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Titolo: 'There will be blood': ci sarà sangue! Fosche previsioni sulla crisi

'There will be blood'
Harvard financial guru Niall Ferguson predicts prolonged financial hardship,
even civil war, before the ‘Great Recession' ends
 
Globe and Mail Update
February 23, 2009 at 6:45 PM EST
Harvard author and financial crisis guru Niall Ferguson has landed with a
thud in Ottawa, spreading messages that could make even the most confident
policy makers squirm.
The global crisis is far from over, has only just begun, and Canada is no
exception, Mr. Ferguson said in an interview before delivering a
presentation to public-policy think tank, Canada 2020.
Policy makers and forecasters who see a recovery next year are probably
lying to boost public confidence, he said. And the crisis will eventually
provoke political conflict, albeit not on the scale of a world war, but
violent all the same.
“There will be blood.”
 The Buy America penchant pushed by the U.S. Congress in passing the recent
stimulus bill was only the tip of the iceberg.
Abu Dhabi buying Nova Chemicals at bargain-basement prices on Monday is a
sign of things to come, with financial power quickly being transferred over
to the world's creditors – namely sovereign wealth funds – and away from the
world's debtors.
And much of today's mess is the fault of central bankers who targeted
consumer-price inflation but purposefully turned a blind eye to asset
inflation.
The Laurence A. Tisch professor of history at Harvard University, and author
of The Ascent of Money, A Financial History of the World, sat down with The
Globe and Mail's economics reporter, Heather Scoffield.
Heather Scoffield: Canadian leaders frequently argue that Canada is in
better financial shape than elsewhere in the world, and therefore should
fare better during this crisis. Do you agree?
Niall Ferguson: Canada is [considered] a winner because its banks are less
leveraged, bank regulation here has been tighter, because its housing market
hasn't been in a bubble quite the same way. It's tempting to conclude from
that ... that Canada will be less hard hit in the crisis than the United
States. But that is unfortunately wrong. Because this is a very unfair
crisis. The epicentre is the United States, but the rest of the world, and
particularly America's trading partners, will get hit harder than the U.S.”
“It suggests virtue is its own reward. You don't get any reward beyond the
self-satisfaction of having been virtuous. This is a crisis of
globalization. Therefore, the more an economy depends on the global system,
the harder it hurts. Canada is not finding the worst. Asian economies are
going to be really slammed this year. But it's an unfair world. The U.S.
won't be as badly affected as most countries.”
Heather Scoffield: Is the U.S. able to escape with less pain because it has
more resources to throw at its problems?
Niall Ferguson: “Partly because they can throw so much at it, and they can
do it at a lower cost than anybody else, because the U.S. retains the
safe-haven status, which makes the world so unfair. Here is the world's
biggest economy, which gave us subprime mortgages, rampant securitization,
the collateralized debt obligation, Lehmann Brothers, Merrill Lynch. It is,
in a sense, the fons et origo of this crisis. And yet, because it retains
safe-haven status, in a global crisis, investors want to increase their
exposure to the U.S. Hence, the dollar rally. Hence 10-year Treasuries down
below 3 per cent yields. It's almost paradoxical that an American crisis ...
reinforces the status of the United States as a safe haven.”
Heather Scoffield: Surely that safe-haven status would be revoked if China
loses faith in the U.S. ability to finance its debt?
Niall Ferguson: As you know, Chimerica – the fusion of China and America –
is one of my big ideas. It's really the key to how the global financial
system works, and has been now for about a decade. At the end of The Ascent
of Money, I speculate about whether or not that relationship will survive.
If it breaks down, then all bets are off, for the U.S. and indeed for Asia.
I think that's really the key point. Both sides stand to lose from a
breakdown of Chimerica, which is why both sides are affirming a commitment
to it.”
“It's very interesting that the Chinese in the last week were saying such
soothing things around the [Secretary of State Hillary] Clinton visit. This
was only days after Treasury Secretary Tim Geithner used the dreaded ‘m'
word – currency manipulation.
Heather Scoffield: Why would the U.S. administration poke a stick in China's
eye like that?
Niall Ferguson: “You obviously have to recognize that Democrats have been
more hawkish on China for some time, than the Republicans ... But I think
Tim Geithner is smart enough to know that this is a very dangerous game to
play and I would be very surprised if you heard that word again pass his
lips.”
Heather Scoffield: Did the Clinton visit improve the China-U.S.
relationship?
Niall Ferguson: It looks like it....The line is very clear from China.
They've consistently made their position clear. They want the status quo.
They do not want this thing to break down. They were kind of appalled when
Geithner said the ‘m' word. And they took full advantage of Hillary
Clinton's visit to smooth ruffled feathers and restate their commitment.
It's a very good bilateral relation. That bilateral will is important here.
The Chinese believe in Chimerica maybe even more than Americans do.
“They have nowhere else to go. They have no other strategy that they can
adopt in time to cushion the blow. Their exports are contracting at a
terrifying speed. They want at all costs to avoid any kind of big shift in
policy. They want to keep, as far as possible, the U.S. importing Chinese
goods. They want to keep currencies stable. They are still buying dollars …
At least officially, Chimerica is intact. But I stress ‘officially' because
there's considerable public disquiet.”
“This is a crisis of globalizaiton that is destroying global trade. This
poses the biggest challenge that the Chinese administration has faced since
they embarked on reforms 30 years ago.
Heather Scoffield: Will globalization survive this crisis?
Niall Ferguson: It's a question that's well worth asking. Because when you
look at the way trade has collapsed in the world in the last quarter of 2008
– countries like Taiwan saw their exports fall 45 per cent – that is a
depression-style contraction, and we're in quite early stages of the game at
this point. This is before the shock has really played out politically.
Before protectionist slogans have really established themselves in the
public debate. Buy America is the beginning of something I think we'll see a
lot more of. So I think there's a real danger that globalization could
unravel.
Part of the point I've been making for years is that it's a fragile system.
It broke down once before. The last time we globalized the world economy
this way, pre-1914, it only took a war to cause the whole thing to come
crashing down. Now we're showing that we can do it without a war. You can
cause globalization to disintegrate just by inflating a housing bubble,
bursting it, and watching the financial chain reaction unfold.”
Heather Scoffield: Is a violent resolution to this crisis inevitable?
Niall Ferguson: “There will be blood, in the sense that a crisis of this
magnitude is bound to increase political as well as economic [conflict]. It
is bound to destabilize some countries. It will cause civil wars to break
out, that have been dormant. It will topple governments that were moderate
and bring in governments that are extreme. These things are pretty
predictable. The question is whether the general destabilization, the return
of, if you like, political risk, ultimately leads to something really big in
the realm of geopolitics. That seems a less certain outcome. We've already
talked about why China and the United States are in an embrace they don't
dare end. If Russia is looking for trouble the way Mr. Putin seems to be, I
still have some doubt as to whether it can really make this trouble, because
of the weakness of the Russian economy. It's hard to imagine Russia invading
Ukraine without weakening its economic plight. They're desperately trying to
prevent the ruble from falling off a cliff. They're spending all their
reserves to prop it up. It's hardly going to help if they do another
Georgia.”
“I was more struck Putin's bluster than his potential to bite, when he spoke
at Davos. But he made a really good point, which I keep coming back to. In
his speech, he said crises like this will encourage governments to engage in
foreign policy aggression. I don't think he was talking about himself, but
he might have been. It's true, one of the things historically that we see,
and also when we go back to 30s, but also to the depressions 1870s and
19980s, weak regimes will often resort to a more aggressive foreign policy,
to try to bolster their position. It's legitimacy that you can gain without
economic disparity – playing the nationalist card. I wouldn't be surprised
to see some of that in the year ahead.
It's just that I don't see it producing anything comparable with 1914 or
1939. It's kind of hard to envisage a world war. Even when most pessimistic,
I struggle to see how that would work, because the U.S., for all its
difficulties in the financial world, is so overwhelmingly dominant in the
military world.”
Heather Scoffield: You speak about the crisis being in its early days, but
most policy makers and the International Monetary Fund are predicting a
quick end to it. Where do you differ with them?
Niall Ferguson: “I do think they're wrong. I think the IMF has been
consistently wrong in its projections year after year. Most projections are
wrong, because they're based on models that don't really correspond to the
real world. If anything good comes of crisis, I hope it will be to discredit
these ridiculous models that people rely on, and a return to something more
like a historical understanding about the way the world works.”
“I mean most of these models, including, I'm told, the one that policy
makers here use, don't really have enough data to be illuminating … You're
going to end up assuming that this recession is going to end up like other
recessions, and the other recessions didn't last that long, so this one
won't last so long. But of course this isn't a recession. This is something
really quite different in character from anything we've experienced in the
postwar era. That's why these projections give positive numbers for 2010.
That's the default setting. And it just seems to me ostrich-like, to bury
one's head in the sand and assume this has to end this year because, well,
that's what recessions do.
“It's obvious, surely we know by now, that this is something quite
different. It's a crisis of excessive debt, the deleveraging process has
barely begun, the U.S. consumers are not going to suddenly bounce back and
hit the shopping malls just because they get a tax cut. The savings rate is
going to continue to rise. These processes have tremendous momentum that
quite clearly differentiates them from anything that we've seen, including
the early 80s, including 73, 74, 75. Those big crises, the ones that we have
lived through, were bad. But seems certain to be deeper, and more
protracted.”
Heather Scoffield: Forecasters say they can adjust their projections as
things change, but households, companies and governments are basing their
decisions today on what the experts tell them to expect in the future. So
how should decisions be made if the forecasts are wrong?
Niall Ferguson: “One possibility is that they don't believe these numbers
either. They feel that it's good for morale. The truth about the crisis is
that it is in large measure psychological. We're not dealing here with
mathematics. We're not dealing here with human beings as calculating
machines. We're dealing with real people whose emotions influence their
individual decisions, and the swing from greed to fear is a very spectacular
thing when it happens on this scale.
“One possibility is that policy makers are lying in order to encourage
people and prevent depression from become a self-fulfilling psychological
conditions. That's why it's called a depression … Maybe they don't really
believe this, but they're saying it in order to cheer people up, and if
they're sufficiently consistent, perhaps people will start to believe it,
and then it will magically happen.”
“The other way of looking at that is to say every time a politician uses a
word like ‘catastrophe' or ‘depression' to pressurize legislators into
passing a stimulus package, for example, the signal goes out to the public
that this is bad. And it gets worse. That's one of the interesting things
that both President Bush and President Obama have done. Bush used that
wonderful phrase, “this sucker's going down.” Obama talks about catastrophe
at the critical moment when he wanted Congress to pass the package. It
reminds me of a wonderful headline that the Onion had last year, in about
October. The headline was, Bush calls for panic. I love it because it
completely called the situation. There he was calling for panic ... to make
people come out of denial. I've been talking a while about this being the
Great Repression. It took ages, ages, for people to realize this thing had
fallen apart.
“August, 2007, was when this crisis began. And if you were really watching
the markets carefully, April is when it began, when the various hedge funds
started to hemorrhage. The stock markets carried on until October of that
year. And in many ways, consumer behaviour in the U.S. did not change until
the third quarter of 2008. So there was a massive denial problem. It was
like Wylie Coyote running off a cliff, and they'd run off a cliff and they
didn't look down so they didn't start falling. As soon as people realized it
was bad, the behaviour switched. Now, people have to try to unscare them
before this thing becomes a self-perpetuating downward spiral. I think
that's why you have to say ‘growth will return in 2010' with your fingers
crossed behind your back.”
Heather Scoffield: Will property ownership continue to be central to our
economy's functioning?
Niall Ferguson: Property ownership is something that our societies,
particularly English-speaking societies, seem to be drawn towards. The
notion that the majority of people should own their own homes dated from the
30s. It didn't really become a reality until the 50s. We've sort of pushed
the home ownership rate up to what seems to be its maximum, and beyond. It
will clearly come down. The lesson of the subprime crisis is that you
shouldn't give mortgages to people who can't afford them. Duh …
I don't think we're going to see a radical shift back to the rental society
of the pre-Second World War era. That sort of exists in Germany. Germany has
had none of this. German households are less indebted now than they were 20
years ago. The property ownership rate, if anything, has been completely
stable. Why the English-speaking world has this fixation is kind of
interesting and hard to explain. That Englishman home-is-his-castle
mentality. We privilege this asset class. And in the U.S., the tax code
privileges this asset class to take out mortgages and invest in property. I
think that's a mistake. I'd like to see us at least achieve fiscal
neutrality, so that different kinds of investments are treated the same. But
even if we do that, Canada doesn't have mortgage interest relief, and the
home ownership rate is the same as the U.S.”
Heather Scoffield: Abu Dhabi has just bought Nova Chemical because the
company couldn't get credit. Is this the way of the future?
Niall Ferguson: “There are some fantastic investment opportunities that
pretty soon are going to start attracting buyers. The returns on the
super-safe, highly-liquid U.S. Treasury portfolios are next to nothing. The
potential returns from buying distressed assets or from buying companies
that can't roll over their debt, are double digit. So any individual
institution liquid enough and not leveraged can start playing this game, and
will play this game. This is going to be the beginning of a whole new
investment strategy in which companies that can't roll their debt over end
up being sold at bargain basement prices, or broken up and their assets sold
at bargain-basement prices, in very, very large numbers. And it doesn't take
a lot of imagination to see that the buyers will be sovereign wealth funds
or other entities in surplus countries. The world divides in two, the
debtors and the creditors. The debtors … (U.S., Europe) ... are going to
have to sell of their assets. Call it the global foreclosure. They're going
to be selling their assets cheaply to those who have the surpluses. This is
not going to be like the Chinese buying Blackstone at the top of the market.
“It's revenge of the sovereign wealth funds. They got burned. And this time,
no more Mr. Nice Guy.”
Heather Scoffield: Does the fixing of one bubble create another?
Niall Ferguson: “We kind of have had a bubble in the sense that we've seen
such a rally in U.S. government bonds. It's tempting to say that will burst
and we'll see yields go back up. Because, you know, $2-trillion worth of
debt is going to hit the market this year, maybe more. Supply is exploding
just when demand is contracting. You don't need to be a Nobel laureate to
see that that has to impact on the price. The difference is there is this
thing called the Fed that can step in and start buying the stuff if the
foreign demand fades. So it's not completely guaranteed that we'll see bonds
sell off in price.
“There is still this inertia that prevents the dollar from falling off a
cliff, that keeps the Treasury market from falling off a cliff. That's
really important to bear in mind. I don't think we'll see a bubble
distressed assets, because I think the price of these assets has started to
fall. Anybody who comes into the market now is essentially paying a premium.
There will be better bargains in the middle of this year, and maybe even
better bargains later on. If I were in the market to buy distressed assets,
I would wait, I would wait a bit longer until they're really desperate. And
it might even be better to wait until they're bankrupt.”
Heather Scoffield: You've written that many financial crises are the result
of excesses due to a belief that governments will bail out the financial
sector. Do we need to get rid of this moral hazard through tighter
regulations?
Niall Ferguson: “In the Ascent of Money, I argue that you can't really have
a bubble if you don't have a monetary authority that has been excessively
generous. From John Law in 1719 to Alan Greenspan in the late 90s, there's
always a banker, there's always a central banker making credit too readily
available. The second thing is, though, that regulation may not prevent
that.”
“Monetary policy evolved in a peculiar way in the 1990s towards de facto or
de jure targeting of inflation, an increasingly narrow concept of inflation
– core CPI. I thought it was a mistake at the time because it seemed to me
crazy to ignore asset prices. Why differentiate? What's the difference
between pricing a loaf and pricing a house? Why do we care about one and not
the other? In fact, we should probably care more about the price of a house
than the price of a loaf, certainly in developed societies. I think there
was a flaw in the theory there, that essentially you could call the Jackson
Hole consensus. When the central bankers got together at Jackson Hole, the
view that emerged from the debate in the late 90s was, we shouldn't really
pay attention to asset prices in the setting of monetary policy.”
Heather Scoffield: And more regulation?
Niall Ferguson: “European banks are far more leveraged than American banks.
I don't see Europe as offering up any particularly good model in any
respect. In fact, I think Europe's prospects could get a whole lot worse
this year, to the extent that it could be very, very hard indeed to keep the
Euro zone together. I think it will be possible because the costs of leaving
will be so high.
“There will be howling anguish, all kinds of pain, conflict between Germans
and the others. It's going to get very uncomfortable indeed. No, I wouldn't
look to Europe for inspiration. You could, I guess, look at Spain...
“I definitely think some type of tighter regulation of banking capital
adequacy is needed. Basil I and Basil II have not worked. In many ways,
they're the great failures. I think Canada's somewhat straightforward,
mechanical definition looks like one the rest of the world should be
adopting.”
Heather Scoffield: You mentioned that the Buy America tendencies of Congress
are probably only the beginning of protectionism. What do you mean by that?
Niall Ferguson: “No administration with Larry Summers in the White House is
going to be a protectionist administration. Here's a man whose commitment to
free trade and free capital movements nobody doubts. And I don't see the
President following through to renegotiate NAFTA or the things he said in
the past. But one of the things that I find troubling about the
administration is the degree to which is has ceded power to Congress. It's
almost like it's a parliamentary system.”
[I was in Washington last week for the passage of the stimulus package]. “I
felt a strange sense of familiarity in the air. Usually Washington feels
totally alien to me. It was just like being in Westminster, where power was
in the legislature. And the key issue was whether the upper house and the
lower house could make a deal. The president wasn't even in town. If you
give Congress that kind of power – basically Congress wrote the deal – then
you're half way to a British or Canadian system in which the legislature
makes the decisions. And the legislature is much more likely to make
protectionist decisions. After all, these are pretty much the same people
who put all those anti-China bills into the works in the last session of
Congress … So I'm a little nervous about how this will play out in the next
one or two years … After all, this is the land of permanent election
campaigning. Congressmen are saying to themselves, ‘ how am I going to
campaign? I don't want to lose my job. What's my line going to be?' It's
going to be very tempting to say ‘American jobs for American workers.' It's
a pretty good slogan. It worked well in Britain.”
“That's out there. There's a lot of populist disgruntlement, and it's going
to get bigger.”
Heather Scoffield: We've discussed many possible nasty outcomes to this
crisis. Is there a way out?
Niall Ferguson: “We've discussed two reasons to non-suicidal. I'm trying to
stay cheerful. One is that Chimerica is holding up. The Chinese don't seem
to want to get divorced from their American spouse.”
“The other is that this isn't leading to World War Three or Four, depending
on how many world wars you think there have been. There will be instability,
but I don't see that instability producing something as huge as the 20th
century conflicts. But it's hard to see a simple and quick macroeconomic
happy ending. That I really struggle to visualize.
But the good news is only as good as this: the United States, which is
Canada's biggest trading partner, is not going to suffer as badly as many
other economies around the world. And that means that from Canada's point of
view, it's not standing right on top of the biggest fault lines in the
global system. The biggest fault lines in the global system are in Asia.
They may also be in Eastern Europe. That's where things are going to be
really unpredictable.”
“The two great zones of conflict in the 20th century were central and
eastern Europe, and a critical part of northeast Asia – Manchuria, Korea. It
makes me a little nervous that those are also places that are going to take
a very heavy share of the pain. But we're looking at a Great Recession, not
a Great Depression. We may be looking at a Lost Decade.
There was a time when if you said the United States was going to suffer a
lost decade like Japan did in the 1990s, everybody would have said you were
a mad pessimist. That begins to look like quite a good scenario. And I think
it's a realistic scenario.
One of the facts is if you subtract mortgage equity withdrawal from the Bush
years, the real underlying rate of growth of the U.S. economy was 1 per
cent. So much of the consumption has been fuelled by mortgage equity
withdrawal. So that seems like a reasonable growth rate for 10 years. … We
just don't have an improvement of standard of living of the sort we're grown
used to. And indeed if you have a more equitable redistribution through the
tax system, which Obama is committed to, it might actually be no discernible
downside for middle America and lower-class Americans. So many of the
benefits of the boom went to the elites. If you have a lost decade plus
redistribution, it may not be that dramatic a change for many, many people.
People just have to get over the fact that their wealth wasn't worth what
they thought it was in 2006. Whether it's their stock market portfolio or
their housing. If we simply go back to where we were, in 2005, that's surely
not the worst thing that could happen to us.”
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 LA CRISI ? COLPA DEI LAZZARONI DELLA SINISTRA NON FANNO UN CAZZO E RUBANO LO
STIPENDIO
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 'There will be blood'
http://vids.myspace.com/index.cfm?fuseaction=vids.individual&videoid=52860753
 


http://vids.myspace.com/index.cfm?fuseaction=vids.individual&videoid=52860753
Sě, il massacro della Diaz puň darci un indizio di quello che potrebbe
accadere se le cose si mettessero davvero male.
Basterebbe che le aste dei nostri bond andassero semideserte e non ci
sarebbero piů i soldi per le pensioni: una bella fetta di disoccupati
giovani campano con le pensioni dei loro genitori, se venissero a mancare
quelle....
Allora Tremorti pagherebbe probabilmente SOLO gli stipendi ai poliziotti per
mandarli a bloccare i doisordini di piazza.
In fondo sono fascisti.
e
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