Basel II is tens of thousands of pages of regulations, no one knows how vast it is, because not all the regulations can be found in any one place, but it could all be replaced by two simple rules: Politically correct victim groups shall always find it easy to borrow money, regardless of their ability or intention to pay it back, and politically well connected businesses shall always make money, regardless of whether they are competently run or not.
Tag: crisis
American debt
Thus the excess “private” debt is not private. The normal level of public and “private†debt is about twice GDP, say twenty six trillion, so we are about thirty trillion or so in the hole and getting deeper fast – well past the danger level of twice GDP.
The vast majority of defaults were black and hispanic
Hat tip Steve Sailer who provides the breakdown of defaults. The proximate cause of the international crisis is that the US$, the international reserve currency, lost much credibility. The proximate cause of the US$ losing credibility was massive defaults by blacks and Hispanics, and the proximate cause of the massive defaults by blacks and Hispanics was affirmative action lending to people whom I could tell at a glance from twenty …
What is wrong with the Bush/Obama economic stimulus
the Keynesian description of the crisis only addressed a small and unimportant part of the truth, thus stimulus could only have a small and unimportant benefit. The economy is not “starting to get better alreadyâ€, rather it is only beginning to go bad.
Creating the next crisis 2
Thanks to the generosity of kindly uncle Sam:
Bad credit?
No credit?
No problem! Buy the house of your dreams with no money down!
The universal government white paper:
In short, the white paper tells us: Politicians are of course entirely lily white and innocent, except that the other party allowed bad people in the private sector to do bad things. Some regulatory agencies failed to do enough. Solving the problem requires more power to the government. Those regulatory agencies that failed the worst, will get the largest increase in money and power.
Inflation looms
The bond market does not tell us what the smart money people think inflation will be. It tells us what those among the smart money people who do not expect very high levels of inflation think inflation will be.
In addition to an on budget deficit of ten percent or so, there is also a much larger off budget deficit, in the form of an ever growing pile of government guarantees, which there is no will to restrain. Put the two deficits together, crisis looms.
Trees do not grow to the sky. That which cannot continue, must stop
obamanomics
Megan nails it: the government is using its intervention in the banking system to pressure banks to give special deals to the government’s special friends.
Securitization
From the point of view of oligarchs and crony capitalists, the crisis is not that a lot loans were made to no hablo English wetbacks. The crisis is that people are rejecting securitization of debt. The Obama regime’s capitalism smashing measures are intended not to destroy capitalism, nor to install socialism, but to restore securitization of debt. This is socialism for the financiers, not for the proles: Crony socialism, crony …
Galt strike or inadequate aggregate demand?
The Randian concept of a Galt Strike is that if the elite slack off, the masses will be impoverished – that countries are rich or poor according to whether the elite is productive, while the masses and resources do not matter much, except in extreme cases such as oil rich sheikdoms. There has been a large fall in GDP over the past six months: The Keynesian explanation of this fall is …