Citigroup’s Chuck Prince said: “As long as the music is playing, you’ve got to get up and dance”, but bank regulators insist on playing the same 30 years old song.

Sir, Andrew Hill worries about how many of today’s banker class remember it, let alone worry, about the complacency expressed in Chuck Prince’s “As long as the music is playing, you’ve got to get up and dance. “James Gorman, chief executive of Morgan Stanley “Amnesia dooms bankers to repeat their mistakes” June 24.

Hill hopes Gorman “is experienced enough to have detected the echoes of 2007 in the current soundtrack of rising share prices and lowering regulatory burdens… and that he teaches “more of his younger, fresher-faced staff to recognize the tune and know when to bow politely and leave the dance floor.

As for me I would much rather prefer the regulators stopped playing that very same old song of the “risk weighted capital requirements for banks”, composed in 1988 by the Basel Accord, and otherwise known as “You earn higher returns on the safe than on the risky”. That song drove bankers into an intense maniac polka, in pursuit of the very high expected risk adjusted returns offered on what was perceived (houses), decreed (Greece 0% risk), or concocted (AAA rated securities) as safe.

PS. Hill refers to John Kenneth Galbraith’s The Great Crash 1929 account of the willful errors and self-interested speculation of the great investment banks. But Galbraith also wrote “Banks opened and closed doors and bankruptcies were frequent, but as a consequence of agile and flexible credit policies, even the banks that failed left a wake of development in their passing.” Money: Whence it came, where it went” (1975)

@PerKurowski

Record labels and Social Media, negotiate copyright issues among you, but please don’t endanger our heartfelt covers

Sir, Anna Nicolaou writes: “The big record labels are pressing the world’s largest social media network… to tackle copyright for cover songs and other content that fans post to their newsfeeds” “Record labels press Facebook to face the music over breaches of copyright” December 29.

That saddens me. On my 60th birthday, thinking about what I could give myself, I came up with the idea of recording and posting on YouTube one cover of a song I have liked in my life, for each day during the whole next year, and so I did, 365 songs! Phew, was I relieved it was not a leap year! Can you imagine how I would feel seeing all that effort and memories just vanishing? http://mynoisyvoice.blogspot.com

If my modest covers generate some ad-revenues, the record labels and the social media should come to an agreement on how to share these… but under no circumstances should it affect all of us who want to express admiration in this way for the songs in our life.

By the way I can’t imagine how any of my covers would impede a single sale of a record containing it; in fact, by reminding people of its existence, it could even generate some new sales. I was indeed moved when one of my covers received the following comment: “Thank you for interpreting so well the song of my grandfather…. I am proud that the memory of his work is not erased over time, and that by disseminating it, do not let it die, an affectionate greeting from….”

If there were one reason I could though understand for the owner of a copyright to take down my YouTube cover, it would be that the song’s original composer expressed horror over how I might be murdering it. Sir, I pray not too many will. 

PS. On my http://ayearofsongs.blogspot.com, with respect to copyrights I actually wrote:

“One is always worried about issues such as copyrights, as one does not want to end up in a slammer at any age, even if voicing some of these beautiful songs could perhaps be worth it.

What I will try to do is to check out on the web if someone else has been doing a cover of the song or any other one by I believe is of the same composer and, if so, I will presume it is ok for me to do it too.

Of course if someone protests loudly, not only for a copyright infringement but also because the composer feels I am destroying or in any other sense behaving disrespectfully towards his baby, I will ipso facto take it down and replace it with another song.”

@PerKurowski

Slow the dance but do not impose the tune

Sir Chrystia Freeland ends “Investors had little choice but to keep dancing” October 9 asking for “a more powerful regulator to be established with the authority and courage to slow down the music for everyone” and this absolutely correct. But in doing so we need to avoid by all means that the regulator chooses the tune to which the markets should dance.

I say so because the current crisis resulted from the Basel bank regulator wanting the market to dance slower and, using capital requirements based on risk, induced it to take up some slow low risk waltzes instead of fast polkas or emotionally laden tangos and which led the markets into the arms of the dangerous AAAs.

By the way there are still two dance halls open and that many feel should be closed but which proves something impossible to do while the music plays. One is the dollar, where investors all know that one morning they will wake up find the safe-haven unsafely overcrowded, and a murderous panic for the exit will ensue, and the other is the public debt here and there and almost everywhere. Who is making the preparations for when these other two dance halls close down?