He’s sweating and grinning madly

I was asked an hour or so ago by a pretty senior economist I thought of today’s financial market action. I offered a range of reactions.

First I said this is the result of no real correction after 2008: no reduction in inequality; no investment in productivity; no market reform; no real regulation of finance.

Second this is the result of using financial QE as a patch and not using what I would call People’s Quantitative Easing as a reform (even if it was green quantitative easing back in 2010 a far as I was concerned).

Third there has been no attempt by government to build infrastructure when borrowing costs have been near enough zero.

As a result there have been five lost years since 2010 when austerity became the agenda. And now we are paying the price.

What to do? First, provide a safe haven for investors: sell new infrastructure bonds so they are promised their money will create jobs. Do it nationally, do it regionally, do it sectorally, but just do it. People need to know that this time there money will be used wisely and only co-ordinated government action can do that.

Second use these bonds and PQE (which will be the part of this programme financed by new government printed money) to hold rates low, to flood money into the real economy and this time deliver the 21st Century Deal – Roosevelt again.

Third, reform taxation.

Fourth, really regulate markets and banks this time.

Fifth, build the democratic framework that takes us beyond neoliberalism.

Sixth, put people and not finance at the heart of everything.

It’s not a complete explanation of answer. But it’s the basis for both.

He’s positively frotting himself into a stupor in fact.

The markets are collapsing and this tells us a great deal, oh yes. The death of neoliberalism and I tell you this candidly.

This from the man who tells us all that markets don’t get things right.

Sigh.

74 thoughts on “He’s sweating and grinning madly”

  1. He has no idea of what he is talking about. Banks have been hit by a Tsunami of regulations since 2008. Dodd Franks, Volker, MIFID and lots more oversight.

  2. I wonder what the “pretty senior economist” made of the range of reactions. I suppose if they thought it worth asking him in the first place they’d be a barking, lefty economist.

  3. Bloke in Lower Hutt

    “Pretty senior economist” tut, tut #everydaysexism, I hope the Feministas don’t catch wind of this post….

  4. “What to do? First, provide a safe haven for investors: sell new infrastructure bonds so they are promised their money will create jobs. … People need to know that this time there money will be used wisely and only co-ordinated government action can do that.”

    Oh, yes, all investors I know know that Govt will use their money wisely (laughs so hard he vomits into the bin).

    It’s precisely because they know that govt can’t use money wisely that Crapita, and all the others, milk the taxpayer so successfully.

  5. BiLH,

    Were I a misogynist, I’d suggest that it definitely could not be Hilary Wainright or Grazia Ietto-Gillies, but I’m not so I won’t.

  6. There is great danger of collapse–but for NONE of the reasons Murphotwat spews. The state is the cause of unfolding economic mess. And even more deeply than that, ultimately, behind the state’s actions is the mental poison of socialism.

  7. Even his own followers are suggesting he calm down a little rather than glorying so nakedly in his, er, predictions. All to no avail; he really has lost it today.

  8. Have now seen one too many stock market crashes to give a flying fuck. Instead, am enjoying the doom-mongering from those who should know better.

  9. “Have had one too many bullets fired at me to give a flying fuck. The fact that they have all missed me means that I can never be hit by a bullet. In stead I larf at doom-mongers with their talk of “deadly” bullets.”

    Ok Biggie— lots of luck with that.

    I actually hope we can get a few more years before the economy goes to shit for selfish personal reasons. But no matter how many false alarms and failed predictions sooner or later SoCal will be hit by the “Big One” (and the Pacific Northwest by the “even Bigger One”) and that is it.

    The mess that is the West’s economy can’t be hidden. Most just won’t look cos they are dumb and believe the bullshit the State puts out. The mess gets bigger and bigger. At some point it will go.

  10. bloke (not) in spain

    Wouldn’t be at all surprised if the markets debacle doesn’t seal Corbyn’s bid for the throne. Richiebollocks is very persuasive for a whole lot of people. And, given the viability of the financial paradigm’ll possibly expire in the next two or three years, The aftermath could give you your new Prime Minister.
    Good luck.

  11. The Shanghai Composite is still 40℅ higher than where it was 52 weeks ago, which was lower than the level 5 years ago, so the fool doesn’t know what he is talking about.

  12. “provide a safe haven for investors: sell new infrastructure bonds so they are promised their money will create jobs”

    Yes, as an investor that is what I want – not ‘will my investment make money?’ or even ‘will I get my money back?’ But ‘will my investment create jobs?’.

    Thank God I will soon be getting that reassurance.

  13. “Fifth, build the democratic framework that takes us beyond neoliberalism.”

    You can’t even fucking define neoliberalism, how can you design anything to go beyond it?

  14. Bloke in Spain

    I think you’ve been getting your newspapers confused. You soft sods in Spain are about to elect Podemos; not us.

  15. @Fecks,

    Oh how wonderful it must be to be a young codger like you.

    The west’s economy is actually remarkably resilient. It has bounced back thus far from, literally, everything that has been thrown at it. The fact that government’s depradations cost between 40% and 60% depending on where you are, is a sign of strength, not of weakness (it’s a sign of other less positive things too, but for the economy, it means we can afford to give up half of our production without bread riots breaking out).

    This to me is the great lesson of neoliberal capitalist market stuff. It adapts and thus survives.

    And of course, the doom-mongers need only get lucky once (e.g. I note AEP still predicting daily that “now this is REALLY it for the euro”). Though it does get tedious to have the end of civilisation predicted every time your portfolio lost 2.2%

  16. Naomi Klein was nearly right with the central thesis of The Shock Doctrine. Unfortunately she mixed up capitalism and statists.

    Ritchie is determined not to let a good “crisis” go to waste.

  17. “I was asked an hour or so ago by a pretty senior economist I thought of today’s financial market action”

    Considering he’d name drop if he was in the same stadium as someone recognisable it’s obvious this is another one of his made up conversations.

    Like his ‘conversations’ with ‘senior figures’ from the Big 4, government, the legal system and (probably) religion.

    And I’m with BiG here. “Oh no, my portfolio has lost a tiny fraction of it’s long term gains, must be the end of the world and proof that neoliberalism can’t work”. Yawn.

  18. OK, so yes, I am in a really bad mood this morning.

    But really, this fucking stupid fucking moron is geting right on my fucking tits and I wish someone would give him some cement boots and set him paddling in the fucking Thames.

    I think we can summarise his points as: “We must socialise our ecomony and make it State run, with a few smarties like me in charge of everything.”

    Well raise your fucking eyes up beyond the level of your navel and look at the Socialist economy that is largely State run by a few people that’s causing all the fucking grief.

  19. Haven’t the Chinese effectively suspended trading on their markets? So the real market value is probably much lower than the published figure.

  20. WAAAHHH Stocks are only up 2% today!!! It’s a disaster! Catastrophe!!! Eurogeddon!!!!! Stock up on tinned food now!!!!

  21. Third there has been no attempt by government to build infrastructure when borrowing costs have been near enough zero.

    What the **** are all those Chinese ghost cities?

  22. “This to me is the great lesson of neoliberal capitalist market stuff. It adapts and thus survives”

    Never said the market would be totally destroyed Biggie. Yes it will survive. Most people survived WW2 but they likely didn’t fucking enjoy it.

    I hope you are right and corporate socialism can get past this for a few more years. But the idea it is all business as usual and a storm in your bedtime cocoa-and-schnapps is horseshit. It is a mess of vast proportions and you nor anybody else can duck it.

    https://www.youtube.com/watch?v=aZJyXbSnde4

    https://www.youtube.com/watch?v=zPdHAleapI0

    https://www.youtube.com/watch?v=k4iuD7xQDxE

    https://www.youtube.com/watch?v=Fr_LwF6JnKg

    https://www.youtube.com/watch?v=UZ-fQmmgtDo

  23. Ann Pettifor was on Newsnight last night hand waving about where the £120bn of claimed tax gap revenue was going to come from. Every time she was pushed on it she kept going on about getting unemployed people into work rather than rattling off any kind of list of subsidies and reliefs that could be canceled.

    That isn’t a tax gap by any normal definition as it includes a figure for tax that hasn’t even been earned let alone tax that has gone uncollected.

  24. You do all know that he’s a Tory mole.. Don’t you..??

    It has been discussed. As has the possibility that he is an idiot.

    But the broad consensus opinion* seems to be that he does actually, really, truly believe the shite he spouts (for the couple of minutes before he completely reverses his reasoning.) And, rather than “idiocy” (which would be sufficient but isn’t actually necessary – e.g. Wedgie Benn was quite bright but gigo), he sincerely believes that there is some all-powerful neoliberal troll conspiracy hiding “real” reality from him and his dupes.

    * i.e. excluding our leftists and Mr Ecks.

  25. The laissez faire system (well, the anti-system because it is a sacred self regulating mechanism that mere humans should never touch or even look at) is just going through one of its periods of “creative destruction” but everything will be back to normal soon: falling real wages and out of control property inflation.All will be well while the children are being taught “Wage increases bad; house price increases good”And that they are comfortable in the knowledge that nothing will ever change.

    “Look upon my works ye mighty and despair.”

  26. Murph doesn’t know shit from wild honey. That he might be right about a massive economic collapse -if it is happening now–is purely a stopped clock phenomena and a measure of wishful thinking. He may see such a collapse as a 1917 moment for his gang.

    I still believe he started his nonsense as a paid PCS hack but the ego inflation and ego (mal)investment he has undergone now means that he is a classic confabulator. A hoaxer who has come to believe in his own hoax.

    He has no insight whatsoever into anything.

  27. Well, DBC has moved back from the fallacy of the excluded middle to simply making stuff up, again.

    Mr E – that’s a bit less direct that you have been before. I excluded _you_ because I thought you were of the opinion that Murphy was simply and mendaciously lying to keep the income flows up.

  28. Ozzymandias eh Read? A semi-destroyed old ruin. Sounds more like your nutso theories than the marketplace.

    For the last fucking time the system we have is corporate socialism not laissez-faire. If real wages are falling it is the doing of the statist market-meddlers in your gang of cunts not the market. Which responds to the distortion created by said meddlers,

    As for what kids are being taught that seems to be leftist bullshit as well.

    Anyone looking on socialism and its “works” does indeed pass close to despair. That so much evil and moronic bullshit has ruined so many peoples lives. And still has legions of knaves like you peddling the shite.

  29. Murph doesn’t know shit from wild honey.

    Dear Mr Murphy,

    Thank you once again for your kind invitation to afternoon tea. Regrettably something has come up and I’ll no longer be able to make it.

  30. SE>

    “I thought you were of the opinion that Murphy was simply and mendaciously lying to keep the income flows up.”

    It’s not necessarily wholly one thing or another. It explains a lot about the likes of Corbyn and Murphy if one posits that their belief in antisemitic conspiracy theories about how ‘the jooz’ are stealing the cream are leading them to the belief that what’s ok for ‘the jooz’ is OK for them.

  31. @DBC, I wonder if there are any Lefty sacred cows contribute to falling real wages, and which contribute to rising house prices.

    Lemme see, essentially unrestricted immigration and the benefit hammock for the former, and excessive planning controls on the other.

    But no, it’s all the fault of the laissez-faire that we don’t in any way have.

  32. Hate the economic collapse doom crap,from 07 onwards you can find hour long lectures on youtube of why this is the year of economic collapse, doom sells and markets correct.

  33. Bloke in North Dorset

    @SE

    “he sincerely believes that there is some all-powerful neoliberal troll conspiracy hiding “real” reality from him and his dupes.”

    And he and a few others are the chosen who can see it, so if you question them then obviously you aren’t a chosen one and must be either an evil neo liberal eg Tim or one of their dupes eg those of us who read and broadly agree with Tim.

  34. The old saying:

    ‘Cometh the hour, cometh the man’ seems appropriate, and without wishing to steal the thunder of Mr Ecks, is there not the slightest frisson of worry that, as in Spain and Greece, an economic downturn could lead to people looking at Corbyn and Murphy and thinking ‘this is free (for me) – why won’t I vote for it?’ I think it unlikely, but never forget that there are powerful forces at work that are unpredictable.

    1/ The three pronged coalition which built The Blair Brown majorities – the unemployed, Immigrants and Non-productive Public Sector employees might have been diminished by benefit cuts and job losses but they still exist – defeated and demoralised by the May 1st result, certainly, but still out there. Even an unemployed diversity co-ordinator still has a vote…..

    2/ The overexpansion of higher education (as Tim pointed out in a short article for City AM last week) has led to a plethora of graduates from either academically dubious disciplines or from worthless institutions, most of which are dominated by the Hard Left – this bedrock could act as ‘the fourth being’ in a Corbyn dominated coalition. Utterly out of touch with the real world, completely unable to compete in a global job market and beloved of ‘safe spaces’, ‘microaggressions’ and other restrictions on free speech, these are the perfect fodder for Corbyn’s campaign.

    I think the possibility is unlikely but be under no illusion, the road ahead will be long and hard and the evil that Murphy (and Corbyn) represent must be opposed unflinchingly….

    If anyone needs a reminder, here is Murphy deporting/exiling the BOE governor if he won’t implement ‘People’s QE’

    http://www.telegraph.co.uk/news/politics/Jeremy_Corbyn/11820156/Jeremy-Corbyn-will-sack-Bank-of-England-governor-if-they-refuse-to-print-free-money.html

    And here he is saying that the state will simply use people as indentured Labour and if inflation kicks in simply stop them working

    http://www.theguardian.com/politics/2015/aug/24/cbi-boss-criticises-jeremy-corbyn-peoples-qe-plan

  35. Van_Patten, on a side note when these tossers lose there shall be no rapid left wing fool to take their place for a long long long time.

  36. bloke (not) in spain

    @Ironman
    “Bloke in Spain
    I think you’ve been getting your newspapers confused. You soft sods in Spain are about to elect Podemos; not us.”

    I’d welcome Podemus in the same way as I’d welcome Corbyn. They’d both have ambition of tearing down the corporate socialists & middle class rent seekers. The people who are fucking it up now. Nobody else is going to. And then, as is their way, they’ll turn on themselves as it all goes pear shaped
    Maybe we get to build something worthwhile out of the wreckage.

    Which brings us to BiG. Who knows sweet FA about markets. Markets work purely on confidence. That’s all there is. The interest rate projections & productivity outlooks & all the other mumbo-jumbo. are what confidence is built on. And looked at from a different viewpoint is the same mumbo-jumbo destroys confidence. So when the BiG’s of the world are in the ascendant, confidence proliferates & markets are strong. But when the Ecks’s are listened to, markets plummet. Simple as that.
    Personally, i’m listening & voting with an X
    By intending being in neither UK or Spain.
    Enjoy the ride folks. Hang on tight, though.

  37. @abacab,

    To be fair unrestricted immigration would be “laissez-faire”, indeed, libertarian. Something a real (not leftist) liberal would be entirely happy with on point of principle.

    The reality of the importation of Islam, of poverty that we will never run out of, is the reason that many fundamentalist market liberals (e.g. UKIP) adapt their ideals to the real world and oppose mass immigration.

  38. ZOMG the FTSE is back where it was 2.5 years ago, it’s the neoliberal financial armageddon we’ve always predicted!

    Quick, Do Socialism!

  39. BNiS

    “Markets work purely on confidence. That’s all there is”

    In the short term, yes, but in the long term, other things like whether a company sells stuff and makes profits is a more important factor.

    Long term the stock market has offered and continues to offer the average Joe a chance to get reasonably comfortably wealthy. Show me any socialist state that has ever achieved that.

  40. “Long term the stock market has offered and continues to offer the average Joe a chance to get reasonably comfortably wealthy. Show me any socialist state that has ever achieved that.”

    The freak wants to put a variable transaction tax on the market that rises inline with volume to “protect the city”, which would reduce the market to a whipsaw crash prone unusable mess. What is it with these freaks, labour the fucking tumor that just comes back again and again!

  41. “Cometh the hour, cometh the man”

    And if it proveth not to be the right hour, cometh again in an hour’s time, and repeat, ad finitum, until the hour truly cometh or everyone else is distracted.

  42. BiG,

    Libertarians do believe that people should be free to move across boarders, but that right does not include the right to live off the taxpayers of a host country. If one wishes to move to another country, one must be self-sufficient.

  43. “The freak wants to put a variable transaction tax on the market that rises inline with volume to “protect the city”, which would reduce the market to a whipsaw crash prone unusable mess. What is it with these freaks, labour the fucking tumor that just comes back again and again!”

    Sometimes I think they’re really trying to bring about the final crisis of capitalism that we’ve been hearing is inevitable for the last 160 years…….

  44. “Second this is the result of using financial QE as a patch and not using what I would call People’s Quantitative Easing as a reform”

    But Richard my dear fellow, how could we possibly have implemented PQE in 2008 when you didn’t discover it until last week?!

  45. “Sometimes I think they’re really trying to bring about the final crisis of capitalism that we’ve been hearing is inevitable for the last 160 years…….”

    The best one is his drive to reduce inequality by putting a cap on the amount top earners can make annually there by reducing the tax intake massively there by having less tax intake to spend on the population there by hitting the poor hardest there by increasing inequality. I hope he loses the nomination on the count that I cant stand 5 years of this mind numbing retarded shit

  46. @Sil

    And his ideas are so childishly simplistic. He would not allow a CT deduction for wages paid to directors above a certain amount and triumphantly calculates how much extra tax this would raise from FTSE 100 companies. That many FTSE 100 directors live abroad and many would follow if his new rules were introduced doesn’t seem to occur to him. That FTSE companies might move their HQs out of London to ensure they get a corporate tax deduction for the full wages paid doesn’t occur to him either. Whereas in reality it might lead to LESS tax, he would already have spent the mythical extra tax he calculated by his usual method of pulling numbers out of thin air and extrapolating them by factors pulled out of his arse.

  47. @AndrewC

    well, yes. But that’s second order.

    He doesn’t recognise that people will change behaviour in response to a change if it doesn’t suit. But then wishes to change behaviour through the tax system when it suits. He’s schrödinger’s economist – he occupys both states simultaneously until observed at any given time. Hence two observations at different times appear to be in contradiction.

  48. AndrewC

    I think he would echo the comments of that great thinker, Tommy Sheridan

    ‘The only banks leaving the UK will be the food banks’

    He would no doubt look at capital and exchange controls to keep the assets here – and if he can put Carney on a plane, he can certainly implement seizures of personal property for directors ‘guilty’ of ‘neoliberalism’ or other ‘crimes against civil society’ – it’s a one hit approach but for him the short term gain would outweigh the disastrous long term impact.

  49. “People need to know that this time there [sic] money will be used wisely and only co-ordinated government action can do that.”

    Where to start?

    “Government” and “money used wisely” are two things that should never ever be in the same sentence together.

    Most of us already know this, of course.

  50. @Mr E,
    Ozzymandias eh? The Australian pharaoh. Anything is possible I suppose in a world perceived as still being run by “Statist market meddlers” and not those who have been “rolling back the frontiers of the State” (Little Willy Hague, boy genius) for decades .All the present crap has been caused by those professed enemies of the post war British state founded on a mixed economy.
    Funny word “statist”; seems to equate with ” government-ist” somebody who believes we should have a government. God forbid no! The markets are the only rulers: they are forces of nature and must be placated by sacrificing the young! Their workings are ever beyond man’s understanding.

  51. Banks are licensed and regulated by the govt to serve as a political tool for goosing the economy in sync with the electoral cycle.
    The changes necessary to establish sound money and safe banks wld not serve the purpose of the ruling class, whatever party they belong to, so it won’t happen…unless there is a change in intellectual fashion so powerful that it becomes politically necessary to follow it.

  52. DBC your pastiche is quite instructive-free markets are indeed forces of nature-if by nature you mean humankind. The spontaneous formation of markets by millions of decision making individuals creates a phenomenon whose principles of formation can be understood but whose workings cannot be replaced by a single mind.

  53. @DocBud,

    The libertarian approach is surely to let people in and be self-sufficient. That causes Milan problems (see below) which is why we stop it. We find it distasteful to have people living under tarpaulins along railway lines, even if they are quite happy with the situation.

    When I lived in Milan there were indeed tent villages of illegals alongside said railway lines. They were claiming no state benefits, anything they got for free was charitable, and clearly believed themselves better off there than at home. What is the libertarian thing to do? Let them get on with it (Being self-sufficient at a level they are happy with but we would not be) or kick them out?

  54. “@Mr E,
    Ozzymandias eh? The Australian pharaoh.”

    That is enough already DBC. You should call yourself Teflon because whatever is said to you slides away to oblivion and you dish up another heaping from your socialist word salad bar. And it has been sneezed on by the punters so much that you should set out Detol and Cillit Bang as sauces.

    Beyond making a futile enquiry about WTF William Hague has to do with free markets beyond vaguely and dishonestly alluding to his alleged support of them, I can make no further comment on the owl-pellet of non-sequitur nuttiness you laughably call a comment.

  55. Mr Ecks

    Thank the Lord that classic Stool pigeon, ‘Lawrence from Guernsey’ hasn’t yet seen fit to enter the fray!

  56. @BIG
    Classic liberalism wld not consider them”illegal” and any employer who wished to hire them cld do so.
    This was the case in England until its Prussianization and the establishment of the “show me your papers and what is your number” state.

  57. One of my hobbies is to imagine how DBCR will react to any thread. The way he threads his streams of irrelevant detail and factual inaccuracy together are very difficult to predict. The use of “soi-disant” and “laissez-faire” and some kind of spurious reference to Adam Smith come as a given but then he throws me by chucking in an allusion to an important political philosopher such as William Hague. The range of topics on which he holds baffling opinions derived from no known facts is extensive. But then, life was so much better in the 1950s, when you did not get to shop in supermarkets. I think, for him, the fall of man happened when check-outs first appeared and it has been downhill for mankind ever since.

  58. @dee
    “free markets are indeed forces of nature”. Adam Smith certainly identified them as such ,so much so that his magnum opus is little more than more than the Romantic Movement applied to economics: that which is best is the most natural in the manner of Byron and Shelley.Most quotes from Smith include “natural”: my favourite, because it exactly explains the current UK housing crisis, has two mentions “The monopolists ,by keeping markets constantly understocked , by never fully supplying the effectual demand, sell their commodities much above the natural price and raise their emoluments, whether they consist in wages or profits, greatly above their natural rate.”
    But Smith like others in Economics’ Romantic era ( revived recently as the Green Movement), believed in the FGLVT or the Fucking Great Land Value Tax. Even I would give laissez faire a chance if it was backed up with a LVT like the originators of LVT intended.

  59. No, no, no, free markets are not at all natural or evolutionary.

    They’re designed and operated by the lizards for their own benefit.

    Or didn’t you know?

  60. @GlenDorran,

    “schrödinger’s economist – if only he was locked in a box.”

    He’s not in a box, he’s in Flash Gordon’s stump. To mix analogies, he looks through all holes in his stump imultaneously (and thus holds all possible positions simultaneously) until observed by putting your hand in. This observation fixes one hole, and you get one position. When no hand is in the stump, he goes back to holding all positions simultaneously until another hand goes in.

    And every so often the guy comes along with the big stick and gives him a big twat on the head. I think that guy has the best role.

  61. “People need to know that this time there [sic] money will be used wisely and only co-ordinated government action can do that”

    Or

    “People need to know that we are going to steal their money and only co-ordinated government action can do that”

  62. “People need to know that this time there [sic] money will be used wisely and only co-ordinated government action can do that”

    I want Murphy, on TV, saying that sentence 24/7 on every channel. I’d rather he replaced ‘there (sic)’ with ‘your’ as it will be more direct and have more impact.

  63. Bloke in Costa Rica

    “I was asked an hour or so ago by a pretty senior economist”

    No you weren’t you lying cunt. No senior economist is going to ask you the fucking time, let alone anything about the stock market. It would be like asking Basil Brush about string theory.

  64. Except, DBC, the monopoly (and the shortage) in the new housing market* is in the provision of house building chitties, not in either the land or the capability of building houses.

    So, exempting Paulson level corruption, how exactly does your reworking of Smith function?

    * There are clearly locations where this isn’t true. But all of those are within a reasonable commute of places where the generic holds.

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