptions, and both attracted cross-party support. Look at the society we have become: we are a bi-polar nation, a bureaucratic, centralised state that presides dysfunctionally over an increasingly fragmented, disempowered and isolated citizenry. The intermediary structures of a civilised life have been eliminated, and with them the Burkean ideal of a civic, religious, political or social middle, as the state and the market accrue power at the expense of ordinary people. But if both 20th-century socialism and conservatism have converged on the market state, they have done so by obeying the insistent dictates of modernity itself. And modernity is nothing if not liberal.

To understand why the legacy of liberalism produces both state authoritarianism and atomised individualism, we must first note that philosophical liberalism was born out of an 18th-century critique of absolute monarchies. It sought to protect the rights of the individual from arbitrary abuse by the king. But so extreme did the defence of individual liberty become that each man was obliged to refuse the dictates of any other—for that would be simply to replace rule by one man’s will (the king) with rule by another. As such, the most extreme form of liberal autonomy requires the repudiation of society—for human community influences and shapes the individual before any sovereign capacity to choose has taken shape. The liberal idea of man is then, first of all, an idea of nothing: not family, not ethnicity, not society or nation. But real people are formed by the society of others. For liberals, autonomy must precede everything else, but such a “self” is a fiction. A society so constituted would be one that required a powerful central authority to manage the perpetual conflict between self-interested individuals. So the unanticipated bequest of an unlimited liberalism is that most illiberal of entities: the controlling state. Even the most “communitarian” liberals—from philosophers like Michael Sandel to politicians like Ed Miliband—cannot promote community without big government. They see the state as the answer, when it usually makes the problem worse. The legacy of liberal individualism is the restoration of the very absolutism that it originally sought to overthrow—a philosophical tragedy that can be summed up as: “the king is dead, long live the king.”

Conservatives who believe in value, culture and truth should therefore think twice before calling themselves liberal. Liberalism can only be a virtue when linked to a politics of the common good, a problem which the best liberals—Mill, Adam Smith and Gladstone—recognised but could never resolve. A vision of the good life cannot come from liberal principles. Unlimited liberalism produces atomised relativism and state absolutism. Insofar as both the Tories and Labour have been contaminated by liberalism, the true left-right legacy of the postwar period is, unsurprisingly, a centralised authoritarian state and a fragmented and disassociative society.

In respect of liberalism, the left has twice sinned. It has produced a managerial state that has destroyed the old mutualism of the working class. And it has destroyed both middle and working class morality; in the name of permissiveness, it commodified sex and the body, creating the licentious empty pleasure-seeking drones of the late 1960s. This left-libertarianism repudiated all ties of kith and kin and, though it was utopian in aspiration, its true legacy has been the dystopia of divided families, unparented children and the lazy moral relativism of the liberal professional elite. In this sense, the left was right wing years before the right, and it created the conditions for universal self-interest under Thatcher. The current political consensus is left-liberal in culture and right-liberal in economics. And this is precisely the wrong place to be.

***

In addition to this liberal legacy in Britain, two further pejorative factors persist: class and monopoly. After the second world war, the need for massive reconstruction enabled European countries to pool the interests of state, capital and waged workers. But in Britain few parties saw the need to abandon their sectional interests. The unions were unwilling to discard free collective bargaining and British postwar industrial relations were frozen in a state of unresolved class conflict. When Keynesianism began to break down, the workers responded simply by asking for more and more of less and less. Thatcher’s anti-union legislation did eventually curtail union power. But British management was shortsighted too—as Tony Benn once put it, if they made a profit they thought there was no need to invest, and if they didn’t there was no money available to invest anyway.

Thatcher, in turn, declared this bankrupt British variant of corporatism dead. But she overshot in the other direction. Instead of holding the middle ground, the state was deployed in favour of the owner and entrepreneur. The benefits of Conservative liberalisation in the late 1980s accrued mainly to the top. The middle class saw its rise in income partly offset by more debt, while the poor sank relatively lower. New Labour did little to reverse these trends. In short, Britain remains stuck with a contested, class-based capitalism that has done great damage to British life.

The final feature of postwar British politics is the maintenance and escalation of monopoly. The fact that the state has established monopolies is self-evident. Nationalisation was a failure on its own terms, even more so because working people were never enfranchised by it. It created remote new behemoths, with popular disengagement from the levers of power. JB Priestley, socialist doyen of the intellectual class, wrote in 1949 that “the area of our lives under our own control is shrinking rapidly… politicians and senior civil servants are beginning to decide how the rest of us shall live.”

Thatcherite neoliberalism was determined to terminate all these state monopolies. Instead, markets would become the vehicle by which efficiency was maximised and prosperity attained. But the free market fundamentalists often did little more than create new monopolies of capital to replace those of the state. It was not until New Labour enacted the 1998 Competition Act that Britain obtained its first effective anti-monopoly, pro-competition regime. And, gallingly for Conservatives, the most effective protection the British economy gained against restrictive practices during the Thatcher and Major years came from Brussels competition legislation.

The financial crisis is just the latest example of the collapse of markets into what I call “modal monopoly.” By this I mean a model of monopoly that extends beyond whether an individual company has undue market influence to whether a certain mode or way of doing business constitutes a cartel. For example, the great housing crash is primarily the result of the absorption of all local, regional and national systems of credit into one form of global credit. The world’s financial system lacked the firewalls needed to separate local from national and international capital. Unduly reliant on one source of credit supply, the residential asset market collapsed when this supply was compromised. The housing bubble was just the last and most notable piece of neoliberal speculation to burst. In the meantime, the big banks were dedicated to generating price fluctuations and asset bubbles and then exiting before their demise. This strategy of market manipulation deployed enormous amounts of capital in speculative arbitrage (just five US banks had control of over $4 trillion of assets in 2007). This market was far from the thousands of small investors envisaged by classical free-market liberals.

Whether by private or public means, the mark of recent decades has been defined by this three-part story: the liberal consensus, the persistence of class, and the triumph of monopoly and speculation in the name of free trade and modernisation. Against this, Cameron’s nascent civic conservatism would be the first radical break with all of the aforementioned ills. It is the fulcrum around which the renewal of Britain could turn. But he has his work cut out. The erosion of our society extends way beyond the dysfunction of the underclass. A study last year by Danny Dorling showed how normal anomie has become, concluding that “even the weakest communities in 1971 were stronger than any community now.” This is, indeed, a broken society.

British conservatism must not, however, repeat the American error of preaching “morals plus the market” while ignoring the fact that economic liberalism has often been a cover for monopoly capitalism and is therefore just as socially damaging as left-wing statism. Equally, if Conservatives are to take power from the market state and give it to the people, they must develop a full-blooded “new localism” which works to empower communities and builds new, vibrant local economies that can uphold the party’s civic vision.

***

How will this happen? What must Cameron’s priorities be, and how can he begin to build a new communitarian Tory settlement? He could start with four tasks: relocalising our banking system, developing local capital, helping normal people gain new assets and breaking up big business monopolies. The first priority must be a banking system that works. Britain’s banks no longer provide credit because they are crippled by £150bn of constantly devaluing mortgage securities. To fix this, we need a new, parallel banking system. To get one, Cameron should announce a reconfiguration of the Post Office to extend its currently limited retail banking function, and reverse Peter Mandelson’s privatisation plan. The Post Office is universally popular, national, tied to the local community and, crucially, entirely free of bad debt secured on declining assets. Other banks would lend to it but, more importantly with interest rates approaching zero, the Bank of England could use at minimal cost “quantitative easing” (printing money) to underwrite both business and mortgage credit. Using the Post Office would introduce some public sector competition. Yes, the state’s balance sheet would expand, but at nominal cost. If it helps to arrest the fall in asset prices (as a restoration of lending would) any public money spent would secure money already invested in Brown’s bailout, and be far more effective than any fiscal stimulus. This new Post Office could genuinely restimulate the economy by lending at small margins, and by being involved in local investment rather than global speculation. It could even be localised rather than privatised, giving it back to communities, to extend investment and increase prosperity in every neighbourhood.

Having announced this plan, Cameron should move forward by helping local communities to take ownership of their assets too. He should set up a new class of local investment trusts, dedicated to investing in the cities and villages that they serve. These trusts could become new centres of local finance; rather than investing in Iceland, local councils and other bodies should be compelled to deposit public funds with them, increasing the local capital base. Likewise the Tory’s proposed new “social fund” could act within the trusts in deprived areas to offer micro-finance to people without assets. This would create a new, but distinctly conservative form of asset based welfare leading eventually to claimant independence. The trusts would own the local Post Office network, and each trust could work to invest and develop local economies. Instead of the wasteful regional development agencies (RDAs), which spend over a third of their £10-12bn budget on administration and help less than 1 per cent of all small businesses, this could create a genuinely local form of venture capital. The regional trust network, meanwhile, could facilitate new guilds and cooperatives. With a common finance centre, and the use of modern technology, these could do anything from research and development to export drives to running local schools and hospitals. It would put real energy behind the “conservative co-operative movement” that David Cameron launched in 2007.

The next step would be to ensure local government procurement is devolved to local bodies. A 2005 study by the New Economics Foundation showed that every pound spent with a local supplier generated £1.76 locally, while every pound spent with outside suppliers generated only 36p. A 10 per cent increase in the amount of council money spent locally would mean an injection of £5.6bn into local economies. And if the trusts were also able to issue bonds, this could restore something like the power of the 19th century municipalities. (Residents could even participate in mass versions of Dragon’s Den to decide on the investments to be made.) So conceived, the localities could help to reverse the dreadful centralising pull of London—which sucks all the talent and money from the rest of the country into the overheated south east, leaving everywhere else a mere backwater.

The next step for conservatism is to reverse the old politics of class, by restoring capital to labour. Cameron should reject the Marxist narrative that paints Tories as wedded to a disenfranchised proletariat. On the contrary: conservatives believe in the extension of wealth and prosperity to all. Yet the great disaster of the last 30 years is the destruction of the capital, assets and savings of the poor: in Britain, the share of wealth (excluding property) enjoyed by the bottom 50 per cent of the population fell from 12 per cent in 1976 to just 1 per cent in 2003. A radical communitarian civic conservatism must be committed to reversing this trend. This requires a considered rejection of social mobility, meritocracy and the statist and neoliberal language of opportunity, education and choice. Why? Because this language says that unless you are in the golden circle of the top 10 to 15 per cent of top-rate taxpayers you are essentially insecure, unsuccessful and without merit or value. The Tories should leave this bankrupt ideology to New Labour and embrace instead an organic communitarianism that graces every level of society with merit, security, wealth and worth.

***

Such ideas are not without a past. The idea of a Tory distributist state is not new; indeed the phrase “property owning democracy” was first coined in 1923 by the Conservative MP Noel Skelton. Anthony Eden used it too in his celebrated speech to the 1946 party conference, and the philosophy enthused both Churchill and Thatcher. Recent Tory proposals to exempt the savings of the low paid and pensioners from tax are exactly the path to follow. They should go further, arguing for far-reaching extensions to employee share ownership, workers’ buyouts and the promotion of equity guilds and asset co-operatives. This would bypass the trade unions as institutions permanently wedded to welfare serfdom, and wed ownership to the earning of wages.

The final piece of the puzzle is for Conservatives to break with big business. We must end a model in which competition is reduced to a cartel of vast corporations maximising profits by discouraging competitors and minimising wages by joining with the liberal left to encourage mass immigration. A covert alliance between the liberal left and liberal right has destroyed incomes and identity at the bottom of the scale.

The Tories must take on the unrecognised private sector monopolies that hide on every British high street. According to figures from IGD research in May 2008, the British grocery market was worth £134.8bn. Of this, the big four supermarkets took £98.6bn, a 73 per cent market share. In the name of competition we have happily handed over our high streets to Tesco, strangling local commerce. The more that price is our only measure of competition, the bigger the economies of scale required to compete, and the higher the barriers to entry for small local competitors. Our fishmongers, butchers, and bakers are driven out—converting a whole class of owner occupiers into low wage earners, employed by supermarkets. And, once you have a monopoly, it demands that other monopolies serve it, just as Tesco demands economies of scale from its suppliers, driving out small and medium-size farms. It is perfectly clear that the Office of Fair Trading and the Competition Commission are not up to the job. Cameron should revamp them and announce his intention to break up all the big-box retailers. And, when he is finished, he should take a hard look at mobile phone companies. Breaking up supermarkets won’t change the world: but, as they say, every little helps.

Taken together, such policies will help conservatives create a transformative red Tory manifesto. They would build a new economic and capital base that decentralises power and extends wealth and also makes a final break with the logic of monopoly and debt-financed capitalism. In doing so, Cameron can finally bring together the Tory tradition of Disraeli’s reform of capitalism with his own entirely justified desire to be a “social radical.” It would render the left superfluous and redefine Marx as just another dispossessor of the poor. Moreover it would recover the insights of 19th-century conservatives like Cobbett, Ruskin and Carlyle, ally them with Tawney and the distributism of Chesterton, Belloc and Skelton—all of who knew that, without something to trade, one cannot enter a market. Making markets truly free prevents corporate domination, but also extends ownership, prosperity and innovation across the whole of society. The task of recapitalising the poor is, therefore, the task of making the market work for the many, not the few. David Cameron doesn’t need to do any of this to win the next election. But, to be a great prime minister, he does.

The Broken Society


(http://www.nytimes.com/2010/03/19/opinion/19brooks.html?src=me&ref=homepage)
(afbeelding res publica, Blond: the rise of the red tories)
The United States is becoming a broken society. The public has contempt for the political class. Public debt is piling up at an astonishing and unrelenting pace. Middle-class wages have lagged. Unemployment will remain high. It will take years to fully recover from the financial crisis.

This confluence of crises has produced a surge in vehement libertarianism. People are disgusted with Washington. The Tea Party movement rallies against big government, big business and the ruling class in general. Even beyond their ranks, there is a corrosive cynicism about public action.

But there is another way to respond to these problems that is more communitarian and less libertarian. This alternative has been explored most fully by the British writer Phillip Blond.

He grew up in working-class Liverpool. “I lived in the city when it was being eviscerated,” he told The New Statesman. “It was a beautiful city, one of the few in Britain to have a genuinely indigenous culture. And that whole way of life was destroyed.” Industry died. Political power was centralized in London.

Blond argues that over the past generation we have witnessed two revolutions, both of which liberated the individual and decimated local associations. First, there was a revolution from the left: a cultural revolution that displaced traditional manners and mores; a legal revolution that emphasized individual rights instead of responsibilities; a welfare revolution in which social workers displaced mutual aid societies and self-organized associations.

Then there was the market revolution from the right. In the age of deregulation, giant chains like Wal-Mart decimated local shop owners. Global financial markets took over small banks, so that the local knowledge of a town banker was replaced by a manic herd of traders thousands of miles away. Unions withered.

The two revolutions talked the language of individual freedom, but they perversely ended up creating greater centralization. They created an atomized, segmented society and then the state had to come in and attempt to repair the damage.

The free-market revolution didn’t create the pluralistic decentralized economy. It created a centralized financial monoculture, which requires a gigantic government to audit its activities. The effort to liberate individuals from repressive social constraints didn’t produce a flowering of freedom; it weakened families, increased out-of-wedlock births and turned neighbors into strangers. In Britain, you get a country with rising crime, and, as a result, four million security cameras.

In a much-discussed essay in Prospect magazine in February 2009, Blond wrote, “Look at the society we have become: We are a bi-polar nation, a bureaucratic, centralised state that presides dysfunctionally over an increasingly fragmented, disempowered and isolated citizenry.” In a separate essay, he added, “The welfare state and the market state are now two defunct and mutually supporting failures.”


[It is now clear that we are at one of those epoch-changing moments in British political history. Just as the 'Winter of Discontent' in 78/79 marked a paradigm shift, an utter and complete reversal of the pre-existing order and the arrival of something new, something revolutionary and something transformative - so the present unprecedented debt crisis of 2008/2009 is doing the same.

1979 brought an end to the welfare state, 2009 will see an end to the market state and the next election will, with the election of a conservative government, usher in the birth of the civic state.

We know what was wrong and what was right with the welfare state, it is right to provide a floor through which people cannot fall, it is right to have a safety net which catches and supports people who for reasons of health, wealth or market fluctuation cannot sustain themselves in the interim. Finally it is right to secure the general well being of all through a universal account of the common good and the necessity of full participation in it.

However we also know that welfare is a far more effective ceiling than it is an adequate floor - it traps as many as it helps and condemns therefore a whole class to permanent poverty and dependence. Furthermore welfare dis-empowers its recipients - the philosophy of entitlement destroys consciousness of mutuality and it fragments working class culture and permanently disables the associative drive that alone can make communities and foster the development of wealth and independence. Finally welfarism was the Faustian bargain that the left struck with monopoly capitalism, it ensures a kind of permanent ascendancy of the middle over the working class and creates an antagonistic feudal structure - where any genuine extension of power and ownership to the poor is resisted by the liberal middle classes who fear mostly for their own status and their sole assumed inherited right to social mobility. (Just look at British schooling)

Similarly we know what is right and what is wrong with the market state. Clearly the market is a more effective and efficient mechanism for the distribution of many resources than the state. Evidently if one can enter the market place and if one has something to trade - the market creates wealth, prosperity and independence. Finally there is the manifest good of liberty and unless this has an economic reality - one would exist under the permanent subjugation of the state, or the private cartel. Yet we also know what is wrong with the market state – too often it replaces a public monopoly with a private cartel. In the name of breaking up the state too little attempt was applied to breaking up the market. Under the dispensation of the market state, private replaced public monopoly and market entry was effectively and progressively denied to newcomers. The majority of Britons having being denied entry to the market lost any access to investment capital. Thus the ability to transform one's life or situation steadily declined as wealth flowed upwards rather than downwards and a new oligarchical class, asset rich and leverage keen, assumed market freedom was synonymous with their complete ascendancy. Market fundamentalism abandoned the fundamentals of markets. Prudent Chancellors promised no more boom and bust, the state sanctioned monopoly capitalism and sat happy on the tax receipts of unrestrained global gambling. As Labour stoked the engine of inequality - it abandoned the rest of the economy for the receipts of city speculation and the re-distributive power of welfarism . Thus the market and the welfare state merged into one as they both colluded in a system whose bankruptcy is now ongoing and self-evident.

The welfare state and the market state are now two defunct and mutually supporting failures
]



The task today, he argued in a recent speech, is to revive the sector that the two revolutions have mutually decimated: “The project of radical transformative conservatism is nothing less than the restoration and creation of human association, and the elevation of society and the people who form it to their proper central and sovereign station.”

Economically, Blond lays out three big areas of reform: remoralize the market, relocalize the economy and recapitalize the poor. This would mean passing zoning legislation to give small shopkeepers a shot against the retail giants, reducing barriers to entry for new businesses, revitalizing local banks, encouraging employee share ownership, setting up local capital funds so community associations could invest in local enterprises, rewarding savings, cutting regulations that socialize risk and privatize profit, and reducing the subsidies that flow from big government and big business.

To create a civil state, Blond would reduce the power of senior government officials and widen the discretion of front-line civil servants, the people actually working in neighborhoods. He would decentralize power, giving more budget authority to the smallest units of government. He would funnel more services through charities. He would increase investments in infrastructure, so that more places could be vibrant economic hubs. He would rebuild the “village college” so that universities would be more intertwined with the towns around them.

Essentially, Blond would take a political culture that has been oriented around individual choice and replace it with one oriented around relationships and associations. His ideas have made a big splash in Britain over the past year. His think tank, ResPublica, is influential with the Conservative Party. His book, “Red Tory,” is coming out soon. He’s on a small U.S. speaking tour, appearing at Georgetown’s Tocqueville Forum Friday and at Villanova on Monday.

Britain is always going to be more hospitable to communitarian politics than the more libertarian U.S. But people are social creatures here, too. American society has been atomized by the twin revolutions here, too. This country, too, needs a fresh political wind. America, too, is suffering a devastating crisis of authority. The only way to restore trust is from the local community on up.

Wednesday 17 March 2010

St Patrick's day 62% up


17 maart: bespoke: a lucky day for the markets. in 2010 +0,45%.
Below we highlight the performance of the Dow Jones Industrial Average on St. Patrick's Day (only weekdays) since 1901. As shown, the Dow has historically averaged a gain of 0.16% (median 0.22%) on St. Patrick's Day, with positive returns 61.5% of the time. This is much better than the average change of 0.025% for all trading days since 1901. The Dow has risen on five of the last six St. Patrick's Days, and the index is higher so far today as well. Happy St. Patrick's Day!

Sunday 14 March 2010

barrons negatief


Sinds begin februari heb ik twee keer geblogd dat de teneur van de barrons artikelen die week zeer positef was. De beurs ging de dag (en week erna) inderdaad omhoog.
Deze week zijn de vier meest bekeken artikelen negatief: 1.het gat van $ 2000 miljard van de overheidspensioenfondsen met hun consequenties voor de kredietwaardigheid van staten en gemeentes (de Amerikaanse variant van het Griekenlandthema), 2.een artkel over het creatieve boekhouden van Lehman Brothers (=vertrouw financials niet, ze zijn ook nog eens kwetsbaar na hun flinke rallies sinds februari), 3. het commentaar: Is Another Market Pullback Near? Het koersmomentum wijst op 9% terugval zo meldt men hierin (maar het wijst wel op hogere koersen over een jaar), 4. het artikel: For Stocks, 16 Lean Years. Door slechte demografie (afnemend aantal 48 tot 60 jarigen die aggressief aandelen bijkopen) moet beurs 16 jaar achteruit [mijn commentaar: dat gaat meevallen omdat mensen noodgedwongen langer blijven sparen dan tot 60 jaar, omdat de komende jaren meer jaargangen in de spaarleeftijd zitten neemt het aantal agressieve aandelenbeleggers voorlopig juist toe).
De voorkant (zie plaatje) straalt overdreven pessimisme uit, dus misschien is de koersdaling alleen maar beperkt tot maandag.

Saturday 13 March 2010

het pensioenstelsel klapt gegarandeerd (2)

De grootste bedreiging voor het pensioenstelsel zit in nieuwe boekhoudregels. In Nederland zijn die voor pensioenfondsen neergeslagen in het nieuwe financiële ToezichtsKader (nFTK).Voor het bedrijfsleven is dat IAS19.
Wat er gebrut is dat een en ander zo veel mogelijk op marktwaarde moet worden gewaardeerd. Die marktwaarde fluctueert verschrikkelijk, zowel aan de verplichtingenkant als aan de beleggingskant.
Voor pensioenfondsen betekende dit een diepgaande analyse van derivaten om o.a. het renterisico af te dekken en een veel betere risicoanalyse. Er was en is ineens een sprong in de kennis van bestuurders nodig.
Voor het bedrijfsleven betekent dit dat over enige tijd (2012?) de resulatetn van het pensioenfonds keihard de resultatenrekening binnenkomen. De winsten en verliezen en de actuariële tekorten kunnen gigantisch zijn vergeleken met de resultaten uit normale bedrijfsvoering en de balans.
De logische reactie van het bedrijfsleven is zo snel mogelijk van die pensioeninvloeden af te komen. Dat veroorzaakt een enorme druk om over te gaan van defined benefit naar defined contribution.
Die overgang betekent dat nieuwe pensioenspaarders in het defined contribution systeem geen zekerheid meer hebben of ze genoeg bij elkaar gespaard hebben voor de oude dag. Ze zijn helemaal afhankelijk van het rendement op hun beleggingen. Dat rendement heb je niet in de hand. Je kunt zo maar tegen een periode van zeer lage rente en/of zeer negatieve rendementen op zakelijke waarden aanlopen. Ik heb wel eens berekend dat bij defined contribution ca. 40% van je pensioenresultaat behaald wordt in de laatste tien jaar voor je met pensioen gaat. Als dat toevallig slechte beleggingsjaren zijn ben je erg slecht af. Het is veel beter dit soort invloeden solidair glad te strijken over de generaties heen. 100% glad strijken is niet redelijk bij een vergrijzende samenleving, maar een behoorlijke solidariteit is toch wel broodnodig. Je kunt tegen mensen met een modaal inkomen straks toch niet gaan zeggen dat ze op een houtje moeten bijten omdat de beleggingsresulataten in de afgelopen tien jaren zo slecht waren. Je kunt dat risico uiteraard verminderen door zo risicoloos mogelijk te beleggen in de laatste tin jaar, maar dan bouw je zeer flink minder pensioen op dan gemiddeld zou gebeuren in een solidair defined benefit systeem. Het bestaansrecht van een pensioenfonds is het goede rendement op lange termijn vergeleken met de lange rente (die op lange termijn gemiddeld in de pas loopt met de groei van het BNP) en dat is vooral ook goed omdat een pensioenfonds zo'n lange horizon heeft en in het solidaire geval ook nog (beschaafd!) risico kan nemen voor 55-65 jarigen en ouder. Nederlandse pensioenfondsen zijn in staat die goede rendementn te genereren als ze niet te pessimistsich worden en daarom zo'n grote aanwinst voor de Nederlandse economie!

wat moet ik met de asset economy: kinderen gaan voor

Ons boek geeft aan dat je de asset economy goed moet sturen. als je dat niet doet kost je dat groei, vrij veel groei. ook door te grote uitslagen in de economie, want dat is per saldo ook groeiremmend.
we hebben zeer lange periode gezien van dalend macro risico. dat is doorbroken door de kredietcrisis en komt niet helemaal goed, omdat asset economy noodzakelijkerwijze risico toevoegt als je de Japansituatie goed wil doorkomen.

dat kan een veel te harde economie veroorzaken. politici geven ineens het voorbeeld: stop met dat 100+ uur werken anders is het gedaan met je gezinsleven. ministers/ partijlieders zeiden dat hun glamour post er wel voor zorgde dat hun kinderen ineens vier jaar waren geworden (of 8) toen ze er weer naar omkeken. er was een onomkeerbaar gat in hun begeleiding ontstaan. kinderen namen hen dat nog steeds kwalijk.

de kansen voor de overheid van de asset economy worden niet goed benut. denk aan nederlandse pensioenfondsen die dolgraag in infrastructuur willen belggen. Nederlandse overheid, zorg dat pensioenfondsen hun geld in Nederlandse infrastructuur kwijt kunnen. Dat heeft een fantastisch hoge multiplierwerking en niet die van Barro.(BAM spreekt over 9* leverage).

reacties op bos: besluit 2007, geloof het niet, het is angst voor de toekomst.
libelle: geloof het niet, hij gaat echt niet de hele tijd bij de zandbak zitten.
wat nu gebeurt is een te fantastisch scenario voor de pvda
sanctie vrouw: de muts reden.
foto Bos met de lege kinderwagen.

eppink bij harrie mens:
de huidige patatgeneratie regeert. ze hebben alles gemakkelijk gekregen, hun baan etc. nu gaat het moeilijker en is het niet meer leuk en scheiden ze er mee uit. Nederland is het land met slappe kniën (Afghanistan). De huidige politici kwamen op met negatieve boodschap: islam, we zitten in een crisis etc.
de pvda grijpt terug op de oudere generatie. misschien ontstaat daardoor wel meer optimisme.

buitenhof: kabinet met wilders an niet omdat pvv geen zetels heeft in eerste kamer.
dus strijd cohen balkenende en niet cohen wilders. cda zal wijzen op te linkse insteek cohen. cohen dat stem cda er een voor wilders is.

MEW en de asset economy


De nieuwe flow of fund analyse van de FED bracht Calculated Risk ertoe weer eens te berekenen hoe groot de mortgage equity withdrawal was [mewq4]. Dat was de motor achter de consumptie en daarmee economie en dat blijft dus helemaal fout gaan. Consumptie wordt door een onduidelijk vortschrijdend gemiddelde van mortgage equity withdrawal geholpen. Greenlaw van MS kan moeilijk verbanden vinden, maar volgens de theoretici moet het een redelijk vernietigende uitwerking hebben op consumptie.

De Kredietcrisis heeft een gigantische verschuiving in het Amerikaanse spaarhuis veroorzaakt. Die is nauwelijks te zien in de toale spaarquote. Die is opgelopen, maa neit zo veel als je zou deneken en als zou moeten gezien de instorting van MEW.
In Amerika was men tot de Kredietcrisis heel ondernemend aan het sparen. Van het inkomen ging heel veel naar beleggingen maar men beleende dit ook. Per saldo gaf de spaarquote aan dat er nauwelijks gespaard werd. Ondertussen liepen de schulden versus inkomen wel op. Sinds de Kredietcrisis zijn die enorme beleggingsstromen vrijwel opgedroogd. Per saldo is de spaarquote maar een beetje gestegen, maar daalt schuld versus inkomen wel. Die schuldaling wordt volledig ongedaan gemaakt door het oplopen van de statsschuld. Zo veel is men er dus niet mee opgeschoten.

Net zoals bij pensioenfondsen die een rendement moeten behalen van meer dan de nominale groei van het BNP, zo moeten die ondernemende beleggingen van particulieren ook meer opbrengen dan de rente. Anders moet men deleveragen.
Japan wordt dan het grote voorbeeld waar de particulier massaal ging sparen tegen 0% rente.
De VS investeerde wel rendabel, men spaarde tegen een hoger rendement dan de rente en daardoor consumeerde de VS zich rijk en spaarde Japan zich arm.
Nu tracht men Amerika en Europa de heilzame strategie van Japan aan te smeren: aflossen en spare tegen 0% rente.

Commentaren op de analyse van CR datMEW -2,7% van beschikbaar inkomen was en groei consumptie dus alleen kon en kan komen uit inkomensgroei en lagere besparingen:
* alleen in de VS ziet men aflossen schulden als iets negatiefs
* The home mortgage AM is out of service, try next decade again
* Opervlakte onder 0 in grafiek brengt ons slechts terug naar 2007 bubbelniveau [ho 2%-3% is sustainable denk ik, niet 0]
* In America, GDP depends on highly-leveraged bets that rely on large negative numbers to produce positive ones. It's like an anti-economy [de essentie, maar dan precies andersom]
*inkomensgroei? Wat is dat? Antwoord andere blogger: iets dat in Azië gebeurt; alleen iets dat bankiers krijgen
*Waaraan is MEW uitgegeven? In die sectoren zit lange ellende. Vooral auto's.
*CR vergat negatief lenen (=defaulten, $25B makkelijk haalbaar per kwartaal)

*

rente en groei: de asset economy


Krugman haalde op zijn blog (http://krugman.blogs.nytimes.com/2010/03/11/beware-of-greeks-getting-gifts/)complimenteurs uit naar Reinhardt. Wat een geweldige grafiekenset heeft ze gemaakt over financiële crises [eens]. Maar daarmee toonde zij tegelijk aan dat te hoge overheidsschuld helemaal niet fout hoeft af te lopen. Krugman laat plaatjes zien van België en voor Groot Brittannië [ukdebt] uit de set van Carmen.
Je komt uit de schuldproblemen door te groeien. Die groei moet zo hoog zijn dat de reële rente lager is dan de reële groei. Daar ben ik het uiteraard helemaal mee eens, ik heb er al eens een column aan gewijd.
Een en ander past wel in het straatje van Krugman die Obama steeds voorhoudt dat hij door moet gaan met enorme fiscale stimulering.
De hoofdwet van de asset economy is dat de reële rente lager moet zijn dan de reële groei. Om dat voor elkaar te krijgen moet men niet te veel schuld hebben (Griekenland heeft een groot probleem), maar ook niet zo weinig dat de investeringen te laag zijn zodat lage groei economie zorgt voor een te hoge reële rente.

de zwanenzang van de devaluatiewedloop


Krugman haalde op zijn blog (http://krugman.blogs.nytimes.com/2010/03/11/chinas-swan-song/) de Australische econoom Trevor Swan aan die met zijn analyse van de vier ongelukkige stadia waarin een economie kan verkeren (zie plaatje via blog Krugman) plausibel maakt dat China moet revalueren. De inflatie dreigt op te lopen door te sterke economische groei. In die situatie zat West Duitsland na 1960 en dat leidde tot menige revaluatie van de D-mark. Uit het plaatje kun je ook halen dat Japan moet devalueren (inflation deficit bij onderbezetting van de economie.
Een complicerende factor is dat er meer doelstellingen zijn dan de twee genoemde. Dat gaat fout volgens Tinbergen. Je moet je echt concentreren op de twee die het elangrijste zijn. Dat doe je binnen bepaalde voorwaarden. Swan koos ervoor tegen elkaar af te wegen werkloosheid bij een nog acceptabele inflatie en de handelsbalans (via de wisselkoers).

In de Kredietcrisis zie je dat het wisselkoerswapen door heel wat landen is ingezet. Door de onderbezetting/ hoge werkloosheid was er geen inflatiegevaar bij devaluatie.
Het waren vooral de satellietvaluta's die flink vielen (Engels pond, Zweedse kroon versus euro; Australische dollar, Mexicaanse peso, Braziliaanse real tegen de dollar; de Singapore dollar, Koreaanse won etc. tegen de yen en renminbi).
Voor diverse landen betekende dit een snel herstel (Australië, Singapore, Korea, Taiwan, Brazilië, Mexico) en werd de te grote daling voor een beoorlijk deel ongedaan gemaakt (A$, BRL o.a.).
De hoofdvaluta's zaten in de knel. De VS koos voor groei, Europa en Japan voor stagnatie. De euro en yen moeten devalueren.
In Japan is dat onafwendbaar geworden. Je kunt nog wat tegenstribbelen zoals Nederland in de jaren 30 deed, maar uiteindelijk moet je valuta er aan gaan als de groei niet herstelt.
In de jaren 30 ontstond een devaluatiewedloop omdat iedereen in het quadrant van inflation deficit kwam of unemployment surplus.
Nederland heeft geen goede herinneringen overgehouden aan dat tegenstribbelen. De gulden bleef lang sterk maar kwam uiterst zwak uit de Tweede Wereldoorlog. Nederland betaalde zijn staatsschuld maar het geld was eerst voor een groot deel afgestempeld via het tientje van Lieftinck. Dat was denk ik niet anders gegaan als de gulden eerder was gedevalueerd, want na 1945 was er geen keus: je moest groei krijgen via een valuta die goedkoop was tegen de dollar. De beoordeling van de dollar was toen totaal anders dan nu. De dollar werd op F 3,81 gezet (1$=€1.72) en gezien als baken van stabiliteit, veiliger dan goud: je moest dollars kopen om je van koopkracht te verzekeren, bij andere valuta's liep je het risico dat ze plotseling niets meer waard werden, zoals bij Duitsland of Japan.

Friday 12 March 2010

politiek

tijdgeest en cohen
zekerheid en optimisme versus populisme
verder wat kwam er langs deze week
flattening nu nog niet, al geeft ifo dit an. als cpi daalt moet je meer geduld hebben net als na 2002 en 1992. na 1992 kwam 1994
inflatie china viel tegen, korea reservegroei laag
duitsland wil lagere euro omdat nog meer exporteren naar pigs niet meer kan. frankrijk wilde altijd al zwakke euro.
china zelfde soort verhaal. export naar westen is verliezend model, meer jugaad nodig
ias19 in afgezwakte vorm/ rendement kan hoger dan rente +2-3%.
europa groei flink naar beneden bij brokers
hielpen al die valutareserves? weinig. grote interne economie hielp.
psv indicator, gelijkspel binnen voor ajax.
zieikzee: iedereen heeft het geweldig gedaan; politiel lehman ook. het was het management dat niet duidelijk maakte dat ze too big to fail waren en experiment te gevaarlijk was.

Sunday 7 March 2010

Tuesday 2 March 2010

Voorspoed komt! Krachtig herstel in VS en Emerging Markets zet door

Ik ben een blog begonnen om te laten zien dat je helemaal niet zo oeverloos pessimistisch hoeft te zijn. De aanleiding is de publicatie van mijn boek "Beleggen op de golven" dat ik samen met Gerhard ter Veer heb geschreven. Daarin stellen we dat we wereldwijd door het krachtige economische herstel in een voorspoedscenario terecht aan het komen zijn. Economische golven gaan niet alleen naar beneden maar ook naar boven. De productiviteitsstijging in de VS is torenhoog en daardoor gaat het goed met winsten en daardoor straks met investeringen en de werkgelegenheid.

Europa doet voorlopig tegenvallend mee, maar in veel Emerging Markets waaronder de belangrijkste (China, India, Indonesië, Brazilië etc etc) gaat het fantastisch. Ook in de VS gaat het goed: 4% groei in 2010 en 2011 is mischien te pessimistisch.

In de regel schrijf ik twee posten per dag waarbij ik meestal een gunstige ontwikkeling laat zien. Sinds ongeveer een jaar puilt het uit van de gunstige ontwikkelingen die je kunt laten zien.
Onderwerpen van de afgelopen dagen:
-Tekorten individuele staten VS vallen mee
-de wraak van Zorba
-Investeringsgroei software & equipment VS 20% in 2010 en 2011
-Gaat Bank of Japan verruimen: hyperinflatie op de loer? Dollar toiletpapier?
-Monstergroei Azië in vierde kwartaal
-This time is different: vrouwen
-Barron's weer optimistisch: S&P500 minstens naar 1200
-duurzame energie groeimarkt
-groei werkgelegenheid VS komt echt wel
-Benderly ziet foreclosures dalen

Monday 1 March 2010

peter sloterdijk geen groot genoege woede tegen bankiers

vpro tegenlicht
In de Vs is er woede tegen de banken. Nederland niet, het is geen land voor revolutie. We proberen vast te houden aan ons verleden opgebouwd rijkdom/welvaart.
manuell castells: woede in Spanje tegen banken; nee is onmacht want je verliest je eigen geld via belastingen.2 jaar geleden was men in spanje midenklasse en nu is men aan de voedselbank, werkloosen achter op de hypotheekbetaling, ondanks de hoge oplideingen etc. .
de aangehaalde activisten pleiten voor een leven met minder luxe, dan zijn de probleemen zo vorbij [dan stort alles verder in elkaar][
kunnen we leven zonder kapitalisme]
slechts 11% vindt nu kapitalisme nu een goed systeem
Knabel: we hebben een soort sociaal kapitalisme er is geen goed alternatief
brusselse bureacratie wordt meest gehaat
ook in letland estland
de geluksbank zonder geld voor niet finaciele diensten [toch weer kapitalistisch initiatief als me geluksbank buiten tallinn wil verbreiden]
indonesie: dirham van echt zlver of goud dat is inflatievast en ok volgens islamwetten. rijken bezitten goud en zilver, armen alleen waardeloos papiergeld.
[wat ze bedoelen is dat we weer terugmoeten naar gedekt geld zooals dennis van ek stelt, als goede manier van woede ovrer banken]