http://www.youtube.com/watch?v=HoG8gL8qfC8

I’ll agree with Mahaish re: the “civility” of this blog. On many other sites, it’s just everybody having a go at everyone else. And the “moderator” who posts very tough sounding Terms of Use seems to be on permenant holiday.

I really agree with this idea of consistent quality content does work. You may not have the “rock star” factor like Obama does (in the sense of his building his social network/donor list). On the other hand, when the “standard” rules don’t seem to apply, we all know people will go elsewhere. And it’s nice to not be bombarded with the “Bernanke is evil, buy gold now” rubbish.

the united nations is usually the forum for the expression hatred and dissunity, and blogs are sometimes like that, in that the participants generally express views based on their predjudicial views of the world.

this blog has this character trait,but in a sense this is its great strength , in that once these views see the light of day they are expossed to the ever prying eyes and minds of other bloggers, and the debate begins as well our collective enlightenment with a little help from the professionals.

infact i would go so far as to say , that the solutions to the economic dilemas we face lie in these blogs, since its better to have thousands of minds chewing over the problem than a handfull of minds, great they may be, cloistered in the hallways of academia .

in many ways people such as yourself ask the questions, but with this blog its not just you that responds with an answer, a very powerfull tool for change and understanding indeed.

i suppose elitists would see such blogs as a trouble makers letterbox, but any mention of the unfamiliar and off we bloggers go scouring the internet for an explaination or greater understanding.

the more informed we all are of the issues that confront us the greater the good in my opinion, and this blog has done that in spades.

and that we have conducted ourselves with great civility, is in part due to the gracious way the moderater has carried himself in this forum,

You might be interested in this analysis of the interplay between the shadow banking system and the zombie, ponzi, fictionally reserved, “real” banking sytem. Professor Gorton’s graphs suggest he may be a “stocks and flows” guy.

http://www.zerohedge.com/article/gary-gorton-shadow-banking-system-run-and-interplay-shadow-and-traditional-banking

“There are few people as qualified to discuss the stresses of (and on) the financial system over the past several years as Yale and Wharton Professor Gary Gorton, who just incidentally has held positions at the Bank Of England, the Federal Reserve and the FDIC.”

“In a submission to Zero Hedge, Professor Gorton provides some unique perspectives into what we have long claimed was the immediate catalyst for the near collapse of the banking system: the bank run, not so much on depository institutions, but on the much more critical shadow banking system.”

“Fannie, Freddie Holders Shouldn’t Assume Guarantee (Update4)”
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aqV2oVx5hc8A
Via Karl Denninger’s Market Ticker

For the time deprived a few extracts.
“March 5 (Bloomberg) — Fannie Mae and Freddie Macbondholders shouldn’t assume the government will make them whole on their investments as Congress disbands the companies, House Financial Services Committee Chairman Barney Frank”

“Please don’t think this is federally guaranteed, I don’t think it is, I don’t think it should be, I don’t feel any obligation to bail you out,” Frank said. Congress will “certainly not” extend any new protections to bond and mortgage-security investors beyond what exists, Frank said.”

“A “whole range” of options is being considered for investors in the two government-seized companies, “from paying nothing to a haircut to whatever,” said Frank, whose committee oversees Fannie Mae and Freddie Mac.”

“Frank’s Second Clarification”

“Frank, in an interview with CNBC television, said investors in Fannie Mae and Freddie Mac debt issued before the companies were seized don’t have as much protection from losses as those who purchased obligations issued since.”

“It depends on when they bought that paper,” Frank told CNBC. “I just wanted to restate what I thought was fairly obvious, that if you bought from Fannie Mae and Freddie Mac, particularly before the 2008 conservatorship, you were not buying Treasuries, you were not buying 100 percent obligations.”

“People who bought from the conservatorship on, that’s a different story,” he said. “What’s happened since the conservatorship, yes that’s in a different category because there were some explicit pledges made by the federal government.”

“Fannie Mae and Freddie Mac are the biggest U.S. borrowers after the federal government. In addition to $1.7 trillion in unsecured corporate debt, the companies have $5.4 trillion in mortgage bonds, according to data compiled by Bloomberg.”

The straight spruikers who are just writers living off the standard beliefs of finance;

The economic journalists, some of whom blow with the wind while others have a non-orthodox stance of their own but temper how much they publicise it; and

The old-fashioned journalists who sniff that there’s something rotten in the State of Finance.

By far the best of the above are the last group, and fortunately there are plenty of them: Michael West in the SMH, Nick Gardner in the Sunday Telegraph and Chris Zappone in The Age to mention but three. There are some very good people in the second group too–like Stephen Long from the ABC, Tim Colebatch from The Age.

Overall I’ve been very pleased with how I’ve been treated by the Australian media–personal attacks like those from Michael Pascoe are a minor part of the coverage in general.

In terms of really critical coverage–good in-depth analysis on their own right–then there are just a handful. Stephen Long definitely, Ken Davidson, Brian Toohey when he touches the issue. Then there’s David Hirst of Planet Wall Street, who’s the sharpest by far but still effectively an outsider trying to re-establish himself in the media here (and I think he’ll succeed).

You mentioned that when you started this you sent links out to various journalists. How would you rank a lot of Australian business media people (in their economic knowledge)? Do any of these people come from banks, hedge funds or other firms? Are any journalists/economists like you?

It amazes me at times when some still throw out the line “for the benefit of our audience, what exactly is a derivative”?

This feedback resulted in many changes through the development of the book.

Interestingly, the book is available on line under a creative commons licence as well as for sale through regular channels.