Newsround: Northen Rock crisis

I read once that the key to happiness is to be able to lie to ourselves. It seems that we do very well since we tend to believe things always are going to be fine, at least in Finance. It might look like a big surprise that an institution like Northern Rock can be in such a turmoil about the lack of trust by its customers.

I won´t say that I don´t understand their current anxiety, I would probably be doing exactly the same because fear don´t understand of promises or messages to calm down people. Money is something people don´t want to play with when there is a clear message that something is going wrong.

The crisis is just another of the many that might happen in other banks or building society. It does not mean that I try to be a fatalist but a mere reality that the banking system was playing too hard, risking too much and at some point, someone will lose or pay for it. It tend to be not just the bank itself but also those who are customers at the time.

This is not the first time there is a problem like that, it happened in the past and it will happen again. If there is something that is clear in Economics is that we never learn anything from the mistakes from the past. Money and how much profit we can make out of it outnumbered the reasons for thinking and taking a more careful approach.

This might not be one of the big crisis yet, but day by day, I keep crossing my fingers that it won´t be. Anyway, we survived all the previous ones. What a global crisis could mean after all?

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Newsround: Climate change and bills

So far you might have not believed it. Fair enough. After all, what’s all this hassle about the climate change if nobody seems to agree what is exactly happening. Still, that’s fair point. You could even argue that scientific evidence is sketchy and inconclusive and any other excuse you could find to justify that changes to the planet are not happening.

I am afraid, though, companies start thinking differently and they believe that we are responsible, therefore, customers should pay the full price of the cost of fixing the problem we created. Many utilities service providers like water or electricity companies have been passing the cost of dealing with the green issues on their bills and more and more will follow.

Besides what it’s been said before , taxes are on the table as the next green income by the government to help to develop alternatives to the existing energy resources that we use.

In short, it would Economics not Politics which will get the message across. We might not like to talk about it, but definately we don´t like paying for it.

HEDGE FUNDS OR MASOCHISM

Back on time a few years ago and I remember reading about the risks that Hedge Funds were, they went on explaining that in a long term, anyone who invested in them could lose everything.

Now, it seems we didn’t listen to the warning. I suppose the whole process of getting into such a mess has to do with some kind of soft Masochism ,enjoyed by those who play with money. I guess the thrill of the risk, the need to be richer quicker and easier than before, push people to the point to risk everything. All of that knowing that when things go wrong, the pain could be excruciating; there are already people worry about losing their houses and the amount of debt they hold, and though not related with the current problem of the Hedge Funds crisis, it could increase if there is a domino effect.

The global economy is going through a test which is not much different from others passed or failed in the past. Perhaps, this time is harder to assess the consequences of a big crisis since globalisation has made everyone linked in some kind of pieces of Lego. We know we can do many things with them, different shapes and it all will look stable and strong. But, these pieces of Lego that worldwide economies are, they are not so strong neither so stable. They are not joint together firmly and able to hold any shaking.

The lack of trust from Bank to Bank is one of the reasons of the current crisis and it also highlights that no matter what activity we choose , as long as it’s run and operated by human beings, there will always be some level of mistrust.

I am sure that we get over this crisis -not matter what the results are-, I am so certain as I am that shortly after there will be another magic financial product with many risk involved and there will be plenty of people to go for it. It’s just a matter of Masochism.

BILL GATES; FROM DEVIL TO ANGEL

He has always been in the spotlight, especially among those who support conspiracy theories. We all might hear that one day, Microsoft will run our lives and the world. Maybe. [We could say the same thing about Google nowadays, but anyway]

The reason for me to talk about Bill Gates is the recent gesture from Microsoft to release more Open Source code to anyone who wants to use, especially to develop software that could help to find a vaccine against the HIV.

It’s not the first time that Bill Gates has been named related to the fight against a illness that is killing and infecting millions of people in the world. Not long ago he along with his wife received the recognition from one of the most respected institutions in Spain for his work in funding and promoting awareness against HIV in the world and especially in Africa.

We hear a lot of how much money we put against flooding, wars, droughts, and many other disasters. Magic hat ready to provide with millions of pounds for those problems. Then, companies also keep talking about how much profit extra they made.

But, what about poor countries? Do we really care for them? Bill Gates might not be the most loved person in the world, and you might or not like Microsoft products, but at least, he is doing something. We might thing that the amount of money given is ridiculous compare to the profit Microsoft makes, but saying that, isn’t it that better than no money at all?