WAR & MONEY: In the absence of sanity thing, there’s unlikely to be vision thing or reality thing

It’s a long way to real-ee-tee

It’s a long way to go

It’s a long way to real-ee-tee

for a stupid so-and-so

Syrian President Bashar al-Assad gave what the media called ‘a rare speech’ yesterday. Mainly it was rarified: a droning stream of accusation that was as long in duration as it was short on reality. The audience cheered, clapped, stood up, and sat down on cue. Afterwards, it would be a good odds-on bet that most of them prepared for a fast escape to somewhere – anywhere – as it was abundantly clear the leader had finally gone tonto. Like a praying mantis – but with less chin – Assad gave off an air of John Cleese trying to make Alchemy seem the best way to knit sausages.

The truth is that Bashar is surrounded by NATO, drowning in Muslim brotherly love, and unlucky in his choice of allies: Russia has backed off, Iran is broke (thanks to the US) while China is 12,000 miles away preoccupied with Nippon hatred. The end of totalitarian regimes always looks like this. Very few people understand just how nasty the new regime is going to be. But then, most media observers of the Syrian situation are almost as uninformed and deluded as Bashar Assad.

It’s not much different in the field of global economics and finance this morning. The Babel Committee on Bank Supervision (Prop. M. King) cut the banks some slack, announcing they’d only need to have 60% of the necessary short-term funding in place when the rules become effective in three years’ time – and would have until 2019 to fully implement the regulations.

To summarise for those who are new in Wonderland, what the Borrowers of Basel are saying is that (a) we know you’re broke and don’t care about what we recommended in the first place anyway, and (b) you have six years to sort out your defences against the Tsunami, which by the way may well happen around June 2013. Reeling out a longer straw to a man drowning on Victoria Falls is unlikely to work, but it reads well for those convinced things aren’t so bad really.

And there is no shortage of such people. A survey of 171 industry executives by the EEF manufacturers’ organisation found that those expecting improved conditions in manufacturing matched those expecting a deterioration. A year ago, almost everyone was expecting dire rather than deteriorating, so this is an improvement. Actually it isn’t really, because it’s just another of those ‘sentiment’ surveys that become meaningless when the opinion-leaders turn out to be talking tosh. Indices of confidence are notoriously unreliable because they involve speculation not empiricism; what particularly worries me about this EEF fieldwork is that the organisation itself has more than halved its forecast for manufacturing output growth this year from 1.5 to 0.7%. So if the EEF doesn’t know WTF’s going on, and the EEF did the survey showing that their members know even less about WTF’s going on, we aren’t left with much. To go on, as it were.

The same contradictory cacophony of crypto-confidence emerged from Deloittes this morning. The consultancy says that Britain’s biggest companies enter 2013 more confident than a year ago, but aren’t keen on investing because of an uncertain economic outlook. Right. So how exactly is their bearly bullish mood going to translate into action? ‘Their priorities are reducing costs and increasing cash flow’, says Deloittes, ‘they do not plan a return to aggressive expansion.’

I reckon that’s pretty much how things stand here at Slogger’s Roost: I too am loathe to expand aggressively, rather more of me sitting in the eat less, turn to casual crime and pull up the drawbridge camp. The frightening thing about this report is that a lot of mugs out there paid for it. A large driver of my tentative attitude to engaging in any form of spending spree is that my bank doesn’t seem keen to lend me any money: the new bank lending guidelines err rather more on the side of rich and big than small and broke.

There’s nothing new in this (it’s partly why we’re here on Mayfair with nine hotels) and the trend is given statistical validity by the nearly 5% rise in the value of UK mergers and acquisitions in 2012.  More £1bn-plus “mega deals” were done here last year than at any time since 2008, according to information services group Experian. In fact, as a result of this, Britain outperformed the averages for the rest of Europe, Asia and the US,  all of which recorded declines in this sort of nonsense whereby companies get bigger, wages get lower, and unemployment rates go higher. In 2011, only a quarter of all mega-merger insanity was over the £1bn plus level; in 2012 it was nearly 40%. It made £128bn for somebody, while the banks involved in underwriting them were pleading poverty….and lapping up £243bn worth of QE liquidity from Mervyn King.

It doesn’t add up, but the clowns in charge care nothing for this, because they know the overwhelming majority of the electorate see a mega-deal as six pork pies for the price of two at Morrisons. Dave himself shows more interest in gay church marriage than banks taking the piss, while George Osborne’s reality consists of ignoring £400bn spent on QE in favour of £18bn saved in welfare cuts. The idea on these cuts is laudable enough (persuade people to work) but as the new Resolution Foundation analysis shows, 60% of the chancellor’s benefit squeeze hits working households. The struggling so-called strivers are bearing the brunt of the cuts: OFFICIAL. We may all be in the same boat, but only the bankers are armed. They can still eat us all one by one, which is worrying given the lack of any rescue task force in sight.

It’s Monday, folks: another day, another outbreak of delusional episodes.

Earlier at The Slog: From TGIF to TGOF in the markets


55 thoughts on “WAR & MONEY: In the absence of sanity thing, there’s unlikely to be vision thing or reality thing

  1. Is it only me who sees the flaw in the argument ‘remove benefits to persuade back to work’? What effing work? Pardon my francais …
    Too many folks are already working three and a half hours a week for thripence … hence the unemployment figures enjoying a luxury massage to delude the rest of us sofa dwellers.


  2. Dave’s friend John Bird will find work for all the beggers who won’t be able to get benefits any more, so you can look forward to having the Big Issue at £2.50 a week thrust under your nose every time you go to the town centre to buy your beans, bread and oatmeal, all most people will be able to afford to or allowed to eat soon.


  3. I find it puzzling why if selling the Big Issue really is helping the homeless and destitute, how come the same ones are still peddling this expensive trashpaper for years?


  4. So, In effect, the de facto power state will hold the tabs on the results of these mega mergers via the quantitive queasing…
    A happy consequence of corporate socialism. Just old fashioned communism aka fascism although some of your readers will correct me and tell it is collectivism (bug society, all in it together). A turd by any other name would smell as…
    The NWO marches on.
    I would not be sure about Russia deserting Syria, IMHO, WW3 will go from simmering to the full thing if they try for a Lybia:
    Bolstered by 16 Russian warships, Assad nixes dialogue with “Western puppets”


  5. “It doesn’t add up, but the clowns in charge care nothing for this ….” Of course it adds up, John. You simply fail to appreciate (although I am sure you really do) that for the banks, big business and the government it all adds up perfectly correctly and ‘the clowns in charge’ really, really do care. The problem is, if they told the public this they have a strange feeling they might find themselves faced with a lamp post and piano wire, something they very much would like to avoid. So they lie and wail about how their careful plans are inexplicably slow to come to fruition.

    The whole point of QE is to ensure government can continue to increase debt and spending, to ensure banks make huge profits (recapitalise and purge previous losses) and to keep big business solvent and share value high. How can you claim that things haven’t worked out just as intended? Their claims that QE was to boost small business, protect house prices and would not involve any devaluation/inflation were complete tosh from the word go, anyone with even a flicker of intelligent thought can see that.

    Mortgages and loans are hard to get not because there is no money to fund them, but because houses are still hugely over valued and in overall decline, the real economy is mired in a continuing slow decline all of which make long term investments like housing or small business loans risky for the lender, but the government, banks and big business cannot and will not admit it.

    Deceit and mendacity has become the defining characteristic of our age, it has become so ingrained that these people would lie even when truth would serve them better.


  6. “A droning stream of accusation that was as long in duration as it was short on reality…. The truth is that Bashar is surrounded by NATO”

    That depends on who defines your reality. Those same news outlets that spin the rest of this tangled web we navigate? I fail to see how you can detect much falsehood in their reporting of financial or other matters, yet buy into the guff about Syria.

    The truth may well be that he is surrounded by NATO, but why? As CIA funded Al-Quaeda insurgents (weren’t they supposedly the bad guys?) kill and maim innocent Syrian civillians the western press churns out Israeli biased rhetoric. To quote Peter C above: Deceit and mendacity has become the defining characteristic of our age’. Quite so.


  7. Pingback: John Ward – War & Money : In The Absence Of Sanity Thing, There’s Unlikely To Be Vision Thing Or Reality Thing – 7 January 2013 | Lucas 2012 Infos

  8. “The end of totalitarian regimes always looks like this.”
    Wonder how the totalitarian regimes that replace them go down? I mean how do you know when a ‘totalitarian-driven-by-‘Allah’-nutjob-regime’ goes down?
    Answer: Don’t know it hasn’t happened yet -which is more worrying really.
    I mean Iran still sits in the ‘totalitarian-driven-by-‘Allah’-nutjob-regime’ corner of the park but they have managed murder and rapine for 30+ years so far with no sign of the people getting anything resembling a secular government, Bet the same goes for all the ‘arab spring’ mob too.


  9. Well we made such a fantastic job of post war Iraq and Libya, it’s only natural to want to liberate those poor oppressed Syrians next. How they must envy the type of freedom we brought to their neighbours!

    It’s perhaps not the end of a totalitarian regime they fear, but the ‘liberty’ that comes afterwards.


  10. Quite true and, as I have said before, thank goodness we have Putin to keep us out (or at least delay our entry) to the cesspool that will be the new Syria and a steeping stone to the quagmire of Iran, the main goal of the mendacious west in this exercise.

    BTW a lot of old money has not left Syria. Four years ago accompanied by an Arab friend I met an industrialist who was interested in diversifying out of Syria. We made some suggestions but nothing happened. I checked today with my friend and the gentleman is now concerned but doesn’t know what to do since most of the doors for Syrians, except Russia, have slammed shut.


  11. This from John Hussman about the Fed :
    The Federal Reserve under Bernanke is like a bad doctor facing a patient with a broken femur. Being both unable and unwilling to restructure the broken bone, he announces that he will keep shoving aspirin down the patient’s throat until the bone heals. Despite virtually no relationship between the injury and the treatment, that femur might eventually heal enough on its own to allow the patient to hobble out of bed. But by then, the patient will need to be treated for liver failure. What’s even more bizarre is that everybody quietly knows this, but as he shoves another handful of aspirin down the patient’s throat, nobody proposes restructuring the broken bone, and they instead stand around helplessly saying “well, ya gotta do somethin’ don’t ya?”


  12. At least Barclaycard is keeping the Post Office and TNT in business by making a show, it seems, of offering me a line of credit every other month.
    Not happening though.


  13. Good article. Not mentioned is the fact he also had suits made by Sam’s in Kowloon.

    Glad to see they make them with double vents, known as bugger’s grips in the Royal Navy. (The RN has double vented uniforms but the RAF has single vents. Not many people know that!)


  14. “…known as bugger’s grips in the Royal Navy”

    Thank you OHA!

    That information brouht a smile to my face – although I don’t suppose the same could be said for those wearing the RN suits!

    (Of course, not that there is anything wrong with that.)


  15. Don’t tell me that every Foreign Office in the West didn’t realise long before Bashar’s old dad popped his clogs, that the eye-doctor son (I think that’s what he did) was not really cut out for the new job.
    Hence the mess Syria is in now.

    So presumably we all had a plan to try and stop a brutal civil war ….
    (or is this shambles the actual plan)


  16. I suspect the majority of people do not understand how the capitalist system works, particularly from the point of view of surplus value as expounded by Karl Marx or The Great Money Trick as explained by Robert Tressell. However as long as it works and comes up with the goods most people seem content not to question.


  17. When I was in the Navy many many years ago aforesaid grips also referred to an excessive growth of hair in the area of the facial cheeks


  18. FTW I would suggest this shambles is indeed the actual plan. The current mess in Syria is due to attempts by the west to destabilise it. Syria sits in a strategically important position if say… oh I don’t know… you wanted to invade Iran. It would also make a nice big post war building plot for new Israeli ‘settlements’.


  19. ”…. but the clowns in charge care nothing for this, because they know the overwhelming majority of the electorate see a mega-deal as six pork pies for the price of two at Morrisons. Dave himself shows more interest in gay church marriage than banks taking the piss, while George Osborne’s reality consists of ignoring £400bn spent on QE in favour of £18bn saved in welfare cuts…”

    It would be laughable if it weren’t so serious. Will Britain ever produce a politician with brains and vision…?
    In the Netherlands we think that gay Bishops remaining celibate in order to remain in office is very amusing …it all beggars belief. What are these people on????


  20. @FTW.NATO wants Russia out of Syria,period.USA has not forgotten the humiliations in Iran.Israel is onside,ironically with our traditional Gulf allies.Even the FO can work this one out.


  21. I read it, and thought it bollocks.
    The arab spring is the latest example of a wave of unrest/revolutions that occasionally sweep across continents, jumping from nation to nation in an un-predictable fashion but still setting each other off. Something similar happened in 1848 in Europe, and 1989. It was called the “Domino theory” when communists took over in Indo-China after the Vietnam war. Latin America going democratic in the eighties is another example.

    It happens fairly frequently in history, but it invariably suprises people.

    No-one planned Syria. A revolt kicked off, and others took advantage and positioned themselves. What the west most wanted, and Russia and China as well, was a military coup that bumped off Assad and a small part of his clique, and was then able to re-establish order and the essential stability that the state formerly provided.
    Unfortunally that didn’t happen, and it’s probably too late for that now anyway. So we’re left with an almighty clusterf*ck, with no happy ending in sight.
    Seeing the hand of Israel/neo-cons everywhere is juvenile.


  22. Whenever a country like Syria goes off the rails…… in this case when a minority crackpot splinter of a larger crackpot religion loses control.. the void is filled with evermore radical believers. AKA the crazy double down.

    At a distance those who cannot get their minds around the fact that there is no plan come up with elaborate conspiracy theory’s trying to make sense of it all.

    I myself enjoy watching this circular firing squad.


  23. The U.S. does not want Russia or China to have port access to the Mediterranean, hence their displeasure with Syria.

    The related matter is Geopolitical – Chinese expansion into Central Asia and Chinese access to Iranian oil. When the U.S. leaves Afghanistan, expect determined efforts by China to forge relationships with the country to try to secure a land route to Iran.

    Oh, and of course Syria is an ally of Iran.


  24. Eh yeah, but Iraq has already been taken care of. Can’t see the Iraqi government denying the yanks passage through their airspace should they want to strike Iran.


  25. ”The idea on these cuts is laudable enough (persuade people to work)”

    Really? And where are the jobs going to come from in a state of permanent recession? It must be the greatest confidence trick in the world that to get the rich to be productive you have to make them richer and to get the poor to work you have to make them poorer – never mind whip up a hate campaign against them.

    I’d like to know how unemployed people in my city of Manchester are going to find work when sooo many employers are happy, and indeed very often prefer, to take immigrants rather natives. Immigrants who will take whatever crappy wages they can get and live eight to a room in some shit-tip. And that’s before we get on to illegal immigrants. In Rusholme, a student of mine (from France) was working for two quid an hour in a restaurant whose owner boasted of his tax evasion. Chinatown and Cheetham Hill meanwhile would shut down tomorrow if the council asked for everyone’s papers.

    Up-rating social security to 1% is fair when private sector workers’ wages have stagnated? How about doing something about the latter before smashing the former. I was out of work two and a half years ago – I was 30, had a good degree from a top university, nine years full-time work experience and five years part-time – and I couldn’t even get an interview. I got back into my chosen field by pure CHANCE.

    And what sort of government shrouds itself in the Union Jack while playing different sections of the public off-against each other? It’s sick. I mean, why not just build the camps now?


  26. The whole banking scandal thoroughly exposed here by Matt Taibbi:-


    “….In the end, there was no lending requirement attached to any aspect of the bailout, and there never would be. Banks used their hundreds of billions for almost every purpose under the sun – everything, that is, but lending to the homeowners and small businesses and cities they had destroyed. And one of the most disgusting uses they found for all their billions in free government money was to help them earn even more free government money.”

    “…..Even worse, the big banks, instead of breaking down into manageable parts and becoming more efficient, have grown even bigger and more unmanageable, making the economy far more concentrated and dangerous than it was before. “


  27. Because they haven’t finished with us yet? Maybe laughable rather than laudable but that’s what the tone of the piece was pointing to anyway I thought.


  28. ‘…make them poorer’
    The reality is though that the welfare for ‘the poor’ comes from…the other working poor. I’ve worked for less than I would have got if I’d stayed in bed, so have many. So do many. Being a parasite is usually a matter of character not economic disadvantage.

    ‘What sort of gov. shrouds itself in the union Jack…..’
    Remember ‘British jobs for British workers’?
    We are ruled from abroad.
    Any government that pretends otherwise is telling lies. Who cares what kind they are?

    ps Phil….I don’t accept that you are working by ‘pur chance’.
    You did all that was necessary. You made your own luck and then kept your job because you deserved to.



  29. “Being a parasite is usually a matter of character not economic disadvantage.”

    Exactly John. We’re all scum. We all hate each other but need each other.

    I personally hate the whole system/experience.


  30. I agree in many ways – but what are the reasons for this situation? The minimum wage and EU membership. We have both wages that are too high to compete with the Far East, and unrestricted immigration from some very poor countries, whose people are, not surprisingly, taking advantage. We have to leave the EU before it is too late and we are levelled down to Romanian standards of living.


  31. Yes, we have to leave the EU, should be UE for Utopian Experiment, before it’s too late, but the politicians on board are all at sea and persons not very unknown have pinched the rudder.


  32. The bit between Syria and Iran is actually the Kurdish * homeland, very independent from Iraq, and doing very nicely thank you with oil and gas. They waited a very long time to get independence and self-determination, and I suggest will not let anyone just barge through in either direction, or use their airspace..
    * the Greater Kurdistan overlaps into Turkey, Iran, Syria, and I don’t think anyone with a brain wants to piss them off. It would affect all the neighbours.


  33. Indeed they do, but Putin is very keen to see how far he can push the bankrupt Americans, just for fun. Nato (or whoever is really pushing things from near Washington) putting more missiles in Turkey is a really dumb, purely provocative idea. Nato can’t do nuthin’ about Russia, it is years too late.
    America still doesn’t do foreign policy, they only understand bully tactics, not strategy.
    Turkey and Iran are not enemies, they are happily trading gold for oil between themselves just now; the US risks losing Turkey as an ally and I think Israel is offside in that regard.
    Israel and Saudi are certainly allies, because the dollar will fail as the world’s reserve currency the minute the House of Saud falls, and when the dollar fails, Israel is on its own.


  34. John,

    That is the best post I have ever read on here. I too had a spell of unemployment that taught me some humility. It takes so little time for the stench of failure to emanate from you and it reflects in everything you say, write or do.

    To acknowledge luck takes great courage. I was first blessed with good family and that saved me. Christ alone know how those without cope. It is only through contacts a job is possible in the main. Most jobs advertised are either non existent (agency fishes) commission only or zero hour contracts.

    I am not a man of violence but there are rather a lot of self congratulatory, smug self satisfied b**-tards I could happily string from a lamp post.

    Share your luck if you can.


  35. “It must be the greatest confidence trick in the world that to get the rich to be productive you have to make them richer and to get the poor to work you have to make them poorer – never mind whip up a hate campaign against them.”

    Well said Phil, but I disagree in that there is an even greater con trick that the ruling gangsters have pulled off for years, and that is to have secret (and therefore illegal) Star Chamber style courts in virtually every town and city in a country that has boasted about it’s justice system being the best in the world.


  36. ” yeah, but Iraq has already been taken care of. Can’t see the Iraqi government denying the yanks passage through their airspace should they want to strike Iran.”

    Then you’ve not been paying attention. Iraq is now run by Shites closelly aligned with Iran.
    IF they bomb Iran, it’ll be through Saudi airspace, not Iraqi.


  37. Paul J:
    “Iraq is now run by Shites closelly aligned with Iran”.

    Effectively Iraq is not ‘run’ by anyone at all, it’s in total chaos, which is the desired result for Syria.

    (The Kurds) “I suggest will not let anyone just barge through in either direction, or use their airspace.”

    I believe Holland and Belgium had a similar notion in 1940. Besides, did you just mention Oil and gas? The emergent ‘Greater Israel’ will lay claim to those.


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