Eight Solutions to the Credit Crunch

Credit Crunch - those are the words on everyone's lips at the moment. Here, we take time out to offer eight serio-comic solutions to our current financial plight.

The whole world is affected by the Credit Crunch, from the rice farmers of Asia to the modern day Gekkos of Wall Street. If the world slips in to recession it will have a knock on effect on everything, from crime to the amount individuals (and indeed governments) give to charity. So, it would be a really good idea if all of the world's major player - that is the banks (with their regulators) and the governments come together and talk about it real soon! When banks and governments act together on an international basis it has much more “Va Va Voom” than when they go it alone. Oh and stop the bankers from patting each other on the back and giving out huge bonuses while everyone else scrabbles around in the supermarkets to make meals that will feed the family for ten dollars.

If the above is not possible - or even if it is, then institutions cannot hold still on a “local” basis either! This way it will force the governments, the banks (plus their regulators) to talk. It could be that they could come to a more even understanding of each other than at the moment. They aren't really getting along terribly well right now. At the very worst it would look as if they are trying to do something which may well have a knock on effect in terms of confidence in the market. Oh and stop those ruddy bonuses (up the revolution!).

The less people have to pay in interest the more likely they are to borrow - and the more cash they will have to put in to the economy by spending. Do it once, do it again - and yes - do it again! An act of desperation in economic terms might be to fly Air Force One over the lands and chuck one thousand dollar bills out the back as it zooms over the little guys. But it could work! The sight of UK Prime Minister Gordon Brown's face as he “gives” away money would be a sight for sore eyes! Sucked prune would not be the word.

Governments should offer to buy back - or at the least guarantee - the mortgage backed bonds that are causing this crunch. It would be hugely costly but it would at least allow the banks to get back to what they are supposed to do - that is lending money. At the moment they are having a true “Winehouse moment” - that is - No, No, No! Anyone who remembers Northern Rock in the UK, however, might be somewhat against this. To say the very least.

Instead of allowing banks to repossess everything the human eye can survey, governments should be looking at ways that they can pay mortgage interest repayments with which people have fallen behind. This will restore the confidence of home owners and - allow them to pursue happiness once more instead of wallowing in the misery of repossession. OK, so the tax payer will pay off - for a while - people's loans, but do we really want to go back to the “buddy, can you spare a dime?” times of the late twenties and thirties? Better to be nice now than regret it later - that's what we tell our kids, isn't it?

Banks should be forced to reveal what they have lost to everyone. Their obfuscatory tactics are just making people more jittery individually and collectively - and it is when the latter happens that the banks will find this reluctance to show us the money coming back to bite them in a tender place. Big style! They are the clever clever guys - and they still got us in to this mess, so show a little responsibility, boys (and those girls who have managed to crash their heads through the glass ceiling!).

John Maynard Keynes, the great British economist (cruelly treated by the USA in the late 1940s when he went cap in hand for an interest free loan) posited that one way to get out of a recession is to spend, and spend - and then spend some more! This gets the consumer in to the shops, the shops make money, the manufacturers make money, they pay their worker, and they go out and spend. In addition, get the world's top one thousand billionaires to shed half of their wealth in to the economy! Oops - is that called communism? Ah, Simba, it is all part of the circle of money!

NATO should go to war against a nation that has no nukes or other WMDs. There is nothing like a good fight to get an economy going again. The country would have to be of a good enough size to stimulate and promote a war economy, enable the conflict to last several years and not put up to much of a fight (in other words, not kill too many of our boys) due to dispersal of population and lack of huge industrial power bases.. Australia would be perfect. Ever since Rolf tied that poor kangaroo down, I've been spoiling for a fight!