Hello and welcome…
It would be remiss of me not to do what everyone else in the world is doing over the course of this week so here goes…
A lot of people must be looking back at 2009 and thinking, like I am, where the hell did that go. This year seems to have flown by much quicker than usual. Or is it the fact that I’m getting old? Does time pass quicker the older you get? If I think back to my childhood the years seemed to go on forever, weeks and months melding into each other like one long hot summer. Anyway, that’s enough of the Stand by Me crap. On with what I was going to say.
It’s good to see that the capitalists of this world still think the sun shines out of their arses despite the complete and abject failure of their way of doing things.
Oooo, ooo, Mr. Obama… Mr. Obama… I’ve got a good idea!! Me, me! Look I know that in the last couple of years that things haven’t been going quite right. In fact, technically speaking, when you crunch the numbers, they’ve been going quite wrong by quite a lot – mainly because I’ve been trying to make ridiculous amounts of money by effectively gambling on things I didn’t really understand but pretended I did.. Anyway, what I’m trying to say is that if you give me MORE money, and when I say give I mean lend, if you lend me more money I can do some more guessing and gambling and I can make it all better. And once it’s all better, then I can pay you back. Good ay?
6 months later….
Oh, yeah, hi Mr. Obama… look I know that we made some number of billions profit this year despite having to ask you for some readies to tide us over but we really can’t afford to pay you back just yet. But I am good for it, I really am. It’s just that we need that money to do a bit more guessing and gambling. See, we’ve made $60 billion in the last six months, but if you let us keep going with the loan, if we can keep doing what we are doing – and remember we are the experts in the field, we know what we are doing – if we can keep going then that $60 billion could turn into $63 billion or maybe even $65 billion. That would be like an extra $5 billion that you didn’t have before man. Where did it come from? Well… um… I don’t really know. I just checked the balance at the end of the day and it had gone up a bit. No, it’s not like actual money you can hold in your hand, like a $2 note or anything. No no, this is an on-line bank balance. Well, yes, I suppose it could go back down just like it’s been going up, but I doubt that very much. After all, we play the markets like this all the time so we have experience and know how that allow us to be extremely confident in ourselves and what we are doing. No, I don’t have any qualifications other than a diploma I got from a technical college in Halifax. No, that diploma isn’t in finance – it’s in something called book labelling… it’s like book-keeping but instead of accounting for the ebb and flow of cash through the books, I’m am qualified for making sure all the books are correctly named. How did I get into the finance industry? I knew a guy in college who told me I was quite good on computers and adding up and he suggested I become a day trader. The rest is history.
Of course, that’s not to say that ALL of those people still involved in the financial institution that nearly bought the world to its knees (but thanks to some quick cash from those people who actually pay taxes, they can continue on their merry way) have no idea what they are doing. Indeed, I’m sure that most people who take huge daily risks with money that doesn’t belong to them in situations they can barely understand, know completely what they are doing.
I am being incredibly sarcastic here. I doubt whether anyone on Wall Street really fully understands anything about the institution they’ve created. All they really care about is making money – and lots of it. And before you go all funny and start suggesting I’m a communist, or, God forbid, ‘against us’, think of it this way… where does the money come from? If I’ve clicked my mouse to complete a trade, then later that day I sell making money, the only thing changing is a number on a computer screen. Where is the cold, hard cash – the tangible thing that I can hold in my hand that shows I’ve actually done something useful.
If I go out to a market and buy a carrot for 9 cents and later that day sell it for 10 cents, I’ve made a penny. I also have a 10 cent piece in my hand that I can show people and say – look at me, I’m worth 10 cents. Yesterday I was worth only 9.
The thing that really sticks in my mind from this year is the amount of profit these US companies made in the months following their bailout by Obama. For example, AIG made $1.82 billion in the second quarter of 09. This after getting nearly $200 billion in loans. I suppose, technically speaking, these loans have to be paid back by AIG, but all they’re doing is shuffling things around and selling them off to do this. They’re not really changing the root cause of all the financial market malarkey that has occurred in the last couple of years (oh, and in the late 90s, and in the late 80s, and in the 1970s, and so on and so on and so on).
People are driven by wanting to make as much money as they possibly can with little regard to whose money it is that’s actually helping them do this. When human nature is involved, you can’t have a totally unregulated situation in the marketplace, no matter how many times they tell you to let the market provide. Look what it provided last year (oh, and in the late 90s, and in the late 80s, and in the 1970s, and so on and so on and so on) – complete meltdown because those in charge of the money-go-round all got off at the same time. Dicks.
Oh well… I’m sure they’ll do better next time (I’m picking it to be around 2018).
Happy new year!!