Blog Review 825


Well, if you start off with faulty statistics and then ignore the real world, of course you can prove whatever it is that you want to.

Guess who might end up carrying the financial can for the Madoff losses? Yup, the taxpayer. Still, at least it's a $50 billion fiscal boost, eh?

No, food miles are not a good way of measuring environmental impact. Total resource use would be rather better.

So those people approving all those no money down, no income checks, negative amortisation mortgages, what were they, on crack? Umm, no, methamphetamine actually.

Competition time! Who would you nominate as your, err, umm, "coprolites" of the year?

The Angry Economist has obviusly spent too much of the season with young children. The latest Nobel Laureate in economics* is, apparently, a "doody head".

And finally, shades of Roderick Spode and those black footy bags. Can any British politician survive being the butt of the Panto jokes?

*Yes, we know, it's the Swedish Central Bank's prize in honour of etc. And no, we don't care.

On the sixth day of Christmas...


My true love sent to me: six geese a-laying. In the song, this seems to refer to the six days of creation.

The goose that laid golden eggs in Britain was our occupational pension system. Businesses would open a pension scheme run by independent trustees, encouraging workers to join it and putting in some money themselves. By 1997, Britain’s workplace pensions savings were larger than the rest of Europe’s put together.

The 97,900 work-based pension schemes that existed in 1997 have now shrunk to just 53,801 – and falling. Of those, 18,990 no longer accept new members, 4,354 are frozen, and 1,779 are being wound up. Less than a third of the 1997 figure are still active and open to new employee members. By the end of 2007 there were about a million less active members of occupational pension schemes than there were just three years earlier. Less than half of those who work in the private sector are now paying into a pension. At the current rate of decline, there will be no contributors at all by 2020. The demise of this once-thriving savings sector is one reason why more and more people now face hard times when they retire.

The sole person responsible for this is Gordon Brown. It goes back to the ending of dividend credits on advance corporation tax, which Brown slipped into his first Budget speech in 1997. It was a typical Brown stealth tax – one that few people understood, and which fewer would even notice until they came to retire many years later. And it has taken about £175 billion out of the pockets of pension savers and put it into the Treasury’s. That is equivalent to a tax of £16,600 on every private pension saver.

The Media's Top 10 Economic Myths of 2008 (No.2)

Yet negativity abounded in 2008, outnumbering positive stories 6 to 1 according to BMI's recent study The Great Media Depression.

CNBC's "Mad Money" host Jim Cramer went further than most journalists actually warning that the country was in danger of "Great Depression, No. 2." On "Street Signs" Sept. 11 Cramer excitedly warned that unless the banking system was bailed out, a second Depression could be in the future.

 "It's obvious the bank system is falling apart," Cramer said. "Let's save it before it goes to zero." Two months later on Nov. 11, Cramer again cried for a bailout -- this time for General Motors.

Cramer responded to criticism saying, "I don't care– for the same reason that AIG was in the business of a criminal conspiracy – big deal," Cramer said. "It's like look – we got to bail them out. We have to. We have to keep the Great Depression off the table."

Ironically in December, Cramer chastised people using Great Depression warnings calling them "scare tactics."


2. Welcome to 1929: Great Depression II

Media myth: The news media drew hundreds of parallels to the Depression, despite economic data that is not even close.

Originally published by the Business & Media Institute

According to network reports, America's finances are "like a house of cards." The media thought things were so bad that journalists on ABC, CBS and NBC hyped similarities to the Great Depression more than 70 times in the first six months of 2008. An additional tally found at least 157 more comparisons from July 1, 2008 to Oct. 27, 2008.

But that parallel doesn't hold up, particularly when looking at daily coverage of the stock market crash in 1929. The difference between how the 1929 and 2008 media handled a crisis was profound – with modern journalists hyping every event and their predecessors expressing calm optimism. A scholar of the Depression, Federal Reserve chairman Ben Bernanke said Dec. 1 that there is "no comparison" between the two situations.

In actuality, the economic struggles of 2008 couldn't really compare to the Depression. At its peak, unemployment skyrocketed to more than 24 percent. Gross domestic product actually dropped four straight years – 1930-1933 – and took until 1941 to again pass 1929 levels. "It was the worst slump in history, and the most protracted," wrote Paul Johnson in the introduction to Murray Rothbard's book "America's Great Depression." "At one point 34 million men, women, and children were without any income at all," Johnson continued. [Click 'read more' to continue]

Film of the Year No. 2


2. Lust, Caution

Wong is a student in Hong Kong in 1938. As her drama troupe becomes involved with the effort to resist the Japanese, Wong infiltrates the social circle of Mr Yee, a hated collaborator, intending to facilitate his assassination. The action shifts to occupied Shanghai, 1941, as Wong becomes Yee’s mistress. The conflict inherent in their dangerous, passionate relationship gives the film both its emotional core, and its title: Lust, Caution. The closer Wong gets to Yee, the more vital she becomes to the resistance – and the more difficult her deceit becomes.

Directed by Ang Lee, Lust, Caution is a brilliant, intense, and moving piece of cinema. It melds espionage, romance, noir and war into a seamless, epic whole that has rightly been hailed as his masterpiece. The acting is superb, the cinematography sumptuous, and the story astoundingly powerful. Most of the publicity surrounding the film may have centred on its sex scenes, but that is unfair. While they are undeniably explicit, and sometimes shocking, these scenes reveal far more than just naked flesh. Indeed, they say far more about Yee and Wong than simple dialogue ever could. Lust, Caution is a remarkable achievement. Watch the trailer here.

Blog Review 824


We expect the Lord Chamberlain, the Home Secretary, the Minister for Promoting Virtue and Punishing Vice, to be calling for censorhip. But the Culture Secretary?

It doesn't seem to be a stimulus proposal, rather, an all time expansion of government.

Perhaps it would be better to simply do nothing?

Adam Smith and the labour theory of value.....that he didn't in fact have one.

Life really isn't inescapably political.

A style guide aid to those wanting to write for The Guardian.

And finally, excuse us, but we're off to polish our egos.

On the fifth day of Christmas...


My true love sent to me: five gold rings. It probably means the first five books of the Old Testament, but to me five rings means the Olympics, which are coming to London in 2012.

Well, they say that. But it's a typical government-led project, so who knows? The London bid for the games put the cost at £3,375m, but in March last year Tessa Jowell revealed that the cost had risen to £9,325m - a tripling of the costs in just a few months. Something of a black hole, which the hole-vaulting Culture Secretary explained as due to VAT, inflation, and a whopping £2,700m 'just in case things go wrong' fund (a figure larger than that the original estimate for building the entire Olympic Park). And that's unlikely to be the end of it, since officials are said to be working to a £12bn target. With the credit crunch, private financing and sponsorship deals now look shaky, and after Mumbai the cost of security has been ramped up, so taxpayers are likely to find the Olympics rather expensive.

The Media's Top 10 Economic Myths of 2008 (No.3)

Equidex President Phillip Gotthelf pointed out on Bloomberg TV on Oct. 7, "I think that the commodities really outlived their, their useful rallies because they've exceeded the elasticity of the consumer."

 "And commodities are consumables, they're not investments. They're speculative equals sometimes, but they're certainly not investments."

According to Gotthelf, those commodities include oil, which he said was poised to go to $40 a barrel or lower in the wake of the global economic turmoil.

 "I'm somewhat amused. Goldman Sachs was forecasting $200 a barrel for oil," Gotthelf said. "I see that their forecasts are getting more and more conservative. I said $200 a barrel was ridiculous. Even $150 I thought was ridiculous. We were looking at $24 a barrel in 2004. Everybody is now making comparisons in the financial sector to the implosion of stocks in 2002, 2003 – the last stock recession. Why shouldn't we see oil return to $40, maybe even below $40 a barrel?"


3. Oil prices will skyrocket to $200 a barrel, gas to $15.

Media myth: Journalists warned of super-high oil and gas prices, but then the bubble burst.

Originally published by the Business & Media Institute

Journalists predicted skyrocketing oil prices in 2008 up to $400 a barrel.

NBC News chief foreign correspondent Richard Engel warned on the July 1 "NBC Nightly News" an attack by Israel could send oil prices soaring – sending gas prices into territories never imagined.

 "I asked an oil analyst that very question," Engel said. "He said, 'The price of a barrel of oil: Name your price – $300-$400 a barrel.'"

What would oil at those levels mean? A June 11 Time magazine story by Robert Baer put the price of a gallon of gas at $12 if oil goes to $300 a barrel. In May, Management Information Services Senior Energy Advisor Robert Hirsch told CNBC's "Squawk Box" the oil at those prices could mean $15-a-gallon gas.

NBC "Nightly News" asked CNBC's Jim Cramer about those $12-15 predictions. Cramer said "I think that $12 isn't in the cards. I do see $5 to $6-a-gallon by end of the summer." But even that prediction turned out to be wrong. Gas prices peaked at $4.11 on July 11 and have since fallen to $1.68 according to AAA.

The news media didn't anticipate the end of the oil bubble with prices sinking from about $147 at its peak to around $45 Dec. 10.

But there were experts who disagreed. [Click 'read more' to continue]

Film of the Year No. 3


3. Gomorrah

It’s not easy to summarize the plot of Gomorrah, mostly because there isn’t one. Rather than taking a narrative approach, the film simply follows a group of loosely connected characters around a grim Neapolitan estate ruled by the Camorra, the local mafia. Based on the 2006 non-fiction book by Roberto Savianno (who has been in police protection ever since), Gomorrah is a bleak, brutal film that pulls no punches and offers no easy answers. Indeed, such is the film’s commitment to realism that even Italian audiences needed subtitles to understand the heavy dialect it is filmed in.

If you sit down to watch Gomorrah expecting ‘the Italian Goodfellas’, you are going to be sorely disappointed. There are no characters to root for, and no compromises made for the sake of entertainment. And at no point in the film is it possible to vicariously enjoy the gangsterism being depicted. But that, surely, is as it should be. Real-life organized crime isn’t glamorous – it is a vile force that corrupts and destroys everything it touches. Gomorrah is a deeply powerful reminder of that. Watch the trailer here.

Blog Review 823


Minister announces a direct attack on free speech and insists that it is not an attack upon free speech. Just don't expect us to cooperate.

This isn't a new idea but that doesn't stop it being a very good one.

A look at how the BBC created its editorial line on climate change. Not, you won't be surprised to hear, a pretty sight.

Sometimes it doesn't matter which decision you make: just that you do indeed make a decision. Dithering simply makes things worse.

A report from the front lines of the green generating revolution.

Labour's campaign song all the way back in 1997 was "Things Can Only Get Better". And so it goes.

And finally, these aren't the seven best criminal capers of 2008, for the best are the ones that have gone undiscovered.