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Robches, didn't take you long to become abusive did it?

I'm well grown up, spent a lifetime working internationally with major organisations and have seen more of the way a very few manipulate what the the majority have and get than any reasonable person would want to.

As I've said in this Forum before, the Euro is currently keeping the bad economies of the Eurozone afloat. I live in the Eurozone, in one of those countries and also have interests in the UK. Without the Euro, those countries would now be sunk - their governments know it and, as a poll in the Irish Times last weekend showed 70% of Irish voters know it.

You have obviously bought free market capitalism hook, line and sinker. That's your privilege, don't abuse someone with wide experience just because they don't agree with you. The system doesn't work, neither does a totally controlled economy.

The market works best, prices and employment are stable, when commodities are available at a standard, stable price and manufactured or processed goods are in competition based on quality. Economic history is littered with free market failures, artificial price hikes and shortages to maintain prices.

Without commodity price stability the world as a whole cannot advance.

Try selling your ideas to a native of sub Saharan Africa. Try it on with farmers in, say, Ireland who are currently producing milk and are seeing the price the market is willing to pay (currently 30 cent per litre) hit levels below the cost of production whilst the average price for two litres in the supermarket is ?1.85.

The fact is you and the rest of us are being ripped off when it comes to the basic necesities of life and, worse, people in the so called 3rd world are being deprived of those necessities because those who have power and money fully intend to keep it - supported by people like you.

By the way, I've spent time on commodity trading floors in London, Chicago, Paris and Frankfurt in the last 25 years. I also spent time on trading floors in London, Manchester and Paris prior to the 1980s. Business was done with a lot less yelling, a lot more thought and the instantaneous knee jerk reaction to rolling news tripping computerised systems into buying and selling frenzies didn't exist.

The previous ways of trading certainly ensured a greater level of stability - even in free markets and perhaps a lot could be gained by a return to a less frenzied way of trading.

'Men' amd 'women' were different 60 years ago but it was a far harder world for those less well off.'The good old days' it was not, for many inner city slum dwellers with life expectancy of about 55 years.

Mysteryman wrote:

> Robches, didn't take you long to become abusive did it?

Bloody hell, someone's sensitive today.



>
> As I've said in this Forum before, the Euro is currently
> keeping the bad economies of the Eurozone afloat. I live in
> the Eurozone, in one of those countries and also have interests
> in the UK. Without the Euro, those countries would now be sunk
> - their governments know it and, as a poll in the Irish Times
> last weekend showed 70% of Irish voters know it.

Well I disagree profoundly. The Euro is a noose round the neck of the PIGS. The fact that 70% of Irish voters believe otherwise is neither here nor there. The EU never cared what the Irish thought when they voted against Lisbon did they? The views of Ireland, or any of the other little countries, count for nothing in the EU. That's just the way it is.

>
> You have obviously bought free market capitalism hook, line and
> sinker. That's your privilege, don't abuse someone with wide
> experience just because they don't agree with you. The system
> doesn't work, neither does a totally controlled economy.

The free market systme is the best way of establishing prices. Any other way involves manipulation by governments or cartels. Neither is good. A free market system is not perfect, but it is self-correcting.

>
> The market works best, prices and employment are stable, when
> commodities are available at a standard, stable price and
> manufactured or processed goods are in competition based on
> quality. Economic history is littered with free market
> failures, artificial price hikes and shortages to maintain
> prices.

So if demand increases, what incentive is there for producers to go to the trouble of producing more, if all they can get is the "standard stable price" set by the wisdom of politicians?

>
> Without commodity price stability the world as a whole cannot
> advance.

So should oil still be $5 a barrel as it was in 1970? Not much incentive for anyone to look for new oil fields is there? This is madness. You seem to think some sort of godlike figures can set prices and all will be well. It has been tried loads of times all over the world. It simply never works in the long term.

>
> By the way, I've spent time on commodity trading floors in
> London, Chicago, Paris and Frankfurt in the last 25 years. I
> also spent time on trading floors in London, Manchester and
> Paris prior to the 1980s. Business was done with a lot less
> yelling, a lot more thought and the instantaneous knee jerk
> reaction to rolling news tripping computerised systems into
> buying and selling frenzies didn't exist.
>
> The previous ways of trading certainly ensured a greater level
> of stability - even in free markets and perhaps a lot could be
> gained by a return to a less frenzied way of trading.

Open outcry markets have always been pretty fremzied places. So what? A market is just a place where buyers and sellers come to establish the price of something, whether it's art or soybeans.

If the Iirish still had the Punt it would now be worthleass. The country is 90% dependant on imports for its everyday existence. Without the euro Ireland would now be in the same situation as Zimbabwe. I know that, the bulk of the population knows it, so does the government and so would you if you gave it a moment's thought.

The building bubble which has led to the problem here was not caused by low eurozone interest rates, it was caused by a massive reduction in interest rates across the world which led to totally stupid lending by banks to developers building housing estates in rural Ireland in an attempt to change the way housing had been built and sold.

Where in the countryside people had traditionally built their house on their parents' land, the developers built large estates as in the UK. For instance in my village (pop 285 in 1998) planning permission was granted for 1200 houses, potentially increasing the population to 5000.

No changes were planned to the infrastructure in terms of sewage, schools or road access. No thought was given to the fact that the area has been, even throughout the Celtic Tiger, an unemployment blackspot with only agriculture and tourism providing consistent employment.

580 houses were actually completed before the collapse. More than 30% were bought for rent and are now empty as the East Europeans went home and others returned to their parents' homes or moved abroad to Australia, New Zealand or the US to look for work on visa programmes or illegally.

Others are empty as they have been repossessed and there are 20 that have never been occupied plus a shopping complex which is nothing more than foundations and a few blocks, blighting the whole village.

The two developers are both bankrupt, owing the county a total of over ?5 million in development fees, leaving roadworks and lighting half completed and leaving piles of building materials, further blighting the village.

What they owe to the banks, who stupidly lent to them, has yet to be made public. The same banks lent the house buyers ever increasing amounts as the price bubble got bigger and bigger. The mortgage lending was up to five times income, often on 35 year mortgages.

The bankers and developers based their finance deals on a dream of ever increasing prices and years of income from interest on the loans.

They also built office blocks, many of which remain either unfinished or finished but empty. In the local county town an office block with penthouse accommodation was completed 4 years ago and has never seen a tenant.

The picture is the same throughout the 26 counties and in June it was estimated that over 50% of all mortgaged home in the country were in negative equity.

Companies enticed into the country with government grants have vanished once their initial agreements have come to an end. They have taken their factories to Eastern Europe and Asia leaving thousands without hope of a job. The unemployment rate nationally is around 13%.

Some of the deals between politicians, bankers and developers were nothing short of criminal - some charges have been made and will come to court - hopefully more will follow.

If the country had an independent Central Bank, it would now be being run by the IMF - just as Greece would not have survived independently without eurozone intervention.

The government has decided to save the banks, at whatever cost. The whole country - most of the inhabitants who have never done anything other than work and, where possible, save - is having to pay in reduced pay, increased taxes, massive job losses and reduction of essential services.

At the same time those who approved the loans, generated the myth of ever increasing national wealth and profitted by paying themselves massive salaries and bonuses, are being paid large amounts in severance pay when they are either forced to, or decide it would be better to, leave their positions. Worse, the bodies set up to manage the mess have appointed the bankers and politicians who got us in the mess to the boards that will run them.

As far as fixing commodity prices and exchange rates goes, please explain how the boom and bust cycle and the way commodities and currencies have been targetted to drive prices up to the benefit of the few has benefitted the average man in in the street in Manchester, Miami, Melbourne and Manila.

Moreso, how do speculative buying, hedge funds and market force price determination help the inhabitants of the favelhas of South America, the shanties of South Africa or the slums of the major cities of India.

What justification, moral or otherwise, can there be for a few people gaining millions in a short period through speculation, the end result of which is thousands are thrown out of work, economies are sent into free fall and people who have worked and saved all their lives see their savings devalued or even vanish overnight.

Read the history of 16 September 1992 and how George Soros made over $1billion in a day by short selling Sterling. The result was the UK economy went into a tail spin, thousands were thrown out of work, interest rates (thus mortgage rates and loan rates to business) hit 15%.

Whilst the ERM, from which Britain had to withdraw as a result, offered a modicum of exchange rate control, it proved easy for a speculator to break a currency and force withdrawal from the system - allowing the currency to float freely - to the benefit only of the speculator

What happened was the direct result of the lack of fixed rates and the ability for specultors to make a run on a currency to no-one's benefit but their own.

There have been periods when grain has been dumped in the sea to keep prices up, whilst millions starve. Where's the sense, the humanity or the morality in that?

As regards to oil, the new oilfields will cost more to explore, develop and run. The current oil price moving in the range of $70 - $85 is driven by fear of instability in the Middle East, the fact that the US has a strategic reserve it maintains as crude oil/refined oil and capped but certainly viable wells in the US, the emergence and needs of the BRIC nations, the winter weather in the northern hemisphere and by speculators betting on which of these factors will have a greater or lesser impact.

The cost of oil has an effect on the price of almost everything the developed world makes or uses.

Oil companies do not determine the price of crude - the markets and OPEC determine that. Oil companies make the majority of their profits from refining, wholesaling and retailing - exploration and extraction contracts are often on fixed price or a revenue and tax arrangement with governments. Oil companies often have to buy the oil they refine at market rates, even though they have extracted it themselves.


For instance crude in 1970, at $5 per barrel with a refining cost across all distilates of, say, $3 dollars a barrel would sell at an average rate of $12 per refined barrel - a profit of $4 per barrel.

$5 in 1970 is worth $28.13 as I write.

With crude at $80 per barrel and the $3 refining costs inflated to today's rate of $16.86, the refined barrel now sells at an average of $121.07 - a profit of $24.21 a refined barrel. In 1970 terms that is only an increase in profit of 30 cents per barrel. Thus the speculator and the governments concerned are making the real money.

The massive profits figures we see posted for the oil majors are due to the volume of refining, wholesaling and retailing rather than the price of crude.

Oil explorarion will continue, at whatever cost as, until viable replacements are found for the oil based materials we use everyday, the world cannot exist without it.

There are vast reserves still untapped off the African coast, off Brasil and even 30 miles from where I am in Ireland, though the government here has a policy of restricting exploration (ably supported by NIMBYs with green credentials) as it sees that in 20 - 30 years time its revenues will be boosted as the demand increases and the number of new fields decreases.

Mysteryman wrote:

> If the Iirish still had the Punt it would now be worthleass.

No, it would have fallen to reflect the state of the irish economy, which could then begin to recover. Then again, if Ireland had never been in the Euro, it would not have got into such a terrible situation in the first place.


>
> The building bubble which has led to the problem here was not
> caused by low eurozone interest rates, it was caused by a
> massive reduction in interest rates across the world which led
> to totally stupid lending by banks to developers building
> housing estates in rural Ireland in an attempt to change the
> way housing had been built and sold.

It's hardly a coincidence that the economies which are on the cross in the Eurozone are the PIGS. They have weak economies, and their currencies should be worth less than the German currency. The Euro effectively keeps them pegged to Germany, and as such they will never recover. Brtian had to leave the gold standard in 1931 because it was killing the economy. If the PIGS cannot leave the Euro, they will never recover. Ireland will revert to being an economic backwater whose main export is its people. Sad, but true.


> Some of the deals between politicians, bankers and developers
> were nothing short of criminal - some charges have been made
> and will come to court - hopefully more will follow.

I quite agree. Irish politics is very corrupt, and bastards like Charlie Haughey end up millionaires without any visible means of support. A lot of people will have made a lot of money out of this fiasco.



>
> As far as fixing commodity prices and exchange rates goes,
> please explain how the boom and bust cycle and the way
> commodities and currencies have been targetted to drive prices
> up to the benefit of the few has benefitted the average man in
> in the street in Manchester, Miami, Melbourne and Manila.

Al prices move in cycles. I'm not saying market forces are perfect, just that there is no better way of setting prices. Wherever governments step in and attempt to set prices, it always ends in chaos.


>
> Read the history of 16 September 1992 and how George Soros made
> over $1billion in a day by short selling Sterling. The result
> was the UK economy went into a tail spin, thousands were thrown
> out of work, interest rates (thus mortgage rates and loan rates
> to business) hit 15%.

The only reason Soros was able to make his money was that Sterling was in the ERM at a stupid rate against the Deutsche Mark. As ever when governments attempt to fix prices, it ended up in tears. At least Britain could get out of the ERM. Ireland seems locked into the Euro, and will suffer accordingly.

>
> Whilst the ERM, from which Britain had to withdraw as a result,
> offered a modicum of exchange rate control, it proved easy for
> a speculator to break a currency and force withdrawal from the
> system - allowing the currency to float freely - to the benefit
> only of the speculator

No, to the benefit of the British economy. The recovery proceeded once the UK was out of the ERM and could set appropriate interest rates (remember the Ken & Eddie Show?). That gave Labour the golden opportunity they had in 1997, which they fucked up over the next 13 years.


>
> There are vast reserves still untapped off the African coast,
> off Brasil and even 30 miles from where I am in Ireland, though
> the government here has a policy of restricting exploration
> (ably supported by NIMBYs with green credentials) as it sees
> that in 20 - 30 years time its revenues will be boosted as the
> demand increases and the number of new fields decreases.

I agree, but if governments or cartels were to keep the price of oil artificially low, then it would not be worth the while of oil companies to exploit these fields. That's the point.

The real point - and going back to the original theme of this thread - is that most of the people who control vast amounts of money and thus prices and supply are generally greedy and selfish.

The selfless get the odd pat on the back, are held up as exemplary beacons of hope and are feted by governments when it suits them but their efforts are only backed financially when it becomes an electoral neccessity or when a major organisation wants to look good.

The cyclical nature of economies is not driven by the wind, or the sun or the rotation of the earth. Natural disasters or good harvests do have some effect but the cycle is driven by speculation - it has been ever since wealth spread from the aristocracy to bankers, traders and the wider populace.

It doesn't have to be that way and deregulation has exacerbated the situation.

There are selfless people with mega millions - the world would be a better place if much of their money hadn't been made on the back of boom and bust.

I trust you read Ken Clarke's speech last night. For a Tory, who believes in the system he was very honest about the state of the world economy.

I don't know the real answer to the problems - it isn't found in any system so far tried - but one thing regulation and price control offers is stability and certainty - something the myriads of economists who are quick to say every situation the world's economy finds itself in is not quite right - really want.

Mysteryman wrote:

> The real point - and going back to the original theme of this
> thread - is that most of the people who control vast amounts of
> money and thus prices and supply are generally greedy and
> selfish.

Maybe they are greedy. So what? The point is they don't control prices, no-one does. A market is like a giant opinion poll of all participants. No-one controls it, otherwise it's not a true market.

>
> The cyclical nature of economies is not driven by the wind, or
> the sun or the rotation of the earth. Natural disasters or
> good harvests do have some effect but the cycle is driven by
> speculation - it has been ever since wealth spread from the
> aristocracy to bankers, traders and the wider populace.

A great deal of the boom bust cycle is driven by interest rates, which are of course set by central banks. That's the sort of system you seem to like, but it is fundamentally corrupt. Why should a central bank dictate the price of money? They don't try and dictate the price of bread and milk do they? Ireland is a prime example of a state brought to its knees by interest rate manipulation.



> I don't know the real answer to the problems - it isn't found
> in any system so far tried - but one thing regulation and price
> control offers is stability and certainty - something the
> myriads of economists who are quick to say every situation the
> world's economy finds itself in is not quite right - really
> want.

The stability of the grave perhaps. You have never tried to answer the question: who are these selfless godlike creatures who will set prices for the good of mankind? How will they do it? Price fixing has been tried over and over again by various governments. It never works. If companies do it, it's called a cartel, and that's illegal too. So what's your solution? It's no good moaning about free markets if you cannot come up with a better system.

I do not think that the calibre of men has altered much. Just look at the way our service people are getting on with it in Afghan. Army recruiting has not suffered as a result of media reports of casualties and is approximately as it was when I joined. I served in hot zones that were hardly reported but where squaddies and booties were paying the ultimate price. That is what isn't different from the chaps in WW2. They did it because they had to.Since 1964 all service personnel are vollunteers and again, I do not think they are any different from your uncle and his mates.
Fuck, when I was posted to Borneo I didn't know where the fuck it was, but I went because I had to. I didn't know much about Aden either,except from squaddies who served in the shithole.

Rodders,
can I ask why you joined up?
My uncle volunteered because there was obviously a need for him at the time .My father joined up just at the end of the war (para) and I have another 3 uncles who also joined up (all paras) at about the same time.
For most of them the war was still ongoing at the time they enlisted so I know they classed it as their "duty" to enlist.