Same difference, Jack.

Sorry about that. A Freudian slip I guess. Brian got started doing neo-Rockabilly with the Stray Cats in the 90′s. I think he is still active running an outfit call the Brian Setzer Orchestra, a kind of retro rock/jazz/boogie woogie fusion band. You are not him, although you never know, he could be a distant relation. You ought to look into it.

best data source for export composition globally is the direction of trade statistics, but it tends to come out with long lags.

what are the common misconceptions in your view

Oil is a global commodity. The US has an interest in precluding a $ 200 oil outcome, regardless of its own supply sources.

Uh, on top of that is the possibility that the upcoming enormous transfer of wealth flows into extremely unfriendly hands, for example, if there were a Wahhabist coup in Riyadh. Do we want a nuclear armed Israel facing off against determined foes with unlimited financial resources right on top of the world’s oil supply? 9/11 was a wakeup call to the risks, the Iraq invasion was a pretext to relocate large US ground armor and logistic support to the ME in case it’s needed.

Anyway, back to trade. Brian, I wanted ask if you could dedicate a post sometime to analyzing the relative size and nature of US exports. I think there are alot of misconceptions about this, but I’m having a hard time finding a place with the raw numbers ie where the US ranks in term of global export volume, what sectors make up the actual exports etc. I think some of your reader might be suprised at the data.

The Daily Telegraph has been exclusively briefed on the discussions, which gave a rare glimpse of the workings of the communist regime and its financial operations.

Those present included senior executives from some of China’s “Big Four” commercial lenders, each of which has the government as its majority shareholder. Officials from the People’s Bank of China wanted to know whether the lending banks “had any skeletons in the closet”, according to one person present.

Had they, in other words, bought any Western loan packages whose value could be affected by the global “credit crunch” which had been sparked by America’s sub-prime mortgage crisis?

By and large, the answer was “no”. The insider said: “There was a debate which drew one general conclusion: that China’s capital walls had largely insulated the country’s banking sector from the crises elsewhere.

“There may have been a feeling of vindication, but there was not one of complacency.”

Strict regulations on the flow of money into, and out of, China meant that the contagion spreading across the rest of the world’s financial markets would have little direct impact on the world’s most populous country.

Oil is a global commodity. The US has an interest in precluding a $ 200 oil outcome, regardless of its own supply sources.

Now that it’s probably too late for this (massive) round of excessive risk taking by banks, Martin Wolf asks the right questions about how to deal with banks:

“Why does banking generate such turmoil, with the crisis over securitised lending the latest example? Why is the industry so profitable? Why are the people it employs so well paid? The answer to these three questions is the same: banking takes high risks. But the public sector subsidises this risk-taking. It does so because banks provide a utility. What the banks give in return, however, is gung-ho speculation.
(…)

Either the banking industry should be treated as a utility, with regulated returns, or it should be viewed as a profit-seeking industry that operates in accordance with the laws of the market, including, if necessary, mass bankruptcies. Since we cannot accept the latter, I suspect we will be forced to move towards the former. Little can be done now. But when the recovery begins, we must impose higher capital requirements.

Banks play strategic functions in our economies, and thus cannot be allowed to fail. Knowing this, they take more risks than they would otherwise (to earn more when things go well, with the certainty to minimize losses when things go wrong). Governments do know that, and do try to regulate banks, but given the potential gains, banks employ legions of smart people dedicated to finding loopholes in the regulation of the day – and who get rewarded handsomely to do so.”

As we know, there is no morality in business. Whatever you can get away with is good – and in banking when you get to keep a good chunk of it, you do whatever it takes…

The New Deal found a solution with unsubtle, strict regulation (notably separating commercial and retail banking from investment banking). These limits have been taken down in the past 20 years, in the name of “efficiency”, and at the obvious cost of resiliency – and at the expense of citizens and taxpayers. They need to be brought back in. Increasing capital requirements is just one small part of it.