Tuesday, September 30, 2008

A Somewhat Hairy Hiatus

I had thought to do this on a two or three day basis, but got called away to Washington to attend a number of meetings. Apologies. It appears that a number of financial chickens have come home to roost, and since I had managed to keep my little credits some distance away from my debits, certain economists and politicians wondered t just how I had accomplished this feat. Particularly at the multi-million level. A meeting of a number of key players was called, and I proceeded to address the meeting.

The address was not particularly well -received.

Perhaps this was because I began with that great economist Charles Dickens, who made the point, I believe in Bleak House, that if income was more than expenditure, the result was happiness. If income was exceeded by expenditure, the result was misery.

From the looks on faces, it appeared that misery was in full sway.

Well what do you expect? I mean, if you're going to offer $400,000 mortgages on houses worth $200,00, then bundle the deals together and sell the packages off in the form of debt that was unaccountably given an AAA rating in terms of eventual return, and then compound the whole mess by re-packaging in the form of swaps, debentures, derivatives or God knows what else, then eventually some institution somewhere is going to default, and suddenly everyone wants their cash back. Only it isn't there.

There is a name for this sort of thing. It is called a Ponzi Scheme, whereby a financial pyramid is created. Now as long as members keep joining, and throwing their money into the pot, those at the top of the pyramid cash in and do very well indeed. When the bottom frays, however, and the incoming funds dry up, the whole thing comes crashing down. And it is not pleasant -- just ask any Albanian.

So in America now, and since a number of global institutions also dove into these murky and dangerous waters, the debt crisis now has international legs.

In several papers, I had warned my financial colleagues that they were sailing in a very leaky ship, but these were laughed at or ignored. What hurt was a comment by one CEO: "Simone's a woman -- what does she know?" This from a twit that, had I a mind to, I could buy his bank out from under him in two hours. Stupid man. I take comfort in Schiller: "Against stupidity, the gods themselves rail in vain."

There is a way out, but that is for another day.

Wednesday, September 10, 2008

A Little Discussion With The Mayor

I can let you know that I've settled in nicely, having purchased a small holding in the north central area of town. Well, not that small -- one must have adequate,if austere, rooms for the servants -- but all in the household seem content. The grounds are not what I recall from my English ancestral home, but to find several acres of land in the middle of a city is not possible. Unless one purchases a park. I flirted with this idea for a time (there is a neat one in the West End) but decided I would put my financial resources to better purpose.

I have also taken time to review the governance of the city, and was appalled. Nothing would do but to have a discussion with the Mayor. This was easily arranged by one of my colleagues. All she did was to put into His Honour's tinted ear that a sizable campaign offering could be on the table if he could free himself from bicycle paths for a moment and enjoy lunch with the erstwhile contributor. That is, me.

His Honour accepted immediately.

Now the Greeks, having given up on mathematics and entered the restaurant business, run some superb places, and it was at just such a place that I met the Mayor, and over some fine moussaka and feta drizzled salad, aided by a vintage Retsina, we got along famously, even to the point that he allowed that I was one of the most attractive women he had encountered. Compliments are always welcome, and I was going to return the favour, but thought I would first raise some questions that needed some clarification.

"Would you agree, sir," I asked forthrightly, "that socialism is what makes capitalism bearable?"

"Absolutely," he replied. "If only some of my fellow councillors --"

"And would you further agree," I interrupted, " in the reverse of the medal?"


A blank look. Oh, oh. This is going to be a bit more difficult that I thought. But I persevered.

"Just flip the phrase. That is, if socialism makes capitalism bearable, then would not capitalism make socialism bearable?"

"Not really," he said. "The poor need our help. Capitalists don't."

Which was not an answer to the question, but now he was warming to his topic.

"You see, the city never has enough money. We have to obtain it through other levels of government, and our own revenue enhancers."

"Revenue enhancers?" I queried. "You mean taxes. But where on earth does the money come from that is to be taxed?"

"The term 'taxes' is misleading," he replied, a note of superiority in his voice, and again ignoring my question. "We at the Executive Council prefer the tern 'revenue enhancers.'"

"The Executive Council. What's that?" I said, fixing him with my eyes.

"Well, it's sort of a Cabinet. To work out, er, final details."

"The deliberations of this Executive thingy. Are they open to the public?"

"In a sense. When the policy is presented to the full Council."

"So it's a kind of Star Chamber."

His Honour looked at me, confusion in his eyes. "I don't know what you mean. Do you mean that we have our meetings in the offices of the newspaper, The Toronto Star?"

"No, my dear Mayor, I mean the Chamber dating back to Henry VII of England, a judicial body separate from the Privy Council, and later became more powerful than the Council under Charles I. There was a star painted on the ceiling in the palace at Westminster where the meetings were held. All was done in secrecy, and the illegality of the Chamber proved one of the reasons Charles lost his head. I think, Your Honour, with your Executive Council, you are treading on dangerous ground."

"I really must go," he said, "I'm already late for a meeting on traffic calming."

He rose, and hurriedly left the restaurant.

Oh, dear, I thought. Poor Toronto.

Sunday, September 7, 2008


So there I was, enjoying the sunlit afternoon at my rented villa on the Black Sea, when I heard a rumble in the courtyard. Closer inspection revealed a Russian tank , a T90 if I was not mistaken (and about such things, I rarely am). I made my way down to the courtyard and greeted the soldiers, who were busily scrambling out of their lumbering conveyance. Hoping that my Russian was up to it, I invited them in for tea. This took them somewhat by surprise, but after a brief discussion among themselves they followed me into the villa.

Over tea and scones, I learned that they were, Sherman like, going to march through Georgia. Apparently the powers that be in Tbilisi had seen fit to poke the Russian bear in the eye, always an ill-advised move. The tank crew had received orders to commandeer the villa and establish some sort of staging area, and I was asked to leave. The request was made politely -- I make a very good scone -- and besides, the owner of the villa, a clan leader with some 200 men at his command, would be perfectly capable of sorting the whole thing out. One way or the other.

And so I returned to North America, after a rather tortuous journey involving a hike through the Caucuses, and a grim trip through Bulgaria involving third class rail. But needs must, and from Sofia I could access my accounts, and arrange a flight from Sofia that eventually landed me in the leafy and somewhat socialist city of Toronto, where everyone was chattering about elections -- the Canadian (just announced) and the American (perpetual).

Before going into these elections, I want to take some time to adjust to the North American way of doing things before posting any deeper thoughts on the process. But I will say this. In Canada, it would appear that the Conservatives have a leader much more popular than his party, while the Liberals as a party are better received than their leader, even if aided and abetted by the Greens. And (this is a bit worrisome) the Socialist party, the NDP, appears to be making strides. There are other parties, but these serve more as background noise to the main event rather than having any chance to grab the brass ring.

America features a rather inexperienced but charismatic black contender, accompanied by a battle-hardened politico, against which we have another battle hardened veteran accompanied by an attractive, gun-toting paragon of Christian womanhood.

I rather suspect the American thing will trump the Canadian in terms of public interest, but we will see.

All for now, it's good to be back, and may all live long and prosper.