But Kevin Rudd is missing it. He ought to have grabbed it with both hands. Something other than the levers of power and let what would be, BE.
After being silenced by every method known to man, and every subsidy under the sun the market was finally allowed to speak. When the market finally was allowed to speak, the market pronounced these banking bigshots a bunch of bums and the market WOULD HAVE SENT THEM ONTO THE STREET to sniff around looking for the short pants jobs.
Now Rudds talking about limiting the bigshots salaries. But thats pissweak. Since the market was about to limit their salaries to zero. Which would have saved the rest of us money every day from here on in and forever.
Its rubbish anyhow. What can he do to limit their salaries? He and the banking bigshots belong to the same overarching racket, and it seems these days that Rudds wing is the juniour partner.
Once we know that we can use monetization of debt combined with adjustments upwards to the reserve asset ratio to keep aggregate demand (as best measured by Reismans “Gross Domestic Revenue”) stable, …..
………once we know that we don’t need the banks co-operation in order to keep spending stable…….then we know that we are fine letting all these misallocators of scarce investment resources, deal with the avenging market on their own. Let them face the market on their own after the ponzi-racket dies. This is no skin of our noses. We have nothing to lose but our crap excuse for capital markets. And we have much debts to pay down.
Since a determined committment to raise reserve asset ratios and add cash means that its doable to trash most regulation, if the banks faced horrible losses, and they would, its just a matter of them selling off one branch at a time, to employees or former holders of government debt ,or anyone who thinks they might like to take a lash at the non-fractional reserve banking caper.
ALLOCATION OF RESOURCES WITH AND WITHOUT BANKS.
The default position for the allocation of resources without banks is a very good one. Its sets a very high bar for the banks to jump over. Resources are allocated in accordance with cash flow. A higher cash-flow leads to greater opportunity for capital formation.
So if this is very good and just resource allocation what do we need the banks for? The answer is that we don’t need them. They create no new resources. Their ponzi-schemes disturb the price system. And since the allocation of resources is very good before they even show up on the scene we better not be tolerating them doing a bad job of it.
This is why if they are not borrowing strictly from savings and lending for wealth creation than we are far better off without them. So lets get rid of this notion that we need these guys to be lending since it does not accord with the facts.
Here is Steve Edney’s explanation of why the big welfare queens are paid so much:
Its pretty obvious that the whole thing is a political sop to soften up the general public who are now underwriting private sector profits.
It has nothing to do with Economics, or I think Kevin Rudd’s sense of sociual justice and everything to do with sending out the right signals to the electorate.
The problem with saying no one is worth $20 mill, is that the $20 mill isn’t paid just for the CEOs labour but to motivate workers all the way down.
Steep pay increases as you rise the rung of the corporate ladder (culminating in huge CEO salaries) serve to motivate the people below to work rather than the people receiving them. I work hard not because I am paid well but because I want to jump to the next level where I get paid more. The steeper the slope of salary increases the more the underlings will try to climb the ladder.”
You idiot Edney. This is a government supported and subsidised counterfeiting racket that buggers with our pricing and resource allocation system. And they get paid so much since they are simply crooks divying up the loot.
They do not EARN the money. You want to see these guys earn their money let them simply learn to live within their interest-rate-spread. We all know that this attempt would have them out on the streets in a matter of weeks.
Your bosses are welfare queens Edney. They more than anyone else are responsible for our trade deficits, for allocating our scarce investment resources to land inflation, rather than small business expansion. They are a bunch of failures and clowns who ought now be out of work. Its not just the bailout that is a subsidy. Its constant, month in month out behaviour. The harder they work the more damage they are doing. They don’t know the first thing about banking (properly considered) rather they are ponzi-specialists. And you cannot be both.
Which one of your bosses, Edney, specialises in small business expansion, with the help of only depositers money. Thats bullshit. None of them. You people call yourself managers and credit analysts but its all credit and no analysis. This is why you turned left-wing Edney. Some part of you saw that where you were the alleged private sector wasn’t doing anything worthy.
If we had let the market speak and let these clowns all keel over than maybe you and a couple of others could have bought a branch and done some real banking for a change. Some real wealth creation. But it was not to be. Once welfare queens always welfare queens.
We ought to start developing proper banking and the software to support it. But this cannot be done while these pretenders and counter-productive know-nothings are getting subsidised to continue to bugger things up for the rest of us.