Tag: Crisis

Time for a haircut!

Rich WillLeave a comment

new-haircut-for-greeceMy Swiss banker buddy is in a grumpy mood this afternoon. He tells me with a certain malice that the UK economy has a deficit of 110% of its GDP, and asks me what should be done about it. Im a bit dubious about this statistic but don’t have my John Lanchester book to hand so can’t really contradict him. He argues forcefully that the only way out of this mess is to cut public spending. I’ve obviously heard this argument a great deal over the last few months but it’s the first opportunity I’ve had to discuss it face to face with a managing director of one of Europe’s leading investment banks, ie. a genuine full-on capitalist bastard.

When he lets me get a word in edgeways I pose him two questions: where did all this debt come from, and who is it owed to? Because as far as I can tell the answer to both questions is the same: the banks. It seems to me greatly unfair that public services should be cut in order to pay the banks so as to deal with the horrible mess that the banks themselves created. I ask him what happens if, as seems likely, one of the debtor countries can’t pay or refuses to do so? His answer is intriguing, and suggests a slogan other than ‘Can’t pay won’t pay!’: in that case, he says, the holders of goverment bonds have to take a haircut. This simply means that their bonds lose value, and their holders lose money. But it’s not just financial institutions and wealthy individuals, he points out, it’s also private pension funds, insurance companies, and all sorts of other interests. Their investments lose value, they reduce spending in other areas, people lose their jobs, the whole economy suffers.

Now I’m no expert and I’m not really in a position to dispute the scenario he’s just outlined. Nevertheless I’ve never quite sure if I even believe in this thing called ‘the economy’. Surely there are different economies, with conflicting interests, some more powerful than others. But even with leaving Naomi Klein aside for a brief moment, it seems to me preferable to force bond holders to take such a haircut, with the risk that this apparently implies of an economic downturn, than to close hospitals, schools and homes for the elderly, essentially privatise universities, starve the unemployed into non-existent jobs and generally abandon the poorest and most vulnerable to destitution and misery.

I’m not about to convince Herr GeldSäcke of any of this. But it’s been a useful session which seems to have cheered him up no end and which has taught me two important things: one, bond holders will need to take a haircut soon, and two: orange jeans and a black cardigan with little white skulls all down the arms combined with a shiny brand new pair of crocodile shoes is evidently a very popular look for forty something year old investment bankers in Zürich this year. Rather him than me.

Our own little mini-Pearl Harbour?!

Rich Will5 Comments

I remain very suspicious about the fact that the RBS, which is right next to the Bank of England, was left completely unguarded at the height of the G20 demonstration. The attack on it has already been used as an excuse to attack social centres around London and arrest a number of people, as this sickening report attests.

I spent a couple of hours yesterday arguing about this with a banker in Barclays and although he conceded that the demonstrators had a point, and that the police may have been a little rough, the main focus of his argument was that the protestors were there to smash things up and had to be stopped. This coincides exactly with the story that the police and the media have been telling, and the only evidence he had for it was the attack on the bank.

I am not a conspiracy theorist, but I am of the firm opinion that the attack on the RBS was essentially orchestrated by the police in order to provide the media with images of violent destruction of property. Just look at this photo: *dozens* of photographers, and *no* police. At the time, as anyone who was there knows, the police were *everywhere*. And, as this one shows, the RBS – the country’s most hated bank, and a blindingly obvious target – is *right next to the Bank of England*. In this video we can hear the news presenters trying very hard to convincingly explain to themselves and the viewers why it is that the police are standing back and doing nothing while the bank is trashed.

And according to someone who actually witnessed the attack:

‘There were a load of police further down from RBS who could have EASILY stopped the damage being done. Which for the record was done solely by about 10 people. The rest being a weird circle of cameras, waiting for the next kick. One guy started lighting the blinds on fire. I have footage also of a guy in a suit, maybe a bank worker, or police not in uniform, filming it, smiling, and laughing with another cop up above from the opposite building. They watched on amongst many other policemen with cameras as a fire was attempted to be lit. A photographer blew the small flames out before it got out of hand. Some protesters then went inside. Only after a while did the police then go into the building, and take a load more pictures of us all for their snatching operation later on in the day.’

Also, and I may be going slightly bonkers here, look at this clip, and watch the guys provoking the police from about 15 seconds in, two in black and one in white. They seem to be acting, acting in fact with a certain amount of impunity. The guy with the metal bar is by far the most violent of the protestors, and his identically dressed friend seems to be trying to egg the crowd on to more acts of bravado. The guy in white was on the front of several of yesterday’s newspapers, sneering in the faces of the police, covered in what appeared to me to be fake blood. Imagine that scene without those three guys, and then watch this. Ring any bells? I suggest that those three protestors are in fact police provocateurs.

I predict that given this kind of policing, and the ease of creating and distributing footage which exposes the lies of the police authorities with regard to who did what to whom, it is only a matter of a couple of years before the British Government follows the examples of China and Pakistan and clamps down on access to youtube!