Posts tagged ‘financial crisis’

31 March 2009

Projection onto Moscow

Here we are, in a time of crisis, and once again Russia operates as a space onto which “western” (in this case, German) fears can be projected.

Moscow, so the German state television channel ZDF tells its viewers (at prime time this evening), is a city of mega-rich and shockingly-poor. While the rich ignore the crisis and continue to party, drink champagne and eat caviar (fade in: image of ballroom dancing, tuxedos, etc), the poor get poorer (fade in: image of poor homeless couple, freezing, being picked up by the police).

The strong implication of the rhetoric in the opening minutes of this “documentary” is that these issues are specific to Moscow’s glittering elite.

Such excess would never be relevant in Germany or anywhere else in the West/North, now would it? Especially not during a financial crisis.

Or would it:

  • Partyelite Berlin. Vodka only 60 € for 1 litre
  • “JPMorgan Chase, beneficiary of $25 billion in taxpayer bailout dollars, plans to spend $138 million for swank corporate jets and a new hangar”
  • AIG’s infamous payout of $165 million in bonuses in this same crisis year. (Plus public backlash)
  • Sir Fred Goodwin’s pension of £703,000-a-year. The former chief executive of the Royal Bank of Scotland’s “departure from RBS was negotiated on the weekend of October 11/12 [2008] when the bank was saved from collapse by an injection of £20bn by the taxpayer.”
  • “Bob Diamond, the hard-charging boss of Barclays’ investment banking arm […] has suffered a brutal £4m cut to his annual remuneration – leaving him last year with a meagre £17m in cash and shares.”
  • Josef Ackerman, Deutsch Bank boss, also took a massive 90% pay cut, leaving him with only 1.39 million euros ($1.89 million) earnings last year.

And at the same time:

  • “Numbers of Homeless Increase as Nation’s Financial Crisis Continues” (USA)
  • “From June 2007 through May [2008], PADS [Lake County’s homeless shelter] saw a 17 percent increase from the previous year in new clients and a 48 percent increase in children.” (USA)
  • Estimates place Germany’s number of homeless people between 300,000 and 860,000. (More on Günter Wallraff‘s experiences)
29 March 2009

Blogs vs. joint action?

A thought I’ve been having recently is mirrored in a New York Times commentary on the lack of riots in the face of the current financial mess:

The texture of discontent (or lack thereof) can say a lot about a nation, and that Americans today are less likely to rebel may not be an entirely positive sign.

It certainly doesn’t mean we have more love, patience or tolerance for one another. Indeed, it may mean just the opposite, that we tend not to trust one another and that we are more alienated from our neighbors than ever before. The lack of direct action could signal the weakening of a social contract that keeps people meaningfully invested in the fate of our country — which may, in turn, be hindering our ability to resolve this crisis.

Before blogs and radio call-in shows, people joined forces and turned to the streets as their most effective means of expression; a unified, angry crowd was often sufficient to win concessions from employers and governments. And so most rebellions of the 20th century were over bread-and-butter issues like unsafe work conditions, wages and high prices for basic commodities. Even “race riots” were usually motivated by competition between ethnic groups over access to jobs and housing subsidies.

But some outbreaks of lawlessness were also indicators of strong, shared sentiments and were driven by a sense of higher purpose. […] Today widespread anger and collective passivity exist side by side.

Where “passivity” means spending time with oneself and one’s internet/tv/radio/___________ (insert preferred form of media)?

After suggesting that at least one of the reasons that Americans are not acting out our anger is our personal shame about not being able to pay the mortgage or credit card bill, Sudhir Venkatesh ends with:

To restore our social bonds, each one of us must overcome our isolating feelings of embarrassment and humiliation and understand that this is a shared plight. We’ll also have to accept that anger, real anger, has a role to play in producing collective catharsis and fostering healing.

Fury, after all, can manifest itself in more productive ways than urban rioting or cable-TV ranting. Fury can inspire real protest, nonviolent civil disobedience, even good old-fashioned, town-hall meetings. That’s how we’ll recover our public life and perhaps help one another through this crisis — storming angrily into the streets and then, once we’re out there, actually talking to one another.

Sudhir Venkatesh, Professor of Sociology at Columbia, wrote the inticingly titled “Gang Leader for a Day: A Rogue Sociologist Takes to the Streets”.

5 March 2009

Jon Stewart on CNBC and the financial crisis

Best counter-discourse on the financial crisis is once again provided by Jon Stewart on the Daily Show.

Vodpod videos no longer available.

22 February 2009

RTBF and banks

Excellent investigative journalism on the Belgian television channel RTBF today. Which I had the pleasure of watching in globalised fashion on German mainstream news this evening.

RTBF sent a journalist into a leading bank, armed with a hidden camera and apparently 500,000 Euros to invest. She asks the bank advisor how she can best invest it, and he provides a good range of advice on how to avoid paying taxes. This from a bank which has just received millions in financial support from the state. From, that is, taxpayers.

Ah, the irony of it all.

Watch it on Tagesschau, 22.02.09, 22:50

16 January 2009

Rational actors. Or not.

They say dislocation is necessary to radically change our ways of understanding and making sense of the world. David Brooks in today’s New York Times is arguing that the financial crisis (a dislocation if ever there was one) has pushed what was previously a marginal theory of economics into centre stage. In this newly emerging economic theory, people are not rational actors, they do not respond in fairly predictable ways to incentives, the economy is not efficient. Instead,

each person’s mind contains a panoply of instincts, strategies, intuitions, emotions, memories and habits, which vie for supremacy. An irregular, idiosyncratic and largely unconscious process determines which of these internal players gets to control behavior at any instant. Context — which stimulus triggers which response — matters a lot. […]

Most important, people seek relationships more than money. If behaving a certain way helps a stock trader or a regulator fit in with his crowd, he’s likely to keep doing it without too much rigorous self-examination.

Now, i’m sure this has been a fairly widespread way of viewing people in the humanities for quite some time. Finally, economics is catching up. And I hear that physicists are reading Foucault these days too…

25 October 2008

Financial Times goes Discourse Analysis

Financial Times Deutschland turns its hand to metaphor analysis in today’s leading financial crisis story. Metaphors such as the finance-tsunami, the earthquakes that shake Wall Street or the meltdown of capitalism suggest that the crisis was caused be acts of nature; ‘the powers that be’. Or Josef Ackermann, the head of Deutsche Bank who earned more than €12 million worth of bonuses in 2007, plus natural powers.

Das Problem beginnt mit der Sprache: Da toben Stürme, ein Finanz-Tsunami sucht uns heim, ein Erdbeben erschüttert die Wall Street, wir erleben die Kernschmelze des Kapitalismus. Diese Metaphern, die ja auch von Journalisten stammen, liegen auf der Hand, um irgendwie zu erfassen, was da draußen los ist. Und doch suggerieren sie, zumal den Betroffenen, die sie aufgreifen, dass hier Naturgewalten und höhere Mächte am Werk sind. Nein, nicht wir Dilettanten haben mit Schrottpapieren gehandelt – ein Tsunami zerstört unsere Welt!

But no, says the FTD, these metaphors lead us astray. The crisis comes from us; from the deeper inner core of ourselves and our society. It comes from our greed and our lust from profit. From bankers to chipshop owners who only change the oil every three days to the consumer who shops around for the cheapest electronic goods – all are part of the problem, according to the FTD.

The story also links to a photo series of conspiracy theories on who caused the crisis. Number 5 is a version of their own theory: the devil and human greed. Number 8 has the best image. Of world governments who are preparing massive underground bunkers to use after the huge planetary catastophe which will flood much of the earth in 2012:

22 October 2008

Virilio and the financial crisis presents Paul Virilio’s take on the financial crisis, first published in Le Monde, now translated by Patrice Riemens. For Virilio, the current crisis is the ‘integral accident’ par excellence, i.e., a catastrophe with massive global resonance, whose seeds were lain in the very technology that led to progress in the financial field. The eyes of thousands are trained upon one issue. He argues that we can not undestand the crash if we think of it as a political and economic issue. We must consider the political economy of speed, the speed brought about by technological progress. Le Monde’s interview:

Gerard Courtois/Michel Guerrin:

In 2002 you produced an exhibition at the Maison Cartier under the title “Ce qui arrive” (‘that which occurs’). It was about the accident in contemporary history: Tchernobyl, 9-11, the Tsunami… A statement by Hannah Arendt was the banner of your demonstration: “progress and catastrophe are the two faces of the same coin”. Is this where we have come to with the ‘crash of the stock exchange’?

Paul Virilio:

Well, of course. In 1979, at the time of the mishap at the Three Mile Island nuclear plant in the U.S., I did mention the occurence of an “original accident” – the kind of accident we bring forth ourselves. I said that our technical prowess was pregnant with catastrophic promises. In the past, accidents were local affairs. With Tchernobyl, we have entered the era of global accidents, whose consequences are in the realm of the long term. The current crash represents the perfect ‘integral accident’.

Its effect ripples far and wide, and it incorporates the representation of all other accidents.

For thirty years now, the phenomenon of History accelerating has been negated, together with the fact that this acceleration has been the prime mover of the proliferation of major accidents. Freud said it, speaking of death: “accumulation snuffs out the perception of contingency”.

Contingency is the key word here. These accidents are not contigent occurences. For the time being, the prevalent opinion is that researching the crash of the stock exchange as a political and economic issue and in terms of its social consequences is adequate enough. But it is impossible to understand what is going on if one does not implement a (policy based on the) political economy of speed, the speed that technological progress engenders, and if one does not link (this policy) to the ‘accidental’ character of History.

Let’s take just one example: the dictum “time is money”. I add to this, and the stock exchange testifies to it: “speed is power”. We have moved from the stage of the acceleration of History to that of the acceleration of the Real. This is what ‘progress’ is: a consensual sacrifice.


Full interview in English at

On a different similar note:

18 October 2008

Financial Crisis Explained

Best explanation of the financial crisis yet seen. Via John Bird and John Fortune’s satire on the South Bank Show.

The extract is actually over a year old, but more relevant than ever at the moment. Even includes a discourse analysis of the financial crisis (through the power of hedge fund names like “High-Grade Structured Credit Strategies Enhanced Leverage Fund”).

Via Stefan Niggemeier.

8 October 2008

Iceland to get loan from Russia

To avoid bancruptcy, Iceland is preparing to take out a significant loan from the Russian Federation according to Financial Times Deutschland. Iceland is sending a delegation to Moscow to make the final arrangements tomorrow (Wednesday). The final amount is yet to be decided but looks to be between 4 and 5.4 billion US dollars.