Trading Game - Part III (Last) - Why Gary Stevenson matters..

During the periods I was studying for my Bachelors' degree in Athens, it was extremely obvious that the monetary policy was wrong in too many ways. I attended the University of Athens for free, I got free books and the bus ticket was extremely cheap. I also couldn’t explain why this personal observation was not relevant to the average Greek student. That was part of their own normality.

As I was born and raised in Cyprus, I was familiar with a different world. We were closer to the English system, our companies were more interacting with England and our financial model looked more like England. That gave us some extra benefits, English style knowledge, more money-making opportunities. When I first visited London, back in 1995, the whole experience was like moving to a bigger capital of Cyprus. There was something extremely awkward. The prices were too cheap for me. That of course was part of a monetary miscalculation that was eventually explained during the bust of 2013/2013.

The model of Athens was different. The people had lower wages and less money to spend, in comparison to a Cypriot. Everything was extremely cheap for myself, in Athens, based on my own salary. And because of that reason, the streets of Athens were full of Cypriot visitors, shopping cheaper than in Cyprus. Soon, many Cypriot companies went bust. There was an increased cost they couldn’t afford..

It took me a couple of years to do the math in detail. The Greek government was indirectly supporting the Greek citizen, for many years, in order to make life look affordable. This observation is identical with what the situation is in the UK. The governments make living affordable, through loans that the people will have to repay later.

Both Athens and London were also contributing to the European budget. That means that both countries sent money to Brussels, in order to support the EU mechanism. Salaries, projects, expenses. That is not necessarily bad, but in addition it’s not necessarily good.

If projects work, there is a benefit for the average citizen of the EU. If projects are implemented for laundering purposes, the bill will be revealed sooner or later.

By 2013 I was able to monitor and keep records on how the EU design was laundering funds for the oligarchs of the member countries. In the exact same pattern that the UK did during COVID. By 2015 it was too late for the people of Greece to prevent what was really happening.The country collapsed. Too identical to the existing trend in the UK.

By 2015 the situation was also really bad and extremely obvious for the UK residents.

People paid a bill that went to a black hole. This is an extremely simple explanation for the BREXIT results. Whoever paid and couldn’t afford to continue paying the on-going scheme, had to put an end to it because they couldn’t afford the continuous, increased bill.

The exact same situation was too obvious after I permanently moved to England. I was not able to clearly understand the “why”, but I could notice that there was an indirect support to the businesses that caused increased instability. Main key point, the extremely low taxation for those who controlled the profits in comparison to extremely high taxation for the lower incomes.

When the Conservatives lost their seats and the Labour Party won the majority in the parliament it was too obvious that the damage to the economy was irreversible. The past governments (Conservative/LibDem) lowered the taxation to the business world and at the same time provided financial support to the general public in need through increased loans that we will have to pay in the future.  This combination of low taxation for the profit making industries in addition to an indirect but continuous support to the problematic financial model and the direct benefit would explode at some future time. IT happens at this time, as the late Hyman Minsky perfectly explained decades earlier.

This explosion occurred during Boris Johnson, Liz Truss and Rishi Sunak. That was the simple reason the Labour Party won that huge majority of seats. The problem was that the Starmer administration was not experienced enough or prepared enough to fix the long-term problems.

I have to be fair on that. My own studies and research allow me to understand and identify early enough. Too many of the politicians (applying to any country of course..) don’t really have any similar studies and experience to do the job. A perfect example is the United States. Trump keeps trying every possible methodology he thinks, in order to hide the increased instability. Yet, it still is not working..

Most of the current team administration and the previous of course (both in the UK, Cyprus and many other countries of course..) are there for the pay check and the benefits they forward to their own peers. They make it too obvious if we closely observe the OPEKEPE scandal in Greece.

So, just to reward Gary Stevenson, since my article started with Gary Stevenson in mind. He explains in amazing detail why the past administration failed and why the current administration still follows an expired methodology. Although Gary Stevenson is described as Leftish, I personally disagree. He is a good thinker that notices what goes wrong. I believe I do the exact same for my own clients..

I am not considering myself as a Leftish. I am not considering myself as a Rightish. I consider myself as a person that identifies early enough what the administration should do and I prepare myself and my clients for the bad scenarios, if and when they appear.

I was doing the exact same thing when I was working in Greece and also when I was working in Cyprus.

The forecasting is a service to prepare the mass of the population and the business world  for the periods the administration will fail to do the right things. 

This is the reason I decided to explain, on my own approach, why everybody should read “The Trading Game” and watch the “Gary’s economics” channel on YouTube.

Our job, as the normal people, the professionals, the business owners is to protect ourselves from the malfunctions of the administration. Every time they occur, every time they become too obvious.

Whoever wants to reach the extra mile on the topics, do please get in touch and message me for more details.

Nicos Rafidhias

https://www.linkedin.com/in/nicos-rafidhias/

Trading Game , Part II : The times when the evidence reveal the criminal activities

 

What I observe in the UK today, is what I observed in Greece, after 2004 and what I was monitoring in Cyprus, during 2008-2013. MSN published today that another company entered administration. There is a pattern that explains this trend. People have money and spend, during good times but then people have less money, spend less and too many companies suffer huge losses. If we observe the current situation, the people have to pay increased bills. So their extra choices are becoming too limited. After they spend the money for the bills and the rent, they have to choose between food and heating. Anything else has become luxury.

As far as I remember, in the main avenue of Nicosia, there was a BHS store. It shut down when I was still in primary school. Their merchandise was expensive and to my own eyes seemed outdated, as well. I noticed that two decades later, it collapsed in the UK, entered administration and shut down. In the last few years too many companies entered administration. Woolworths, Debenhams, Wilko, Bodycare. There is an extremely simplified explanation for that. Higher costs, high prices, losing customers. As I remember, there was a customer mentioning “why pay for washing powder 4 pounds in Wilko since the exact same costs 2 pounds in Poundland? “.

There was an interesting story during the collapse of Cyprus Airways and Olympic Airways. At the time we all struggled to attract investors, in order to save those two companies, there was another part, inside each company, trying to save their own benefits. Trying to save their own (and unexplained..) benefits meant that no serious investors would risk to save them. That was the main reason that the UK government gave British Airways to the private sector. There is a moment you are not able to control everything. Greece and Cyprus failed to receive the message.

The collapse of the banking system in Iceland is an extremely interesting example of proper management. You leave the markets to do their own job and at the same time you avoid transferring those losses and other hidden obligations to the people that had nothing to do with the mess. The law did their job, as well, investigated and punished. Cyprus followed a completely different behaviour, a few years later. The major Cyprus Banks (Bank of Cyprus and Cyprus Popular Bank) invested in Russia and Ukraine but the outcome was extremely poor. In the exact same period the Cyprus government used the Social Security Pot for their own salaries and pensions. That also activated and increased the financial instability, known as Ponzi finance. There were clear criminal activities, implemented by the Cyprus administrations during that period of time. Although, in Cyprus the bubbles of the oligarchs are too strong. They protect each other and transfer the bill to the rest of the population. The population realised a few years later that their property (including their houses) were sold to foreign funds, in order to cover the losses caused by the banking gang.

There are two extremely valuable books, describing what happens in Cyprus. THE GANG (2020) and MAFIA-STATE (2022) both written by the Cypriot researcher Makarios Drousiotis, explaining how the former Cyprus president, Nikos Anastasiadis, was involved in the wrong-doing and money-laundering. Those two books are part of my own collection, next to the Trading Game of Gary Stevenson, just because there is a continuity from “The Trading Game” period to the GANG and the MAFIA-STATE. Anastasiadis was indeed involved in money-laundering and there are too many proofs for that. The worst part is that the collection of evidence includes the Tassos Papadopoulos administration (2003-2008) in addition to the Dimitris Christofias administration (2008-2013) as well. What happened in Cyprus is still kept hidden and the time it will be revealed, in detail, it will show something worse, the involvement of the European Commission and their own criminal activities..

Nicos Rafidhias studied Political Science and European integration before and during the creation of the European Union and the Euro Zone. 

LinkedIn: https://www.linkedin.com/in/nicos-rafidhias/

Personal page: www.nicosrafidhias.co.uk

Business page: www.officeofis.co.uk

This article is part of his recent book regarding the boom and bust of corporations and countries. 

END OF PART II

Trading Game , Part I : The times when memories bring also valuable facts from the past

I have to admit that I am a great fan of Gary Stevenson and his podcast series called “Gary’s Economics”. Gary Stevenson was a Citigroup trader. He was extremely successful, according to his own words. I am not able, of course, to verify whether he was a successful trader as it is not relevant to my own purposes or research. Stevenson speaks clearly for the “Whom you know” bubble. The people in the bubbles that control the game. This is my primary interest. The people that play the game, too many times without any valuable skills.

I have also noticed a few third-party posts saying that his claims are not always accurate and that there is a different story in many of his own claims. This is not something I would be interested in investigating further, since it’s not part of my interests or capabilities. My own research involves Gary Stevenson as a book author. Gary Stevenson wrote a book called “The Trading Game”. I was amazed to notice too many little details that allowed me to understand the period that Lehman Brothers, Cyprus and Greece went bust. As a well prepared book, it allowed me to bring back memories related to the Lehman Brothers bust, the stock market industry, the Northern Rock boom and bust, the RBS boom and bust, what happened before and what followed that period.

What is the most interesting issue for my own research and book writing is that he mentions and also explains too many things that I started studying thirty years earlier ; wrong doing and money laundering implemented by the National Governments and their private sector peers and in addition the effects they cause to the increased financial instability of the public economics and the Ponzi financing patterns they create. Greece, Cyprus, Ireland, the UK, France or Germany, they all play the game badly. In the end, every time, the general population received the bill.

In addition to this information, there is great detail regarding the financial markets inside stories and the side effects they cause to the normal and basic economic operations. I was part of this “game” around fifteen years before Gary Stevenson. The story was then exactly the same. Some privileged people, as Gary Stevenson mentions, earned large amounts of money from extended speculation. As happened a few years later with the Greek economy. The Greek economy was “stable” for a decade but the real truth was that it was in a very bad situation for many decades. The Greek governments were borrowing massively. A very common practice of almost every government. The interest during the first period of the Euro was equal to Germany’s for some years but when things went really bad, it was way above the average and that activated and increased the financial instability, also known as Ponzi finance. We all remember what followed.

During the last act, the Greek government had to ask for a bailout from the TROIKA.

The TROIKA approach failed exactly like any IMF approach in the past.

You need extremely high skills to design and implement a viable restructuring model and according to my own research both TROIKA and IMF have no interest in that. Their goal, at that moment, was to save the exposure of France. A combination of failures including the trading giants and the public sector inner gang. The government of Greece played the game. Also badly.

The instability in Greece eventually caused a hidden instability for both Germany and France. Here is the main observation I was interested in. Under the normal and basic operations of any unit, meaning a house or a company, you need to have balanced economics and limited exposure. It is not possible to keep imbalances for long. Eventually, you will be out of the economic circle and the competition will buy your business or steal your market position.

This is why “The Trading Game” is an exciting reading. We can see when the traders take advantage, the time the circle of a company or a country is completed and how much hidden cost the ordinary people have to pay without even noticing it. Both directly and indirectly. Yesterday was Portugal, Italy, Ireland, Greece and Spain. Cyprus followed. Today we have reached the core of the problem, the UK, France and Germany. What happens at the moment and what I expect to follow will be explained in the following part where I will remember the days of the Yellow vests..

Nicos Rafidhias studied Political Science and European integration before and during the creation of the European Union and the Euro Zone. 

LinkedIn: https://www.linkedin.com/in/nicos-rafidhias/

Personal page: www.nicosrafidhias.co.uk

Business page: www.officeofis.co.uk

This article is part of his recent book regarding the boom and bust of corporations and countries. 

 

END OF PART I

The times real experts are needed

 As the UK is now copying the pattern that both Greece and Cyprus followed between 2006 and 2015, the lesson is the exact same ; you never put amateurs to do the job of professionals.

After thirty years in business, I find that the most valuable modules I ever studied were the Financial Instability Hypothesis and the Minsky Moment.

Funny detail ; those modules were studied because of my personal curiosity and my personal business activities.

Although most Universities tend to offer the typical modules of Political Science, Political Economy, Marketing, Management and Human Resources, the people that do that extra mile always get knowledge that makes the difference.

Today's CITY AM (post shared earlier) admits that the industry of education brings a dangerous combination of problems to the most recent graduates ; debt and unemployment. The industry sells a generic service that stopped providing any benefit.

During my Bachelor's studies in Political Science (around 20 years earlier), I was lucky to have a lecture by the UK Ambassador in Athens, Greece. The Ambassador described the UK business system as extremely stable, in comparison to the Greek system. Long term job positions, building careers in comparison to the short term job model of Greece.

Although the Ambassador was right on his observation and analysis, at that timeframe, around ten years later I found out that the UK unfortunately copied the model of Greece ; short term job positions, freezing the salary of the low income population and covering the gap through the Universal Credit pot while multiplying the salary of the politicians and the public administration, paid by continuous loans.

This long-term policy, followed not only by Truss but by several previous administrations including Thatcher, caused the Minsky Moment during Liz Truss 45 days in power. Since then, Truss repeatedly stated that she did nothing wrong, despite Kwasi Kwarteng's repeated statements, admitting the mistakes they made.

How Liz Truss caused a Minsky Moment ?

Liz Truss decided to give extra free money to peers from a country already facing collapse. All previous administrations provided free money to their peers ; Truss made that little extra effort.

Why did Rishi Sunak and Keir Starmer continue the same pattern ?

Both Sunak and Starmer are part of a huge circle of politicians with extremely limited knowledge on how to run a country or a union. They never had any courses on the field because if they had they could notice and correct the red flags. The majority of the politicians I met, all gave promises to their supporters including free money and benefits, like Boris Johnson did with Michelle Mone.

The Financial Instability Hypothesis and the Minsky Moment explains the day that you give everything and you now operate on increased loans and multiplied interest rates.

This is a phase where real experts are needed.

Are we able to monitor and control success and failure ?

 Are we able to monitor and control success and failure ?

Back in 1989 a young student bought his first shares

in the stock exchange.

In the next 20 years he was lucky to evaluate

the potentials of around 2000 more companies in Cyprus, Greece

and the United Kingdom,

monitoring also what went wrong for those that shut down.

When the Cyprus Stock Exchange collapsed and billions of pounds were lost , without any obvious reason, that was a red flag that for an aspiring professional on fraud investigation would be repeated

As a Bachelors studies student, the same person, 

made a couple of assumptions regarding the EU design, stability and future failure.

Unfortunately, today we monitor the most negative

of those scenarios happening. The people that implemented and monitored the procedures of European integration had no idea on how to do it properly. This is why today we are discussing the models of a soft disintegration.

What the outcome of the 2008 crisis has proven for sure

was that PIGS cannot fly if monitoring and controlling is left to people with limited skills and experience..

The collapse of Portugal, Italy, Greece and Spain

opened the Pandora Box

for the United Kingdom, Germany and France, but the red flags were not obvious unless you had studies and experience on the topic of Ponzi finance.

This is why today all governments wonder how to fix the problems they caused but in fact they have absolutely no idea on how to do it.

The pattern is identical and whoever can observe it, is always one step ahead but the majority of the population will pay a huge bill.

This is because both the Project Managers and the Fraud investigators failed to do their own job properly, when they should.

Ten years earlier I wrote a post regarding the upcoming problems of France. Today everyone discusses those problems but fails to understand the necessary solutions. In the meantime, the United Kingdom has left the European Union, in order to fix their own issues. This is how inevitable that choice was.

Based on the evidence, coming from cases such as 

- Overend, Gurney and Company,

- Northern Rock,

- Royal Bank of Scotland,

- Lehman Brothers,

- Cyprus Popular Bank (MARFIN Laiki) Group,

- the Cyprus and the Greek bust,

and the most recent cases of :

- Wilko and

- Poundland,

I have recently created a series of modules

focused on the necessity of monitoring, controlling and re-designing,

during the periods that things go really bad.

Based on the case studies and the evidence, I follow

the routes of how the money disappears each time and

who are the organizations

that will allow the system to restart again.

This research allows the participants to understand

how important it is to make a functional design and implementation,

especially during the periods that the society needs stronger support,

in order to recover sooner.

An important module, allow my learners to understand Ponzi schemes in the 21st century era

and the importance of Hyman Minsky and the Ponzi Finance theory

in order to identify and evaluate the health condition stages of any private and public body.

As a professional on the field, I am always looking to train the organizations and the teams that plan to be the problem solvers of tomorrow and I offer the best available knowledge.

So when I read articles blaming Keir Starmer, Rachel Reeves, Emmanuel Macron I can instantly understand which parts of the analysis are accurate and which parts are misleading, based on the personal perceptions of the writer. What I could say as a general rule is that each leader brings good things among bad things, during their administration. Unfortunately, it takes too much time to evaluate whether the majority of their actions were good or bad and it’s always too late to fix the damages that were caused.

This is where Political science meets Project Management and Fraud investigation, in order to provide the best possible solution.

If you have some examples to share, please share your own comment or example.

The Cyprus bankruptcy - The "before" and the "after" (part III)

 

In a similar situation, the British government faced a shocking devaluation of the Sterling pound during Liz Truss' administration, losing markets’ trust. What was the difference in that incident? Due to the danger of the Sterling pound to be plunged for good and for the long term and of course due to the danger of losing their seats due to the election that looked inevitable, they forced Liz Truss to resign.

The period of Liz Truss' administration brought to my mind the administration of Demetris Christofias in Cyprus, ten years earlier. As I assume, Liz Truss never heard of Demetris Christofias or ever paid attention to what happened to Cyprus ten years earlier. She just planned to increase the debt level of the United Kingdom that unfortunately for her had already reached the Ponzi levels, where nobody is willing to lend more. Liz Truss, even today claims that there was nothing wrong with her governance. Although, whoever has experience of Ponzi financing can easily understand and connect the practices of Christofias administration with what happened ten years later in the UK.

Those two financial crises prove the fatal mistakes of each private or public administration. Every administration claims to hire or appoint the best. Although, each administration hires or appoints based on friendly relationships or political benefits, translated as votes.. As a result, the administration is full of incompetent members or fraudsters that sooner or later create chaos. Cyprus is a perfect example. We all know that people in the public administration are appointed in exchange of votes and they cover fraud practices like money-laundering and in recent years the sale of passports to international criminals.

Mafia-State is a whistleblower evidence of what was happening during Anastasiades' administration. Anastasiades was repeatedly linked with international fraudsters and money-laundering practices that shaken the European community. Even worse, the whole European community infrastructure is designed in a pattern that one century ago led to the collapse of the “Latin Monetary Union” that today nobody dares to mention.

One hundred years ago, the European people had another monetary union that because of fraud, corruption and incompetence had to be left to collapse in silence.

As history repeats first, first as tragedy and second as farce, Greece was expelled from LMU from 1908 to 1910 and they faced the same pattern a century later. This time Cyprus was added to the story. When you spend all your (national) money, someone will have to loan you some more, in order to keep the (monetary union) illusion alive. But, just because a loan is always a loan, you are first out of the Union unofficially, but you are out a few years later, officially..

End of part III

The Cyprus bankruptcy - The "Before" and the "after" (part II)

 

It was a sunny Saturday morning. I woke up and went on my weekly shopping route. Before that I went to withdraw some money from the ATM but my transaction was declined. It was really awkward, I knew that there were enough funds in my account, so I tried one more time. Transaction was again rejected. People in nearby ATMs faced a similar situation, as I could now observe. 

Suddenly my mobile phone rang. Sylvia Papamakariou, my Cyprus Green Party main liaison, informed me that Cyprus was bankrupt, banks were shut down and I had to go to our headquarters for a brainstorming meeting regarding the next day. It was the moment I could see in real time that “IT” happened once again, as Hyman Minsky wrote a few decades earlier. Unfortunately, in Cyprus nobody wanted to listen and nobody wanted to speak, even after it was too late.. That was the rule then, that is the rule now..

As the rest of the population were celebrating the Carnival period, mostly in Limassol, that first and then during the second weekend a team of experts were trying to develop scenarios of what to do, what to avoid and what to save. We then had no idea of the real corruption levels of Cyprus, we just assumed that something would and should change. Illusions as we realised later..

The corruption levels in Cyprus are huge and unfortunately almost everybody is involved. The huge benefits of the public sector and the politicians that form each administration were always coming from a financial alchemy. The savings of the Cyprus Social Security pot were immediately transferred to serve the Government expenses so every new expenditure and pay rise meant that there will not be any kind of safety pillow in case of any emergency. That means also that in case we needed to cover any kind of emergency like saving our Banks would be achieved only if our European partners were willing to lend us more money. And they had no reason for that since our Banking system ws another alchemy ; giving higher interest rates in order to attract more deposits and create new bonuses for the Bankers..

So, in a simplified analysis, if Cyprus were still having the national currency of the Cyprus pounds and each Cyprus pound was equal to 1 euro, that weekend we could agree to devalue our pound so possibly 1 euro could buy 10 Cyprus pounds or even 50. In such a period that the national economics are just reckless, the evaluation of the national currency is defined by the markets. Luckily, Cyprus was already in the Eurozone. That meant that our government was able to steal as much as they wanted, since the people would pay the debt in a future period. 

That’s a flaw of monetary unions that lead to their collapse sooner or later. Just to make it more relevant to the recent period, both Turkey and Argentina, two countries that have their own currency, observe the continuous devaluation of their national currency against others.

End of part II