I had heard that some Euros were better than others and this story confirms the rumours.

Germans are refuisng to accept Euros which have originated from the Latin Bloc, especially Italy. They want “hard” Euros issued by the almighty Bundesbank, that inflation fighting automaton. You can hardly blame them given the fiscal history of Italy, never mind Greece, Spain or Portugal.

But what this shows is the lengths to which people will go to mitigate risk. It seems a waste of time really given that the Euro is universal in its value and acceptance. But its a bit like English and Scottish Pounds. No one ever wanted a Scottish one even though they were both accepted as legal tender by the Bank of England.

Perception is everything and the Germans have long memories of inflationary times.

The sad fact is that if the financial system falls apart nothing will save you. Having a nice pile of gold soveriegns might but the reality is that there wouldn’t be enough to create a reasonable market for exchange. Now a nice veggie garden is more of a goer in times of monetary distress. This is where NZ has a major comparative advantage. Nearly everyone has a patch of dirt in which to grow stuff.

Our central banks have a lot to answer for but promoting home grown veggies is one good thing to come out of this debacle.

After a 1200 pt rally in the Dow the market has come to its senses and started bailing again. It’s a year now since Bear Stearns stumped up $3bln plus to bail out one of its funds thereby signalling the start of the crisis.

The news is bad wherever you look but the focus now is on the banks and whether they will be able to shore up their balance sheets which have more holes than a block of Emmental.

The pressure of continued write downs will simply hasten the inevitable collapse of a major institution. The big question is how the banks will be re-capitalised.

The first wave of capital provided by overseas investors has resulted in major losses and burnt fingers. Sovereign funds may be a little more wary this time round even if the price is way cheaper.

The Naked Capitalist reports on discussions the Fed has been having with private equity companies to see if they might be interested in stumping up some cash. However, there are issues of bank ownership and the size of stake any non-bank organisation can take. The word is that the Fed could seek to relax these rules.

This does not fill one with confidence.

Closer to home NZ finance companies are collapsing like a house of cards. It’s hard to know if any will be left. Already prosecutions are underway against accountants who signed off on the books of failed companies. I wonder how bank auditors will be feeling when they come to sign off the books of the major banks and see a long list of assets “uanble to be valued” properly.

There should be caveats galore.

But the question remains as to whether the crisis will spread to the major banks. If it does we could see queues around the corner of all our financial institutions before too long. I’d certainly advise people to have a bit of cash set aside and money spread around various banks. Having said that NZ is one of the only countries in the OECD not have have deposit insurance for banks.

Given the central banks moves so far it’s safe to say the banking system is underwritten to some degree but if you own shares in a bank i would be very uncomfortbale about that.

I haven’t blogged for some time now. One reason is that I have been very busy and when you get busy sometimes the creative juices don’t run fast enough. Having said that what’s new to write about? It feels a little like groundhog day…….

I’m sitting comfortably at 39,000 ft on the new A380 heading for London. It’s a lovely machine. It’s amazing what we can build and the technology we can put together and yet………….

A dictator pounds along the well worn route to genocide, societal collapse and the ignominy of international tribunals and exile in some foreign land whilst the international community looks on in horror and wonders what to do.

The sad fact is that people like Mugabe will always appear. They are our shadow, our dark side. They come as saviours representing hope but become corrupted by power, insecurity and self loathing. Democracy is damned messy, it’s painful but one thing is for sure it gives space for us to address our shadow, to address our short comings, our weaknesses and our frailties. Nothing can be done for Zimbabwe now. The play has been written long ago and we are into the final act. Mugabe like Amin before him is unravelling in a paranoiac binge of violence. It’s painful to watch the people there suffer so much.

The Burmese catastrophe simply reinforces this never ending drama. It’s like Alice in Wonderland, curious and curiouser, as those generals walk around in their own fantasy creation. Is this really happening? Can you lock up the democratically elected leader forever? Are these generals real people or some kind of virtual reality?

I say carpet bomb the country with food parcels and emergency kit. Shower the place like a mid winter storm. Get Santa and his reindeers involved.

Invasion of national sovereignty they say wringing their hands with diplomatic concern.

Bollocks….we need an invasion of humanity. Now.