Wednesday, April 10, 2013

Zut alors! Ils ont mange ma dromedaire!!!

AFP is reporting to-day, that the family left to care for a camel presented to French President Francois Hollande by Malian villagers in gratitude for evicting AQ rebels, has probably eaten their ward. Somebody recently revisited the area and decided to check on the Presidential cadeau. It had gone 'Pouf!'

The French Minister of Defense  broke the bad news at a recent cabinet meeting. The President's reaction was  not noted.

So either the family were AQ sympathizers or the situation in Mali is so bad that camels are a liability worth eating rather than a source of transport or work income. Maybe next time une poule, un canard,  a foie or even a simple boeuf might be more appropriate. Pas des cochons!! Les musseliman don't eat pig. At least these others  might make better eating.

Also in the news to-day, Maggie Thatcher stepped into the mystery. She was the right (no pun intended) person at the appropriate time for Britain. She may not have accomplished as much as she wanted, but she set the stage for the British take-off of the 1990's and early 2000's. Most Brits never had it so good. She was a notable player on the world stage at  time before things really got too complicated and when big changes were made. Reputedly she started doing a Ronnie  ( ie dementia) shortly after leaving office and that's why she was so little heard from, while her successors sailed Britain into some very dangerous shoal water.

The coverage of her demise naturally runs the gamut from eulogistic paeans to the almost scatological - one of the best I've noted (and possibly most apropos) was calling for the 'privatization' of her public funeral. It will be a while, though, before we see another one of her kind - lots of women in politics to-day, but none like her.

Another poignant passing of note - a junior staffer in the US foreign Service who was killed in an IED attack on a convoy taking books to a school opening in Zabul province. Somebody's bright-eyed 25 year-old daughter became the latest waste in a war that has gone on far too long. That it takes a convoy of armored vehicles to bring schoolbooks to children is almost as sad as her loss. The explosion took the lives of 6 other Americans, the military there to do 'kinetic' on Afghans who don't appreciate their schoolbooks, or them. If you're going to invade somewhere to make it better, the army should be the first thing removed. America squandered a slim opportunity to do that with malevolence toward Afghans in general after they could find no more enemies. Anne Smedinghoff paid the price for that.

Also in Afghanistan, a NATO bombing raid took the lives of 10 Afghan children. I'm pretty well sure that their parents would mourn their passing too. But their mothers were killed in raid, as well. Whether their fathers were killed,  is questionable - for the Afghan/ISAF troops involved claimed to have killed only 7 insurgents, including a high level commander. So, in 'ourspeak', that means it was their fault for bringing their families to a firefight. That's what the infamous chopper jockey said when he was told he'd chain-gunned two infants. We go around the far side of the world to bomb people and their deaths are their own fault? Incredible. Say the same thing about the 9/11 victims (some of whom could actually have been considered combatants) and even Moslems wouldn't buy it.  Even if they were enemies using human shields, we shouldn't kill kids. Most likely they were only some poor Afghan farmers visited by not necessarily friendly strangers on a mission in the middle of he night, who tried to scare them off with gunfire and received a roof-ful of precision munitions for their trouble.

Such was to-day, the 9th of April.

Thursday, April 04, 2013

Creative Thinking 101

How do you stop the notorious 'run' on a bank, when depositors decide they need their money back all-at-once,  that leads to its collapse? That poser has puzzled great minds since the first time it happened. Conventional wisdom has dictated that the bank (or stock market) stays closed in hopes that the crowd waiting at the door gives up and goes home for lunch.

The latest 'euro-crisis' in Cyprus has opened a new and highly creative door, revealing an old, but little-used solution - simply steal the deposits. Not all mind you, just the ones that belong to the fabulously wealthy. Naturally everybody who doesn't have deposits thinks this is a 'mah-vellous' idea. The bank simply 'confiscates' the deposits over a certain amount, in a quantity sufficient to guarantee the liquidity of the joint. This can't bode well for banks, or at least banks as they exist now.

The notion of a bank in the first place was primarily as a 'safe place' to store the family boodle, away from access by the ravening hordes who would have attacked the family castle or kidnapped family members for torture, to lay hand on it. It seemed a sensible idea to entrust it to a friendly hebrew - exempt from usury laws - who had cooked-up the notion of holding somebody else's money to facilitate business dealings. It wasn't long before the notion of using money to make money in 'legalized, virtually risk-free gambling' took root. Whatever it was, it surely beat the idea of burying it in a can in the backyard.

It didn't take long before governments developed the view that it was a public 'good' that citizens 'save' money in banks. It freed-up a large domestic source of cheap (relatively) currency for  annual bond sales. The notion of lending to governments wasn't wasted on banks who soon realized, with some accommodating legislation, that loaning to citizens was even more lucrative. And so the situation to-day, where banks can apparently loan, or 'invest',  their deposits to develop 'holdings'.  So much so that they can actually run out of ready cash should too many depositors make withdrawals.

In times past other cash-rich 'investors' might come to the rescue of a beleaguered bank - preventing a collapse of it's 'holdings' and getting themselves a piece of its 'action'. In other times, there was no rescue the bank collapsed and the wolves 'devoured' the holdings at less than cost. In the latter case, depositors generally lost most or all of their money.

To-day governments guarantee deposits to some extent and banks are required to have some deposits 'reserved' to cover a partial run. In actuality this 'reserve risk'  can be farmed-out to other banks, or economic entities by way of  'insurance' . It sort of goes sour when the insurers themselves become 'cash-strapped', too - as happened in the latest mass meltdown. Then only governments can help by 'guaranteeing' a print of more money. That 'cash infusion' to banks and commercial houses may have prevented a catastrophe in 2009, but the same thing caused world-wide inflation in the nineteen twenties - and a worldwide depression in the thirties. Timescale-wise the panic of 2009 has another 6 years to run.

Any deposits in excess than the insured maximum are at the mercy of the stability and security, or lack thereof, of the banking establishment. Most banks nowadays discourage large accounts by paying less interest on them and/or by levying service fees. They encourage 'speculative saving' on investments - their mutual funds- where risks of loss devolve back onto the investor, or in this case the depositing customer. (I think they use these depositor funds to 'hedge' against their own corporate 'holdings' which are designed to make a profit for the entity and its investors - which might explain in part why bank profits seem immune to the vagaries of the investment market.)  Banks are the best of 'blue chip' stocks.

Banks have always been able to 'borrow' deposits, at interest, to lend at greater interest. This, with the concomitant fees charged at both ends, is how they 'make their money' (investment 'holdings' aside). The new wrinkle is that, in addition to the old 'pyramid' thing about using new deposits to pay-off old deposits, banks will now be able, not only to use, but to 'disappear' significant amounts of deposit obligation. This couldn't be good for  'high-roller' business.

'Wise' people with lots of money have been, historically, loath about advertising their wealth, or wanting 'the public' to know how much they have, or where it's located. To this end many people take it off-shore - testing the good name of some foreign entity to keep their funds secure from outside viz government or lawsuit, interference. Switzerland, until fairly recently, made a national industry of bank secrecy. The Caribbean and private European banks seem to have grabbed a bigger market share. The Arabs and orientals have done their own (largely closed, in-house) thing for a long time.

The Cypriot 'template' is now being bruited as the 'saving grace' of banking but, so far, there is no indication it can, or will, work, even for the immediate purpose. It does, however, virtually guarantee that Cypriot banks won't have the same problem with large depositors in future.

 'Smart' people, like  Russian oligarchs, don't  stick around to get burned when somebody starts playing with matches.

Wednesday, April 03, 2013

The Jihadis of Middlesex County

Almost immediately after the attack on an Algerian oil drilling operation back in February, it was noised about that Canadians, or somebody carrying  Canadian passports, had been involved with the AQ force blamed for the attack.

This is the second such incident, another being the attack on a bus-ful Israelis holidaying in Bulgaria just before Christmas. Recent follow-ups to that incident  claim that the dead bomber was assisted by two others - one carrying Australian papers and the other, a Canadian. Thus far neither of the suspects has been identified.

The Algerian connection remained fairly speculative until yesterday, when  the names of two Canadians were announced and it came to light that both CSIS and the RCMP had been investigating them well before 'the balloon went up' in the Sahara. The name of a third Canadian - all residents of London, Ontario who had, we're being told,  hied-off to seek jihad, had been schoolmates. One was of  middle-eastern extraction and the other two were 'converts' to Islam. They had been reported to authorities as ' hanging around with bad characters'. Who reported them remains unknown, but security forces indicate the three were being asked-about.

Somehow, despite the official curiosity, all three obtained Canadian passports and then 'disappeared' overseas only to turn up as members of an AQ unit whch captured an oil installation, taking a number of foreign workers hostage, and, we're told, executing a number of the 53 of them who died. The two major players were killed in the ensuing counter attack by Algerian security forces, and the third is reputedly in jail somewhere in the middle east - arrested before he could 'do any harm'.

To-day the 'Harpergovermint' is on 'the hotseat' about who knew what, when and how much? Needless to say the 'Harpergovermint' is doing its standard fancy-dancing for, once again, it's fairly obvious that nobody had a clue what was going on. Still don't.

So far they haven't been able to either find out or come up with a plausible story. So we have the Minister of Foreign Affairs handing-off to the Minister of Justice who then hands-off to the RCMP who in turn have no comment. Teeedle dee Baird,  tweedle-dum Vic Toews and Duddly Doowright  we've seen this 'force' before - standing on guard for thee and mee.

On the news last night the moslem population of London, Ontario were taking to the airways to deny any knowledge and express their  shared concern with all Canadians. Question is, where were these young guys getting all their jihad info and is there somebody still educating the disaffected to head off for parts east and the GWOT? Are the mosques of London, or any where else in Canada, being used to foment jihad?

Harpergovermint  needs to de-thumb the bum and let the people of Canada know what our security services are about. Either we have a problem, or we don't -  keeping it a secret doesn't help Canadians ... of any flavour..