Consider Bangladesh - Extract from Norman Macrae's Last Article 2008 - how to prevent 2010s decade of slump

[chris macrae]

Below enjoy Norman Macrae's Last article, 2008 - 65 years after his last days as a teenager navigating RAF planes over modern-day Bangladesh in world war 2

Macrae Family Asia Rising Timeline 20th Q2 Sir KK's 25 years preparing for writing up legalese of India's Independence with Gandhi; Norman Macrae's Q3 and most of Q4 @ The Economist: Consider Japan from 1962; Consider Asian Pacific worldwide youth century and lead currency from 1975...Fast Forward to Consider redevelopment of Cox'a Bazaar  , Royal Automobile Club, London Saint James 2008. and subsequent dialogues on celebrate Bangladesh at 40 as number 1 Youth Collaboration Lab for end poverty experiments; Glasgow-Bangaldeshi-www Youth Interdependence Declaration 4 July 2010 -race to atlanta as greatest twin capital of youth's millennium goals and job creation Nov 2015 -all of above need integrating into 9 minute khan-ac type training modules of The Curriculum of Entrepreneurial Revolution , linkedin round The Economist since 1972 -how open education can make 21st Century's coming of age- youth's most productive and sustainable era

If banks in rich democracies had been truly competitive

institutions, at least one of them somewhere would have seized

the main opportunity created by the computer. This main

opportunity was to make all deposit-banking vastly cheaper than

ever before. By this cheapening it should make such banking

hugely more profitable. Then further competition would search

for the cheapest ways to guide all the world's saving into the

most profitable (or otherwise most desirable) forms of capital

investment, thus enriching all mankind.

Instead, during 2008 the total losses of banks in rich democracies

- in North America, West Europe and Japan - soared into trillions

of dollars. Fearful for their solvency, these banks virtually stopped

lending. The issuance of corporate bonds, commercial paper, and

many other financial products largely ceased. Hedge and

insurance firms also crashed. Mankind is thus threatened in the

2010s with its longest great depression since the hungry 1930s.

 

Why? The strange answer seems to be that other happy

consequences of modern technology promised to make this

cheapening even faster. Call centres in Bangalore vastly undercut

the middle class salaries of Midland bank clerk who until the

1950s expensively answered clients' questions in their branches

in the City of London. Cheap mobile phones kept village ladies in

once miserable Bangladesh as fully in touch with market prices as

is the chief research officer of the First National Bank of

Somewhere in California. His weekly salary is still 1000 times

greater than the previous annual earnings of that village lady. The

cost-effective way of running the old Midland or First National

then seemed to be to cut its total salary cost by something like

99%. This did not please Western welfare governments, or the

decent chief executives of the old Midland or First National bank.

 

Western welfare governments have long preferred to run their

banks in high cost cartels, and even invented reasons why this

seems to be moral. Their deposit-banks have usually kept in cash

only 10% of the total amount deposited with them. If 11% of

depositors suddenly feared that their banks might go bust, this

could accelerate a run that would send them bust indeed.

Governments therefore thought that depositors would be less

fearful if they were assured that the banks were officially and

tightly regulated. Actually, this mainly meant that the banks had

to hire ever more expensive lawyers so as to escape any crippling

consequences from this regulation. The attached quote shows

that Samuel Pepys understood this fact of life in his Diaries of July

21, 1662.

 

I see it is impossible for the King to have things done so cheaply

as do other men

- Samuel Pepys on discovering an important commercial fact of

life in his Diary, 21 July, 1662

 

The decent bosses of the deposit banks felt that the best way of

avoiding sacking nine tenths of their staffs was by competing

with a very different sort of financing called merchant banking

whose earnings and bonuses were far more generous than those

given to their own staff. These merchant banks were of peculiarly

differing pedigree. In London, it was assumed that they could best

be run by families like Barings who had done the job for over 200

years. In the 1990s, Barings went totally bust because one of its

hired traders bet much of its money on a hunch that a bad

earthquake in Japan meant that the shares of Japanese banks and

insurance companies would become more profitable. In Zurich,

merchant banks felt it most moral to keep the accounts of their

depositors totally secret, especially if these accounts were being

used to defraud their own countries' tax authorities. In 2008 those

4

secretive banks were then defrauded. In Wall Street, Goldman

Sachs and Lehman Bros bid up their annual bonuses to millions of

dollars for each partner. In 2008 even Goldman Sachs made a loss

and Lehman Bros went bust.

 

A former chairman of the Federal Reserve argues that "fearful

investors clearly require a far larger capital cushion to lend

unsecured to any financial intermediary now". He therefore thinks

that taxpayers money should be ladled into them to make those

investors less fearful. This seems far more likely to make

depositors intermittently more terrified and cause any depression

into the 2010s to linger on and on.

 

One of the few big banks to make a profit in 2008 was the

Grameen Bank (which means Village Bank) in that once basketcase

country called Bangladesh. The sole staff in a branch serving

several villages was once a woman student. It is now more usually

someone who has learnt to use the computer in the right way.

The rest of this report will examine how this marvelously costcutti...

[chris macrae]

[chris macrae]

Consider Japan

REMEMBERING NORMAN MACRAE  Posted 22 June 2010 by David Warren UK Ambassador in tokyo |  -see below 3rd remembrance party hosted Japan Ambassador to Dhaka, April 2011 with Bangladeshi's leading youth  technology wizards and collaboration NGO leaders	.Asian Sample Tour of Macrae's Curriculum of Entrepreneurial Revolution ..  sample tour of Norman Macrae- 15 years into his career at The Economist, Normanis asked to sign his first survey 1962 Consider Japan: his greatest debates on youth futures start in 1972 when he saw students experimenting with digital networks: 1972's Next 40 Years ; 1976's Coming Entrepreneurial Revolution;

I was very sorry to read in last week's "Economist" magazine of the death of Norman Macrae, who was its deputy editor for many years.

Norman Macrae was the first journalist to recognise the growing economic importance of Japan in the 1960s.  His seminal essay "Consider Japan" (which can be read in the Norman Macrae archive) was published in September 1962, is a fascinating and powerful analysis of the Japanese economy at that time, and was an important corrective to those who still thought justin terms of Japan as a poor, developing country producing cheap counterfeit goods.  The "Economist" obituary gives many other examples of Macrae's prescience and far-sightedness. The sudden jolt of recognition that Japan was about to become - as it had in the late 19th Century after the Meiji Restoration - an industrial giant (two years after "Consider Japan" the world woke up to Japan's success with the Tokyo Olympics) led directly to the British Government's trade promotion activities that I listed in my last article on the blog, the setting up in the early 1970s of the Exports to Japan Unit in the then Department of Trade, and the emphasis in this Embassy's work on trade and investment links with Japan,that lasts to this day. Do read the "Economist"'s obituary of Norman Macrae - it is a tribute to a massively influential thinker, whose impact is still felt today in the work we do here in Tokyo.

[chris macrae]

Consider Cox's Bazaar

The idea of developing Cox's Bazaar as world destination hub (rivaling the world trade multiplying potebtial of dubai or hong kong or singapore) and offering the region's 21st C gateway to bangladesh, india and china was too good for Norman not to want to celebrate it with its author Dr Muhammad Yunus. This Norman did in his last public birthday party with 40 Londoners and Dr Yunus at the Royal Automobile Club London Saint James 2008, by sponsoring 2000 yout book club and 10000 youth dvd club of dr yunus, and bequeathing funds for Glasgow Interdepenece Day and 70th birthday wish weekend with Dr Yunus 4 July 2010. Norman's last article is circulated in the consider banagldesh pamhoplet used at his remberance parties and we welcome similarly bold yout colaboration ideas at www.considerbangladesh.com

Norman loved cox' bazaar as he spent his last year as a teenager navigatinfg raf planes over this port - and noted how efficiently its infrastructure started being developed by the Americans compared with Chittagong which the Brits were responsible for developing during the world war 2 . Norman's viewpoints on peace as biggest economics compass of starting up 21st C are here.

[chris macrae]

Happy 2014 from Norman Macrae Foundation [e-mail]

Over the 24 months of 2014-2015 we will be reporting connections between youth summits wherever we can linkin and assemble micro-wikis around the above issues - you can help us here: Googledoc the most collaborative 24 month race youth have played

 

1 PEACE CURRICULUM Q&A

PC1 Was it a mistake for a book, whose main economic recommendation was that open education would be the net generation's greatest ever entrepreneurial freedom to start with valuing how to network peace?

APC1.1 Timing is everything in mediating transformation in worldwide  system futures. Noran argued that 1984 was the greatest opportunity since world war 2 for citizens to vote against governments spending (through tax) a fifth of all their lives on arms.  Why 2014 is the other greatest youth opportunity to bid for worldwide peace

 

APC1.2  None of his obituary writers at The Economist or elsewhere understood Norman's timeline: spending his youth in parts of Europe ruled over by stalin or hitler, spending his last days as a teenager navigating raf planes over modern day Bangladesh and Myanmar, going up to Cambridge to be mentored by keynes that the number 1 system design job of economist is to end hunger and that youth should never let those in power divorce the future compounding disciplines of economics and peace

 

APC1.3 Ironically all those readers and investors in the entrepreneurail revolution curriclum which Noramn spent 40 yeras editing The Economist from number 3 weekly uk journal to one of a kind global viewspaper understood how the search for peace was embedded in all his major surveys: as the only journalist to be at the founding of the EU, as the journalist who believed the deviation of the BBC fgrom world service was the greatest missed opportunity in mass media, as the journmalist who cheered on Japan as the most value multiplying nation of 1962 and asia pacific worldwide yoyth region liberating china as the turn of the millenniums greatest opportunity for youth to design colaborative millennium goals and action networks around

 

APC1.4 Dismally few of the 21st C most famous economist undersrand the curiculum of economics that Keynes mentored his alumni including Norman on:

1 the core job of the economists is to back whatever system designs she or he believes will help the human race unite to end poverty ( see the last Keynes last essay on persuasion); see also last 3 pages of Keynes general throory on why yoth's grearest enemy is a particular type of elderly academic economist who is most prone to pad his pension with funding from big governments on indsutry sectors that have lost that purspoe which has most relevance to producing future livelihoods.