The End Of Britain:: The downward slide has begun


Britain is about to be flattened by a tidal wave of debt. It doesn’t matter if you vote Conservative, Liberal, Labour, UKIP – or for no party at all. The facts are the facts.

Let’s take a look at some numbers…

Two and a half years ago, when the Coalition government formed, we were already in a huge amount of debt. In fact, the previous government had left the country sinking under £700 billion’s worth. Take a look at the following chart:

UK_Public_Debt.jpg

Source: ukpublicspending.co.uk Read more of this post

Ontonix:: how to correct ratings (or how to stop the manipulation)


When war is just too “dangerous” for the financial masters of the universe (even when their political puppets crave it) i.e. when the bankers aren’t able to effectively bankroll both sides, or the outcome is likely to be detrimental to their ability to retain power in a post-critical landscape – NOTHING to do with the number of innocent victims – their most effective means of waging war is to manipulate global finance!

We have already seen the US pursue a high risk QE strategy, aimed at retaining the, once mighty, USD as the currency of international trade, despite the fact that the American economy is shot (sic). In the unlikely event that one of the Middle East powers had attempted such bully-boy tactics they’d have been, swiftly, sorted out. So perhaps us Europeans should be thankful that we aren’t perceived as such a threat!!?

Nobody pays for a sovereign rating. It comes for free, at an agencies discretion. So, while the agencies decide to favour some countries, they try to discredit others. Ratings have become instruments of politics and strategy, and also weapons in an economic war. The lower the rating, the more it costs a government to sell bonds as it must pay higher interests rates. A downward rating spiral may kill even the healthiest of economies…

What rating agencies do not take into account is the resilience (the opposite of fragility) of an economy. A company/country can perform well form  a purely financial perspective but still be fragile. This new aspect of business can easily be taken into account. The same balance sheet, income and cash flow statements can be used to compute the resilience of a company to measure the resilience of its business structure. Once you have the conventional PoD rating and the Resilience Rating™, which ranges from 0% to 100% (100% means the business is very resilient and stable, 0% it is dominated by chaos) you simply multiply the two to obtain a Corrected Rating:

Corrected Rating = PoD Rating X Resilience Rating

This is clear in the image below, which puts together the two

Ontonix – Complex Systems Management, Business Risk Management.

The Other Financial Crisis – Project Syndicate


The author is far better qualified than I to comment on the matter but I do believe I have a worthwhile, if not ‘contribution’ then, comment or question. Money is no more than a promise based upon the assumption of future economic growth. Is the enabler of innovations (driven by new thinking, collaboration and technology) required to fuel that growth but is constantly being devalued as a result of the current economic climate, so is in short supply: how do we expect to achieve the required growth? Doesn’t that make ideas and innovation a more bankable currency than conventional money? My conclusion: This IS an ‘Innovation Economy’ where ideas are worth more than money but will be left to whither on the vine without it!

Proper access to credit for productive segments is an integral part of a well-functioning economy. Without it, growth falters, job creation is insufficient, and widening income and wealth inequality undermines the social fabric. That is why any comprehensive approach to restoring the advanced countries’ economic and financial vibrancy must target the proper revival of private credit flows.

http://www.project-syndicate.org/commentary/advanced-countries–private-credit-crunch-by-mohamed-a–el-erian

Economic resilience for Scotland requires INTERdependence


I don’t wish to engage in or contribute to THE political debate on how the interests of our nation are best-served! No offence to Salmond or Lamont  but, rather than listen to them, I would defer to some “older wisdom”…no not Ming Campbell:

“To put the world right in order, we must first put the nation in order; to put the nation in order, we must first put the family in order; to put the family in order, we must first cultivate our personal life; we must first set our hearts right.”

Confucius

Apart from cultivating greater personal understanding of how WE can contribute to a better Scottish society, our greatest challenge is how to (re)build financial resilience: create a sustainable economy and undo the damage done to our finances, our hard-earned reputation for economic thinking, innovation and business leadership. Read more of this post

Economic madness:: way to go Sir David Attenborough!


‎"Anyone who believes in indefinite growth on a physically finite planet is either mad, or an economist."

-David Attenborough, 2011 speech to the RSA

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