WALL STREET 2

Highlights - Couple of 'punch' dialogues from Gordon Gekko , Susan Sarandon ( old but still beautiful) .
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Wall Street was a cult movie and Gordon Geko was any traders God. In the movie , when Gekko says ' I once said Greed is good.... but now it seems its legal' i expected a fantastic movie to follow - something that would capture the recent turmoil in the financial markets and exaggerate all the wrongdoing - Gekko ishtyle. Perhaps Rajnis Endhiran spiked my senses into expecting a lot of overdramatization and exaggeration. The movie unfortunately falls flat - its not walls street its more of a love storey with Gekko and the street as a back drop.


A big disappointment though not total.

The movie jogged memories of my days with Lehman and the 2007 crash. It started with JP buying Bear Sterns for $2 a share , followed by the collapse of Lehman - then the bailout of banks , tarp and what not. Oh and how could I forget all those rumours of naked short selling and the alleged accusation of Merrill and Goldman conspiring to take their revenge on DIck Fuld and Lehman. Consequently a lot of us lost our jobs , a lot others lost a lot a fortune and lives changed. Wall Street 2 captures some of these moods and plentiful rumours. I am sure , that most of us who had to live through the 08-09 crash would reminiscent those days after watching this movie. I sure am glad that i survived those bitter cold days. They still send a shiver down my spine once in a while - but I sure am glad I made it through

SCIENCEs FIRST MISTAKE

Science’s First Mistake and Religion
by Ian Angell, London School of Economics

The 2009 Christmas season in London had Richard Dawkins teaming up with Ricky Gervais, Dara O’Briain, Jarvis Cocker and other celebrities, to put on a show they called ‘Nine Lessons and Carols for Godless People’, at the Bloomsbury Theatre and the Hammersmith Apollo in London. This motley crew of smug self-professed humanists was intent on disgracing the much loved Christmas institution, in much the same way a Black Mass profanes the Eucharist. How they must have chuckled at their cleverness when they paid for the slogan “There’s Probably No God” to be emblazoned across 800 London double-decker buses, and all timed to coincide with
Epiphany, the celebration of arrival of the Three Wise Men bringing gold, frankincense and myrrh.

Virtuous in their indignation against religion, they set about offending every Christian in sight. Certain of their own faith in science, these contemptuous and contemptible bigots thought nothing of trampling on the beliefs of others. Such is the intellectual imperialism of scientism – a prevalent and predominant attitude among those who dogmatically project the scientific method as the one and only true way of acquiring knowledge about reality and the nature of things. They don’t seem to realise that the scientific method is limited by paradox, even in Physics - science’s backyard. Their ‘rational’ certainty in the natural laws of Physics is built on shifting sands, namely that of linear causality. All are guilty of making Science’s First Mistake.

The phrase ‘Science’s First Mistake’ is the title that Ian Angell and Dionysios Demetis chose for their new book (see www.sciencesfirstmistake.com to obtain a free .PDF download). It is a play on Nietzsche’s notorious words “Woman was God’s second mistake”. Before politically correct readers throw up their hands in disgust, they are asked first to reflect, and to recognise that this was Nietzsche’s idea of a joke. Woman was not the target of his rhetoric. No, he was referring obliquely to God’s first mistake, or rather humanity’s: namely that homo sapiens, godlike, had been put in control of the planet – the Sixth Day as described in Genesis 1, verses 27-28:
27: So God created man in his own image, in the image of God created he him; male and female created he them.
28: And God blessed them, and God said unto them, Be fruitful, and multiply, and replenish the earth, and subdue it: and have dominion over the fish of the sea, and over the fowl of the air, and over every living thing that moveth upon the earth.

How paradoxical, that in its attempts to replace God, Science should take up the baton of domination from Genesis. This too was recognized by Nietzsche in his most infamous quotation “God is Dead!”, although most people don’t realize these words are completed with “… And we have killed Him.” Here Nietzsche is pointing out the rise of secular societies, and what is of particular interest here - humanism, all grounded in the arrogance of certainty in scientism and the conceit of Modernism.
For there can be no dominion over the Earth! Control through the application of Science is a myth. There can be no permanent solutions to the ineffable human condition, only contingencies. We are all at the mercy of the Fates. Indeed, the hubris that comes with an unquestioned belief in scientific method, particularly when it is targeted at social, political, commercial, and even religious concerns is an accident waiting to happen.
It’s time to nail the big lie of the last three centuries, and stop this obsession with tidy methodical ‘rational’ solutions. ‘Understanding through scientific theory, and applied via its methods’ does not place us in control of human destiny. Indeed, there is no such thing as ‘understanding’, only mere description through observation … and observation is itself a delusion steeped in paradox. I must admit that it came as quite a shock to me, an agnostic, that the words of a nineteenth century hymn should resonate so well with my thinking:
Immortal, Invisible, God only wise
In light inaccessible hid from our eyes ...
(Hymns of Christ and the Christian Life, Walter C. Smith.)

For human observation does not allow us access to the ‘real world:’ observation is deceived by the linearity inferred in causality. We don’t observe causality in the world; a belief in causality is a necessary prerequisite of observation and cognition. Indeed, without the delusion of causality there would be no observation; observation and cognition are only possible because linearity is erroneously imposed on what is an always complex, non-linear world.

Linearity - just one thing after another; an assumption of sequential and consequential developments that are free of interference and surprise. Linearity – bring A and B together, and the outcome is predictably C: here A, B and C are the categorical ‘things’ that we observe and focus on in the world. However, that non-linear world is drowning in a chaotic bubbling alphabet soup of misinterpreted so-called ‘causes’ of previously-created effects, only for them to interact and become new ‘causes’, and on and on; any one of which may interfere with specific instances of A or B before they interact, or mess with and change C even before C’s existence has become apparent to us; and all is swamped in the delusion and paradox of observation.

Surely we must recognize that each particular A, B and C is an instance taken from an
expanding set of categories that each of us has been developing self-referentially since birth, and that form the cognitive building blocks of individual ‘understanding’. However, these categories are abstractions, ideals, parts of a map; they are not the ineffable and inaccessible things-in-theworld that they are supposed to represent – rather they are merely pale intellectual shadows created inside our heads. ‘The map is not the terrain’. “Everything that distinguishes man from the animals depends upon this ability to volatilize perceptual metaphors in a schema, and thus to dissolve an image into a concept”: Nietzsche again.

During our lifetimes, each of us continuously categorizes the things-in-the-world we observe – and we bunch each instance together with other similar things as if they are the same, and each group of similar entities is identified with a particular abstraction. However, in categorizing, that cognitive ideal must miss the unique totality of each particular instance of the thing-in-the-world to which it corresponds. Indeed, in order to observe, it is essential that we don’t observe every miniscule facet of all the components that make up the world. Without the filtering property of linearity we would be overwhelmed by the sheer enormity of the detail. This filtering out of the unobserved gives rise to interfering paradoxes that come with this categorical basis of observation; hence the imagined linear predictability of the behaviour of things-in-the-world, and the accompanying wish for control, will always prove illusory.
And yet observation is our cognitive laboratory, a place of enforced linearity, where we experiment as we make our way in the world; and that is only possible because we utilize the fiction of linearity that is categorization. It’s not only in the Harry Potter books that we humans can induce a change in the world by chanting incantations and waving a magic wand. We may not realize it, but this is what we humans do every day when we self-referentially use our categorizations/descriptions/observations of ‘objects in the real world’ (what is this but casting a magic spell) to create ideas, so that when ritually applied, the world bends to our will … usually.

However, we remain the apprentice, never to be the sorcerer – the paradoxes that stem from delusion, along with unexpected events, will ultimately conspire to upset our desired imposition of control mechanisms. Nevertheless we can create transitory stabilities that enable us to make our way reasonably successfully in the world. Our trick is to introduce social, cultural, intellectual, as well as physical artifacts into the world that form a pragmatic sink for much (but not all) of the surrounding noise, and which limits the disrupting influence of both detail and non-linearity.

However, these filters can never hold the complex world of surprises at bay indefinitely. The linear incantation that is ‘understanding’ will never totally control the non-linear world that can only be seen “in light inaccessible hid from our eyes” … in other words a world that cannot be truly seen. Or as Niklas Luhmann so eloquently puts it: “observation is only possible because it is impossible”.

Science’s first mistake is its failure to recognize there is no permanent dominion over a world that can only ever be ‘observed’ by ignoring the delusion and paradox implicit in observation itself. People in humanist glass houses shouldn’t throw stones. So please Messrs Dawkins, Gervais, Uncle Tom Cobley, and all, sort out your own mistakes, before criticizing those you see in others.

All human observation is flawed; all understanding is delusion. Man cannot understand what is happening in the world. Mankind cannot understand or communicate with God. However God, should He exist, would not operate under the same restrictions. He is not trapped by human limitations, and so it is possible that He could communicate with us. Whether humanity can grasp His messages correctly, is of course quite another matter. And that’s where faith comes in, and also why no scientist can be in any position to deny Him.

From within their own self-referential certainty many scientists see religion as absurd. Religion of course attributes Truth to an ineffable supernatural Being beyond the realms of observation and sense data, thereby displacing the paradoxes from human territory altogether. And from that
position, all non-belief is absurd.

Greece debt crisis unfolds (source The Economic Times )

Source: The Economic Times
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http://economictimes.indiatimes.com/News/International-Business/Greece-debt-crisis-unfolds/articleshow/5529954.cms
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LONDON: The markets are in a funk about the public-debt crisis in Greece. The country was clearly not ready for euro membership and now faces.

some hard choices: make savage budget cuts and plunge into a deep recession; default on its debts and lose its credit rating for a generation; plead for a bailout from its European Union partners; or quit the euro.

But, hey, there might be money to be made from this Greek tragedy. The way to do it is by swapping Hungarian bonds for Greek ones, selling the euro, ditching Spanish and Portuguese assets, and shorting the Athens stock market. The Greek crisis is accelerating all the time.

Last week, Greek bonds plunged as the markets took a look at government plans to cut a budget deficit running at 12.7 per cent of gross domestic product. Traders decided the numbers didn't add up. There was speculation that a bailout was being organised by the European Central Bank, or the EU.

Greece's troubles seeped into the currency markets, dragging down the euro. Other euroarea bond markets, in Spain and Portugal in particular, took a tumble. One wild story had Greece selling bonds to China to ease the budget crisis. The markets are demanding answers, and in the next few weeks they may get them. Greece is in the spotlight, and it will have to come up with a credible plan.

The trouble is none of the options is very appealing. If the country gets serious about curbing its deficit, most of the growth of the last decade will turn out to have been illusory. If Greece begs its euro-area partners for a bailout, it will be humiliated. If it starts printing some "new drachma" to pay back bondholders, it will be almost impossible to borrow more.

Greece will do what most of us would when faced with such a terrible range of choices: prevaricate, delay, postpone and hope something turns up.

Until the crisis is resolved, though, there will be plenty of opportunities to make money. Here are five places to start:

One: Buy every Greek bond you can lay your hands on. Greek 10-year bonds yield 6.6 percent, compared with 3.2 percent for German debt. That is a huge difference for what is essentially the same product: a government bond denominated in euros. So long as default is avoided, and Greece stays in the euro area, your Greek bonds will soar in price.

Two: Sell Hungarian and Polish government bonds. Both countries are in respectable shape economically, even if they have been hit hard by the global recession. Both aim to join the euro area at some point in the coming decade, at which point interest rates would fall in line with the ECB benchmark, and bond prices would soar. But after Greece's woes, do you think Poland and Hungary will be allowed into the euro area anytime soon?
Not likely. Short those bond markets as soon as you can.

Three: Sell the euro. Every day, EU and ECB officials line up to declare that the Greeks won't get any help. Officially, that might be true. There are plenty of ways to help out on the sly. Greece could be allowed to issue bonds jointly with other countries; the ECB could extend measures that allow it to accept Greek bonds as collateral for loans; or the EU could find a way of increasing "structural" subsidies for the Greek government.

The markets will smell a bailout, however, even if it comes packaged in some fancy label. The credibility of the euro and the ECB will be badly damaged. Investors will ditch the currency, and switch back to the dollar and the yen.

Serving time for a crime I did not commit

Jan 2010 ... 12 bulls and 13 bear market days. Where are the green shoots and signs of recovery ?

Last November, I recall joking with my friends that the worst is yet to come. Maybe a few of the asset classes and industries might start looking better in the near future , but banks are going to have a rough time ahead. . I wouldn't be surprised if we find cities and countries going bankrupt. With the high percentage of gearing and leverage applied by banks in the business transactions we find that the risks and losses are multiplied by factors of 10 to 100 if not more. Are financial rescues like the TARP and bailouts enough to save the economy? Greed in the industry would just result in all the aid and bailout money being swallowed as quickly as they are being loaned out - creating even more debt.

The few trillion dollars bailed out was meant to write off bad assets. But then have banks written off these assets? Are they no longer bad assets? If so, could someone explain how this has been achieved?

Banks still have these assets on their books. Suspension of the traditional mark to market method of accounting for the rotten assets has only resulted in a profits for banks - but on a completely baseless accounting practice.

The global economies remain very fragile with very bleak prospects for the heavily indebted economies of the US and UK. Sovereign debt crisis in economies with large and rising deficits are inevitable - and we have just started seeing examples of these in the last 2 months - and UK is in the list of such examples - its just the timing that is not clear.

Whatever measures are being taken to rescue the world economy seems too little too late and also very unsustainable.

What can be said about the banking industry is that it is a regulated oligopoly with very restricted competition. The current hue and cry of bonuses and pay scales is just a joke. Banks are free from market disciplines which apply to "genuinely" competitive industries and can therefore chose to do as they wish and pay their staff what they like. The cost is always borne by the customers and if not by the tax payers.

This makes me believe I am serving time for a crime I did not commit. I love the challenges and pressure involved in my line of work, but I am tad bit uncomfortable with the moral ethics and values of this industry. But perhaps, being a part of the system is crime enough. My fervent passion to work in the financial services industry has taken me through a roller coaster ride the last 2 years. Its had more downs than ups, but I am still here - with optimism and a fair bit of courage to see this through.