Melamine, and Merill Lynch

In the 1960's, BBC television produced a program, "That Was The Week That Was", known by its acronym at the time as "TW3". That programme paid a particular tribute on the day after our President, John Fitzgerald Kennedy, was assasinated in Dallas, Texas on November 22, 1963. That broadcast, with its absence of satire, and commemorative notes, was reknown for its respect, of civility, and propriety, not for its own British audience, but for Humanity, and for America. To Britain, I belatedly send my thanks after what has also been a difficult, though ultimately material, week.

This week in which the world collectively shuddered at the effects of human greed, of irrational judgement, of the impropriety of governance, and the effects of toxic offerings, seems typical of our times. While images of infants in China with intravenous lines in their foreheads pronounce judgement upon the deception about simple staples such as milk, images of America's elderly being stripped of their retirment savings cross our screens and fill the pages of the internet. Iceland stands on the brink of financial collapse, simply due to her dependence upon banking as commerce.

For a moment let me turn my concern to the loving parents of children who were intoxicated by melamine in their milk supply. It seems many if not most of the children are in China itself. I send their parents, the siblings and the children themselves, my love and prayers. I pray they recover their health, and enjoy life playfully engaged in childhood, and not in being treated perpetually for organs that failed because they received a poison in their milk or formula. Perhaps the introduction was inadvertent, .. or supposed to be inconsequential. It is a tragedy that our children reveal our adult failures, ... even when it is on a global scale.

So what of the global economic collapse? What connection could I possibly draw to melamine and babies on dialysis half a world away? Perhaps simply that some concepts of finance, and some instruments to conduct investment, can in and of themselves be so distantly separated from the economic metrics they are meant to reflect, that they are in and of themselves dangerously deceptive, both for their safety and for their risk.

What do I mean by this? Let me draw an analogy. If you went to drive your car, and instead of a straight forward choice of R, D, D2, and D3 or D4, ... you were confronted with a choice of "R1d1, R1d2, ... D1r1, D1r2, D2rr1, d2rr2, ... etc.", and so you see the complexity of an absurd collection of investment options.

Some are simple, based upon market ups and downs. Others are more complex, ... based upon wagers that things will go down, and buying on a promise or margin. Then others are based upon derivatives, ... you remember, calculus-type relationships of ups and down over time and such. Nothing human beings can intuitively understand, and therin lies the rub. No clear-cut winner or loser, for the terms are such that you can not know directly the result. The result of the "market" is derived from the many factors that were direct results, and then determined indirectly, as a derivative, of what occurred. You know, ... like "magic"! , the sort of thing that we are meant to not understand, and to simply accept.

The new sorts of financial instruments that have been marketed by American Investment Bankers are toxic, no less than melamine is to infants. They abuse the trust of investors, both professional, institutional and personal. They are confusing and deceptive. They are indirect, and so they might have seemed inviting. The effects of their failure, however, seem now to be extremely direct, no less than a bullet through a dark curtain.

A severe retrenchment is inevitable. Liars and thieves are like seventeen year locusts. They strip the leaves, kill some trees and disappear for a while. In their wake We, the survivors must assess what we are to do next. The deaths, ... the families destroyed through panic and despair, are a lesson once again that we are not what we own. We are who we are. I will wave to you, and offer to share with you what I have and can grow, in order that we all know we will make it through.

Others will hunker down in their homes, shotguns in hand, protecting thmselves against the unkown. In the end, there is no one there outside, of whom you should be afraid. What you seek to protect inside, ... the things you love the most, and would guard with your life, have sadly been rendered worthless by the men you asked by your vote to govern us all.

They have failed us all. There remains only you and I. We will begin again. When you have grain and I have vegetables, ... and there is some wood close by for heat, ... we will all begin to recover.

I am so thankful that you are my neighbor and my friend. Your children are my treasure, and mine yours. That simple truth is what we forgot, and that which once upon a time had made us Human.

I am so thankful this dark week is ended, and a brighter week begun. Nothing has changed, of course, except my thinking, and my realization that we are all together, and all alive.