A fair society ...

[????]

Those banking practices have caused a global boom, cheap money, massive assett inflation, and huge government taxation takes for 10-20 years and that huge pyramid sale which has underpinned western economic growth has benefitted everyone DJKQ - it may have been a fallacy, it may have been shortsighted, annd it may need fixing, I tend to agree with some if your previous analysis on that, but its a nasty and inconvenient fact that everyone has benefitted from a boom to varying degrees (yes even the very poorest, though them the least) and the blame is split between Bankers, governemnts...AND you and me (as a generalisation as I don't know bugger all about your personal position). Convenient and unpopular as they are all they remain is a dump and easily targeted scapegoat for most of our culpability. It's Daily Mail like.

[louisiana]

???? Wrote:

-------------------------------------------------------

> and my argument was that seriously wealthy people

> WHO HAVE DONE it themselves aren't on the whole

> just lucky - that's all. No - ohh they're great,

> they're my heros; they should be what we all

> aspire to. Fairly predictably - this has been ment

> with

>

> 1) "Lots of people inherit their wealth" - er, no

> sh1t sherlock

> 2) "God what a narrow aspiration...who'd drive the

> busses. you shallow person"Was never put forward

> as an aspiration for all just a fact.

> 3) "bankers are all w*nkers", may or not be true

> and gawd knows we've raked over it a million

> times, but not what I was talking about

>

> I'd reiterate - self-made millionairres may not

> all or always be pleasant, moral or anything to

> aspire to bUT they've by and large had the balls,

> drive, willingness to take risks and yes a bit of

> luck to get there. Most peole don't even try- and

> that's not a problem, they don't have to, many

> don't want to BUT they can't just dismiss those

> that do and make it as 'being lucky'.

I'd argue that there are many, many business people who work just as hard, take just as many risks launching and running their own firms, and don't make it big. Why? Frequently, they are not brilliant business people. But often, they are just unlucky. For example, they got majorly ripped off by a shark sent in by 3i, on IP (a condition of venture financing), and couldn't afford to pay cash up front for a 6-figure IP court case. (You *do* have to have serious money to defend IP.) For example, they got smashed up in an accident. For example, two or three other, larger firms stole their IP and they didn't have the resources to do anything about it. For example, an important employee left and took all their IP, client lists etc. etc. to a larger competitor, and they lost momentum. For example, they got hit by a car while crossing the road in Bloomsbury and suffered major brain trauma, and were never the same again. Sometimes a business partner (who is sometimes even their brother) shits on them big-time. Sometimes their wife/husband develops MS and they have to reduce their 80-hour 7-day week. Sometimes several such bad shit things happen to one person/firm in a matter of a few years. And often they just keep on bouncing back, but they don't make it big.

Whether any of these things happen to your or your firm may be largely down for luck (with in some cases an element of judgement - for example, should you have made that seemingly excellent hire?) But I don't think it can be argued that these people don't work hard, haven't worked hard, decade after decade, or don't take well-informed risks on a daily basis. Many of them have their homes on the line. Some of them encounter good luck, some of them encounter bad luck. Many of them persist through one bad luck experience after another, decade after decade, and some of those come out ahead.

But it's a fact that not all the people who work hard and take risks in business can come out ahead of everyone else doing the same! Not even most of them.(Check the maths.)

I've seen plenty of people who work bloody hard running their own businesses, who have not made it big. I have seen a few who have gone through various failures/wrong courses, before ultimately achieving considerable success. Business is a learning process. I would say there is no significant difference between these two groups other than luck, and in quite a few cases, degree of ruthlessness. If you are prepared to shit on others, it's actually quite easy to make quite a lot of money if you're not unlucky.

I have seen quite a few others, who are incredibly wealthy and have dabbled in businesses belonging to their families, or have merely continued the family business (such as Greek shipping) that their grandfather founded.

I have the most respect for those who have started with nothing (no great education, no parents at home to pay all the bills, no family to 'invest' six or seven figure sums in their kids' projects) and have achieved a moderate degree of success: and for me, that's not about money and the Sunday Times rich list, it's about being a respected figure, being known for something that's interesting or innovative, being known to be a good employer, contributing something to society. I think those things are of greater value than a pile of Monopoly money often achieved by doing things to other people that would cause many of us sleepless nights.

[SeanMacGabhann]

Ooooh. So much of it i agree with quids. Your post here and on related threads is largely spot on

But historically and in the future, us masses will want what we can't have. The lessons between the 30s and 80s amounted to agreeing the banks would be careful not to fuel that. But having been in a straightjacket for so long they have continually lobbied HARD for each govt to give them more leeway. Any govt from thatcher onwards would have list votes acting the parental role in the face of such lobbying

Again I agree the subsequent boom aided lots but wouldn't we, like Arsenal without silverware, have benefited from such discipline

We are where we are. And I agree with you the city needs to play it's part to the full. But is should have been doing it's job properly to begin with. If people are angry with them it isn't just mail like hysteria. They didn't do their inportant job. And when people get cross with them they say they will take their toys away. That is just bullying in the gave of fair criticism. The lehmans and other banks which messed up left a huge crisis which the other banks failed to solve. They should take that criticism on board and understand their limits. If Jamie dimon or similar (and he did a much better job than most) was able to quell the trouble then people couldn see why bonuses were worth it. But it was ploddders like brown who stood up. The world was within hours of every cashpoint not working because the all powerful bankers were paralysed.

We need them. We really do. But they aren't worth what they believe

[????]

...but now is not the time to call their possible/probable bluff

[DJKillaQueen]

This is an intersting discussion..and I see Quids point...get them profitable again and the enconomy motoring and then regulate.

[????]

...get our economy better callibrated so we can afford to decide if we want to go down that path....the city looks on the up again to me and for now we should reluctantly be either be grateful through our gritted teeth and as Londoners frankly we have no choice or start gain which means reinventing our economic and social models based on far less wealth/income for us all....you ready?

[louisiana]

DJKQ, I don't see proper regulation happening anytime soon.

Back in 2006 and 2007, I couldn't believe how in the thrall of big business/banking (I'm small business) Brown was. It was a love affair. And every party has that love affair. It's still going on! In early 2007, my mum visited (literally the blue moon event), and I told her how bonkers property was. But then in her homeland, similar things were happening. We were just ignoring it, it was so preposterous. You could really see the whole pile of cards about to come crashing down. When we had the revelations on CDS's etc., well, quelle surprise. It really wasn't that much of a surprise.

But I'm not seeing anything other than BAU on either side of the Atlantic, from government. We might think back to the shock we experienced at the time when various announcements were made.... but has this had any actual effect? For example, in terms of separating retail banking from some of the more casino aspects of the sector? Or any other actual measures to regulate what is going on? I mean, the recent ratios testing stuff was just a complete pile of dog hair.

Edited to remove a rogue 's'.

[SeanMacGabhann]

I'm inclined to agree. That was end of 2008. But then again, there never is a "time". There is always a reason to back off. That should give us pause for thought at least

[DJKillaQueen]

frankly we have no choice or start gain which means reinventing our economic and social models based on far less wealth/income for us all

But where was the income/ wealth for us all? Virtually little growth in public sector jobs in 20 years! A third of the population need benefit and for the middle-classes, the only investment has been housing and they are squeezed by that too. Housing being an artificially inflated market managed and massaged by who again?

Of course there was real wealth generated for the economy but it's a red herring to think it is the only way to do things. Meanwhile manufacturing shrunk to an all time low of 9% of our economy and areas of high unemployement in the North saw no regeneration anytime soon.

We rely too much on the financial services sector and that in part is why we are so afraid to tinker with it. We have nothing else in this country...and that squarely is the fault of sucessive governments who in my opinion have been lazy, and failed to invest in people, skills, training and enterprise.

[Mick Mac]

Huguenot Wrote:

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> Which bit Ravenelli?

:))

[Huguenot]

"Housing being an artificially inflated market managed and massaged by who again?"

I'm staggered by the depth of this conspiracy.

[DJKillaQueen]

No conspiracy...goalposts changed to keep ready supply of buyers and therefore pushes prices continually up out performing other sectors (including pensions) subject to more normal stresses of market forces. Do you want me to list the deregulations one by one and their impact? The various warnings given to government and then ignored and the now ludicrous position we have were people part buy part rent......

You can ignore it all you like H but those are the facts and you know what? Plenty of far more intelligent and knowledgable people than you and I agree with that. Why else did government have to dictate to banks to ease off on repossessions?

The housing market needs regulating before we all end up on HB or homeless, because most of us don't earn enough.

[Huguenot]

What shall we call them?

The Upper Classes? The New World Order? The Jews? The Bilderberg Group?

End Time, Freemasonry, Illuminati, Protocols of the Elders of Zion, Round Table?

[Huguenot]

There's a fairly obvious conflict between these two assertions:

"Goalposts changed to keep ready supply of buyers"

"The housing market needs regulating before we all end up on HB or homeless"

This is why it doesn't seem like a logical argument, and if it's not a logical argument then... well what is it?

[DJKillaQueen]

Oh it's logical alright. If buyers dry up the market self regulates...but in 25 years the moment buyers dried up the mortgage industry just came up with a new way to sell mortgages (culminating in the ludicrous self certified mortgages). You know my views on buy to let for example. It can't go on and that's why the FSA are looking into ending various types of mortgage such as the capital free interest only mortgages that btl investers mostly used.

In other words, ending the practise that made it simple for those who either had no investment nor could probably afford a mortgage, to get one. The same kind of sub-prime lending that has partly landed us in the mess we currently are in. The EMF again this week warned that UK house prices are over inflated. Are you going to acuse them of being some part of a conspiracy as well? Do I need to go on?

You seem niaively oblivious to the part all this plays.

[????]

I think DJKQ has a point about self-certification et al. It's a bit of a cliche to say it but when I first got a mortgage in the 80s (deregulation had happened but early days) and whilst you didn't have to wear a suit and tie there was an element of a job interview to get a mortgage. I got out of ownership in 1999 and back in again in 2004 (yup. what a great 5 yaers to be out of the market :() and when I went back in it was like filling up your car with petrol in terms of ease and also checks...

[Huguenot]

I may well be a naif, but I just don't see conspiracy in these situations.

I see a housing market that went crayzee because demand outstripped supply. This happened because of modern social issues - the demise of the family unit, an increase in individual wealth and empowerment. It meant existing stock was being used less efficiently, and new stock wasn't able to keep up.

I see a financial services industry that delivered the products their customers demanded. I bought those products, because I had no investment, and I'd have voted for anyone that could give them to me.

I see an FSA and a government that failed to regulate appropriately because they'd never encountered a situation like it and advice was conflicting - the default situation was 'do nothing', as it has been for documented history.

And in all of that I see essential human frailty, our self aggrandisement, our ambition, our hubris.

[nashoi]

DJKQ

Before you write off the importance of manufacturing altogether can I just point out that even in 2007 it contributed 50% more to the treasury than the financial services sector and its profitability continues to grow. Though it is right that the number of people it employs is shrinking.

[????]

No conspiracy agreed just went out of control and no-one (or very few) saw it happening so can we hardly solely blame the bankers for saying "This time it's different"...similar things were "No more boom and bust" and "?250,000" for a one bedder in SE22 is a great investment"

Human greed and optimism (and it's in most of us) over rode the reality.

[SeanMacGabhann]

Oh I don't know that not many people foretold it

a full 2 years before the 2008 crash for example

What I remember is that anyone suggesting such a thing was decried

tunrs out in 2007 I was too

[Huguenot]

And more remarkably still, about 10 posts beneath there's an Alan Dale comment that hasn't been deleted.

Who would have thunk it?

[DJKillaQueen]

oooh...no let's not have Alan Dale as the last word lol.........

[Huguenot]

Ha ha.

I take SMG's September 2007 comment, and trump it with this from March 27th 2007 (pre crash):

"In this sense, whether house prices are likely to drop is irrelevant, don't even bother with the argument - investing in houses is already a bad idea unless you want to live there!

Similarly, from a long term perspective, I think we are all going to be underwater soon?

This is not free money...

Alan, I notice that on other threads you recommend disinformation as a route to financial gain - is this urging to buy houses a reflection of your willingness to capitalise on defrauding others about value?"

Oh yes, I am a God.

[Huguenot]

In fact, that whole thread's a pretty good insight into pre-crash thinking. It's a real shame Alan Dale played his 'delete history' card. Worse than Stalin I say.

[????]

Well. I think by 2007 sentiment was largely in with there being a potential crash (no-one got the severity) certainly CDOs were being questioned by then and the US property market was going down - which is why an economy based on asset prices rising for ever was so stooopid, so strikes me that the more astute on the EDF were looking at what was starting to bubble rather than huge premeditated foresight, sorry chaps.