Titolo

Seven Myths. Nay: Seven Follies (II)

4 commenti (espandi tutti)

PREMESSA:

Abitando a Milano e conoscendo diversi giapponesi (e non avendoli visti morire di fame agli angoli delle strade ai tempi) mi aspettavo un'analisi della situazione attuale che partisse dallo studio di quella giapponese, sui quotidiani o in televisione.Invece tranne vaghi accenni non ho trovato nulla quindi volevo ringraziarti (anche per la mail di prima di Natale, sono io "il folle" che ti ha scritto chiedendoti della P2).

DOMANDA:

If a depression comes, experience shows, it is because the banking system and financial markets remain "clogged" and not operational

Questa tua affermazione ed in generale il post mi hanno spaventato molto. Non solo per la situazione che prospettano ma perchè tutti sembrerebbero convinti della bontà di questo Mith/Follie ...so the question is:

In your opinion are they really to blind to see or they see, but they prefer not to "touch" (or they know they cannot touch) the banking system and so they're searching for alternative strategies?

 


anche per la mail di prima di Natale, sono io "il folle" che ti ha scritto chiedendoti della P2

E non ti ho mai risposto! Non mi sembrava folle, anche se la tesi centrale era un po' ardita ... ora vi rispondo, privatamente ;-)

grazie.

Vengo all'altra domanda difficile che fai (hai un vizietto, tu!):

In your opinion are they really to blind to see or they see, but they prefer not to "touch" (or they know they cannot touch) the banking system and so they're searching for alternative strategies?

Mah, who knows? Siamo tutti prigionieri delle nostre teorie e dei fatti che ci sembra di vedere o di come li interpretiamo. Siamo inoltre prigionieri, e questo e' ancora piu' importante, dei vested interests che difendiamo ed a cui apparteniamo. Sul sistema bancario non ho dubbi: le banche centrali di quasi tutti i paesi sono "captive" delle loro banche nazionali. Su questo tema intendo ritornare in uno dei miti (il numero VI) quindi per ora passo :-)

In general, it is clear that:

- Central banks are captured by the financial/banking industry, hence they are too concerned with the failure of banks and less with the fact that allowing a "shakeout" of the banking system worldwide may, at the end, be beneficial. This, again, is the theme of myth VI.

- Governments are concerned with unemployment and so on, hence they try desperately to keep firms alive, even firms that should die (e.g. Detroit's Big3). My view is, in one line, the following: let bad firms die and spend the money you are spending in keeping them alive to provide unemployed workers with insurance and easing the process of finding new jobs. If public spending we need, I favor providing insurance over providing bailouts.

- Economists and experts in general are ... debating. Let's just leave it at that.

I am sorry I scared you, as I am actually trying to do the opposite. I am trying to say that there is a recession, but it is not the end of the world and deflation is neither. There are too many doctor dooms trying to get publicity by preaching fear and the obvious. We do not need that.

 

Central banks are captured by the financial/banking industry, hence they are too concerned with the failure of banks

In Ireland (substitute "central banks" with "banking regulators") they are starting to realize that, and to look into possible fixes.

Talking about bailing out the Detroit Big Three, today's NYT had a small article hidden in the Business Section that examines GM's situation. It turns out that the government's rescue package for GM has "a requirement that the automaker demonstrate a plan for achieving a positive net present value."

The author then makes some quick back of the envelope calculations that show that even under fairly rosy scenarios it is difficult to come up with a positive present value going forward. Hence, the article concludes,

even tough action [by GM: i.e., deep cost cuts, debt restructuring and union concessions] may not persuade the government that G.M. is sound enough to escape bankruptcy.

...Not as flashy as Paul Krugman's articles, but very illuminating!