Horserace addendum

by Henry Farrell on October 12, 2008

As a quick addendum to my most recent post, Patrick Ruffini at _The Next Right_ effectively calls for the RNC “to give McCain the shiv”: It’s worth quoting _in extenso_ for added schadenfreude. [click to continue…]

Now we’re getting somewhere

by John Q on October 12, 2008

The British government has abandoned proposals for non-voting preference shares and is moving towards full-scale nationalisation of the banking sector. According to the London Times(h/t Felix Salmon) the latest proposals would leave the government owning 70 per cent of Royal Bank of Scotland and 50 per cent of Halifax. The London stockmarket is likely to be closed, and it seems unlikely that many banks will remain private by the time it reopens. Presumably, with Morgan Stanley and Goldman Sachs in deep strife, the US can’t be far behind, though Paulson is still talking nonsense about non-voting shares. Still, it’s only three weeks ago that he was opposing any kind of public equity, and only six weeks ago that he was claiming that there were no real problems.

As the Times says, no-one knows how much toxic sludge will turn up when the government finally gets access to the books, but it seems unlikely that most governments will be overwhelmed in the way that Iceland has been. The capacity of developed-country governments to raise additional revenue is huge, easily enough to cover trillions in bad debt over a few years. So, once the sector is nationalised it should be possible to get lending flowing again. And, the prospects for an orderly shutdown of the massively overgrown markets for derivatives like credit default swaps suddenly seem a lot better.

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Surprising tastes

by Chris Bertram on October 12, 2008

“I have yet to meet someone who does not want a naked picture of their loved ones with text about themselves.”

“Says the wife of the President of Iceland”: . The next time I’m in Reykjavík, I’ll introduce myself as a counterexample.