Monday, September 29, 2008

In the land of Atatürk

This will be a short post from Turkey where my family and I are spending a fortnight's holiday. An internet cafe and a Turkish keyboard are not condusive to a long note.

However I just wanted to record what a wonderful but contradictory country Turkey can seem to the visitor. Aside from the hassling street traders who shout 'yes please!' at anyone looking remotely like a visitor, the people are extremely warm and welcoming. Travelling with a baby boy seems to bring out the best in people and I have lost count of how many warm words and smiles we have received in the last week.

Turkey is 99 % muslim yet the state is strongly secular, a conflict that persists to this day. Despite being in the middle of Ramadam the cafes and restaurants on the Agean coast where we are staying are still thronged with diners, Turk and foreigner alike.

This does not seem a completely free country. The army is very strong with a visible garrison in most towns and rather bizarrely the BBC and Times websites are both censored in this internet cafe (a website with a picture of Atatürk appears when typing those web addresses). However CNN, the Telegraph and many others are freely available. I fail to understand what is going on here.

Another point is this is a much fought over land. What is now Turkey was once Greek or Roman. I will not attempt to summarise the history but historic sites such as Ephesus and the seven churches of the revelation are all to be found close to the Agean coast.

Overlooking all this is Atatürk who founded the modern state of Turkey in 1923. His portrait, often complete with cigarette, can be found in every cafe, shop or establishment you visit.

Superficially at least, this is first and foremost the land of Atatürk and everything else (whether Islam, commerce, terrorism, tourism,nationalism and a range of unstable neighbours) is less apparent in a host of inconsistencies.

Hopefully back with some photos of this interest country next week.

Monday, September 15, 2008

Putting the "Free" back into the Free Market

A hard day in the office for some in London today

Although the collapse of Lehman Brothers is clearly a bit of a disaster for all concerned, including the 5,000 or so London-based workers who will probably loose their jobs, I do think this is one of the most sensible things to happen in the financial markets in the last year.

Until today, the emphasis has been on saving and bailing out every institution that failed. There did seem to be a limit to how much longer this could have gone on, regardless of whether it was right to do so or not. In the end there is even a limit to what the government can prop up and it seems that limit may at last be reached. (In this instance the limit has been reached by the US government but hopefully the principle will apply in the UK too).

To me at least, the whole point of a free market economy is that successful businesses flourish and failing businesses close. This may sound incredibly obvious and simple but in recent times this has been overlooked. This may not always be "fair" (especially on the many small cogs who work inside big machines) but it is an effective way of encouraging strong and well managed businesses. To prop up every failing bank seems to go against this philosophy and indirectly punish the more prudent banks who are less effected by this crisis. Why should rash instituions like Northern Rock be supported and carry on getting new business at the expense of banks who never needed state support ? This does not encourage good business in the long term if every bank knows it will be "saved" no matter what rash gambles it makes.

Therefore the failure of Lehman Bros, painful though it is, seems to be a return to reality. An old bank has sadly failed due to its more recent activities. Those who would have sought the services of Lehman Bros will now have to go elsewhere, potentially strengthening other banks. The buy-out of Merrill Lynch is another market solution that does not require taxpayers money.

Banks are now realising that the best way to save themselves is to help each other by putting money into a "lending pool". This seems to be a return to basic principles of banking and the free market and is far healthier in the long term.

The credit "cake" is shrinking at the moment and the weakest banks may struggle to survive. However the only real route to long term health is to let the market "weed out" the weakest whether by buy out or in hopefully only extreme cases bankruptcy.

Hopefully this can be a first step in turning the recent tide of "government support" in every situation from flooded houses built on flood plains, home insulation, failed holiday companies and even failed banks. These are just some of the areas attracting government "support" in the last year. In turn this must be paid for by taxes, which weaken the economy even further.

How ironic that it must fall to the Liberal Democrats to propose tax cuts and signal some end to the continued growth in state spending and the inevitable taxes that follow it.

Saturday, September 13, 2008

New to the job since 1973

I have deliberately been keeping my powder fairly dry on the US elections. Ultimately, despite the importance of the result to the wider world, this is a matter for Americans to decide. Past embarrasments, notably the Guardian readers' campaign to make the voters of Clark County, Ohio vote for John Kerry in 2004, should act as a reminder against "meddling" in overseas elections. (For the record, the Guardian initiative was spectacularly unsuccessful and Clark County along with the rest of Ohio voted for Bush. See this link for some hilarious responses to the letters received from do-gooding Guardian readers !)

Nonetheless we do seem to hear more about the US elections than we sometimes do about our own elections and if nothing else they make a great spectacle and story. For one thing they last so long compared to our own which can be over in about a month since the day they are called.

Below is a short clip of the man "a heartbeat away from the Presidency" on the Democrat side, one Senator Joe Biden. A special connection with British politics is his rare distinction for plagorising a speech by Neil Kinnock. If you have to plagorise, surely it would be a good start to find someone worth plagorising !

Anyway below is Mr. Biden asking a wheelchair bound Senator to stand up. Senator Biden like his role model, Neil Kinnock has a long history of gaffes. He compounds this gaffe by giving the excuse (around 0.30 on the clip) that he is "new to this". New to what ? He's been a Senator since 1973 !!

Thursday, September 11, 2008

Seven Years Ago....

I had just started a job working for the Ford Motor Company and was visiting their Motorsport operation deep in the Cumbrian countryside. September 2001 was unusually bleak in Cumbria. It is a beautiful place full of hills and lakes and normally full of farm animals. However in 2001 a deadly outbreak of foot and mouth hit England and millions of animals were slaughtered and disposed of by burning or by burial in pits. All the fields, normally full of sheep and cows, were completely empty.

It was against the backdrop of bleak and eerie beauty of an empty Cumbrian countryside, in a converted country house, working for a giant US Corporation that I first heard of the attack on the twin towers. My colleague who I was working with did not seem to realise the enormity of what was happening but I went out to the car to listen to the news on the radio. Everyone can remember where they were that day and I am no exception.

As well as remembering that day on its seventh anniversary, it must be seen as some success that despite a brutal and determined enemy there has not been one serious terrorist attack on the US in seven years since 9/11. Bombs in Madrid, Bali and London during that time show that the risk remains real.

The images from 9/11 are all too shockingly familiar. Below is a less well known scene from London on September 12th 2001 when the Queen ordered guards outside Buckingham Palace to play the Star Spangled Banner. Many had gathered outside including a lot of Americans stranded in London and unable to return home due to the no fly order being in operation. It is a moving scene, albeit in a short clip.

Wednesday, September 10, 2008

Oil Falls over 30 %, shame about the petrol

I intend to come back with something more insightful in the near future, but for now time limits me to a moan about petrol prices !

With oil falling below $100 a barrel this week, this represents a near 33 % fall from its peak of $147 in July. Surely for a commodity to fall in price by a third is a massive movement even allowing for the dramatic rise beforehand ?

It is a shame that the petrol stations seem blissfully unaware where the price falls remain mediocre to say the least.