Wondering about Société Générale

I’ve been banking at SG for over 30 years and unlike many of the commentors I’ve been reading on various sites, I don’t have much to complain about. But then, I deal with my friendly, local branch where they offer me a café whenever I come in to talk serious business (which admittedly, is quite close to never. But it’s happened a few times.).

But like everybody else on the planet, I don’t really believe what we’re hearing about the Jérôme Kerviel/Société Générale affair. At a primary level, there is sufficient bullshit in the way the French conduct business normally, that suspicion is a reasonable response to anything. I realize that this sounds trite, that people everywhere are suspicious of everyone who operate in the Halls of Power, but, hey, France has elites like no other, and as any mother knows, elites will be elites. It will be fun to see how this all plays out in the coming weeks.

One of the things I’m curious about is: if I understand correctly, JKerviel’s trading position was positive or close to it, up to the weekend before when things hit the fan.

The losses occurred subsequently, on the first 3 days of the week of january 21-5, when SG’s boss, Daniel Bouton panicked and unwound the position into (malheur!) the worst three market days of the last several years. It was this panic sale that concretized the huge losses.

I imagine this selling was motivated by the moral values (corporate responsibility, dread, shame, etcetc) of SGs top management. Because this is France, transparency was never an option. Resolution had to happen secretly. But did it have to happen under the sign of total panic?

Conversely, what would have happened if the markets were going up those three days instead of tanking? The shame would have been the same. The elitist secrecy also. So, would we have ever learned about the ‘scandal’ of a rogue trader being responsable for 20 billion euros of illicit gains by the SG? I guess we would have, the day that SG announced record earnings for a bank of over 20 billion.

About a Blog

Just came across this lovely explanation and graphical representation of what happens in the seconds after a new blog post is published on Wired. There’s something scary about this, but the interface design is quite nice.

blogspeed

Minimum Wages in Europe

For those interested in this sort of thing, here is a complete list of minimum wages in all countries in Europe. Some days, you just need to know this sort of thing, especially as the world economy melts down.

Garbage In or Garbage Out?

From a recent article on the Oil Drum on using superkites to propel ocean freighters, I learned (always read the comments!) that the Emma Maerks is the world’s largest cargo ship. You can see what it looks like here.

In a recent voyage, it left China, destination Europe, with a load of 11,000 20ft containers full of:

Martini glasses, sports bags, shower gel, shampoo and bath foam, pinball machines, toothpicks, chopsticks, electric guitars, tool boxes, drum kits, lamp shades, silver and wooden photo frames, wooden trouser hangers, candles, books, laptop computers, singing and dancing gorilla toys, poker tables, bingo sets, lunchboxes, cuddly toys, make-up, dolls, toy motorcycles, christmas decorations, sofas, puzzles, televisions, frozen mussles, computer parts, CD players, fax machines, key rings, jam, noodles, biscuits, pumpkins (frozen), more than 1000 bales of carpet, 117 boxes of girls jeans, 40 boxes of brass, 2000 pairs of mens shoes, 9000 pairs of trainers, three boxes of spectacle frames and more than 1500 frozen cooked chickens.

On the return trip to China it loaded up with:

Plastic scrap, waste paper and card, waste electronic components, repairable electrical goods and scap metal.

If I knew what geo-economic tea leaves looked like or how to read them, I’m sure I would know what this all means. Meanwhile, I just have to rely on hunches.

I Am Not Afraid

I just came across this paragraph from the Downsize DC organization that should well become a mantra for well-being in the world we live in. It is meant to be sent to people who represent us politically, and since this is the way I’ve felt for the last 20 years, it just has to be true:

I am not afraid of terrorism, and I want you to stop being afraid on my behalf. Please start scaling back the official government war on terror. Please replace it with a smaller, more focused anti-terrorist police effort in keeping with the rule of law. Please stop overreacting. I understand that it will not be possible to stop all terrorist acts. I accept that. I am not afraid.

Thanks to Bruce Schneier for this.

Outsourcing CO2 Emissions

If I were a modern western industrial nation with a profound desire to decrease my CO2 emissions, I wonder if the most efficient way of doing so wouldn’t be by outsourcing my polluting, energivorous manufacturing to some large Asian powerhouse country.

There would be multiple benefits to such a strategy:

  • The CO2 produced by the manufacturing processes to make ‘my’ stuff would no longer be counted as ‘my’ CO2
  • The CO2 produced by transporting the manufactured stuff to markets within my borders would no longer be counted as ‘my’ CO2.
  • If anyone bitched about how much CO2 I still produced, I could say I was as concerned as the next country by the problem, but hey! what’s the point of upheaving my own economy if that big Asian powerhouse that’s making all ‘my’ stuff isn’t regulated, too (hehe).
  • Obviously, our stuff would be dirt cheap cause it’s made by cheap emerging economy labor, so we can get more of it.
  • And in the end, because property is 9/10th of the (anglo-saxon) law, I get to keep the stuff!

Wow! Anyone else think that this a great geopolitical approach to attacking climate change?

A Graph is Worth a Thousand X-rays

healthcare spending