back again

Return to basics! When I’m a hermit in the mountain house, I focus on my thoughts – and home repairs don’t appear in my daily schedule. But "she who must be obeyed” identifies very quickly the tasks needed to keep the house purring (and of my lack of practical skills). Wednesday it was tree planting and a visit to a traditional, derelict Romanian house between Sirnea and Pestera which is owned by our old neighbour - who wanted to show us the various heirlooms (clothes and wooden instruments); today it was sawing planks to make an extension for the table – and then doing the work. First thing in the morning required transporting the empty gas canister to the shop for a replacement (which is quite a challenge for the uphill carry!).
Apart from the physical labours (including scything), my time has been taken up with reading Paul Mason’s marvellous study of the financial crisis – Meltdown; the end of the age of greed And here's Mason in full flight.
Haldane, in a Bank of England discussion paper today, compares the situation with the one facing Roosevelt in 1938, when Congress forced him to rein in stimulus, prompting a double dip: he ripped up bank regulations and forced banks to LEND. Policy "went macroprudential" and the recovery took off.
Fisher, as quoted in an excellent post by the FT's Isabella Kaminska , says:

Non monetary factors, not monetary policy, are retarding the willingness and ability of job creators to put to work the liquidity that we have provided… Those with the capacity to hire American workers - small businesses as well as large, publicly traded or private - are immobilised. Not because they lack entrepreneurial zeal or do not wish to grow; not because they can't access cheap and available credit.
"Rather, they simply cannot budget or manage for the uncertainty of fiscal and regulatory policy... According to my business contacts, the opera buffa of the debt ceiling negotiations compounded this uncertainty, leaving business decision makers frozen in their tracks.

Paul Mason comments on his blog -

Jeff Sachs in today's FT flays the global rich for their capture of fiscal policy, condemns the outcome of globalisation and issues a plea for a policy u-turn: The path to recovery now lies not in a new housing bubble, but in upgraded skills, increased exports and public investments in infrastructure and low-carbon energy. Instead, the US and Europe have veered between dead-end, consumption-oriented stimulus packages and austerity without a vision for investment. Macroeconomic policy has not only failed to create jobs, but also to respond to basic social values too."
There is, as the elite stare out of windows of business class at the blue skies and do some thinking, something big starting to change. Let's dissect it into bullet points:
• By deciding to bankrupt states instead of banks we avoided a Great Depression
• But some states can no longer take the strain
• The recovery is faltering in the West: in the US, UK and Eurozone. It could easily become a double dip
• Monetary policy has been now, publicly, tweaked towards semi-permanent QE and zero interest rates (except in the Eurozone where as Sachs points out policy is in the hands of dysfunctional institution and has basically had to go free form)
• There is no more money for fiscal stimulus
• The option of inflating away debts, public and private, is being quietly pursued but its impact is to flatten consumer demand
• Thus those who dream of a return to consumer and house-price led growth are being disabused.

There is, in short, a zombified situation well known to small businesses and households. Nobody wants to spend, or invest because they cannot predict the future.
Large numbers of businesses are being kept alive because banks cannot afford to declare them busted, or the liabilities rush onto the books. Ditto for many households - Haldane points out 35% of unsecured debt in the UK is with zombie households.
Fisher of the Fed is pointing to the same problem: businesses are awash with cash but - as all orthodox monetary economists know from reading Milton Friedmann - this can become a bad thing. In 1933 the build-up of unspent cash in the economy, as the money supply fell, provoked the final crisis. So what to do?
It is strange to see Jeff Sachs, the man who unleashed neo-liberalism onto East Europe, calling for a global version of the New Deal, but that is effectively what is emerging as the option.
To reorient tax policy to protecting the poor, raising their skills, focusing the investment flow towards green energy etc you would have to do something approaching a political revolution in the US: because from K street to Capitol Hill politics is set up to deliver the opposite.
The Bank of England's Andy Haldane prefers the realm of the possible - the new boss of financial stability policy in the UK is musing publicly about a "macro prudential" intervention into banking policy - effectively encouraging the banks to become more risk prone, throwing off fear-induced aversion to lending.
But this rather runs counter to the wave of regulation being forced onto the banks (let alone the proposed Financial Transaction Tax That Will Save The Eurozone). And since Haldane is still speaking the Bank of England's riddle language, where nothing is ever concrete, we will have to wait and see.
One interpretation is that he has given up the idea of forcing a major shift in power between banks and states (Andy Haldane, Pittsburgh 2009) in favour of forcing the banks to once again act like Masters of the Universe.
What everybody is toying with is the idea of a big, government-led structural change within capitalism: whereby the priorities are re-oriented so that private sector growth does not return at the price of impoverishing developed world consumers and workers.
At times like this I always come back to Hyman Minsky, the unorthodox neo-Keynesian economist who predicted the crash and whose work contains the kernel of what a 21st Century structural change might look like.
Minsky, who has followers on both the left and right, argued: socialise the banking system, rip up regulation for the private sector non-financial economy so it can grow, and abolish welfare, making the state the employer of last resort but forcing the unemployed to work.
By socialise, he meant: reduce banks to the basic function of collecting and lending the savings of the population, in a variety of non-speculative businesses. Today that could be mutuals, nationalised banks, Landesbanks, credit unions etc. The difference between this and Glass Steagall is that you actively discourage the existence of a financial speculation sector.
We have come to call the crash of 2008 the "Minsky Moment" - but in hindsight it wasn't. Not until something big goes bust, and millions of people lose their money, is it really a Minsky Moment. Everything policymakers have done since 2008 has been designed to delay the reckoning.
So why is the thinking beginning to change?
One of the most brilliant observations in Alistair Cooke's memoir Six Men concerns the difference he observed in Edward VIII's mien, with and without access to intelligence briefing. Cooke wrote:
"Daily possession of 'the papers' is, in fact, the main and most deceptive perquisite of high office". (Cooke A, Six Men, 1977)
Without them, Edward would fume as they hustled him onto a plane at the outbreak of war: "We know damn all about what is happening."
That is the situation for most of us today. I interpret the sudden flurry of blue skies thinking as a sign that those who do get "daily possession of the papers" are bracing themselves for more trouble in the autumn - banking trouble, real-economy downturn trouble and political protest trouble.

For more on the crisis see here, here and here.
And a good comment on the Uk riots

Finally an excellent case study of the disease of privatisation

contrasts

So hot in Bucharest on Tuesday (at least 35) that the petrol vapourised and the engine came to a halt just 200 metres short of the flat. Fortunately the next day was wet and we managed the run to the mountain house with no difficulty – despite a surprising traffic jam (for a Wednesday) at the 10 kilometres’ bottleneck at the Sinaia-Busteni stretch. And today we have high wind, rain and 8 degrees – the precise measurement thanks to the small (birthday) barometer I have just erected on the balcony. Ideal weather for the usual house clean-up – and dipping into the dozen or so books waiting for me. These include Colin Crouch’s The Strange Non-Death of NeoLiberalism ; and Fukuyama’s new opus The Origins of Political Order

contrasting mayoral styles

I had occasion a few months back to congratulate the mayor of sector 1 in Bucharest who has organised a free rental bike scheme this year in one of the central parks. That contrasts, of course, with the appalling record of Sorin Oprescu – El Supremo of the City - who has (as befits a surgeon) laid about the old buildings of central Bucharest in true Attila the Hun style. Disregarding not only history – but laws. Here in Sofia, we have been talking very positively of the mayoress (Yordanka Fandukova) – first for the way the pavements are being slowly rescued from the cars (with bollards); and, over the week-end, for the freeing of the narrow streets from cars in the evening. One of the problems of central Sofia is the narrowness of the pavements (one-way roads also – but that keeps the speed down) but, for 3 evenings, the streets have been blocked to vehicular traffic; and tables and chairs of the bars and cafes (and kids) have spilled onto the streets. Marvellous!

Craig Murray has been on good form recently – with first a comment on the Chinese reaction to the US downgrading; then a very sensible recommendation on how to deal with the criminal banks
A year ago, I was paying tribute to Tony Judt; and blogging about the greed and incompetence of our leaders

Sofia's charms - again

Another very pleasant lazy (yester)day enjoying the incredible variety which Sofia has to offer anyone who appreciates serendipity - and who has some aesthetic inclinations. A slow walk up Ignatiev st in the morning to the City Gallery – which, in addition to the special "Other Eye” selection of paintings from its vaults by art critics, has at the moment a marvellous exhibition of paintings of monasteries in the Balkans. Then a meander in the park where the jazz musicians were, as usual, active - giving everyone great pleasure. Then across to the great Tabak cafe at the back of the National Gallery – where they were loading various fascinating sculptures (hope it wasn’t a heist!).

There was a small political meeting going on nearby – of older people. And, at the open market in front of Alexander Nevski Cathedral, I picked up a large Chiproviste carpet for only 100 euros –

and also an amusing small „Troitsa” painting on wood by a young Dmitrov (Ivalio?) – the trinity were a corrupt looking mayor, teacher and priest all imbibing.
On the more serious side, this article well describes how the financial crisis is impacting on ordinary people who bear absolutely no responsibility for it.
I hadn't realised that the German social market was based on the theory of
ordo-liberalism

summer relaxation

A very pleasant walk this morning around the old open-air market area between Hristov Botev and Maria Louisa Bvds which boasts in a small area a graceful mosque, a massive synagogue and a delightful Romanian Orthodox church called Holy Trinity(Sveti Troitsa - actually Macedonian romanian). This is the rather down-at-heel area which stretches to the Central Station (across the Lion Bridge) but which is slowly becoming gentrified - in a typically gentle Bulgarian way. I hope it doesn't drive the Syrian and Iraqian foodshops out - where I stocked up with spices and other delicacies (eg Aleppo soaps) for the mountain house.
Lunch was in the small courtyard of the ivy-clad house at the back of the British and Polish/Hungarian Embassies which are a couple of minutes from my flat. Lunches take time here!

better things to do!

Time for a break! I see that my readership is falling off - hopefully people are taking a rest from the internet. Better things to do! So I will probably do the same this month when I will be going up to the mountain house.
The book which has been gripping me these last few days has been a door-stopper of a book (in the sheer weight of its 790 odd pages and illustrations) - Art; a new history by Paul Johnson (2003). It's the most informative of any art book I've ever read - by someone better known for more conventional (but broad-sweep) political histories. The book is written by someone with a clear vision of what is interesting art and what is spurious. Realist at is his love (as mine) and he therefore dismisses a lot of modern art (including the impressionists - a fairly meaningless label anyway). His style is clear and personal - with the historical context of (and social relations between) painters being sketched out in a highly illuminating way. A lot of neglected artists from northern europe, russia and america find their way into the book. Even those critical of his prejudices have to admire the result.
Robert Weir Allen is a 19th century Scottish painter in the realist tradition (not mentioned in the book) and this is his Home from the Herring Fleet

What's in a picture?

Regular readers will have noticed that my booklet on Bulgarian painters seems to be on the back burner. I have hit a wall – not being able to find the basic data which I feel I need on about 50 of the painters on my list (of whom I have a reasonable sample of images). I don’t know about you – but, whenever I see a painting which I like, I always want to know something about the painter. Where did (s)he grow up? Where were they trained? What were the defining inspirations and influences?
So I am trying to include in my booklet some text on such things as –
• Date and place of birth – and year of death
• Training; where (particularly if abroad) and with whom
• Genre – and how to identify
• Main places of work – and influences

But the time has not been wasted – I’ve been looking at some examples of painting books eg Modern art 1851-1929 by Richard Brettell in the superb Oxford History of Art series which is good on classifications, social context and the width of selection – as well as Art – a new history by Paul Johnson which is an easier and more personal read (as someone who does not profess to be an expert).
Paintings speak in different ways to each of us – although that doesn’t stop art critics and historians from imposing a lot of words and noise on us.

I realise that I have always put a visit to the municipal art gallery at the top of my list when visiting the various cities of Europe (and central Asia) – for example
• Berlin in the 1960s (to discover the 19th century realists such as Adolf Menzel; and the works of the first 3 decades of the 20th century of Georg Grosz; Max Liebermann and Kathe Kollwitz
• Brussels in the 1980s (to be moved by the 16th century Flemish art – and late 19th century realists);
- Venice also where I saw Caravaggio's incredible realism in all its glory
• Istanbul in the late 1980s (and the delight of their miniaturists and calligraphists)
• the stunning Hermitage in Leningrad in January 1991 (Repin and the Russian Itinerants); and
• Tashkent in the early 2000s (for the Asian side of Soviet art).

Only as I write this do I realise that most of these paintings are figurative whereas what I have fallen in love with here in Bulgaria are the paintings of their land- and sea- scape artists. Perhaps that it nostalgia for my home country, Scotland, which I left 20 years ago – and the glorious landscapes painted in Victorian times by people like John Knox and William MacTaggart and, in the early part of the 20th century by the Glasgow Boys and Colourists.

It was only in 2007/08 when I was living and working in Bulgaria that I stumbled on the landscapes and seascapes painted by the Bulgarian painters who were working in the early and middle of the 20th century.
I found them beautiful – and affordable – and have found myself an art collector!

And now that I have a reasonable number of land and sea-scapes, I am trying to find more figurative work – such as the R Ivanova painting which heads this post

- and this unknown

the demise of the citizen

I’m not a technical geek – so it was a bit of a surprise when I realised a couple of months ago that the information and references I receive when I google are in fact personalised to me on the basis of a personal profile the google machine has built on me from my internet activity. New York Review of Books has just published an interesting, wider review of the role of Google.

In this part of the world, an individual citizen is remarkably free from the sort of social controls on development we are used to in northern europe. Houses spring up without any sort of municipal approval; and of, course, two factors make it difficult to develop such a system here. First the municipal officials simply don’t exist to make it work; and, initially at any rate, any attempt to develop a planning system would be totally corrupt. People would simply buy the required permissions. The British planning system can, of course, sometimes go too far, with even minor adjustments to one’s home requiring protracted negotiation. But noone, as far as I am aware, has even suggested abolishing the system. Most citizens accept that the protection of the "greenbelt”; public parks; historical features; some element of aesthetic propriety are worth a little bit of bureacracy. I was appalled to learn that all of this could be thrown away by the coalition government in Britain.

The recent coverage of the Murdoch family and empire has focussed on the minutiai of who knew what. We must not lose sight of the fact that this is an empire which has successfully controlled government agendas and made a mockery of democracy.
And a good "take” on the current US crisis – and, again, how it has exposed the lack of any democracy in that country can be found on Real Economics.