Lady Gaga for IMF boss: Wael Ghonim for ECB?

Of course Trichet is against any default or "resolution" as the ECB holds a large proportion of Greek, Irish, Portuguese debt. Default could make the ECB insolvent, if it is not technically so already!

I would like to recycle my suggestion that I put onto Robert Peston's site today - Sir Bob Geldoff. Not only has his name got a monetary resonance but he would certainly question the sadistic tendency of the IMF to toe the austerity and privatise every thing line of destructive conventional wisdom. Privatise everything - look what it did to Russia. austerity - look to Greece,Ireland and Portugal and soon the UK.

PS: When does the 400 character guillotine fall on this blog?

The key criteria for ECB & IMF top jobs is the willingness and ability of the candidate to sustain the completely contradictory, illogical and irrational nature of these organisatiions whilst delivering a credible performance that there is logic, reason and objectivity in their policies and decisions, as well as maintaining the "conspiracy of the plutocracy" to pick up the tab for the IMF & ECB decisions - indeed you could probably add the Fed to this list, given the size of the US economy and the level of indebtedness....

Take the endless demand for austerity measures combined with privatisation and deregulation that characterised the IMF's strategy for decades. It destroyed the middle classes in countries in South & Central America, Africa and held back the former soviet countries, whilst the ECB's demands for the PIIGS to slash their spending has simply driven their economies over the cliff leading to rising welfare costs and falling tax revenues, driving them even deeper into debt and the risk of defaulting.

Take the economic hawks in the UK who support this strategy - Mr Gordon @ MotherCare for example, who signed the round robin with other CEOs' endorsement of the Conservative rapid & deep spending cuts - yesterday his company announced that it has seen UK revenue plummet and now proposes to close a very large number of stores in the UK - all caused by the faltering UK level of demand which is about to fall even more as spending cuts hit aggregate demand - MotherCare now plans to expand overseas and disinvest in the UK and dump hundreds of jobs here - thanks for that Mr Gordon - but the strategy you endorsed was supposed to benefit the UK economy, not export jobs overseas.

This is the heart of the contradiction - those who want to cut taxes and spending to make more money then find they are cutting demand which shrinks their turnover and profit margins in the UK - so they shift investment into the developing markets which simply exacerbates low growth and recession risks in the developed economies, which then sink under their mountains of debt.

People are waking up the fact that 'democracy' is a fraud.
Voting every four or five years for pepsi or cola makes no real difference.

It's not just about Euro or world bureaucrats.
It's not just about who to vote for at general elections.
The whole system is the problem, i.e. capitalism.

I personally think that HUGO CHAVEZ should be the next IMF boss!

Thanks for the great topical post.

Thanks more so for making it on this blog platform, rather than the horrible new BBC blog fiasco.

I don't think we will see any kind of 'haircut' for any country no matter how bad their situation gets. The politicians haven't spent the last few years transferring all the debt from the financial sector to the taxpayer in order to pass the parcel back again. Instead you will see the time limit for the debt re-payments extended, over decades if necessary, so the worst affected economies can see some kind of economic growth. After all can you imagine what would happen in these countries if one of them were to be allowed to default, even partially? The cat would be out of the bag and citizens across the world would start saying 'why do we have to cop the pain while they get let off?'
I'm afraid the die was cast back when the banks were originally bailed out, we're all on the hook for this, and our children and our grandchildren.

It does feel like we are being run by some kind of political and economic elite, who don't really care about anything except their own interests. In Britain they seem hell bent on maintaining all the fictional wealth they created out of things like housing - which is only worth what they keep telling us it is once everyone getting onto 'the ladder' is paying a mortgage at today's prices, something only a fraction of existing homeowners are doing - whilst at the same time passing all the losses and bad debts onto our shoulders as well. Win win for them, lose lose for us.
We are still borrowing close to £150bn a year and that money isn't for paying people on the sick, its to pump into the economy in order that we keep on paying our mortgages, overdrafts, car loans and credit cards. If we can't pay our debts then the banks have to write them off. Its an on-going bank bailout. And yet all the politicians, whatever party they're from, all define the bailout as meaning just the recapitalization money given to the banks a couple of years ago. Its this money, the national debt, that means we will all have to work until we die, that our public services are going down the plughole, its why Ken Clarke was on the radio yesterday basically saying we can't afford to put people in prison any more. These are not temporary things, they will hang over our society for generations, yet at the same time no-one can afford to live anywhere because the banks don't want to take a hit on any of that fictional equity they created out of nothing.
So the idea that these people will allow any kind of debt write off for the good of society at large at the expense of themselves is laughable.

#5

'Voting every four or five years for pepsi or cola makes no real difference.'

I like that one and I agree...though how about this one...

Voting every four of five years for Dr. Jekyll or Mr Hyde makes no real difference.

Quite obviously it should be this man who cannot be named :

https://bbc.kongjiang.org/www.bbc.co.uk/news/uk-politics-13453626

Thereby already protected from the slings and arrows of outrages fortune, and any stench eminating from Denmark . A perfect master of the universe - unseeable, unknowable but omnipresent ?

At least we can be assured of sensible, insightful, considered commentary. Usually.

'Frenchmen have traditionally made good IMF chiefs. (All the duff ones, in recent years, have been from other parts of Europe.) But even by past standards, Mr Strauss-Kahn was exceptional, and exceptionally well-suited to the time.'

Good job the author of this did not say it on the BBC... er... to a woman... er ...

Plus, considering the financial achievements/outcomes of the time one presumes is being referred to, a Gallic eyebrow may be raised at how swimmingly well the world of money globally has 'worked' out over the last few years.

The objective of all these institutions was to create stability to allow the global economy as constituted to work. In this they have utterly failed, so what legitimacy have they left? What value are they, whoever runs them?

The sticky, smelly brown stuff gets closer to the fan as each day passes. How long will the illusion be sustained?

Paul,

The 'election/nomination' processes for the leaders of the institutions you mention above make FIFA look like a paragon of virtue.

PS - How did you get away with mentioning Bilderberg, I thought that was strictly verboten within the BBC!

museV

richard bunning

Re your #4

A well articulated post
(we won't be able to read posts like that on here for much longer when the new format takes over btw).

Did you listen to Vincable on Radio 4 this morning?

Cable's £2.5bn 'Investment Fund' for SME's is a joke!

It obviously equates to 2500 separate £1m stakes in 2500 SMEs. And £1m doesn't go very far these days....its pathetic!

I also suspect that this approx figure only represents a very small percentage of the total number of businesses in the SME range.

It's just another sop to fool the stupid masses.

We need to nationalise all of the remaining banks now.

It's about time the 'powers that be', whoever they are, should look at the victims of austerity. The blameless many who are now suffering for the cosseted few, the banking/politico classes. There is an entirely spontaneous unsponsored (by unions, student bodies, or anybody else) demonstration taking place in the middle of Madrid, if no notice of this is taken who knows where it may lead. They don't care if Trichet has a hissy fit and won't talk to anyone, but they may well care if he tries to impose yet more austerity without allowing the Greeks some sort of postponement or partial default because where Greece goes, Spain could follow and so could the Euro itself.

Some light relief:
https://bohodotcom.blogspot.com/2011/05/everyones-at-it.html

@15 "It's about time the 'powers that be', whoever they are, should look at the victims of austerity. The blameless many who are now suffering for the cosseted few, the banking/politico classes."

Do you really think they give a toss?

The history of the last 30 years has been a project to restore power and money to those that always had it, but for a short post-war period seemed like they might be losing it.

... short post-war period when it seemed like ...

muggwhump:

"In Britain they seem hell bent on maintaining all the fictional wealth they created out of things like housing - which is only worth what they keep telling us it is once everyone getting onto 'the ladder' is paying a mortgage at today's prices, something only a fraction of existing homeowners are doing - whilst at the same time passing all the losses and bad debts onto our shoulders as well. Win win for them, lose lose for us."

Dead right. Banks lending pumped up house prices. Recent entrants borrowed at the higher prices. Prior owners rode the wave. Socialising losses means they keep on surfing. Youngsters have to peddle five times as fast just to stand still. The best part is if they pull the plug youngsters will be accused of impoverishing boomers. And they will, because like GB instead of painting the roof they have spent it all on consumerist tat and holidays. The funny part is that the wave is going to comply to gravity real soon regardless.

Not all the losses went into banking bonuses via commissions. Lots of the money lost by every UK bank is money that has been loaned out to real people who have sold a house they bought far cheaper years ago, or perhaps are a buy-to-let landlord forcing up rents, or people who have taken money out of their house based on a rise in it's "worth". Banks helped create this situation but they weren't the only ones drinking champagne regularly at the next generation's expense.

I can guarantee you the boomers won't give a single inch on this between now and the moment the whole thing blows up in their faces. Merv King is dragging it out for them, but fortunately many are dumb enough to start asking for higher interest rates because their shopping bill has gone up a bit and believe their house will hold it's value no problem!

The financing of home ownership is a source of economic failure. Mortgages used to be provided by building societies who had a simple business model of lending out a sensible multiple of savings invested. The banks used to deal with loans for the purchase of capital goods – real investment. Nowadays most loans are made on residential property, with land as the collateral (bricks and mortar are, after all just capital and subject to depreciation). The banks incur very little risk with mortgages because, here at least, very few borrowers default owing more than the value of the property. They are in effect collecting rent via interest payments on inflated land values – one of the reasons why they are so profitable – without actually creating any real value. But personal and business loans are also commonly secured on land values. If all land rent was collected for public benefit, the banks would not find mortgages so attractive and would probably be happy to quit the field in favour of mutuals. Meanwhile the banks would have to revert to their 'honourable' business of lending on the basis of knowing their customers.

Next generation, new (worse) rules. Club together with friends so you can all have a smaller share of the pie than boomers:

https://bbc.kongjiang.org/www.bbc.co.uk/news/business-13411292

What's that you say? You have loads of debt and a degree but your salary won't pay for a house? At least the liberal establishment are well-fed as 3rd rate academics are paid for at unis by your fees! Realise that the point of your degree was to keep them, not to educate you.

And if you think prices are ridiculous and you won't buy until there's a crash, don't worry the rental market is sewn up too:

https://bbc.kongjiang.org/www.bbc.co.uk/news/business-13457418

Residential landlord site has different figures to the BBC who as usual give a negative figure then rubbish it as irrelevant. https://www.residentiallandlord.co.uk/news2653.html

A step closer to an utterly unsustainable position but they will drive this ship into the rocks rather than increase rates, which will ravage the housing market and take the banks down yet again, because the fact that the UK is generating wealth is a lie.

If you are young the best thing you can do is get a job abroad. You are going to be paying for a demographic bulge that has failed to save for itself and expects you to throw away your youth to pay for it. Best case: you nurse them into a comfortable grave and then get no pension or health care. Worst case: the whole thing blows up way before then and you still get nothing. Take yourself out the system.

ps play a fun game on the tube. Spot the young person with an iPad. I haven't won yet. iPads are very expensive, a bit of a waste of time and beloved by those utterly out of touch with their youth. Yet the media make out like everyone has one - just like houses!

strange analogy.

because of the titantic there is no point employing ships captains so let lady gaga do it?

does the titantic prove all ships captains [middle aged male from a limited selection process] are incompetent?

i hear the sound of someone trying to whisk water into a thick cream?

what should be the threshold of competence? public popularity, idealogical dogmatism or demonstrated skill?

21 Ben
I am sorry you can't afford an I-Pad whatever that might be. I suspect it is one of those absurdly expensive electronic-type gadgets which will be useless once the lights go out in 2014. Let the fools have their trivial fun as it won't last. A bike is so much more useful. Just be happy to be young.

Spanish Revolution 2011?

@21 Ben

Since when was it "normal" for a person to expect to leave university and be able to buy a house of their own immediately? Only in the "new normality" which created the housing bubble. As a supposed boomer, I didn't buy a house until in my 30s, and that was with a group of friends and we had to raise a 30% deposit. That was "normality" then. Of course "normality" was different in the post-war period.

Appeals for anger against a so-called "golden age" are unproductive. I'm not saying that things aren't bad for today's graduates. But complaining that you're not getting your share of the "good old days" won't get you anywhere. They're not coming back. Better to find some decent policies for addressing today's problems today.

QE3 on it's way methinks ?

https://pragcap.com/debunking-reinhart-and-rogoff?utm_source=twitterfeed&utm_medium=twitter

stallinic - "Just be happy to be young" - I'm middling, but I don't think that is acceptable. The older generation have been young too. I find this dismissive, patronising and plain wrong. I do however love my bike! ;-)

gastrogeorge - we are living in a generational apartheid. In parallel some have and others do not. Hardly unproductive to ask that we rebalance this abhorrent system. I also have no time for this "we are where we are" stuff. With that attitude we would still have a feudal system (which we nearly do have for the landless youth).

Also I made no mention of people leaving uni and immediately buying a house. You inferred this. Average FTB age is now 38. Hardly straight out of uni. It's delaying people having families.

Good to hear some stuff this morning on Radio 5 about the generation gap. I had no idea how the world worked when I was 20. You just take the world as you find it. Youngsters are therefore taking a while to catch on to this two-tier system, but it is coming.

@27 Ben. The implication of your complaint, your re-balancing of the system, is that you think it should be possible to lower the first-time buyer age into your twenties. My point is that this was only "normal" when the bubble was building. I bought my first house in my 30s, my parents bought theirs in their 40s. Your "solution" would be to create the conditions for another bubble. That's no way forward.

It was always pointed out that the higher inflation rate in house prices was always stealing money from your children, and not a tangible increase in asset value. This is what is being crystallised now.

As for "It's delaying people having families", since when did home ownership become compulsory for having children ...

gastrogeorge - weird first paragraph. Don't see why making life sustainable would lead to a bubble. By rebalance I don't mean the CML solution of increasing lending multiples. I mean tear down the housing bubble once and for all so people aren't working all hours just to cover the rent / mortgage. The by-product of this would be calling time on the bubble which would mean many home-owners have no money.

second para - yep

last para - ok this is subjective so let's drop it

@29 Ben. What's wrong with renting? I did it. Most of Europe does. The situation for buying a house now is far more "normal" than it has been for the last 20 years. I don't see more people on the streets (because they can't buy). The bubble has been torn down. Let's not start another.

"What's wrong with renting?"

What's wrong is that someone owns the houses which are rented out. If you can afford to rent the house you should be able to buy it, because the true capital value of a house is annual rental value times the discount rate. Rent-seeking is an economic term for unearned income. And rent is the (unearned) return to the landowner.

Government Orders You Tube To Censor Protest Videos

time for an asian head of IMF :

[Unsuitable/Broken URL removed by Moderator]

Don't mention Scntuthorpe

Spanish revolution 2011? Yes please, I will go incognito to a Parisian suburb, meet a contact and trek over the Pyranees to a Spanish contact who will help get the peseta back and reclaim Spain for the Spanish instead of speculators on the money exchanges....bring it on, Manuel....

New I shouldn't have mentioned Sncuthorpe ! Orwell shortlisted blog here ( or has 1984 really really happened ?)

https://heresycorner.blogspot.com/

This comment was removed because the moderators found it broke the house rules. Explain.

Traditionally the IMF Managing Director has been a trained economist, Paul. The only exception to that requirement was the first MD - who was a Belgian finance minister who had a law degree? A principal objection to Brown's candidacy is that apart from all the political baggage he has no formal economic qualifications as far as I'm aware. That makes a little curious his comments to school-children in South Africa that you played at the top of Friday's Newsnight in which he appeared to tell a kid who asked him what he had studied that he 'studied economics'? Precisely at what level and when did Gordon Brown do that I wonder? Every biography of him up till now suggests that his MA (Honours) at Edinburgh University was in History and that was followed with a PhD which was on the Labour Party & James Maxton.

The IMF Articles of Agreement do not of course stipulate that the MD must be either an economist or a lawyer (NB Christine Lagarde's degree is in law?; Trevor Manuel is a civil engineer?!) - but there is a requirement to lead the team of professional economists and also to take instruction from the Finance Ministers on the Interim Committee of the IMF which formulates policy. They would be nuts to hire a guy who was forever undermining his own Prime Minister as Chancellor and who was never particularly objective in shamelessly spinning IMF assessments of the UK economy for his own (political) purposes. And Brown also nearly ruined Britain.

This comment was removed because the moderators found it broke the house rules. Explain.

With regard to GB and his lack of formal economics qualifications, the very best economist I know has a science-based PhD but has studied economics as an amateur since he was an under-graduate. I can recall very little from my own economics degree course which I've found relevant to an understanding of the subject now. Things do not appear to have changed since then and it's hardly surprising since economics students are mainly looking to a lucrative career rather than seeking true enlightenment. GB is a passionate politician who I'm sure would have followed the far more sound amateur course.

I dont suppose GB will be playing this clip during his interview for the top job at the IMF.

https://www.youtube.com/watch?v=gaRKh3VIf-U

Or there again, maybe he will, they can all have a good shared laugh at it at our expense in an emboldened kleptocracy type way.. after all they must all be superior beings to be able to get away with such a brazen display of the success of nepotism and leverage over wisdom and 'the good'.

GB may say '' remember this one (shows the above clip) I wonder if the minions actually believe that we do represent hard working families and small business.. they must be sooo inferior and stupid when compared to us ...guffaww guffaww''

Alaistair C '' Gordon.. turn your microphone off''...... more hilarity follows..

GB '' gosh they really are THAT stupid arn't they''

They may trade jokes thus during the interview..

Q '' How many hard working families and small businesses does it take to realise they are being completely shafted by us''?

A '' An infinate number because they are sooo stupid they think WE work for THEM''

ha ha ha ha ha ha ha...etc...

Rupert Murdoch particularly enjoys this joke aparently.

#41 continued..

Finally, the clip that gets GB the IMF job.

https://www.youtube.com/watch?v=9Gi7qqvRlY0&NR=1

Anyone that can say that with a straight face is exactly the type of person they are looking for.

"GB is a passionate politician"

I'd rather have someone cunning, looking to grab a place in history who, because they have an IQ above 80 delivers a sustainable economy. Even Vince Cable gets it:

https://bbc.kongjiang.org/www.bbc.co.uk/news/uk-politics-13480971

Even 6% or 7% feels pretty optimistic.

Rates to rise in a bit. The BoE are just going to lift one foot and paint under that first to ensure we really have put ourselves in the corner as much as possible, then we will raise rates:

https://encrypted.google.com/search?hl=en&source=hp&biw=1920&bih=981&q=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2Ff9f2e146-831c-11e0-85a4-00144feabdc0.html&aq=f&aqi=&aql=f&oq=

Spanish youngsters questioning the gap between promises and reality. Will we see this in the UK?

Further to Post 40 from Carol Wilcox. I too know at least two physicists who became fine economists - but they studied economics at university level too. Gordon didn't as far as I'm aware. He has certainly never mentioned studying economics at Edinburgh Uni on his official CVs up to now and I certainly don't remember him dropping into a seminar in the Economics Department when he was doing his PhD. He did sit in on a student paper I gave on the economics of devolution to the University's Student Politics Society and during his time in the History Department as an undergraduate may have done a bit of economic history (I seem to remember something about him having once been in a tutorial with Rosland Mitchison the eminent social historian who was also my tuto in Economic History 1 a few years later - and for which I won the class medal largely thanks to her input). But Gordon was mainly based in and around the Politics Department at Post-Grad level where one of his thesis supervisors was as I recall James Cornford - though his PhD is normally listed as being in History? I seem to recall he worked on the history of the ILP (Independent Labour Party) and that this was the basis of his biography of 'Maxton' - which was finally published in 1986. Although this deals with the 1920's and 1930's, the book makes only a ONE SENTENCE reference to Keynes and also doesn't say much at all about the so-called Birmingham Labour Party Resolution on employment moved by Oswald Mosely. Mosely's name is not in the index curiously .... Keynes appears twice - in a list of names, and the sentence on page 194. Gordon did however edit the famous 'Red Paper On Scotland' in 1975 when he was still a post-graduate and there are economic essays in that collection by at least five trained economists - two of them Marxists and one of course was Vince Cable whose essay 'Glasgow: Area of Need' was written when he was a lecturer in political economy at Glasgow University. Cable is a professional economist of huge international experience as well having been an ODI Fellow in the Kenyan Treasury, an ODI Research Officer, economist at the Commonwealth Secretariat, Chief Economist at Shell etc etc Surely a much better bet for a job at the IMF than his student editor?! He also took a tougher line on bank regulation that Gordon Brown did as a Minister!

without Brown you would have no dosh from cash machines, overdrafts recalled, business collapse and mayhem on the exchanges....you guys don't know when you are well off...look at the shambles now all thanks to Osborne, get a grip Toryboy....

Replaying the Brown clip again from last night's Newsnight, what is curious too is that the South African school pupil asks him 'What did you study at school?' He repeats the question before answering 'Economics' - presumably aware that he is on camera? But go back to any of the online biographies posted by the Labour Party, Downing Street or 'GordonandSarahBrown' about his school days in Kirkcaldy and curiously 'economics' has not hitherto been mentioned? There are references to the fast-stream programme he was put through; his interest and ability in mathematics and english; 5 'Highers' (which the site usually tries to explain to English audiences - inaccurately, I would suggest? - that Scottish Highers are 'roughly equivalent to A-Levels' (sic) - and sometimes there is a reference to him having done 'O-levels' a bit earlier than usual ... even though the 'O-level' is an English qualificiation and the Scottish qualification is called 'O-Grade'? So if I were recruiting for the IMF I think I would be asking to see copies of relevant certificates before Donald Trump gets on the case! As for his statements on education in South Africa, the words 'apple pie and motherhood' spring immediately to mind! And in any case wasn't 'Education, education, education' a phrase coined by Tony Blair?! Brown's other phrase about 'neo-classical endogenous growth theory' was (according to Michael heseltine) 'Balls' - and Ed Balls did do some economics at Oxford I gather before he worked for the Financial Times on that Oil Supplement in Nigeria as stand-in after another FT man was expelled for criticising the big oil companies operating in the Delta? Though a phrase like 'put an end to boom and bust' does sound like Gordon Brown - though how on earth an Edinburgh University trained historian who had read a bit of Marx and researched the politics of the 1930's could come out with anything quite so a-historical continues to baffle many? It certainly didn't fool any socialist economists.

Have just see 'The Guardian' story suggesting that Cameron may back Mandelson for the job at World Trade Organisation when Pascal Lamy stands down. That actually does make some sort of sense given that Peter Mandelson was a highly respected European Trade Commissioner ... and he does have an economics degree too! He also worked as a professional economist on graduation - in the TUC Economics Department!

Having spent all those years in Brussels too Peter Mandelson's language skills are probably also better than Gordon Brown's ? And Mandelson is also pro-European - whereas Gordon Brown has been against Europe since he was a student in the 70's.

"get a grip Toryboy"

Not very articulate, but at least it has some footing in reality, unlike the rest of your point.

https://bbc.kongjiang.org/www.bbc.co.uk/news/business-13032013

Mr Brown said the banking meltdown had forced a rethink of financial regulation "in its entirety".

"I have got to accept my responsibility and I do, and I have been very open about saying we made mistakes on that," he said.

Love the way he mixes we and I even in one sentence. Not that it matters, but this demonstrates how feeble he is as a man.

“I want us to do even more to encourage the risk takers”
Mansion House speech to the City of London, 17 June 2004

post 45 presumably means to write 'without Darling' or perhaps even 'without DSK'? I seem to recall that Gordon Brown as PM angrily slapped down his Chancellor Alasdair Darling when he retreated to his croft in the remote Western Isles and gave a crucial interview warning Britain that we were about to enter the biggest financial crisis for nearly 65 years? Such warnings echoed consistent advice about the Brown/Greenspan asset bubbles over many years by Cambridge economists such as Labour's own Lord Eatwell, Lance Taylor at The New School and the IMF.

On bank regulation, Brown gets that wrong the day before the First Queen's Speech when he over-rode the sound advice he was being given by Eddie George Governor of The Bank of England and transferred responsibility for banking regulation on advice of Ed Balls to a new and untried 'Financial Services Agency' which hadn't been set up and whose subsequent performance has been widely ridiculed. On employment, Brown got that wrong as well - New Deal failed on Day 1 when a job applicant asked during Brown's visit to the Wellgate Job Centre in Dundee to launch New Deal if he could see 'the Executive and Professional Vacancies register'. The response from civil servants who jumped in was that 'this was privatised in 1984, Minister, and ceased to exist in 1989'. Brown's speech at Discovery Point was then hastily altered on the basis of criticism in that morning's 'Guardian' that New Deal's focuse on 18-24 year olds meant that it was mistargetted as the real long-term unemployment issue related to other age cohorts ... Brown inserted a sentence into his pre-prepared statement already issued by HM Treasury saying that of course he would in due course look at extending the scheme to older workers ...

Mandelson of course also has a lot more experience of Africa than Gordon Brown. In the 1970's before going to the TUC Mandelson did a year of VSO teaching in Tanzania. In his first 7 years as Chancellor Gordon Brown's only visit to Africa was as I recall a 24 hour trip for a Finance Ministers' meeting. It was only when he was after Blair's job that he organised a plane-load of journalists including the BBC's Mark Mardell to accompany him on a whistlestop tour of African capitals which Mardell records here in his diary of this trip along with a joke made by Brown about how he might be able to do more for Africa as a 'junior trade minister' than as PM:

https://news.bbc.co.uk/1/hi/uk_politics/4177281.stm

As for 'passion' [comment No 40] the phrase 'passion for Africa' was Tony Blair's in fact - and in sharp contrast to Brown Mr Blair actually loved going to Africa. Blair even spent his holidays in Africa - in Egypt - and Blair's father was a law examiner in Sierra Leone. Blair's 'passion for Africa' was real - he also spoke fluent French which is of course another handy prerequisite for an IMF MD who will have to deal not just with the English-speaking African countries but Francophone Africa as well. And expertise in managing gold reserves is also helpful at the IMF ... Brown's track record on that as UK Chancellor was disastrous ... having taken the decision to get rid of British gold reserves (fair enough) he then botched the technical operation by not just selling at the bottom of the market (resulting in a massive loss of revenue) but by flooding the market caused major employment disruption in South African gold fields which led to demonstrations of displaced miners in Pretoria. He aslo forgot to tell other European central banks in advance about this UK decision - and they all had to go into emergency session to stabilise the market he had disrupted. Not the best of recommendations for a role at the IMF on co-ordination of financial policies I would have thought ......

Brown wasn't of course physically present either at the G8 Summit in Gleneagles in 2005 - unlike, for example, Scotland's First Minister Jack McConnell who stood in at the private dinners after Tony Blair was called away for part of the Conference due to the 7/7 bomb in London where Brown was also pictured sitting in The Commons. But again what I also remember about G8 is that Brown's so-called 'Enron-finance' plan for boosting development aid against future budgets was rejected at that G8 not least on the technical grounds that it was incompatible with US and EU rules on budgetary procedure and fiscal prudence? The IMF would also have opposed that on these technical grounds I'm sure. What was of course a shame was that by hogging all the pre-Conference limelight for this technically incompetent International Finance Facility the UK G8 organisers deflected attention from French proposals supported by Jacques Chirac for Tobin-style taxation of international currency transactions and other innovative proposals to boost international aid budgets. I can well understand that some of Brown's hedge fund mates might well have been a bit alarmed by the prospect of such levies on their speculative manoeuvers but France had garnered a lot of support for such a progressive initiative. Interestingly France still supports that view which is shared by Christine Lagarde their candidate for IMF.

This is how the BBC's Mark Mardell who accompanied Brown on his whistle-stop trip to South Africa, Mozambique, Tanzania and Kenya a few years back summed Brown up: It's a widely held view at Westminster that Gordon doesn't do abroad. He travels for meetings but he tends to dart in and out.

The last time he went to Africa was seven years ago, when he spent twenty-four hours in Johannesburg. So why make a week-long visit to the continent, taking in the biggest shanty town in Kenya, an HIV AIDS orphanage in Tanzania, and a women's credit union in Mozambique?

In part it's to highlight the British government's intention to make tackling poverty in Africa their central task as this year's chair of the G8 - the group of the world's richest countries.

Stunningly enough, he and they actually believe in it.

In Mr Brown's recent announcement of a full-scale aid plan for Africa, which he compares to the United States Marshall Plan which rebuilt Europe after the Second World War, he talked of being part of a shared moral universe.

And it just so happens that we all expect a British general election this year, and for the government as a whole, this focus on Africa has distinct advantages.

When it comes to foreign policy, any distraction from Iraq is welcome.

And then there's the raw, personal politics. The recent tensions between Tony Blair and Gordon Brown have all been about Mr Brown's conviction that he should be prime minister by now.

He isn't, but he can do what prime ministers do: look concerned in shirt sleeves as cameras follow him around picturesque places revealing a more rounded person than the gruff finance minister usually displays.

Abroad has its advantages.

@Neil Robertson
"Brown's track record on that as UK Chancellor was disastrous ... having taken the decision to get rid of British gold reserves (fair enough) he then botched the technical operation by not just selling at the bottom of the market (resulting in a massive loss of revenue) but by flooding the market caused major employment disruption in South African gold fields which led to demonstrations of displaced miners in Pretoria."

You should read this: https://www.ft.com/cms/s/0/5788dbac-7680-11e0-b05b-00144feabdc0.html. Completely exonerates Brown's decision. Anyone who says he can predict the bottom of the market is either a fool or a billionaire.

I had plenty of criticisms about Brown's chancellorship but I admire him greatly as a man. As a UN NGO representative he is the only politician I have ever heard praised at international events on several occasions.

Sorry Carol Wilcox but Gordon Brown's intervention in the gold market was indeed disastrous. Perhaps he could not have predicted the current heights to which the price of gold has climbed in recent years but what any high-school student of economics could have told him was that if you are selling off bullion in bulk it makes sense to spread that disposal over several tranches so as not to disrupt market conditions as happened in that case and create problems for other central banks and unemployment amongst miners in Southern Africa. As for 'admiring him as a man' that is of course completely different from regarding him as qualified for a technical position in an international financial institution dealing with economics. I have known Gordon since we were at university together and he is a nice guy even if that view is not always shared. I too have no doubt that he is praised in UN fora, and he did of course studiously court support from NGOs - Shriti Vadera was on the Oxfam board as I remember during her interlude from being a high-flying financier. But the key point is that these are not qualifications for the job of being Managing Director of The International Monetary Fund. Perhaps he should try Unesco if he is so interested in education, education, education - except the top post is taken too. Or perhaps he just needs to focus on his current job as an MP for Kirkcaldy instead of spending his weekends in Vegas at a hedge fund convention (as he was doing last weekend) along with Colin Powell and George W Bush? One of the themes of the conference incidentally was 'How to Make a Profit Out of Financial Armageddon'. Look it up on Google if you don't believe me .... SALT 2011 Conference Las Vegas. And the click on the House of Commons Declaration of Members Interests to see just how much people are prepared to pay for access to his words of wisdom? I think it would nowadays be well beyond the reach of anybody working for NGOs!

Former US Assistant Treasury Secretary says the only recourse for the austerity conned EZ countries is REVOLUTION!

https://www.youtube.com/watch?v=kEPob3kQ-6g&feature=player_embedded

Sadly Gordon Brown doesn't do 'revolution' either! Even 'devolution' was too radical for a control-freak like him!

If links to Guido are verboten by NN then I'l just dedicate this to him - he can listen in Pentonville maybe ?

https://www.youtube.com/watch?v=jbCqwl2geQg&feature=related

gastrogeorge: "The bubble has been torn down. Let's not start another."

Ok again this is subjective as neither of us can predict the future. But I'd be amazed if this statement doesn't look way off the mark in 2 years.

@Neil Robertson, Alan Beattie of the Financial Times does not agree with you: "Britain was right to sell off its pile of gold".

'However those nations do have leaders who are elected, and they are elected in order to promote the interests of the country they come from - not somebody else's'.

This shows you are facing the wrong way back at the starting gate

So while it all sounds awfully clever, its not.

Gold is pretty to look at but actually fairly useless compared to other materials.

Why do we still value it so after the demise of the gold standard?

There is no logical reason now to have huge vaults full of gold sat there doing nothing.

You cant eat it and it has limited practical use other than in decorative jewerely.

It has been replaced by a series of 1s and zeros on bank hard drives and bits of paper with lawyer jargon scrawled on them underpinned by a judicial system in the last instance..

If the banking system went down would we go back to gold?

I doubt it.

Gold is the mother of all bubbles its value only sustained by a perception of illusory value, when in fact it has very litttle realvalue now that its status as a mechanism of value exchange has been superceeded.

Gordon was right, he just underestimated how stupid we all are.

@Carol Wilcox: Alan Beattie of the Financial Times does not agree with you: "Britain was right to sell off its pile of gold".

Perhaps so - perhaps not - but the key point is not whether that decision was right or wrong, the criticism is over the manner of the disposal ..... basically Brown dumped a whole lot of bullion on the market in a oner depressing the price and causing unemployment amongst black African miners who demonstrated against being laid off by the mining companies in Pretoria around that time ... and not informing other European Central Banks of the UK's unilateral decision forced them to take emergency counter-measures to try and stabilise markets ... that was plain silly as well as being discourteous ... neither quality commends Brown to the IMF - a body that is charged with ensuring financial stablitiy across countries and is also of course a major holder of reserves in gold .... Brown's candidacy for the IMF is political ... and the IMF should not in my view be politicised in that way ... it is a very rule-based organisational culture and is very different from the World Bank. One IMF official once compared the World Bank across 19th St as 'the Mexican army' whereas the Fund was more like 'the Prussian army'. These organisations have different functions and different cultures and in my view that is healthy. It would be a major departure moreover to appoint a former Prime Minister who has no economic qualifications to the role of IMF MD. And from a British point of view, it is important to remember that British voters kicked Brown out. Last week too we in Scotland kicked his Labour Party out - and even in his own constituency in Kirkcaldy Labour lost to the SNP. The rather cynical press campaign he and his acolytes have been running to get him into the IMF suggests that he really hasn't got the message. And given his lack of formal economic training, do we really want someone in that job who will have to phone up his mate George Soros for advice when he is stuck?!

#57 Neil Robertson

I think it was Hawkeye on a previous blog that said gold cannot be a bubble as it is a finite element...and it is tangible (i.e. fungible). If gold is not the bubble, then what is the inverse of the bubble?

So Gordon sold gold 'at the bottom of the market', but everything is relative to FIAT money. Are we sure he sold it at the bottom of the market?

The selling and buying of gold only benefits short term speculators. Do you think Gordon was a short term speculator?

How does buying or selling gold help the economy?

These are serious questions btw.

One last question……can you eat gold?

Or ring up Larry Summers when he wants a second opinion on a regression analysis? Complete and utter nonsense .... Brown didn't manage to run the British economy - what sense is he going to be able to make of e.g. Hungary, Spain, China, Canada? An IMF Managing Director has to be a bit more than a one-trick-pony. Get serious people!

@ 66 How does buying or selling gold help the economy?

These are serious questions btw.

Presumably these are questions for Gordon Brown not me. All I am saying that if you are going to sell gold do it sensibly to maximise revenue - and minimise the impact on the poor African miners and fellow European countries he forgot about.

#64 Jericoa wrote:

'Gold is pretty to look at but actually fairly useless compared to other materials.'

In fact it's very useful in many electronic products!

The last time I looked seriously at the gold market, too, the second biggest source of demand after central banks was not 'speculators' but dentists!

@66 One last question……can you eat gold?

Yes ... if you swallow a filling. Digesting gold is however another matter ....! But of course gold miners in South Africa who have jobs send remittances home to feed their families. And many of the unrecorded private holdings of gold e.g. by Indians offshore or in places like Gaza utilise gold to hold savings for a rainy day I guess?

Just for Neil...

https://www.commodityonline.com/news/Zimbabwe-may-sell-diamonds-to-launch-gold-backed-currency-2011-05-20-39184-3-1.html

Sounds like Britain is nominating a woman in any case .... stitched up live on 'Newsnight' too! If it all goes wrong blame Kirsty!

https://bbc.kongjiang.org/www.bbc.co.uk/news/business-13488127

https://www.independent.co.uk/news/people/profiles/christine-lagarde-there-should-never-be-too-much-testosterone-in-one-room-2206357.html

@72 Thanks for that! Another monetary trend in Africa that apparently began with a move by the Central Bank of Zimbabwe was the proliferation of swimming pools in central banks across the Continent ... IMF rules were drawn so tightly that Central Banks were often prohibited from investing in companies directly but legislation did allow for them to build Central Bank buildings and staff facilities ... hence the rash of Central Bank swimming pools in Zimbabwe, Malawi, Lesotho etc anywhere the same IMF draft Monetary Acts had been implemented ... some would argue that it is of course better to invest in swimming pools than in gold ... last time I was in the Central Bank in Lesotho it was welcoming all the local kids to their swimming pool. Of course this is yet another reason why Madame Lagarde may be the perfect IMF choice .... as a former member of the French synchronised swimming team she'll be in her element discussing liquidity in Africa should Gordon B's candidacy sink?!

27 Ben

I am glad my comment annoyed you. I find your endless sneering at the so-called baby-boomers quite offensive. The statement that you are `middling' is too vague and needs qualification.

I agree wholeheartedly that quite often life gets difficult but to survive you have to adjust. To blame others for your own circumstances is a common ploy by those who are unable to objectively analyse their true situation.

The simple reality is that due to intellectual and moral incompetence the West has stolen from the future to live the high life. This has gone on for decades - it became very evident in the Eighties - and could have easily continued for longer if greed had not become good. Many people understood what was going on, argued against it and suffered career failure as a consequence.

The future has now caught up with us and we face the consequences of our mutual failure. The most fascinating thing I find about it is the continued widespread disbelief as to the dreadful extent of our current situation.

No doubt I will see you in a town square at some time in the future.

hi stanilic - I don't see why you need to know my age but mid 30s. I'm not young but I am disgusted at what is happening to young people. I don't need to blame anyone for my circumstances as I'm pretty successful, thanks. I know people might find this impossible to comprehend but I'm concerned about the plight of young people, not myself. As someone older, who is successful and now has a bigger picture on how the world works (though I am of course no expert), I am indeed objective on what is happening to the next generation, and it's disgusting to see the older piggies refusing to back off from the trough, even as the walls fall down around them.

Young people are stuck in a myriad of seemingly reasonable rules and they cannot know that those that went before them had subtly different rules that resulted in a much easier path. Suggestions are helpful, like "buy a house with friends", yet the results are sinister.

Your comment "just be happy to be young" is the sort of thing someone would say having run out of any genuine points.

"No doubt I will see you in a town square at some time in the future."

If there is an event like the gathering of young people in Spain in the UK, do you think old people will be welcomed into the throng? I guess you could wade in and test the waters...

@77 Ben "I'm not young but I am disgusted at what is happening to young people."

Maybe you need a bit more perspective. I would guess you don't live on a sink estate or, worse, live on less than $1 a week.

gastrogeorge - come on you can do better that this on the logic front.

https://www.paulgraham.com/disagree.html

Using that logic you could drive people into the sea whilst shouting "at least you're not from the Third World". This is the subjugation of young people by the existing adults. If you live in a world where the median income is $1/day then to make them into serfs you need an income of $10/day. In the UK you still need a big gap, only the base is higher.

Really weak. "at least you're young". "at least you're not in Africa". It's embarrassingly weak. Where do you think these responses fit on Graham's scale? I'm thinking Ad Hominem, maybe Responding to Tone.

"I would guess you don't live on a sink estate" - yeah, if you forced me to choose one, Ad Hominem.

#69.

Yes it is useful but not to the extent of justifying hoarding it by the ton in underground bunkers because it is critical to the functioning of society. We fight for oil now not gold you may have noticed.

There is plenty enough for dentists and electronics manufacturers such that its 'real' value would be a mere fraction of its current 'worth' on the markets if it were valued only based on its practical usefullness and 'prettyness' valued by society.

If the global economic model crumbles we will still be fighting each other for oil while the vaults of gold lay gathering dust.

Those south african miners should not be risking thier lives for this stuff. They should be doing productive work instead, having a good standard of living and lots of free time as well thanks to the dividend of technology. A dividend stolen from the people kept in debt slavery and busy on futile jobs in order to keep a very small group of people disproportionatley hugely wealthy, a wealth they have goaned in the most part without providing any value to society.

As i have said before I have no problem (for example) with Bill gates wealth , how he got it and and how he uses it, i have a huge issue with Richard F fuld jnrs wealth and his like.

77 Ben

Thank you for being so frank. Mid-thirties: hum - Thatcher's children, perhaps?

Possibly you could be one of the young people I found a job for in the late Eighties and Nineties. Speaking as what you would call a baby-boomer, many of us are very conscious as to how difficult it has been for younger people since the late Seventies. You don't have a monopoly on that front. A colleague I took on at sixteen turned thirty yesterday: grown into a good manager, a good person who I want to see to succeed some more.

I am arguing with our directors about taking on a graduate to learn the intellectual elements of my job before I retire as those from the school of hard knocks don't have the intellectual training - not their fault. The directors won't because as Thatcher's children they think it will cost money: in my view the return will be worth its weight in gold plus it will give some young person one hell of a hand up.

I am sorry, Ben, it isn't the baby-boomers you have to worry about. I appreciate every generation produces its own scum, mine repel me and I am usually among the first that take them on. My suggestion is that the real problem in your terms might be in your generation.

With regard to the youngsters in Madrid I did note that the BBC only managed to interview the middle-aged members of that event. As you know I don't see this as an intergenerational conflict: I see it more as a conflict between the powerful and the meek. Now I will let you into a little secret: the meek will inherit the earth. Remember, it is written!

Ah retirement. Final salary? But a distant dream for those who will pay for people retiring today. Either way, for your sake I hope it's index linked.

Regarding the "children of Thatcher". If they are balancing the books instead of spending "because it's the right thing to do", all the while pocketing the unsustainable benefit and passing down the bill, then more power to them. Are those meanies asking questions like "I know we'd all like a big pension but these assumptions seem absurd - aren't life expectancies growing?". And "I know we are all benefiting now by borrowing into the future, but what happens when house prices reach a rediculous multiple of incomes?"

If it's short-term profiteering eg not training people up in order to chase the next quarterly profit report, then that's bad, of course. Both have their root in short-term thinking and a predilection towards robbing Peter to pay Paul.

Finally, it's not about you or me - I'm sure you are a nice chap. You certainly come across well. It's about a block of people behaving irresponsibly and leaving others to clean it up. That block is everyone except the young 'uns.

Oh, Ben, can't you see that most of the wealth which you believe is resting in the hands of the baby-boomers is vested in land. The vast increase in the value of our homes is all down to land value. If we all paid for exclusive use of the land, which is our common inheritance, via a land value tax, most of this disparity of wealth between the generations would disappear and you would be able to see more clearly the much bigger disparity between the 1% who own so much and the rest of us.

82 Ben

Not final salary: money purchase and mostly my money over thirty years and more. Balancing the books is one thing but creating opportunity for the young costs very little and the return in enthusiasm is very infectious.

I am very used to cleaning up after the human elephants but it also makes me angry as it should be quite unnnecessary.

Paul Mason says tongue-in-cheek, could Lady Gaga do the job (IMF head honchess) just as well as 'professional' economists.

At a weekend wedding reception, I got chatting to a lady from Belgium.

She cheerfully told me that they have not had a Government for 18 months and the Belgian people are not missing it one bit.

Makes you wonder, does'nt it because there is a significant element of 'self-serving' in these large bureaucracies.

So, just how much would we English miss our Government if it went AWOL?

Very little, I suspect.

It doesn't matter who gets the top job at the IMF, in the words of Liam Byrne "I'm afraid there is no money."

The ECB is insolvent and can't print its way out, what happens when the IMF, the absolute lender of last resort runs out ?

We are probably going to find out in the not too distant future.


#85 JohnConstable wrote:

'So, just how much would we English miss our Government if it went AWOL?'

Our Government did go AWOL just after the last election whilst they carved up a coalition, the sky didn't fall in, the markets (and everybody else) went about their business (stability was the order of the day)

It was only when a Government (of sorts) was formed that the rickety rollercoaster of UK public finance resumed (in it's now entrenched downward path)


#Carol Wilcox

A land tax (on current Government spending) works out at an average of around £3 per sq mt per year (which seems fair enough)
Murray Rothbard didn't like it though, he saw all sorts of problems with implementing such a system.
How do you answer the critics of Land Tax ?

I notice that your 'new' blog remains empty and migration seems not to have taken place. Can we assume that you have taken on board the justified derision poured on the new system and decided to stay put or has auntie been caught napping?

@RobRocket

I'm afraid that £3 per sq m pa average is meaningless in view of the vast difference in values.

I don't have any interest in what 'modern libertarian' Murray Rothbard has to say about anything.

The recent review of taxation headed by Nobel laureate James Mirrlees gave clear support to LVT. The subsequent inquiry by the Treasury Select committee received a dozen or so submissions by LVT supporting groups but chose to hear verbal evidence, where the issue was raised in one query, from a group of accountants. Well if they aren't vested interests in the status quo... There's loads of evidence of the practical implementation of LVT on the web.

Further to my comment @ 85, I pressed the Belgian lad and said surely somebody is missing the AWOL Belgian Government?

She thought for a bit, then said well, the King of Belgium is a bit upset but the rest of us are just relieved not to have these politicians arguing and bickering all the time.

By default, Belgium leads the way to vanishingly small government.

threnodio_II @ 87

There are a legion of issues with the 'new' blog format, not the least being the apparent inability to track individual bloggers entries, as we can with this 'old' system.

Fundamentally, I suspect that the core reason why the new system is so poor is that they do not appear to have asked existing users for their comments and/or got them to beta-test it.

90 - JohnConstable

"Fundamentally, I suspect that the core reason why the new system is so poor is that they do not appear to have asked existing users . . "

Ask existing users? What do you think this is, a democracy?

Seriously, the new blog format stinks but the arrogance with which the BBC ignores and even moderates out the flood of protest beggars belief. As I have posted eleswhere everyone's favourite auntie has morphed into big brother and I have better things to with what's left of my life than play Kafka to their Goering.