*** FUTURE POSTS WILL ALSO APPEAR AT 'NOW AND NEXT' : https://rolfnorfolk.substack.com
Monday, March 28, 2011
Sunday, March 27, 2011
The Most Evil Bank Scheme Ever
Wrong. Just like the Oklahoma Land Rush of 1893, who gets there first wins all. This is why those in the FIRE economy have taken over.
But you know, they are small thinkers, all of them, even the billionaires. What they've done so far is like building a faulty nuclear reactor; what they could do is like dropping the H-bomb.
Here's the scenario:
1. Two new banks are created - let's call them Orcbank and Trollbank. No branches - don't need them if you don't deal direct with the public. The problem with the housing bubble is the people. They have to be missold mortgages and then have to keep up the ridiculous payments while their equity tanks. Far too messy.
2. The Federal Government borrows a scad of money from the Federal Reserve - it doesn't matter how much, because the FR makes it up out of nothing anyway (watch Glenn Beck's recent crisp summation of the Fed's history).
3. This money is divided into two equal parts and deposited interest-free in Orcbank and Trollbank.
4. Orcbank lends whatever is the legal (who makes the laws?) maximum multiple of its deposit, to Trollbank; Trollbank does the same for Orcbank.
5. Then the banks go shopping. They go to all other banks, plus Fannie Mae and Freddie Mac, buying up any residential property that is now worth less than its mortgage. Not at phony book value valuations: the real, disaster-filled forced-sale valuations. Many billions, maybe trillions of dollars'-worth. And Orcbank and Trollbank buy the lot, for the full value of the debt, cash on the nail.
6. You now have two monster insolvent banks. Oh, dear.
7. No, you don't. You merge Trollbank with Orcbank, forming the new First Bank of Mordor. And poof! the debt disappears, every last cent of it. All the assets (mortgages) and liabilities (money loaned out) on one are exactly the same as, and counterbalanced by, the other. Matter meets antimatter; mutual annihilation of all assets and liabilities.
8. What's left? The deposits, which are returned to the Federal Reserve via the Government. The interest? We'll come to that shortly.
9. Oh, and there's the not-so-little matter of free-and-clear ownership of gigantic quantities of residential real estate. First Bank of Mordor, wishing to have nothing to do with such a tedious and messy business as moneylending, deregisters as a bank and becomes the Sauron Real Estate Trust. Sauron can rent out property at whatever rates it likes, whatever the market will bear - having no debts, everything after maintenance and repairs is profit.
10. Sorry, that should read "everything after maintenance, repairs and management costs" is profit. In fact, you don't want to make a profit: you just want to pay everyone who's in on the scam. No pesky shareholders, please, so no dividends. If the Fed can be a private company and own America's government, Sauron can be a private company and own America's real estate.
All it needs is the OK, and there's a small enough number of people to see right about their doubtless and naturally very large and absolutely confidential though never defined ongoing expenses, if they're willing to take the money. And the Fed will need some interest for the money it loaned for that short period of time; plus I guess a few billion in administrative fees. Who cares? It's only money.
Upside? Some very happy people in blue suits who just relocated to the Caribbean or that island Scaramanga fitted out so luxuriously. Insolvent banks bailed out - and you can always rinse 'n' repeat if you didn't do enough the first time round (by the way, there's always the commercial real estate bubble to rescue, too).
Downside? Joe Average pays rent forever. But there's not that many properties he can buy instead of renting. In fact, you may just have turned a bubble into an incredible shortage and so up go valuations again. After all, they're not making any more land. Who knows, when the price is right Sauron may start selling tranches of real estate, just to ease the market.
And if Joe Average doesn't like it? What do you think you've got police, Army and the National Guard for?
No, surely they wouldn't do it. Surely you'd never get this past enough legislators and regulators to make it stick. But I'm telling you this idea publicly, just in case it's already been germinating in someone else's twisted little head. That's what you pay quants, lawyers and accountants for - crooked schemes to steal from the people.
This is the potential of fractional reserve banking, governments that lend free money, crony capitalism and the secret magic of the Federal Reserve. They'd have to dress it up as rescuing the system and the people; you know, being responsible managers of the economy.
All they have to do is dare. And look what they dare to do already.
Saturday, March 26, 2011
New Smart Bomb
Many bulk orders were found on the partly-completed forms found among the wreckage of the spectator stand. Claiming "it finally puts the 'eth' in 'lethal'", a spokesman for the manufacturer said that subsequent tests would be carried out in strikes on Libyan armoured columns.
Breaking News
Elsewhere in the capital, over 200,000 people have been marching in protest against something, but nobody has noticed.
Wednesday, March 23, 2011
Index-linked savings to return!
But there is a sales target (£2 billion) and then quite possibly NS&I will shut up shop again, as they did last year. So it's likely that these will fly out very fast and you should be on the lookout for the launch - click here to get email updates from NS&I.
INVESTMENT DISCLOSURE: None. Still in cash, and missing all those day-trading opportunities.DISCLAIMER: Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog.
Tuesday, March 22, 2011
Galgenhumor
"I wish my lawn was EMO so it would cut itself."
"The EU has no power over Parliament" - British MP
People also get confused between the EU and the Council of Europe."
Rt Hon John Hemming MP to Mr Rolf Norfolk, emailed 22 March 2011
In view of this, be prepared to challenge any Minister who claims that something is so and cannot be changed, because of European legislation. The struggle is between the people and their supposed representatives in Parliament.
Monday, March 21, 2011
More drivel, and getting more dangerous
"It remains puzzling why David Cameron, with so much unresolved in meeting the huge challenge of remaking Britain, has chosen to take the risk of leading the way into Libya.
"His boldness in an honourable and moral cause is indisputable. Now that British forces are engaged, we can only pray for their success, and hope that the crusade to remove a wicked despot from power ends as happily as do the best fairy stories."
Elsewhere in the (recent) news: "Why we should do nothing about Colonel Gaddafi", by Max Hastings.
Sunday, March 13, 2011
It begins
How interesting that businessman-turned-professional-investor Karl Denninger should host a YouTube video by a subversive group that intends to mount cyberattacks on "The Machine"; a video that concludes with the soundtrack of Mario Savio's 1964 sit-down protest "put your bodies upon the gears" speech at the University of Berkeley, California.
And now that speech no longer sounds like merely the effusion of youthful testosterone, the power-ambition of spoiled adolescence; it begins to sounds reasonable, even to an older, cynical man like me, who never bought into revolution even as a student. It begins to sound like the only, desperate chance.
In that beginning are the seeds of a bigger beginning.
New Con-LibDem pact?
Saturday, March 12, 2011
Linguistic survival
Friday, March 11, 2011
A seed crystal of suspicion
But I'm more interested in the presence of a British spy on a remote farm in the desert 30 miles south of Benghazi, ready-placed to rendezvous with them six months before they arrived - and three months before even the unrest in Tunisia had begun.
Wisconsin News
Breaking news: Wisconsin has immediate openings for 250,000 serfs. Must provide own smock.
Tuesday, March 08, 2011
Extrapolation
After that, it'll have to be cheques.
I think I have discovered in Nature an economic model for our times.
Overentitled scribbler juggles smoking petard
Just wait until the age of the death of deference turns its attention to you, you po-faced toerag.
I have also submitted this as a comment to Mr Hastings' article; I am not hopeful that it will be allowed through by the flappers.
Monday, March 07, 2011
Bartender update
Sunday, February 27, 2011
'Global Credit Warfare': China Preparing for a Treasury Bond Sell-Off?
INVESTMENT DISCLOSURE: None. Still in cash, and missing all those day-trading opportunities.DISCLAIMER: Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog.
Friday, February 18, 2011
People are a problem
This puts pressure on students.
The US education system (and the English one for the past 30 years) is inclusive. Very little expense or effort is spared to have every student reach their 'full potential'.
This puts pressure on the teachers and the rest of the system.
The US and English systems should be producing a better 'yield' of the STEM (Science, technology, engineering and mathematics) people that we need, yet they are not.
A possible reason is above.
Saturday, February 12, 2011
Could the Dow hit 4,500?
INVESTMENT DISCLOSURE: None. Still in cash, and missing all those day-trading opportunities.DISCLAIMER: Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog.
Thursday, February 10, 2011
Mathematics Education
Below is an edited version of an email which I sent to a colleague in our college of education.
I am also rather distressed by your comment:
"A PhD is a terminal degree which means we are capable of self-teaching material we are unfamiliar with".
I know a great deal of mathematics, computer science, statistics, engineering and physics. I would still have much trouble teaching something like Abstract Algebra, and I have had several courses in the subject. It's not all 'just math'.
The problem, which is very close to that of our meeting today, is that mathematics is one of the most tiered subjects there is. As one of my administrative superiors told me, many subjects have an 'Intro' course, after which one can take any number of courses. This just isn't true for our discipline, until about the senior level. That is why we take the issue of prerequisites and previous material so seriously.
It is also upsetting to experts in other fields (especially education) that success at one level of mathematics is no guarantee that one will ever succeed at higher levels. A previous administrative superior couldn't understand it at all, which is one of the reasons why he publically stated that learning algebra was unnecessary 'for anyone'.
In (not so) short, this is why I take the problem of training future mathematics and science teachers so seriously. With all too many school administrators having the idea (as another administrative superior told me) that 'anyone can teach math', no wonder that we have the problems that we do.
I have been party to many discussions on mathematics education on usenet and elsewhere. Every single time, my honorable opponent criticizes how the subject is taught. They then either offer no ideas at all, or ones which have already been shown to fail elsewhere.
Ponder this: Mathematics has been taught as a discipline in its own right for about 2,500 years. The subject itself lends itself to brutal editing and revision, so that only the most robust facts and proofs survive. Given those millions of man-years of developing and teaching the subject, isn't it reasonable to suppose that we are doing some of it correctly, or at least we might know better than outsiders?