Sunday, 20 November 2016
please mind your head
My usual time limit for a blog post is still ten minutes.
Ten minutes and a picture, as frequently as practical from my own camera (like the bullet train above). Then another different ten minutes to whizz around few of the other bloggers and maybe drop a comment or two.
Sometimes there’s so much happening that I (a) don’t blog at all or (b) get into more detail which breaks my own informal rules.
I realise there’s a declining use of blogs, but also for me that there’s a chance to straighten some thinking by the mere act of writing it down - or like today’s post - by dictating it and then skimming it with the keyboard to fix the typos - thank you Nuance.
Right now there’s the big wide world stuff like Trumpton and Brexit and the possibility of knock-on effects towards people like me. I do mean ‘us’ of course, but that's a version of us involving the people I know directly.
There’s secrets embedded in all of what is happening. One is an American situation. Obama knows it, Janet Yellen knows it but Trump might not yet. It's the scale of the US Federal Reserve liabilities. Currently around $4.4 trillion dollars. That's a lot of wonga and gives a leverage of 112. In other words there’s underwritten cash for only 1/112 of the total. Something will have to give.
Back in Harvard and Cranfield days, we used to talk about good leverage for banks being around 20-25. Actually the Bank of England used to insist upon it.
A quick look at the biggest bank in the world (HSBC) shows they run at a leverage of 12 and a UK highstreeter like Lloyds is around the 21 mark.
So Trump will have a huge debt to figure out as part of whatever happens next.
The UK isn’t quite at that level, but it is really quite difficult to determine because the Bank of England has a special off balance sheet Treasury vehicle where it can hide anything to awkward. Who says the BoE is independent of the government? The fiscal and political have some interesting overlaps.
Why do I care about any of this stuff? Partly in a perhaps misguided attempt to understand what is happening in the world, but also to try to figure out what to do next at a personal level.
Back in blog-world, I keep most of my real world stuff away from the blog. Employment, family and the personal stuff may only appear quite tangentially.
But, as Shakespeare might say, there’s the rub. I paraphrase, but however much the whips and scorns of time, of oppressor’s wrongs, from law’s delay, the insolence of office and spurns from those unworthy of patience, it’s still about deciding when and where to act. To be, or not to be, so to speak.
And that raises the intertwined question.
Reflection that requires action as well. Perhaps it's time for a reboot?