Learning from Dogs has been running for one year.

On July 15th, 2009 a post called Parenting lessons from Dogs started what has now become a bit of a ‘habit’.  But more reflections tomorrow.

Reach for the Skies

Today I want to voice something that has been running around my mind for some time.  It is whether we give in to the mounting doom and gloom at so many levels in our societies (and it can be a very compelling draw) or whether we see this as a painful but necessary period where slowly but surely the desires of ordinary people; for a fairer, more truthful, more integrous world are gaining power.

And I’m going to use Richard Branson to voice it for me!

(Now this is an unusually long Post so I’ve inserted the Read More divider to prevent the Post visually swamping your browser.)

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Congratulations to Martin Wolf of the Financial Times

An article was published in the FT on the 29th June that beautifully describes the ways in which we are all being so beautifully ‘screwed’ by the world of finance.  (Note, you may need to register to see this article, but please do.  Registration is free and the FT is full of great content.)

It starts like this:

Paul here. Pass the parcel is a game for kids’ parties that involves passing a multi-wrapped ‘present’ around where the kid holding the parcel when the music stops gets to unwrap one sheet, then passes it on, etc., etc., until the kid holding the parcel with just one wrapper on it when the music stops gets the present.

Martin continues:

Our adult game of pass the parcel is far more sophisticated: there are several games going on at once; and there are many parcels, some containing prizes; others containing penalties.

So here are four such games. The first is played within the financial sector: the aim of each player is to ensure that bad loans end up somewhere else, while collecting a fee for each sheet unwrapped along the way. The second game is played between finance and the rest of the private sector, the aim being to sell the latter as much service as possible, while ensuring that the losses end up with the customers. The third game is played between the financial sector and the state: its aim is to ensure that, if all else fails, the state ends up with these losses. Then, when the state has bailed it out, finance can win by shorting the states it has bankrupted. The fourth game is played among states. The aim is to ensure that other countries end up with any excess supply. Surplus countries win by serially bankrupting the private and then public sectors of trading partners. It might be called: “beggaring your neighbours, while feeling moral about it”. It is the game Germany is playing so well in the eurozone.

It’s an article that really does need to be read in full. Martin concludes thus:

Yet it is quite clear that an isolated discussion of the need to reduce fiscal deficits will not work. These cannot be shrunk without resolving the overindebtedness of damaged private sectors, reducing external imbalances, or both.

The games we have been playing have been economically damaging. We will be on the road to recovery, when we start playing better ones.

Now I really don’t want Learning from Dogs to focus on ‘doom and gloom’. There’s more than enough of that to go round twice and thrice.

But when someone writes in such a great clarifying way – then it deserves the widest promulgation. The more we all know about the games being played, the better we can change the rules to benefit society.  Well done, Martin.

By Paul Handover

Truth – 0, Lawyers – 1

Hayward of BP taking the oath

I can’t possibly add anything of substance to the hours and millions of words spoken about this tragic event.

All I felt as I watched the Congressional Hearing live on CNN was both embarrassment and sadness as a fellow Englishman demonstrated how the lawyers have won.

Hayward, from the couple of hours that I saw, said nothing of substance, nothing of real value and nothing that recognised how the American people, and the world in general, deserved openness and in-depth answers.

Very poorly advised, in my opinion.

Tragic.

By Paul Handover

Growth is good?  Good for what?

[Apologies to our readers but a consistent error in all the links to previous posts within this and earlier posts has now been corrected.  You can view all the previous sections of his lecture by clicking the links in this Post. Ed.]

We live on a finite Earth.  But really understanding what that means is difficult.  I guess because most of us think that in our own little way we can’t really be doing any harm to the planet – I mean what’s another few grams of CO2?

Al Bartlet, University of Colorado

Well here’s Dr Albert Bartlett of the Department of Physics at the University of Colorado chatting about arithmetic!  And if you go to his website, you will come across this quote on the home page:

“Can you think of any problem in any area of human endeavor on any scale, from microscopic to global, whose long-term solution is in any demonstrable way aided, assisted, or advanced by further increases in population, locally, nationally, or globally?”

Want to sit in on his famous lecture, “Arithmetic, Population and Energy: Sustainability 101″?  Well you can.

The lecture is broken down into 8 10-minute videos, each of them on YouTube.  The first two instalments are here , Part Three and Four here

Parts Five and Six were in this post. These are the concluding two parts.

Part Seven

Part Eight

By Paul Handover

Growth is good?  Good for what?

We live on a finite Earth.  But really understanding what that means is difficult.  I guess because most of us think that in our own little way we can’t really be doing any harm to the planet – I mean what’s another few grams of CO2?

Al Bartlet, University of Colorado

Well here’s Dr Albert Bartlett of the Department of Physics at the University of Colorado chatting about arithmetic!  And if you go to his website, you will come across this quote on the home page:

“Can you think of any problem in any area of human endeavor on any scale, from microscopic to global, whose long-term solution is in any demonstrable way aided, assisted, or advanced by further increases in population, locally, nationally, or globally?”

Want to sit in on his famous lecture, “Arithmetic, Population and Energy: Sustainability 101″?  Well you can.

The lecture is broken down into 8 10-minute videos, each of them on YouTube.  The first two instalments are here , Part Three and Four here and Parts Five and Six in this post. The concluding two parts are tomorrow.
Part Five

Part Six

By Paul Handover

Growth is good?  Good for what?

We live on a finite Earth.  But really understanding what that means is difficult.  I guess because most of us think that in our own little way we can’t really be doing any harm to the planet – I mean what’s another few grams of CO2?

Al Bartlet, University of Colorado

Well here’s Dr Albert Bartlett of the Department of Physics at the University of Colorado chatting about arithmetic!  And if you go to his website, you will come across this quote on the home page:

“Can you think of any problem in any area of human endeavor on any scale, from microscopic to global, whose long-term solution is in any demonstrable way aided, assisted, or advanced by further increases in population, locally, nationally, or globally?”

Want to sit in on his famous lecture, “Arithmetic, Population and Energy: Sustainability 101″?  Well you can.

The lecture is broken down into 8 10-minute videos, each of them on YouTube.  The first two instalments are here with Part Three and Four in this post. The remaining four parts over the next two days.

Part Three

Part Four

By Paul Handover

Growth is good?  Good for what?

We live on a finite Earth.  But really understanding what that means is difficult.  I guess because most of us think that in our own little way we can’t really be doing any harm to the planet – I mean what’s another few grams of CO2?

Al Bartlet, University of Colorado

Well here’s Dr Albert Bartlett of the Department of Physics at the University of Colorado chatting about arithmetic!  And if you go to his website, you will come across this quote on the home page:

“Can you think of any problem in any area of human endeavor on any scale, from microscopic to global, whose long-term solution is in any demonstrable way aided, assisted, or advanced by further increases in population, locally, nationally, or globally?”

Want to sit in on his famous lecture, “Arithmetic, Population and Energy: Sustainability 101″?  Well you can.

The lecture is broken down into 8 10-minute videos, each of them on YouTube.  The first two instalments are in this post with each of the following three days having the next two.

Part One

Part Two

By Paul Handover

Alice in Wonderland?

Does anyone else see how perverted this story is?  A company which is 60% owned by the U.S. Treasury, in other words, 60% owned by taxpayers — not voluntary shareholders, but TAXPAYERS, has hired a private investment banking company to take the company public.

That is, to be sold to public stockholders.  For a profit.  Which is going to be distributed to whom?  The government.  Who took the company over by edict, essentially by force, ignoring lawfully binding financial contracts in the process.  Oh, yes, technically G.M. went through a “banktuptcy,” but when one of the two involved parties is the federal government — the one who makes up the rules of the game — then it isn’t a game anymore.  It’s “do it, or else!”

GM Headquarters

Absolutely unbelievable.  This IPO should not be happening.  The bailout should not have happened. None of this should have happened.  If the company cannot generate a profit in the marketplace, then it should go bankrupt and its resources freed up to be used where they are most valued by the marketplace.

by Sherry Jarrell

Are Derivatives Really to Blame?

Derivative securities are not inherently evil, though the media would have you think otherwise. It seems that any

Are they evil?

type of investment that does not directly involve commodities is an easy target these days.

But derivatives are just another type of investment, those whose value is derived from some underlying security or asset or event.   Insurance is a type of derivative investment, as a matter of fact. If the bad event happens (a car accident, flood, or fire, for example), then a claim is made against the policy.  If not, the policy expires.   The value of the policy is derived from the insured asset or event.

If derivatives are bad, then so too is insurance.  If derivatives are bad, then so too are leases with the option to own.  If derivatives are bad, then so too is the equity in any type of company, small or large, private or public, including those that produce real products and commodities, for stock is nothing more than an option to buy the underlying assets of the company for the price of the face value of its debt.  If derivatives are bad, then so too are convertible securities and most every other type of financial innovation we’ve witnessed in the last 30 years, and for decades to come.

by Sherry Jarrell

Karl Denninger is a hero!

Karl Denninger - Mr Market Ticker

Several times a week, I drop into Karl Denninger’s blog The Market Ticker.  While frequently the articles are too technical for me, it’s still, nonetheless, possible to get the drift of Karl’s messages.

As his overall theme is strongly coincident with my own views on my pension investments, and which have served me proud over the last 10 years, especially the last 2 years, it’s natural that I like what Karl does.

But the point of this Post is to underline just how much time and effort Karl puts in to his work, all of which is free to the world at the click of a mouse.

Are there others who devote equal amounts of time to their Blogs and websites?  Yes, many!  And many of them are also heroes (and heroines!)

Of course, I have no doubt that The Market Ticker is part of Karl’s business strategy but, again, he could choose other ways to make his income without sharing, for free, so many valuable ideas.

Here are a couple of examples to underline my deep respect for this man. (Taken from Market Ticker on the 13th May.)

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