At home, the world can now breathe out. The local scandals can continue, to the extent they have not been conveniently forgotten. For one, the current prime minister privately messaged his long-term friend, the director of the largest private bank DNBNor, only days before the Norwegian bank bailout was made public. Between this messaging and the publication, DNBNor liquidated a NOK2.3G portfolio of state-obligations. The bailout, to the tune of NOK350G, depressed the price of the obligations sold by some NOK70M, which could be considered a profit on their shorting. Luckily, the chairman of the finance supervising board Kredittilsynet is also one of this group of friends, and only after severe prodding in the media (and stating that no bad had occurred) did he remove himself from the investigation, after clearly stating that he was not too involved to supervise it.
The prime minister, of course, still has the messages barred from public as ‘nationally sensitive’, but the media is keeping this warm in a fashion – although most of them seem to think that nothing wrong has happened on the political side. Those greedy bankers.

Yes, the media. The largest TV channel here is NRK, Norsk Rikskringkasting. NRK is state owned, and the chairman is appointed by the department of culture. Like the state bureaucracy, NRK is supposed to be politically independent. This independency is seen most clearly in the fact that NRK stays pro-AP, regardless of who else may be in power at the time. The second scandal these days comes with the publishing of the memoirs of one of the old NRK journalists, who was receiving money from the labor-party to actively campaign for them in the 60s. As most scandals, this has a bit of hypocrisy to it, as all of NRK is funded by the department, and that department tends to be headed by the labor-party.

One could say that the scandal was that he was getting paid twice for doing the same job.

-rN

The trains and subway are unaffected by the snowfall, but due to a particularly heavy cover of leaves (it seems that this is a season of extremes), the rails are too slick for normal services – there have been half-heavy delays since Friday. Of course, the now very old subway-cars fare significantly better than the German-built X3000 cars, as they are fitted out to dispense sand on the tracks to provide friction, while the new ones are not. We already saw this last year when the X3000s were just taken into service, but I guess the problem was hoped or wished away.

Of course, the first snowfall never lasts. The snow will melt. The forecast for tomorrow is rain.

-rN

In the US, taxes are supposed to fund specific projects. Imposing or changing a tax to redistribute wealth seems like an affront to Americans, as wealth is supposed to be created and not redistributed. In the US, poverty is seen as a failure of wealth creation - while in Norway, poverty is a failure of wealth distribution.

The two worlds could hardly be more removed.

This is highlighted by by Obama’s gaffe on ‘redistributing‘ in the Plumber Joe case, and the reactions this garnered. The idea that a president-candidate should focus more on redistributing wealth than creating it is patently un-American. In Norway, on the other hand, we’re clearly aware that the purpose of those that by failure of regulation have become rich, is to contribute more to society.

A recent comment by Victor D. Norman, an economist nominally of the conservative party, and previously their minister of labor and administration, shows how much the Norwegian world-view differs from the American. As stated in a the business-oriented paper Dagens Næringsliv (my translation);

The reason for taxation is not to supply funds, but to have private consumers and businesses engage fewer people, and thereby free up resources for public services.
(Victor D. Norman, Dagens Næringsliv, 2007-12-08)

At the core seems to be a diametrically opposed view of what the state is supposed to do, and how the citizens fit into it. In the US, the state has previously been a construct to provide a few essential services for the population, while in Norway the citizens provide the basis for the essential taxation that is the reason for the state and all of society. Another example of this difference is this quote from Audun Lysebakken, of the (currently in government) leftwing socialist party;

The level of taxation will always be rising, except in periods of economic downturn, when it will remain stable.

The rat has naively believed that the government would require funds for certain agreed-upon tasks, and that those would remain fairly fixed. With time, the number of tasks would expand as populist parties bribed the population with fair promises to let them into power, but the core premise would still be that any remainder, any resources left un-consumed by the state should be left allocatable by the citizenry. The rat now understands that this is not the case in Norway, although it is still believed to be so in the US.

The rat further hopes that the current election will not bring a redistribution of world-views as well as possibly an increase in redistribution of wealth.

-rN

-rN

It’s been a good weekend. I’m curious what’ll happen during the next week. I don’t have any new stock-purchases lined up, but I can’t really imagine another week of >5% drops on the stock exchange. We’ll see.

-rN

This morning, I found an interesting item on the current crisis. While it seems fairly established that it was the homeowner-support risk-subsidy policy set up by the US governments ( Carter and Clinton, but none of the presidents in between managed to fix it either) that caused the pile to topple over, most of the blame for the actual crisis once again seems to reside with the federal reserve. From today’s ASI blog review, a little piece on “The Artificial Boom“.

The point I take home, is that you can’t really have a bust without first having a boom (as that bust will be the deflation of the previous inflating boom – ie. a more or less unavoidable readjustment). Thus the important thing is not to avoid busts, but to avoid the artificial booms that are fueled by politically motivated changes in regulation or fads.

-rN

I normally cook without a recipe, and quite often the result is both edible and free of glass shards, although  not really posh.

-rN

Another part of my normal day is my fairly new-found interest in economy. I’m watching a few items of stock that I’ve bought into, and they are all currently falling steeply (as is everything). My main investment is in the chemical company Yara, which I bought at 149 when the rate was going up. It went to 462. I then bought at 149 again when the rate was going down, and it is currently trading at 105.

From 460 in June to 120 in October...

My other stocks are doing less bad, but still going down. This view into the Macro- of the economics is fun.

A third item of my usual morning is to check up on a few blogs. I’m subscribing to a few RSS feeds, but one of my favorite bloggers gets a visit every day; David Thompson publishes various stuff on Britain, with a heavy helping on post-modernism. I was particularly happy to see a validation (or at least a second source) of the link between current political correctness (and all that ‘lefty’-stuff) and old-school Marxism. Previously I’ve found this detailed by the military historian William S. Lind (at DNI), but David continuously provides practical examples, and how this is has grown into a lot of western thinking.

While I’m not ready to out myself as a liberalist (fairly unheard of in Norway), I am enjoying the Adam Smith Institute blog greatly, and have also found a lot of sense in the thoughts of Milton Friedman. It’s interesting to see that both the socialists and the free-marketeers blame the others for the current economic situation, and also reject their suggested solutions as ‘more of the same’.

-rN

Although I don’t do twitter, today’s dinner will be baked salmon, with a dab of sour cream and a tiny cucumber/tomato salad.

-rN