[sonus] understanding issues: part 2

This is part 2 of the Sonus series on why we're effed, who is responsible and whom we need to lynch. I've just read all of it to part 5 and have to say it gets even better the further you read.

Dates for posting the Sonus articles: March 16th, 18th, 20th, 23rd, 25th and 27th.

Part 1 of this series can be read here.




Let us now revisit the simple banking model in Part I

I do not want to over-complicate the varying mechanisms, between the US and UK banking systems, as that is not the issue here, merely to say that over time the State began to control the individual banks.

Banking licenses were issued, which allowed the banks to issue bank notes in their own name, (subject to limitations), and as banks failed, or merged, no new licenses were issued. Over time this resulted in a monopoly for the Bank of England. (Differing notes are still issued by banks in Scotland)

In order to control the amount of credit (debt) that could be issued under fractional reserve lending, (sometimes called “the multiplier effect” in the UK system) The Bank of England could require the clearing banks to hold varying proportions of the assets as deposits at the Bank of England. (The Chinese authorities are very active currently, using special deposits as a way of controlling their economy, via credit/debt issuance, and they seem to be avoiding the traps of pro-cyclicality quite well)
That is enough of the details to suffice.

There are several features of a modern Fiat system that must be understood in principle.

0. Modern Fiat systems have evolved efficient control mechanisms. If a 5%, or a 2%, or whatever %, rate of inflation is required, absent large extraneous events, that is what will be achieved. (remember the previous political machinations with interest rates prior to election times, and the Kudos Brown earned for making the B of E independent - allegedly)

0. All Fiat systems beyond a tipping point, have a definitive life-span, after which the “National Debt” is compounding at such a rate that it overcomes the ability of the economy to pay it. The Maths cannot be beaten.

0. During that life-span, incremental debt injected creates diminishing increases in GDP, on a £ for£ basis. Towards the end of a Fiat life-cycle, massive injections of incremental debt will create negative GDP. Once again, the maths cannot be beaten.

0. Increases in the rate of inflation in a Fiat system shorten the life-span of the system. Maths again.

Ron Paul says it well!

The above are enough rules for now, but think of their importance, and understand the implications of the above in relation to current circumstances.

The intrepid blogger Karl Denninger blogged about points 2, 3,and 4 above. He produced a graph here.

When reviewing this graph, take note that it was published BEFORE trillions of new debt was injected, albeit sterilised, by the Fed. The upcoming de-sterilisation will bend the trend line lower!

And the blog is here.

Simply put, there is too much debt in the economy. If people won't borrow, because they are up to their eyes in debt and non-profitable companies can't service any more, or can't roll existing debt over, the velocity of money decreases. You cannot inflate away from an over indebted position by injecting more debt via borrowings. Interest rates will not remain at, or near zero, for long, as bond vigilantes will strike, then even more existing debts become unserviceable as interest rates rise, and currency devaluation becomes the only option.

The dirty hidden secret of all Fiat systems is the theft of all savings via inflation. Gradually, over the years, everything is confiscated. Yet everything is so gradual, (when operating properly) that it goes un-noticed, becomes part of an unconscious acceptance, it is insidious and evil.

Once again, Ron Paul gets it.


To give an example, in 1972, I purchased a serviced building plot from a local council, obtained detailed planning consent, and built my own residence. The land cost £2,500, it was one quarter acre. Today, the land would cost more than £150,000.
The land has only marginally increased in value due to development, - it was bought with outline planning permission, - the difference is that the £ has devalued since 1972.

Difficult to believe?

Well here is a website that can be used interactively to illustrate my point.

Here is a website that looks at the prices of housing from 1890, to present, and adjusts them for inflation. It shows vividly the vast over valuation of housing currently, so let's say the land valuation could drop to £75,000, that is still a vast devaluation of the £ from the £2,500 purchase price.

Yes, it is American, but if anything the degree of historical over valuation is higher in the UK.

In the normal run of business activity, if a business were to issue receipts for non-existent goods, or sell a product that it did not own, it would be guilty of fraud, and the directors would run the risk of jail time.

This is what banks do as part of normal business activities, called fractional reserve lending, and it becomes legal because the Government issues a banking licence that says it is legal.

It is the global use of fractional reserve lending that increases overall inflation levels via increasing levels of credit (debt/money)-(although inflation levels may vary geographically) and results in the gentle theft of all savings, over time.

The dirty little secret restated, is that no Government running a fraudulent Fiat Banking system wants you to know, is that prices do not automatically increase, it is the currency that devalues in a Fiat system. NO FIAT CURRENCY HAS A FIXED VALUE AGAINST ANY GLOBAL ASSET, IT MUST DEPRECIATE OVER TIME. PERIOD. AND THE ASSET MUST APPARENTLY INCREASE IN COST. Absent fractional reserve lending and interest on debt, the normal evolution during a product life-cycle is one where the product becomes cheaper due to increasing volumes of mass production rising from public acceptance of the product selling in greater volumes, and improvements in technology, and competing companies entering the market attracted by the initial margins. For example, look at the advances in computing power, and the price decreases in the last 2 decades,- albeit an element of the price reduction is due to off-shoring/currency manipulation in the exporting countries.

The mistake that MOST thinkers make is to consider the currency as fixed and commodity prices as increasing. Such thinking is particularly useful to Fiat governments. It disguises their theft of the savings of the populace, and their reneging on their future liabilities, eg, for pensions.

A Fiat system cannot be deflationary without ultimately imploding. It struggles to exist profitably in near zero inflation (equilibrium). It can best exist in a “growth” situation, that is, where increasing levels of credit/debt are being created, - the classical western “growth model” of western economies.

Deflation is death to Fiat because the paying down of all debt, or the cancelling of all debt via bankruptcy destroys the money supply, and economic activity ceases, since credit (debt) is “money” in a Fiat system. This is part of what worries the global financial authorities in this current deflationary stage of global financial collapse.

Here is an excellent summary of the above issues.

The authorities are determined to preserve (their) the Fiat system at all costs, even at the expense of criminal moral hazard, and possibly the future viability of the country, and age-old democratic values. Although the current crop of political leaders seem oblivious to economic principles, there are increasing numbers of dissenters to their methods, who are becoming increasingly more vocal in their opposition.

It is this passion evidenced by the authorities, for the preservation of the Fiat system, which is becoming increasingly illogical, that causes inquiring minds to speculate the true motivations behind a seemingly noxious stand. 
 
 



Jamming with a Pretty Woman refreshment break.

Or as I remember clubs!

 
 
 
 

Part 3 of the series can be read here.


It says 'written by James Higham' below. Actually, it was written by Sonus but I can't reformat the author in my template.

[cheerful news] if you're a favoured bank

This was interesting to me on the personal level:

Bank of America (BAC.N) is close to receiving billions of dollars of support from the U.S. government as it tries to digest Merrill Lynch, the investment bank and brokerage it bought on January 1. Merrill has billions in troubled assets -- ranging from commercial real estate to subprime mortgages -- that suffered during the brutal fourth quarter.

Isn't that nice? So now the taxpayer over there is expected to shell out for some takeover, merger or other corporate move its directors decide on. The bank can move with impunity, knowing they're going to be "bailed out" along the way.

It would be nice to have a business where the government takes such a kindly interest in my welfare rather than slug me for every dollar/pound they can get their hands on.

And what of Mandy's £20bn? Favoured sons, eh?

By the way, the "personal level" was referring to when I went for a position and we were assured that BOA was the safest bank in the world. Is that right? Doesn't need a bailout then, does it?

[so it begins] the slide to ... what?

A Sunday roundup, of sorts:

1. John Trenchard shows footage of what is actually happening in Gaza today.

2. Ian Parker Joseph hits the nail on the head again:

Just read carefully the second clauses of Articles 8, 9, 10 and 11 HERE.

And as the nine hippies of Tarnac are finding, one doesn't actually have to pose a real threat to the State - it's enough for the paranoid and weak central State to believe that you might.

It's a pity Ian's comments system doesn't allow some blogs to comment as I'd like to have added to this.

3. Meanwhile, Henry North London has translated Brown's message into English. Here's a sample:

Prime Minister in Black, translation in Blue

As we look forward to this New Year, we face a challenge. A challenge of how we build a better tomorrow, today.

Hello folks, we're unfortunate to live in the time when our whole economy is based on oil which is rapidly running out but we haven't told you this yet because we are scared stiff, and we know that you would lynch us if we told you things were going to get worse even though it would be the truth.

4. Great piece from Mr. Eugenides on Scotland's first space port.

5. Finally, Blake's 7 is an analogy for our current woes, according to the Quiet Man.

[product placement] productive or counterproductive

From MI6:

The Bond franchise has long been known as a cash cow for its producers, not least because of how much it grosses at the box office, but also how much revenue it rakes in from advertisers wanting their brands strategically placed in the movies. It has been claimed that since 2002's Die Another Day was dubbed "Buy Another Day" by some critics.

And it doesn't just happen on the silver screen. In 2001, jewellery brand Bulgari paid author Fay Weldon to liberally dose her novel The Bulgari Connection with mentions of the brand, while numerous music artists have made Faustian pacts with commerce to bankroll their endeavours.

How you feel about that can vary from David Lynch's reaction to one a bit less extreme, realizing that the trend has been around from the 80s and even before and also realizing that the film is not going to be initially funded without it, even if the gross exceeds that amount later. After all, Art may be the primary thing but so is making money on the film is also a factor.

What happens when product placement goes further?

When you see giant Coke cups sitting at the fingertips of American Idol judges, that's not just product placement. That's full-fledged product integration — when a brand becomes inextricably identified with the content of a show.

That's why network executives use words such as "natural" and "organic" when they talk about product integration and scripted TV ... they don't want it to be so blatantly obvious that it overwhelms the programming. But they don't want you to miss it, either.

Somewhere along the line it becomes sponsorship, such as in the Formula 1 races and so on. Does it work? I'm not sure but in the case of Bond's Casino Royale, it didn't in one respect. During the train scene with the watches, this exchange took place:

Vesper: ... maladjusted young men who'd give little thought to sacrificing others in order to protect queen and country. You know, former SAS types with easy smiles and expensive watches - Rolex? [indicating his watch]

Bond: Omega.

Vesper: ... beautiful. Now having just met you, I wouldn't go so far as calling you a cold-hearted bastard -

Bond: Of course not.

Vesper: ... but it wouldn't be a stretch to imagine ...

Does it matter in the end or are you, the viewer, annoyed about the intrusion of products into the flow of the film? And what should producers do about it?

[touch and go] the ghost returneth

Intriguing group this Touch and Go whom I posted on last December. The line-up looks like this [I can tell you now some of these links don't work]:

• Charlie Gillett
• Vanessa Lancaster
• David Lowe
• James Lynch
• Gordon Nelki

Most know the music but you'd be hard pressed to see any but Vanessa and James in concert and then only at times and mainly in Eastern Europe, which is interesting for a British group singing about Harlem.

The thing is, it was basically a David Lowe project which got out of hand and when Eastern Europe wanted them to appear as a ... well ... as a band ... they realized they'd have to actually create one.

Their best known hit was where Ms Lancaster sang:

I find you very attractive ... would you go to bed with me? The song's accompanying video feature[s her] asking the same question to various inanimate objects including an iron and a shopping trolley.

... all to Monsieur Lynch's manic trumpet work. Something quite tongue in cheek about the whole thing but the music still stands up over a decade later.

Here's a video using Life's a Beach:





In a careless moment, not so long ago, I wrote to them as to the possibility of a performance in my "home" town here, not actually expecting a reply.

Oh my goodness, I've just received a nice letter from Jim Lynch wondering what the heck I'm doing in this place and once these current "troubles" are over, I'm going to see what can be done.

Touch and Go.

[touch and go] find you very attractive

The test of an ongoing concern of any note is if it is readily accessible in Wiki.

Touch and Go are not so accessible unless you type in all the words Touch and Go Band Wikipedia.

The thing is, they never really were a band, let alone that there is an entity called Touch and Go Records as well [not them] and heaps of Touch 'n Go other things. So it's a labour of love but finally worth the effort. And even if you do get into their personal site, it says not too much.

They themselves say, in their blurb, which has definitely changed from the scratchy liner notes in the early 2000s:

Touch And Go is the progeny of an unholy alliance between television composer David Lowe, veteran radio presenter and music journalist Charlie Gillett and co-founder of Oval Music, Gordon Nelki. The trio conceived a new concept based around largely instrumental jazz-based tunes with an ‘economical’ use of lyrics — quite unconventional by today’s chart standards.

Would You…? [uses] a sampled vocal clip and trumpet jazz licks played by James Lynch, over a Latin rhythm.

And the girl? The sultry voice behind the success of the project?


Her name is Vanessa Lancaster and she's a UK based "voice-over artist for numerous UK TV commercials and has modelled both on the catwalk and for beauty products. Her other television credits include Emu’s World for ITV and the James Bond movie Octopussy."

The trumpeter, James Lynch, is one of the UK's top session musicians, appearing in a lot of shows , including with the BBC and has also toured with the Spice Girls and Robbie Williams.

So you've got the picture - a studio project without a face but a fun one nonetheless and a unique sound for all that. And that girl .....


Now cut to the 2000s. Clearly, David Lowe felt that it would all just fade away but Eastern Europe had other ideas, expecially the Ukraine and there was a demand for a human presence as some sort of face for the "band" - Eastern Europeans don't fully understand music they can't "see".

While David Lowe "writes [most] of the material, produces, arranges, and plays drums, keyboards, and most of the bass, as well as doing some of the vocals. Most of the parts are filled in by a cast of various musicians, none of them part of Touch and Go officially, contributing vocalists, brass, and wind parts, guitar, and violin," Vanessa and James front the "band" and co-write songs.


Now, here's the thing again - Vanessa Lancaster just don't gel in my mind as a vamp singer - look at that body language. She comes across to me as a happy girl, flattered to be included in something as much fun as an ongoing Europe-wide touring band. I mean, she clearly doesn't get down and dirty - look at the way both of them are dressed and he's the epitome of the cleancut Brit TV show session muso. And yet they sing:

I find you very attractive ... would you go to bed with me?

Vanessa was taken to task about this by the host of a late show in Bulgaria, Slavi Trifonov, who was keen to know if she often asked strangers to sleep with her.

She replied that when they wrote the lyrics they were looking for the craziest questions that they could ask somebody. The songs are often constructed around the sort of come-on lines used at the social get-togethers of the well-heeled and fashionable, added Lynch.

Uh-huh but there's more.

The song's accompanying video feature[s her] asking the same question to various inanimate objects including an iron and a shopping trolley.

Now I'm already beginning to really like this bit of fun, let alone the duo themselves and the superlatively catchy music but the next part clinched it for me. As the Sofia Echo explained, they visited "Sofia's First English Language School for a question and answer session in a small classroom packed with eager pupils."


Whoa there! This is a sultry nightclub act whose songs have been used by American pole dancing troupe G String Divas, raunchy and heavy with sexual innuendo. And they're invited to a school, to talk with the children? Well, you know, I'd probably ask them too - there's something very attractive about this pair.

Now, in a very minor way, I've also trodden that path. When I first came over here, I was taken to a school to meet "staff and students" and was also very politely mobbed. In their case it differed:

The pupils were keen to know if the two stars liked the school, what they thought about Bulgaria, and if it was difficult to compete in the music business. Lancaster answered and asked the students what they wanted to do in the future and if they found it hard to study English.

I too was mobbed by dozens of kids demanding autographs and I know full well the attraction of Eastern Europe for urbane westerners enjoying something a little different. There's still a fresh eagerness over here and great honour bestowed on guests, which is just lacking back home.


Wiki also notes:

As of 2007, the ensemble is still touring Eastern Europe and performing their popular tracks from the mid 1990s

Members

• Charlie Gillett
• Vanessa Lancaster
• David Lowe
• James Lynch
• Gordon Nelki

Now one of my favourite "bands", Touch and Go's website is here. Google if you'd like to get this music. More here.

[political bloggers] failing to connect the dots

Political bloggers may be driving themselves to exhaustion but are they too narrowly channeled?

Just been round to various blogs and one thing is painfully obvious – political blogs are islands and political bloggers run in well worn grooves.

It’s exasperating to see bloggers persisting in pushing the same narrow focus, no matter how correct it is and flatly refusing to either research outside the style of journals they use as their primary sources or failing to take the macro-view into account.

For example, one blogger keeps asking: “Why do we need a stepping stone to an English Parliament?”

Well clearly because there isn’t going to be an English Parliament whilst Brown is there and Brown needs breathing space. How would I know this? Look at Part 3 of the micro-control article and the links and a possible answer is there. At least it's worth considering, which I don't see major bloggers doing.

And why don't we see this sort of thing - three questions for CP? Why are the big boys not covering it?

The regions are being beefed up - this is not even in dispute and CP is moving into positions of influence within local areas. The focus is on RDAs - they flew the regional assembly kite and now it’s occurring by the back door, just as the Treaty is.

Now why would the DTI have altered its website and included regionalization? Why would CP be training people hell for leather in local areas such as the South West to assume command “beyond authority” as they put it? They are doing that – follow the relevant links.

Look – here is a video of Diversity Training at Ian Parker’s site plus his comment:

Diversity training has had to be forced on companies because there are no actual benefits to be derived from it. Were this not the case organisations would already have recognised the competitive benefits and implemented their own diversity programs, without the need for government legislation.

Why are the major bloggers not picking up on these things? Where are they? Tied up in Polly Toynbee and David Milliband. Even Mr. Eugenides touches on the “what” all right and well done but does not get into the “why” or “what is going to happen as a consequence?”

"Looking at the content, the result is that the institutional proposals of the constitutional treaty … are found complete in the Lisbon Treaty, only in a different order and inserted in former treaties," Mr Giscard d'Estaing said.

The former chairman of the European Convention - the body of over a hundred politicians that drafted the 2004 EU constitution – suggests the new more complicated layout was only to avoid putting the treaty to a referendum.

Ignoring the body of evidence out there from the more unorthodox sources, Iain Dale refers to training for something not going to happen:

This sort of training course teaches them debating skills, media skills and how to campaign. It may sound dull to those not involved in the political process, but this sort of thing is vital for young people from all parties if they are to acquire the skillset to become our politicians of the future.

There are going to be no “conservative leaders” because it goes straight from Britain to the EU Treaty regions. We must begin to look more broadly at the whole frame, such as Dizzy did:

What's important to point out here is this is not about saying you think Gordon Brown and the Labour Government are secretly trying to enslave us all in an Orwellian nightmare with the ultimate aim of destroying democracy. No, this is about asking whether the proposal passes the Stalin Test. Would someone like Stalin have found a system like this useful?

So, given that Dizzy is not talking through his hat, then what are the possible consequences of this tightening of restrictions even on people’s movement? A possible answer is via Sackerson, where Tony Allison says, about the peak oil consequences:

For example, we could see a re-birth in local farming and manufacturing, as food and industrial products become exceedingly expensive to transport.

Of course we’re going to – the population is being increasingly made to remain local. Still with Sackerson, Robert McHugh says of the squeeze on the bourgeoisie:

The Middle Class is getting annihilated from this silent event. Incomes are not keeping up. This was done because this administration “equates stock market success with economic success and has directed their efforts to drive up equities at literally any cost,” to quote one of our subscribers.

Can anyone see where this thing is going? Yep, the middle class is about to go bust and those holding gold are sitting pretty:

Charles Merrill, a relation of the Merrill Lynch founder, has become a gold squirrel.

And other big boys who are in the know?

… up to 25% of M&A deals had some dodgy looking share deals associated with them in the past few years ...

Joining the dots – that’s what is necessary here. Think tanks with data from a variety of sources coming in and bloggers combining to sift through it all and get the whole picture.

By the way, was informed today that one of my irregular sources was visited by CP today for 3 hours 59 mins 46 secs and he asked:

Now, do these people waste tax-payers money? :)

[blogfocus saturday] back to the roots

Well hung blogger and his big gun

[Note before we start: all links are in yellow; red, blue and brown will take you nowhere, sorry.]

From the title, you’ll see that this Blogfocus goes back to my blog-beginnings and in a sort of Genesis of the Daleks manner, I’d like to present, this evening, eleven of the original bloggers who gave support to an arrogantly naïve blogger newbie who took some time getting set up and settled down.

While I can’t claim [with one possible exception] deep personal friendships with the individuals here presented, I do claim and I think it is apparent in the writing, that each holds a special place in my blogworld [Oliver Kamm would cringe at this word]. Like you, I can easily forget slights and insults – they’re just the collateral of good debate – but a good deed and kind word is never forgotten.

1] The Pedant-General-in-Ordinary has an alter-ego who can be found at the Select Society but this sort of thing: We’re doomed and only the EU can save us… is a dead giveaway. Bit of a pointer, one would think.

I was thinking of a doing a “blimmin’ EU” post, but had not raised sufficient bile to do it justice. DK, however, lists us today - not entirely incorrectly - as being broadly anti-EU, so perhaps we should devote some time to the topic.Bring your pitchforks: It’s time to lynch the manufacturers of Mercury Barometers! I mean - look at it: if ever there were an instrument more finely calibrated as a vicious killing machine, I’m struggling to find a better example. I can see the stout jaw of Mr Free Market going all wobbly at the sight of it. Oh, OK, I’m still being facetious, but only just. Listen to this Today Programme interview: The key quote from Philip Collins (MD of restoration company in Devon that deals with Mercury Barometers):

It’s incorrect information that’s bandied around. 30 tons of mercury end up in the atmosphere every year. 0.1% of which is the TOTAL amount used in barometers each year. Average lifetime of a mercury barometer? Well, let’s just say that there is a decent antique market. So we have 0.1% of the total emissions being used in the manufacture and, for the sake of argument, let’s assume that each barometer lasts 100 years - these are expensive items which are handled carefully then hung on a wall where they are then not touched - so the mercury barometer trade could be contributing as much as 0.001% of emissions.

Seriously, this is the level of intellectual rigour applied in favour of a directive which will most likely shut down a craft industry for approaching zero benefit. The governments wanted to ban it immediately, but MEPs have put down an amendment to give a two year phase out to give the companies more time to adjust.

I still have two small issues: 1] Why does action have to been taken at the EU level? Why cannot our government act? 2] If the EU is so concerned about exposure to mercury - so concerned indeed that it must shut down a trade that will have to all intents and purposes exactly zero effect on the risks of exposure to mercury - why does it then INSIST that mercury be injected directly into the bloodstream of small children? Answers on a postcard, preferably addressed to Ms McAvan.

Another 10 bloggers here …

[cfs] the disease of champions

The man in the photo is Alistair Lynch, triple premiership spearhead - hardly a hypochondriac, hardly a shrinking violet. A solid customer. And yet he has CFS [Chronic Fatigue Syndrome] which not only greatly reduced what he could do but put CFS on the table for discussion. Was there ever a syndrome so mercilessly attacked and summarily dismissed and yet it exists. He was diagnosed with it. Thousands of others have it. Just how real is it?