Having listened (admitted not to all of it) I was less impress than George but having little understanding of economics, the meaning of fiscal terms or of how the markets work I really don't think any  "man-in the street" or "common-sense" comments I could make have any relevance or carry any weight. Unfortunately it seemed to me that the experts' analyisis of what had gone wrong gave little indication that they knew what action would put it right. Richard's Marx quote would suggest that 150 years ago economists could have told you what the outcome of the wild expansion of under-financed home-ownership would be, so one would have thought that the "experts" who would have advised Clinton, or whoever, as to where the implementation of any specific flight of fancy would lead would have curbed any wild political adventure. Far from this being the case it seems it was Greenspan who was driving forward the dangerous policies. Is it little wonder that the public and the politicians turn on the market as one would turn on a doctor whose directions one had followed only to be told that your illness had increased because you had followed that medical advice.
    Elizabeth Warren appeared to float a good idea when she said that mortage payments should have been frozen at the "teaser rate" which was the rate deemed to be the one the buyer could actually afford, yet when asked why this idea had not been followed the professor admitted she herself would not pursued that policy but would have "tried other things first" what these "other things" were she did not explain.
  You do not have to be on the Republican right to be thinking, like someone in the spring of 1914, that what we need is a bloodly good war. Of course we all know what that led to.

Well indeed, but then 'credit markets' are essentially what capitalism is. And even 'capitalist economists' have their own version of acknowledging instability in such a system in accepting the likelihood of the 'boom and bust' cycle. Marx argued that would be cumulative and fatal to the system; the panel members here were clearly all starting from the position that it needn't be. And they would all, undoubtedly, have disagreed with Marx by rejecting his basic premise that all value derives from labour and nothing else. But their accounts of what had gone wrong did nonetheless seem to me to have clear parallels with the mechanism that Marx described  -  even if he regarded it as inherently fatal, and they thought resulted from mismanagement.   


But as I understood it they were all against the lack of transparency that these particular clever-dick 'financial instruments' had introduced into the system. By their capitalist lights, a basic objection was that these particular things were anti-market, they mucked up the market by being near impossible to value properly. Hence, from a capitalist/market perspective, the problems. I may have misunderstood but I think those on the panel who were saying there was nothing wrong in principle with repackaging 'financial instruments' were saying that they were fine if they brought or maintained clarity; but these things were doing the opposite, in effect the anti-market thing, to the extent that no one knew what they were worth (which again resonates with Marx in that passage). Whether or not one agrees with the basic premise, that at least seems a consistent position to hold.

And here it is. The format and style take some getting used to, but a lot of it is very informative, to me at least.

http://thislife.org/Radio_Episode.aspx?episode=365

Tommo 

Sad yet funny. Didn't they have a bigger version of this pic?

Has anyone seen the cover of the Economist?

I'll post it as a link, as the image may offend some...

Economist Cover

Surely Washington has enough on his plate without having to worry about inflation? 

Tommo
Governor of the Piggy Bank of England
London

Diamond-encrusted earphone covers - what financial crisis?

By Duncan Geere Tech Digest - Friday, October 10 04:12 pm

I suppose there are two schools of thought with regards to the current whirlwind around the stock markets. One group of people will save every penny they have, so that they're sure of being able to afford to eat in a year's time still.

Another group, however, thinks "sod it, I might not have any money left tomorrow, I better spend it all today just in case", and buys these... hideous... things. They're diamond-encrusted headphone covers. You have to provide your own headphones!

Depending on how much you have invested in Iceland, you can either plump for the US$60,000 coloured diamonds (yellow, pink or black), a US$4,500 set with white or black diamonds, or even just a set covered with the ever-popular Swarovski crystals, for "just" US$110. That's Christmas for your mad aunt sorted.

Related posts: Swarovski Mickey Mouse MP3 player ramps up the tack factor | Gresso White Diamond mobiles - 'bling' doesn't even come close.