Tuesday 28 July 2009

World Financial Armageddon. Part two.

World Financial Armageddon. Part two [condensed for blog version]

Pointers as to why hundreds of top personnel in financial institutions should have foreseen the impending Financial Armageddon.

Quote attributed to a President of the USA Thomas Jefferson [1743 - 1826] "I believe that banking institutions are more dangerous to our liberties than standing armies". This quotation certainly illustrates that the awesome power of banks is not a new thing.

The following three quotations are from a long report by Mr Warren Buffet in 2002 on DERIVATIVES.

1/ I view derivatives as time bombs, both for the parties that deal in them and the economic system.
2/ But the parties to derivatives also have enormous incentives to cheat in accounting for them.
3/ In my view, derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal.
Mr Buffet is an internationally known expert on finance and has, on several occasions, staved off potential world financial drama. Please kindly note that these quotations are from the year 2002.

A few months ago I read an article in a national paper, the headline approximated to "At least ten warnings of the impending problems were given" the article then named the persons concerned and stated when the warnings were given and how they were worded.

Part three of the World Financial Armageddon will be in my next blog.

Frederick W Gilling 28/07/2009

Thursday 23 July 2009

World Financial Armageddon

World Financial Armageddon. Part one [condensed for blog version]

In my original document I used a sub title "An Economic Force Majeure" as I felt the expression
credit crunch did not, in any way, reflect the devastating seriousness of the cataclysmic implosions/explosions in the world's financial systems/institutions. In its traditional usage contracts maybe rendered void by "Force Majeure", and I feel that an economic force majeure justifies actions that otherwise would not be legally acceptable, for example, recovering rewards such as fantastically high salaries, bonuses, company shares or what have you, given to executives who in any way were responsible for the World Financial Armageddon. Being responsible includes, for example, not acting on advance warnings of the consequences of their actions, not advising all and sundry of the impending problems and/or concealing vast amounts of toxic debt accrued by their companies.

How does an ordinary person , such as me, come to grips with the number of noughts involved in billions of this and several trillions of that. The front page of the Sunday Times Magazine dated 17/05/2009 has a headline "Anyone seen where our fifty trillion went?" Coincidently enough the magazine also featured a short story entitled "The Decline of the West". The author, Mr Hanif Kureishi, really hit a few contemporary nails hard on the head for, in several ways, his story embraced both the causes and effects of the World Financial Armageddon. Played for or not I feel he also partially illustrated what many people will recognise as a spend, spend, spend malaise that had the Western World very firmly in its grip. I only saw the magazine in July as it was passed on to me en route to the next family in the chain.

My worry is that very little priority will be given to ascertaining who was responsible, in any way, for the practically instantaneous implosion that brought some of the biggest financial institutions in the world crashing down under the weight of debt, billions of it "toxic debt".
Any dealing that is considered to be detrimental to any of the world's communities should be investigated with the backing of governments. Draconian power should be given to the people charged with finding out all of the facts in any way related to the Financial Armageddon.
Unless such a course is followed the whole matter may be swept under convenient carpets
all over the world and the game will re-open and vast sums of money will be released to hunt down ever larger amounts of money.

My mind boggles at the scope there has been for the outright theft of millions by clever personnel, with inside tracks, in practically any financial institution carrying huge amounts of toxic debt.

In part two of World Financial Armageddon I propose to give a few background points to justify my contention that many people, in key positions, must have known that financial disaster was impending.

Frederick W Gilling. 22/07/2009

Tuesday 21 July 2009

Politics Four

Politics Four

In the previous blogs on politics I have advocated doing away with party politics and suggested different ways in which MPs may be forced to resign. I am also in favour of MPs electing the Prime Minister as well as such other Ministers and Deputies as thought necessary. MPs, by virtue of a successful vote of no confidence, can also force a Minister or Deputy Minister to resign from office.

I am strongly in favour of the following requirements being made law.
Candidates for election as MPs must have spent the first sixteen years of their life, or at least five years as an adult, living in the constituency in which they wish to stand for election. An adult is classified as being a person of voting age.

The suggestions that I have made will involve a major shift in how MPs are selected and how the country is governed. Every MP will be able to speak their mind in the House without being concerned that they are bucking the wishes of a party's hierarchy, and that should reflect how they think the voters who elected them feel on the matter being debated.

Looking somewhat further into the future it should, at least, be conceivable that the need for general elections will fall away. If the voters are not happy with "their" MP they can force him or her to resign, likewise MPs themselves can force a fellow MP to resign or a Minister to relinquish their position. A safety valve could be built into the system, by a suitable mechanism, whereby voters or MPs can insist that a referendum be held to decide whether voters as a whole want a general election.

Surely with an efficient "no party" system in place democracy must be better served. I have long thought that one of the highest honours that a person may aspire to is to be elected, on personal merit, as a Member of Parliament in the UK. Voters and would-be MPs have it in their power to bring meaning and a golden glitter back to such an accolade.

My next blog is titled "World Financial Armageddon". F W Gilling 21/07/2009

Saturday 18 July 2009

Politics Three

No doubt, I surmise, in the early days of Parliament party politics evolved to fill a need, students of political history should be in a better position to voice an opinion on that supposition. At one stage different factions of "The Establishment" probably went head to head in the quest for power but, I should think, it took much longer before "The Rest" took on "The Establishment". Now I think the situation is such that none of the political parties will come out with a manifesto that is too far to the left or right of centre. The situation now, as I see it, in simple terms is as follows. There are 664 MPs, approx 90% of them try to follow the line set by their own parties' hierarchy, 10% are the hierarchy of the parties. 50% minus a few % are trying to get the ruling party out of office, 50% plus a few % are trying to stay in office and belittle the opposition parties. Very regrettably it could be argued that a goodly percentage of them tried very hard, and in many cases successfully, to greatly increase their affluence by making the maximum use of various expenses that they could claim. Then, to further increase the shame that this approach engendered, many of them did their utmost to restrict the publication of essential details. A revealing spotlight is now being shone on the salaries and expenses claims of other public. or quasi public bodies.

Recently there have been suggestions that there are too many MPs. On the TV this morning
[13/07/2009] there were figures showing a massive increase in the annual costs, related to politicians over the last ten years, some of this brought about by salaries now paid to elected members of councils.

I suggest that the number of MPs in the Commons could be reduced to 300. This number of truly independent MPs, motivated by the knowledge that both their "constituency voters" and their fellow MPs can force their resignation if their performance is sub par would, surely, be more effective than double that number following the orders of their party hierarchy.

Switching the focus to the House of Lords raises many questions, first and foremost is the main one, that being "Is a gathering of mature brains required to act as a steadying influence over the House of Commons"? If the answer is yes then a natural question that follows is "How mature should the brains be"? That is to say should it be specified that to be a member of the House of Lords a person must be at least forty years of age, or 50?, or 60?

The next thing to be resolved is whether or not members should be elected, I think they should be and I also think there should be only fifty of them. I also think that voters and members should be able to force their resignation in a similar way to that which I have suggested should apply to MPs.

Having sorted out the composition and function of the House of Lords perhaps some thought could be given to the use of the words "Commons" and "Lords". In my opinion they are archaic
and smack too much of "The Establishment", again, in my opinion, some thought should be given
to the need, in this day and age, to attempt to enhance the importance of members suggested by the ceremonial robes they wear. Carrying that theme a few more steps I suggest that the word Lord should be restricted to use in its religious context.

There is, I am sure, a prime need to give every responsible person in the country a justified feeling that they, the people, are fairly in control of events, other than natural disasters, and that their efforts and opinions, on a grand scale, do matter and are seriously considered. In this context I feel that much more use should be made of referendums to decide critical or contentious issues.

I am convinced that now is an ideal time to consign party politics to the dustbin of history, they are long past their sell by date.

To be continued in Politics Four. Frederick W Gilling

Saturday 11 July 2009

Politics Two

As a first step towards ending Party Politics I have,in Politics One, suggested ways that will enable the voters in a constituency to force the resignation of "their" MP, and also ways that MPs can remove Ministers or their Deputies from their specific office, as well as ways by which MPs can force an MP to resign. These provisions are, in my opinion, an essential step to party free politics as they should ensure that MPs will strive to stay tuned in to the thinking and wishes of the people in their constituency. This thinking will not be influenced by the wishes of the hierarchy of a party that chose them as a candidate for a particular constituency, they will not have to toe the party line.

A question that I asked myself,long ago, is fundamental to my thinking, the question is "Why are leaders of democratic countries often lionised or hated with passion"? If they are doing their job correctly they should be representing the wishes of the majority of the voters in their country, in effect they should just be a conduit through which the population speaks. At times they may take a position, that though it represents the will of the country they do not agree with it, they can state why they have doubts but never the less they will follow the will of the country. An example contrary to this, I think, is provided by the UK going to war in Iraq, it could well have been that the majority of adults in the UK did not want to go to war with Iraq yet that is what happened.
Very often the leaders of parties with large majorities in Parliament lean towards dictatorial actions, this tends to make a mockery of the word Democracy!

The leader may well have a deeply held belief that he knows best, he should not act on that belief, he should do what the majority of the population of the country think is best. I will slip in a little plug for an idea that I had many years ago and that is, "when a country goes to war the older members of the population should be called up first", the justification for this being that it is more than likely that the older members of the ruling party voted to go to war. Perhaps, if time permits, a country should not go into a war unless, as a result of a referendum, it is the wish of the majority of voters.

MPs at the first meeting after an election must, under the control of a senior judge acting as a Speaker, re-appoint the Speaker or elect a new one. The Speaker must not be an MP but he/she may be an ex MP, suitable legislation can easily be drawn up to allow for this. It could well be that a Speaker may serve as such for many years, they may, however, be forced out of office by a vote of no confidence in which the views of all MPs are recorded.

When the official Speaker is in control the next function of the House is to elect a Prime Minister,and, I suggest,two deputy PMs. That done the House will then elect such other Ministers and Deputies as thought necessary.

In the course of time the Chairmen and Members of various committees will also be elected by the House.

To be continued in "Politics Three". Frederick W Gilling.

Tuesday 7 July 2009

Politics One

End Party Politics Now
Why?
Because There Just Has to be Something More Democratic
How?

As a first step three pieces of legislation must be brought into effect ASAP.
Firstly, voters must be given the right to force the immediate resignation of "their" MP.
Secondly, MPs must be given the right to force any Minister or Deputy Minister out of office.
Thirdly, MPs must be given the right to force the immediate resignation of any MP.

A great deal of thought needs to be given as to the different ways that the above can be accomplished, a guiding principle is that it should be neither too easy or too difficult.
The MP, Minister or Deputy Minister being so sanctioned need not have committed any particular misdeed, the voters or MPs who wish the sanction to be applied may be generally unhappy with the performance of the MP concerned; several ways of initiating the above steps are suggested below, there are many other ways or forms of penalty clauses.

Two different ways in which voters can force the resignation of their MP are given, both are subject to fine tuning, there may well be better ways. The first way is that 5000 [or ?000] voters in the constituency must sign a petition demanding the resignation, the petition and five million £s must be handed in to the designated authority. If the MP concerned does not contest, or loses, the resulting by- election the five million £s are returned to the person who handed it in. The second way is that 10 000 [or ?0000] voters must sign a petition requesting that a referendum be held in the constituency to determine whether or not their MP must resign; this petition must be backed up with a sum of money equal to the cost of holding the referendum. If the MP is forced to resign as a result of the referendum the money handed in to cover the cost is returned, if the MP is not forced to resign then the money is not returned.

MPs may propose a vote of no confidence to force a Minister or Deputy Minister to give up his office or to force an MP to resign; something along the following lines is suggested. Five, ten or??
MPs must put their names on the proposal for a vote of no confidence. If the vote was to force a Minister or Deputy to give up their office and the vote was not carried then the MPs who proposed the vote will each be fined three [?] months salary. If the vote was to force an MP to resign and it was not carried then the MPs who proposed the vote of no confidence must resign.
If the vote to force an MP to resign was carried and the MP concerned then wins the resulting by- election the MPs who proposed the vote of no confidence must resign; they can, however, contest the resulting by-elections.

The question as to whether such votes of no confidence are carried by a simple majority or by some other numerical amount is open to discussion.

To be continued with End Party Politics Two. Frederick W Gilling.