RESIGN NOW!

I too heard him mention in an interview that he was investing in Bonds but I truly thought this was for the benefit of the BBC(Business Daily interview – radio).

I think he was actually taking the “mick”.

Sorry to lower the tone, John,
but this just got me laughing.

Yes, that is pretty much what I have thought. But perhaps not just yet. Hugh Hendry has a pretty solid record. As usual, it’s all about timing.

http://www.cnbc.com/id/15840232?video=994367935

The really worrying bit is where governments start getting involved in the long term debt markets. Such as buying up long term toxic securities like mortgaged backed bonds. This will put the taxpayer at a long term risk and create a nasty hangover for years ahead which the markets will not forget. Better to let them die naturally and take the pain now.

A better explanation at

http://www.financialsense.com/fsu/editorials/merk/2009/0113.html

Good piece at the following, on money supply. Notice in the notes, number 4.

http://www.financialsense.com/fsu/editorials/dollardaze/2009/0112.html

As for the excuse she was talking about the corporate bond market, the only reason speculative investors are buying up cheap corporate bonds is because they are betting on people like her bailing out certain industries if they go under.

Never forget she was Gordon Brown’s Treasury advisor with a remit for ‘city issues’ from 1999 to 2007. Perhaps someone should make a FOI Act request and find out exactly what she advised the PM during this time?

I suspect she has been the main driver in government of the response to the credit crunch. Darling as good as admitted in his Guardian interview he didn’t have a clue what was going on and he was supposed to be Chancellor.

She has been part of the Downing Street bunker for a long time now and from what I have heard on the grapevine was Brown’s favourite Civil Servant. ‘Freddie’ suggested above:

“Among those with whom she has had dealings, her reputation is, um, not sure how to put this in a civilised environment such as this blog …”

This echoes exactly what I’ve heard about her too. However, more importantly, like JR says, everything she has done has been a disaster.

(Para left out-ed)

She says she was talking about the bond market, but that is a bubble waiting to burst, so no green shoots there either.

What does puzzles me is that in a fractional reserve banking system, because it is impossible for banks to honour their withdrawal commitments to depositors, it is incumbent on the Central Bank to provide liquidity.

In the case of Northern Rock that is exactly what happened. So where was the Central Bank.

Brown says the business model was flawed (insolvency) but, even if he knew what a business model was, how would he know at that point, and if he did know in advance, why did they not do something about it earlier?

What we now appear to have is banks happily taking one, two and three month deposits from business customers, without the capacity to honour their obligations to repay and no Central Bank behind them to provide liquidity where necessary.

Sounds like fraud.

At all.

Its just the forehead getting a bit high these days.

And wide.

But regardless of this, he’s dead right on the bonds.

Among those with whom she has had dealings, her reputation is, um, not sure how to put this in a civilised environment such as this blog …

Unlike Balls, she had the good sense to recognise that being a Labout MP was not a good long-term prospect, so got a peerage when Gordon was in a poistion to dosh them out.

(And in terms of destruction of tax-payer value, do have a look into the lunacy of the privatisation of London Underground, another of her little projects.)

My view is that, while the banks, central banks and governments are starting to stabilise the credit markets, the recession that has been triggered by the credit crunch is only just starting to kick in.

Reply: Exactly. Some improvement in credit markets, moving from 10 feet of ice to nine feet, is not about to swing the economy round.