The Big Short on my life and those of others

The patterns I see

When it comes to financial matters, I have always said my father is a brilliant accountant, but it did not come down through the genes. Successful as he was in his profession which he still practices on behalf of the Anglican diocese in which he resides, only one of my siblings took a career path that had any financial component.

However, I somehow have an affinity for noticing patterns, things that align and things that seem to be out of place, unfortunately, I have never exploited that knowledge to the full as over time I have watched things that were once an inkling become an industry where if I had been more driven by my deepest premonitions, I would have been one of the pioneers. No regrets.

In March 2000, I travelled to Munich for an interview with the now defunct Compaq Inc., I decided to spend a week there and during my visit I met with a futures trader who was heavily leveraged in dot.com stocks. My reading of the situation then was things were about to collapse, simply because I noticed a pattern.

My advice to him was to reduce his exposure, he looked at me with incredulity, within weeks the dot.com bubble burst and the rest is history.

As it touched me

I have a more personal story about how I was affected by the markets, just less than a decade later. I bought my apartment in Amsterdam 2001, having given my estate agent 6 weeks to complete the deal to pick up my keys on the 1^st of November 2001.

It was a 105m², 7th-floor apartment with large windows overlooking two old Amsterdam harbours, a wonderful place by any standards. My mortgage was at inception the same as paid for rent in another part of Amsterdam for about 18 months.

The trajectory as it then was, whilst the housing market seemed overheated, the interest rates were going down, and this happened progressively every two years until about 45% was shaved off my mortgage in 6 years.

That other marker

Meanwhile, there was an underlying current that should have sent alarm bells ringing that I ignored until it was too late. My mortgage was undergirded by a life insurance policy that I paid a hefty sum to every year and in the mortgage term of 25 years, it was supposed to have accumulated enough to pay off my mortgage.

Each year, accounting for administration costs and much else, nothing was being compounded into the policy, rather, I was seeing less of what I put in that I had to ask for a review of the conditions of my mortgage to ensure I had not been defrauded.

Everyone who had worked on my mortgage had already walked away with their commissions as the signs of a financial crisis appeared on the horizon with the sub-prime mortgage defaults in the United States.

The tsunami I could not outrun

I could not ignore what was happening, yet I felt like there was an earthquake somewhere far away and the water was receding from the beach in anticipation of a tsunami I could not escape, it was scary.

As so I wrote in August 2007:

Blog - Dishonest lending clue to market tremors

Then casually in October 2007:

Blog - Local situations in global straits

The tsunami had already come in and swept me away from my apparent comfort zone, a revision of my biennial fixed term mortgage saw a rise of 50 basis points, some consequent outgoings of about €550 a month in addition to what I was already paying.

No particular fault of ours, only the banks shoring up their books having messed up and gotten bailed out, with none of the people in charge of this debacle going to jail for anything, if any even got to be questioned for their atrocity.

Swept away

By then, it had become a case of Fixing Capitalist Errors with Socialist Favours which I wrote in December 2007.

Within two years of that, I was diagnosed with cancer, got treated, recovered, but the markets had dealt a blow to our livelihoods, the job markets also began to introduce unfavourable filters to eliminate foreigners from consideration where we once freely had access.

In the end, I sold my apartment at a loss after 10 and a half wonderful years, though barely covered by the insurance and eventually returned home to the UK to rebuild my life.

The Big Short

Earlier today, I went to watch The Big Short which is described as a biographical comedy-drama, and whilst I will agree it is biographical and it is a drama, it was no comedy when we look at the disaster it caused in millions of lives whilst those who found out what was wrong with the system walked away laughing to the bank.

At worst, the banks have been fined billions by the regulatory bodies, but there have been no major indictments, the legislative framework that was to help avoid a similar collapse of the banking system has been watered down and the banks have more or less returned to their brand of casino banking with new banksters slinging guns of dubious provenance as products of the highest quality.

We’re back on that merry-go-round of atrocity for which the generality of the populace has been made to pay dearly for in austerity and worse, whilst the politicians and the banks waltz away in illicit copulation.

Yet, in understanding this rotten and corrupt enterprise a bit more, history is probably going to repeat itself worse than before and the criminals will once again walk free.

Woe betide them.

Editorial: Thirteenth of May 2011

The guilty roam free

The credit crisis which has been felt globally for the past few years still has the architects of this catastrophe rolling in the quids without a care in the world.

Many have wondered how this happened and why it was pre-empted as the professionals have continually feigned that it caught them unawares.

The investigations of a US Senate committee have yielded grounds for indictments to be brought against first Goldman Sachs for basically playing both the market and their clients in fanciful financial products whilst divest themselves of their liabilities and cajoling other institutions to buying up what they knew for sure was worthless.

Untying the Gordian knot

The Rolling Stones article lays out the case of The People versus Goldman Sachs in such fine detail with the use of useful vivid analogies that the layman would catch on to what an almighty confidence trick this was.

This was work that the regulators and the Department of Justice should have done but were both derelict in their duties and suborned into a dastardly evil capitalist enterprise that has robbed everyone blind and made the gangsters of banking otherwise known as “Banksters” the masters of the world.

Now that the case has been made and all the footwork done, one would hope the cajones exist in the boxers, briefs, jocks or I dare say panties of those who matter to visit the full force of the law on these people and they should not relent until every dime as been paid including interest.

The world would never forgive us if these banksters get away with the biggest highwayman’s looting of the bullion ever.

Roam to Rome

Schengen, a town in Luxembourg where in 1985 European countries agreed to relax border controls allowing free movement within European borders, it represented a kind of unity amongst Europeans between 22 states.

It has worked a treat for Europeans as a sign of integration and unity without the encumbrance of passport checks, inane questions at customs and every other inconvenience that pertains to traversing borders.

The Arab uprising on the Southern coast of the Mediterranean Sea has been a matter of concern already but the unrest in Libya has brought it to a head.

Apparently, Colonel Gaddafi, the besieged and buffeted leader of Libya is allowing the untrammelled flow of sub-Saharan Africans and others across the sea to Malta and Lampedusa in Italy creating panic on those islands along with the administrative and logistic nightmares of processing these asylum seekers.

Visas made wiser

With no one responding to Italy’s concerns about this influx, the Italians granted temporary visas to these aliens who under the Schengen agreement could cross borders to countries where they might feel more comfortable by reason of joining relations, being able to speak the language or recognising a country as a soft target.

That got France to sit up since a good deal of these aliens speak French and by the time you knew it, Gaddafi’s deftness had sown division amongst NATO allies on the immigration front as they try to enforce the no-fly zone in Libya.

Fresh blood for right-wing vampires

Then every little-minded country with their right-wing populist fear-mongering personality with their villager-visits-city mind-set stepped into the fray stoking angst and horror at the hordes invading their sacred lands of purity and superiority – time to race to the lowest common denominator.

Shut the gates, batten down the hatches, pull up the draw bridges, barricade the doors and let the rabid dogs roam to bite any that dare walk the streets.

Globalisation is going into decline and the nation state rises again just because the Arabs have awoken to the possibility of self-determination. What a strange world we live in.

Acknowledgements

The fantastic report about the Senate committee’s unravelling of Goldman Sachs’ con-job was published online by the Rolling Stones Magazine. Wikipedia has a webpage that explains the Schengen Area and the Schengen Agreement.

The Guardian announces the news of the furore that has erupted about the influx of aliens and the possible radical revision of Schengen.

Thought Picnic: Analysing the Cultism in our Religion

Between religions and cults

An article titled When Does a Religion Become a Cult? [1] In the Wall Street Journal inspired this blog and whilst the main thrust of the write-up offered the signs that make religious cults evident, there was a possibility that certain of those perspectives were not necessarily all-encompassing.

Being on expert on the subject I have however witnessed first-hand people who have joined up to religious organisations seeking some solution to life’s problems and ended up becoming people with altered personalities, narrowed views of life, extreme fundamentals and spewing out doctrinal teachings that border on blasphemy to evident apostasy looking like new revelation.

Effective Controls

It is instructive that analysts of cult phenomena suggest a number of criteria that define cults as behaviour control, information control, thought control and emotional control. Beyond this are two other categories defined as financial control and extreme leadership.

What apparently indicates as control is different for different cultures and one can suggest that in open and freer societies the elements of control are probably more obvious and directly impacting on the adherents of such cult followings.

In this sense, one could be deluded into thinking that cults rarely exist in African cultures because the controlling forces do not appear to be enforced in a seemingly policed environment rather people tend to abdicate the free moral agency they have and submit themselves to the controlling influence of their leaders and then flock together with the false sense of safety in community.

Indirect but controlling nonetheless

There are many elements of behaviour control masquerading as religious creeds with interminably long lists of dos and don’ts of with absurd logic pandering to ancient rites that have long been superseded by modern ways that are conveniently ignored.

Information control usually presents as doctrinal diktat breeding anti-social forms of extremist and intolerant attitudes encouraged by the laziness of congregations to review criticisms no matter how constructive those views might be.

With a plaint and fawning audience, thought control is easy, people who are brought up in patriarchal societies might not be disposed to inquisitiveness or questioning the basis of the tenets they adhere to. There is a self-censorship in place that automatically kicks-in when a “Man of God” speaks, acts or commands as some vague dread of the supernatural instils the fear that allows for bling-followership and no critical assessment of the circumstances the person is in.

The aspect of emotional control is easy, as humility is confused with accepting humiliation and the guilt complex is exacerbated by painting scenarios that leave adherent apparently eternally grateful for the succour the leadership appears to provide.

In the pocket of the mind

Financial control is almost as innocuous as it is diabolical, holy texts are trotted out to convince, persuade, cajole, tease and in the extreme defraud as people are first convinced of a monetary key to blessing and almost compelled from the pulpit to give everything to the point of pain; whilst mind-control is quite difficult to assess, the beholden are already taken.

The religious leader regaled in the best flaunts this luxurious appearance as something to aspire to but only available through deeper financial commitment as hopes and desires are played and teased with the eventual promise of success which is almost within grasp – the spur is captivating to keep the people striving. The message gets perverted to “Use God and Love Money”.

By which time extreme leadership does not look that extreme any more, people who have willingly and freely associated that they have been subsumed and the leader either by design or unwittingly earns a cult following of almost sycophancy at some presumed closeness to God.

The slide to a cult

In any event, very little needs to be done to exercise absolute control as varying degrees of control as pertains to the earlier criteria could have inadvertently created a self-sustaining cult environment, the participants so completely oblivious of the fact that they have also stuck so close to a commune they cannot cut loose.

The sad thing is many are already in cults thinking they are fervent followers of some religion, the distinction between the terms almost impossible to distinguish. The analysts however conclude that every coercive religious group harbours the telltale trait of untoward secrecy – however, secrecy might well be hidden in everyday language, a lot being said but a dog whistle to those who know.

If members experience impediments in relationships, ideas or travel and the group’s finances are suspect and non-transparent, one might just say, following the money will just take you deep into the grotto of a cult.

Sources

[1] Mitch Horowitz: When Does a Religion Become a Cult? - WSJ.com

Nigeria: Ministers' perception of bad image

Perceptions of image

Nothing gets me so irked than to read half-truths and sometimes untruths upon which the principals have entered into a determined scheme of denial whilst pasting every external element in sight with blame.

The Nigerian Guardian reports that the Nigerian Ministers of Finance and Information blame the media and human trafficking for Nigeria’s bad image [1].

I quote liberally from that news story acknowledging the source to be the Guardian Newspapers.

Whilst the plight of human trafficking is a very serious issue that has hit our screens over time, I would be hard pressed to find any recent material on that matter as compared to the Niger Delta crisis and the way it imparts on the oil infrastructure and oil markets, the inability to conduct decent elections and the sometimes unfavourably slanted reference to Nigeria when it comes to scam letters.

The West has people in Nigeria too

Let us examine the premise put forward by these esteemed servants of the Federation of Nigerian, the Finance Minister, Dr. Mansur Muhtar revealed, “there was a lot of negative reports from the local media and these in turn shaped what the Western media and investors think about the country.”

Interesting insight suggesting the Western media do not have liaison offices and personnel in major cities of Africa’s largest “democracy” and one time its biggest oil producer. Investors would come from countries that probably have embassies plugged into Nigeria and its environment for business and Nigeria belongs to many trade and bilateral organisations that would have representatives in the country and there are international conglomerates operating in Nigeria already.

It is a bit far-fetched to suggest that it is the local media that serves as the main news feed for the International press thus the main source of the bad image of Nigeria.

Credit comes with noticeable impact

The same minister went on to say, “the public seemed not to be giving enough credit to government for what was being achieved.”

Whilst Nigerians might like to hire praise-singers they are not effusive in praise for situations that impact on them negatively. Unlike in the West where we desire and demand small government; where infrastructure, power, transport, health, education and water resources do not seem to be available to the common man, that country needs big government.

The minister must understand that to gain any credit, the activities of government must touch people’s lives – roads for their business activities, power that meets the needs for a developing nation, integrated transport with focus on railways, hospitals that have qualified personnel and unadulterated drugs accessible to the majority, schools that have materials and can stay open the whole year round and really potable water.

Unfortunately, the ministers live in the exclusive decadence of opulence called Abuja almost oblivious of the realities that meet everyday lives such that they expect praise from postulation rather than action that really changes lives for the better.

The enormity of the challenges

I suppose what really puts it all in perspective comes from this further statement; “... government's efforts are not being given enough recognition and coupled with the enormity of the challenges not being appreciated.”

Nigerians know the challenges they face every day, the need to survive, the need to keep a roof over their heads, the need to put food on their tables and the undying optimism that things would improve.

What they expect of their government is first of all competence, the statement the minister made cuts the other way which questions whether the government has ever appreciated the enormity of the challenge of steering the ship of state called Nigeria.

10 years is some time

Blaming previous governments for our problems today is becoming an unforgivable excuse, the same party has been in power for 10 years, a fifth of the time that Nigeria has been independent, 10 years is a long time to turn a country round if the leaders can exhibit a modicum of competence.

I am happy that the Minister of Information has also recognised the negative element of human trafficking and child abuse, however, it does not go far enough as a matter of the Nigerian image abroad if it does not also address the more controversial issue of child sexual abuse within Nigeria itself.

Deliver and trust will follow

If the “people no longer had trust in the government to deliver its promises,” it would appear no tangible promises have yet been delivered on because like I said earlier in my blog; impact would bring recognition, Nigerians would no more stand for the voluble, loquacious and vacuous politician with promises by the truckload – I am sorry, we are looking for results not the thought and ceremony about actions.

Let us see ceremonies at completed projects not stupid foundation-laying ceremonies for white elephants.

In all, I think the ministers are looking for sycophants to sing their praises in vacuity and publish lies and vague achievements to give the government credit for nothing and hoodwink Nigerians with statistics and platitudes without showing real results.

Methinks, the ministers are in deep denial.

Sources

[1] Guardian Newspapers: Muhtar, Akunyili blame Nigeria's bad image on media, human trafficking

Making an ass of a South African policeman

Qualified to Minister?

Sometimes, one wonders what qualifications are required other than political affiliation and cronyism to become ministers of the realm in many governments.

The Nigerian Blog World is bursting with opinions about the suitability and qualifications of the current Finance Minister who understudied as a Minister of State in that Ministry a seemingly more capable person who had PhD in regional economics and development and was a vice-president at the World Bank.

Though it is said that the current Finance Minister is respected internationally, for a country like Nigeria with a huge oil economy undergoing extensive reforms, a BSc in Geography and Post Graduate Diploma in Management in some countries might just be sufficient for a middle-level position in Local Government.

In any case, she is now the Finance Minister and we can only expect that she would perform with excellence despite our general misgivings.

New treatments for HIV/AIDS

In South Africa, certain ministerial appointments and the antics of the ministerial personnel borders on the laughable as they make pronouncements that would have circus clowns look unfunny.

The Health Minister, Manto Tshabalala-Mismang is apparently medically trained culminating in a Masters in Public Health. There is no doubt that the side effects and toxicities of HIV/AIDS drugs are issues of concern.

However, to then use that issue to advocate the treatment of AIDS with lemon, beetroot and garlic without empirical medical or pharmacological research to support that basis makes this qualified doctor look like a quack.

Group-think AIDS malady

To compound issues, these bizarre statements were made at an international conference on the HIV/AIDS.

For a country like South Africa that has such a high number of infected citizens, the health minister has for 7 years been the worst possible person to appoint to address a situation that borders on a national crisis.

This is not helped by the fact that certain obtuse ideologues in leadership are viewing HIV/AIDS as a purely social issue instead of seeing the serious medical and public health perspective to the problem.

The clamour for her resignation if not her sacking cannot be loud enough; this woman has failed to grasp the context and brief of her ministerial portfolio, to say the least.

The making of a crime story

It is not strange to see policemen in Amsterdam in cars, on scooters, on bicycles, on roller-blade skates, on horses or strolling on foot; they get around the town just as everyone does and they do command a modicum of authority.

Returning to South Africa, which supposedly has one of the highest crime rates in the world, anyone in charge of dealing with crime should be adequately providing resources to the men on the ground to tackle serious crime whilst maintaining a façade of authority and respect.

In the case of South Africa, this might mean armed personnel, reinforced cars equipped with radios, photographic equipment and a few other paraphernalia that would allow effective arrests and quick despatch of cases.

So, one would think it valid when the police suggest they cannot get to crime scenes because they do not have cars – cars in themselves provide some sort of protection to the occupants as they race to crime scenes.

An ass of a policeman

The minister in charge (Minister of Safety and Security), Charles Nqakula offers a “better” suggestion; they should ride bicycles or donkeys to those crime scenes or get out of the police force. It might sound rhetorical or metaphorical, but I think he is deathly serious.

Bicycles, I can understand, but then how do you get the suspect back to the police station for charging and questioning as part of your investigation and prosecution process.

Now, there no way any policeman who mounts an ass is going to command the authority to take charge or exude the seriousness that entertains a crime scene; even if he had a gun, he would be a jumped up version of the milky-bar kid.

If the policeman had to chase after offenders, an ass or donkey is hardly the kind of runner for that sort of thing, they are more beasts of burden; you could probably lay dead men on the donkey but not criminals.

Arrest this stupidity

The minister with a past career in journalism is probably good at writing fantasy stories but serious crime affects lives, people, property and economies at large.

He should be addressing the core issue of ensuring that the police force is equipped to meet the challenges of a 21^st Century South African society.

Headline grabbing sound bites that pour scorn and ridicule on the people of South Africa would not do, in fact, it would appear that a background in law enforcement or the military would be better suited for this job.

Political appointments

It would appear there are some ministerial appointments of convenience in very sensitive positions where the said ministers become untouchables even though they are performing no beneficial ministerial function for their people.

What leaves one astounded is that many end up pontificating in such a way that their heads do not check what their mouths are saying, however, it is the chief executive, the head of government we should hold responsible for making appointments where possibly better qualified citizens are available to do a better job for their people.

The Finance Minister in Nigeria is yet to prove herself, but the tow South African ministers reviewed here have proved that we probably can get donkeys to do better jobs than they are doing.

It is time for the president to move the war on corruption to the next stage; a war on ministerial incompetence.

The doctor says good riddance

The doctor has moved on

I was writing the piece below as the news flashed that the Minister of Foreign Affairs in Nigeria has resigned. I am impressed with her grace her sense of integrity and the way she has maintained her honour.

This is all because a bumbling patriarchal president had turned his cabinet into a chess-board full of pawns that could be moved and sacrificed with impunity.

It is a loss to Nigeria that a technocrat of that worth and values should be frustrated out of service to her homeland, whilst we hear that Nigerians in Diaspora should return to help build the nation.

Dr Ngozi Okonjo-Iweala would be the banner to the fact that we do not have the kind of government that helps develop the worthy and patriotic cause of serving our great nation of Nigeria. It is a sad day indeed.

The humiliation of the doctor

As the debate heats up on Ayoke’s Exodus; about the importance of the Foreign Ministry in relation to Finance Ministry in Nigeria.

One must once again look at the situation where the erstwhile Finance Minister who is now the Foreign Minister was stripped of the leadership of the Economic Management Team.

My view is that developing economies have more to gain in promoting trade and development which is linked to the management of resources and consequently their economies than trying to peddle vacuous influence without requisite backing of good governance and sensible economic policies.

With Dr Ngozi Okonjo-Iweala being stripped of this economic profile and then being advised to concentrate on the Non-Aligned Movement, this makes interesting reading on deeper analysis.

The Non-Aligned Movement does not include any country in the West, probably; the only countries of note would be Nigeria, South Africa and India, with China as an observer.

The rest of the list which consists of 55% of the UN lists the poorest and the most deprived countries that require aid to keep things together, including the State of Palestine. I must say, it includes all the OPEC countries.

What is the relevance of the NAM?

However, in a new world order where globalization, makes every economy susceptible to global financial swings and machinations, one wonders the value of the NAM apart from the kindred spirit of having been colonized or having once had their economies shackled to IMF poison pills.

Also, the 14^th NAM summit is in Havana, Cuba between September 14-15, 2006, whilst the 2006 Annual Meetings of the International Monetary Fund and the World Bank Group is in Singapore between September 18-20, 2006.

No marks for thinking the more familiar face of a former vice-president of the World Bank could help a lot more in the negotiations than a meeting Nigeria would be the proverbial one-eyed man

A Shuffle unworthy of a black jack table

Lame Ducks Blame Luck

It appears lame duck regimes have a penchant for doing the incredible and anomalous.

Besides getting bogged down in incumbency inertia and bereft of great ideas, the work at hand moves from the general purpose of governance to securing a legacy which should have been duly affirmed long before the duck went lame.

The rehash of ideas, achievements and prospects for a future that is already upon us is enough to bore into stupefaction, if only we could be spared the details.

In the UK, not many were convinced of the radical nature of the reshuffle after the drubbing of the Labour Party in the local elections of May this year.

However, some saw a bit of a spark of wisdom in moving Jack Straw to lead the House of Commons from the post of Foreign Secretary then wondered how Margaret Beckett would handle the rather volatile, if not delicate brief of Foreign Secretary - somehow, she seems to be finding her feet.

Financed for Foreign Outlook

So, the news came that there has been a reshuffle of the Nigerian cabinet, of a government, which has less than a year to run. The striking changes pertained to the Finance Minister who would move to Foreign Affairs and the Foreign Minister moving to Internal Affairs.

The erstwhile Finance Minister - Ngozi Okonjo-Iweala - is an economist of world class standing and repute who was once a vice president in the World Bank and as a technocrat has made strides in bringing transparency to our financial environment as well as securing extensive debt relief.

Olu Adeniji who is now the Internal Affairs Minister was also part of the UN programme to repatriate the best minds of the developing world in Diaspora to their indigene countries to help in radical change and development - he is a career diplomat who was until now in charge of the Foreign Affairs Ministry.

Election 2007 in auction

This reshuffle has had many crying foul play in anticipation of the looting the treasury for the impending 2007 election.

Now, one would really hope that this would not be the case, but the innate propensity of the ruling elite to loot the coffers of Nigeria with impunity could only be curtailed for as long as there is no political position to fight for.

A power tussle is ensuing within the ruling party for a successor to President Olusegun Obasanjo as he failed to cajole, persuade, coerce and importune enough support for the seemingly tacit third term quest.

If the ruling party is to retain power, the problem of not having developed to a point where people can be convinced of good intentions through the honest word of politicians would mean persuasion through looting the treasury which should now be bursting with the proceeds of high oil prices.

Second hand bad hands

The Minister of State in the Finance Ministry has been elevated to the position vacated by her boss, but she would not take over the position of chairman of government's economic management team or have direct dealings with the external financial institutions, which the new Foreign Minister retains.

One can only wonder at the competence of the new Finance Minister if she cannot fully assume the brief for a ministry where she has to date been Minister of State and the malleability of that person in the impending looting of the treasury as many expect.

In view of this reshuffle, I am of the opinion that any talking head can handle the Foreign Affairs brief, however, it is the financial, economic and fiscal issues that need a competent pair of hands and definitely not a safe pair of "forcible" hands.

Shuffle unworthy of a blackjack table

Beyond that, the whole reshuffle looks like a pack of cards not presentable to black jack table as ministers move to new ministries whilst retaining some influence in their old ministry as is the case for the Minister of Solid Minerals who takes over Education and retains her core portfolio with Education being shorn of both its former ministers.

The two things that need the most attention, the education of the masses to meet the challenges of the 21st Century and the management of the economy to provide the infrastructure befitting of a country of Nigeria's stature suffer in the face of an expediency in need of a decent explanation.

We would see as it all unfolds.

References

Bloodied and slightly bowed, Tony Blair battles on

Obasanjo moves Okonjo-Iweala to Foreign Affairs

Nigeria: Obasanjo Sacks Obaji, Moves Okonjo-Iweala, 4 Others

Gunmen and reformers