Commendations on "TIME TO WAKE UP"   "What a great article" - Don Bailey   "Excellent article Emile" - Philip Goldsmith   "An excellent piece of writing Emile" - Ronald Lello, Founder, Millenium Trust   " I just want to thanks you very much for this brilliant, incisive analysis....not a word wasted, and no fool, or ideology gladly suffered." - Eric Liknaitsky, CEO, Contemporary Films.
Unregulated regulation – a contagious malady EMILE WOOLF – EP 52 [Going Postal - 8 April 2019] More often than not, regulation is a cover-up for exploitation or protectionism – probably both. Thoughtless, invasive regulation has become unstoppable. Traders and consumers adhere to the idea that highly regulated markets serve their interests, and it suits governments to feel that they are doing the right thing for their citizens by setting up a regulatory system that protects their interests. This knee-jerk response to every perceived ill has led to a proliferation of regulatory agencies that cause more confusion than clarity.
Which regulator?
Coping, for example, with the torrent of financial crimes and misdemeanours begs the obvious question of which overstretched regulator should respond to any particular wrongdoing. Should it be the Financial Conduct Authority (FCA)? Serious Fraud Office (SFO)? Financial Services Authority (FSA)? Financial Reporting Council (FRC), now replaced by the Audit, Reporting and Governance Authority (ARGA)? Prudential Regulatory Authority (PRA), Competition & Markets Authority (CMA)? I can hardly keep up!
alphabet soup of busybodies
  The scope for overlap between the respective remits of this veritable alphabet soup of busybodies is legion. Each has its own sub-committees composed of great and good retired professionals, acting in multiple arenas of banking, pensions, financial reporting, trading standards, insurance, mortgage lending – you name it - each covered by its own ombudsman, with the perennial risk that any particular injustice will fall through the cracks. Failing the victims After years of delay and prevarication these sleepy watchdogs will arrive at the “guilty” ruling that any of us could have reached on day one. They extract millions in fines and penalties from the corporate employers of wrongdoers – but none of it is applied to compensate the real victims! After some initial haggling it is passed back to – yes – whichever regulator brought the initial charges. As for the reprobates who mastermind and orchestrate the mis-selling, market rigging, “cooking of books” and myriad other violations, they are rarely made to suffer personal retribution for their misdeeds. Concepts of humiliation and redemption are meaningless to them, as amply evidenced by the nauseating levels of executive pay that persist.
no compensation for victims
Financial penalties levied by regulators at the corporate level fail not only to compensate victims, but clearly have little deterrent value as instruments of reform. Why else would the same charade repeat itself, over and over? They also have a negative impact on the afflicted companies’ share prices, thereby inflicting unwarranted further damage to the savings of innocent shareholders – again, the wrong target. This continuing charade amounts to little more than an unvarnished extortion racket by regulatory agencies whose elaborate form masks their total unfitness for purpose. Monetary destruction The worst currency crime the world has ever witnessed, the wanton destruction of purchasing power by unmeasured money-printing, is still being perpetrated by the most senior of all financial regulators, central banks. Yet they, the Bank of England and the European Central Bank, have the gall to impose stress tests on commercial banks whose precarious balance sheets merely reflect wounds resulting from central banks’ own wanton profligacy and interest rate suppression. Auditors Auditors of companies that buy packages of questionable bonds (however labelled), while content to vet every aspect of the transactions, invariably fail to test the true worth what’s actually in those packages. Auditing is a failed safeguard and we should not be surprised to find that the auditors and the masterminds behind the fudged valuations are members of the same firm. The companies issuing those bonds also had auditors. But when these “client” companies issued paper with arcane titles (such as “reverse convertibles”, or bonds that can be converted into equity if the issuer can no longer pay the interest; or “collateralised debt obligations”, being parcels of mixed mortgage debts ranked by “quality”, each providing the collateral for the others; and a range of other “asset-backed securities”) their auditors were evidently sufficiently well remunerated simply to close their eyes to the risk of a litigious tempest capable of threatening the solvency of those “clients”. “Valuing” bonds When dubious accounting practices are used to contrive ‘Triple A’ rating for parcels of near worthless bonds, or when the adequacy of bondholders’ loss provisions is tested by reference to “mark-to-market” criteria, or when the accounting rules require the “incurred” loss model to be used for valuing debt instruments, where in heaven’s name are the regulators? Indeed, their uselessness is evident whenever these zany investments are incorporated in balance sheets at “book value” - until the holders are compelled to face reality and write them off, perhaps years after the “expected loss” model would have crystallised those losses. How’s that for the corporate version of kicking the can down the road? Bankers’ Remuneration As for the currently obscene levels of bankers’ pay, we see a further instance of regulatory distortion. Left to the market, pay at all levels of management tends to be higher in the most successful institutions, where wise executive management is at a premium. But when government provides guarantees for insurance of deposits, as well as implicit promises of a bailout if all goes wrong, executive pay is set free of the market. When government and institutions connive in corruption, what hope is there for effective regulation? Conclusion Of one thing we can be sure – no matter how many regulators are installed, they may delay, but will never prevent the inexorable implosion that will cripple effective governance. The final word comes from the distant Eastern wisdom that describes the Four Ages of human society. In the Golden Age people do not know that they are being governed; in the Silver Age they revere their leaders; in the Iron Age they respect them; and in the “Age of the Beast” they revile them. As humankind moves into its final phase, it is hamstrung to the point of paralysis by the tentacles of regulation that is increasingly complex, convoluted and ultimately destructive of the very values it is set up to protect. Well, at least we know where we are. [EMILE WOOLF 1-4-19] ________________________________________________________________________________

Wonderful, Emile! You have such a talent for writing that the man-on-the Clapham-ominbus or Joe-sixpack can understand.

[Patrick Barron - Professor of Austrian Economics & Banking, University of Wisconsin]
"Wonderful essay, Emile. Right on target! Nigeria has overtaken South Africa? My God!" [Patrick Barron, Philadelphia]

"Really worthwhile piece – Tweeted to my lists today with the attached image…" [Steven Spencer, commodities trader]

"Hello Émile -please keep me on your list. Your blogs are clear, concise, enlightening, superbly written... ..." [Shirley Packalan]

"Emile Woolf has presented a plan for a post-Brexit UK that incorporates Austrian school of economic principles. In my opinion it is a masterpiece." [Patrick Barron, banking economist]

"I found your description of QE the clearest and most striking you have yet written"

[Steven Maddocks]
Steven Maddocks

Many thanks and I certainly want to go on receiving your superb articles.

Keep going!

[Don Bailey, OBE]

"Emile - This is excellent, as usual. Don't you dare release me from your blog list!"

Richard Elias [Insurance executive]
  • “Brilliant! Can’t wait to read the next one.”
  • [Mahtab Clark, Tax adviser and practitioner]
  • "As always you have chimed with my longstanding desperation at the stupidity of Central Banks’ support for their irresponsible major banks."
  • [Steven Spencer, Commodities Trader]
  • "Very many thanks. I really do appreciate reading your penetrating analyses."which make so comprehensible these economic issues that affect us all”
  • [Clement Roberts, retired senior civil servant]
  • "Excellent, dear Emile, as always. Thank you."
  • [Richard Elias, Director, Hyperion Insurance Group]
  • “Excellent, Emile!
  • The central bankers are like cooks who keep turning up the heat on the pressure cooker while screwing down more clamps on the lid. The inevitable explosion will be terrible.”
  • [Patrick Barron, Economics and Banking Professor, USA]

Comments on "Economic Perspectives" 27:

"It is such a clearly worded and important topical contribution to the argument that it needs wide circulation as soon as possible."  Steven Spencer, Spencer Associates, Commodities Consultancy

"Bravo - economic common sense expressed in first class prose - thank you!"  Jonathon Clark, Financial Adviser

"Emile, Thank you. Excellent  piece. I will steal some of your arguments and loved the Burke quote!"  Michael Forsyth, House of Lords

"Well done, send it to all MPs and Peers!!"

Robin Long, Ex-Senior Partner, City Accountancy Firm

"Love that line “kicking the can down the road” doesn’t work in a cul-de-sac!" You should write some scripts for TV programmes"  Richard Watkinson, Business TV Producer

"I wish you were on our Brexit negotiating team!!!!"  Donald Bailey, OBE


Wonderful, Emile. I really like the stories. I think that is how people get "hooked" on reading a rather scholarly article such as yours.

This paragraph of yours about demand could be the focus of a follow-up essay:

The fallacy underlying the whole charade begins with the belief that creating jobs creates demand - and that demand will, on its own, generate economic growth. However, that doesn’t happen, and it’s not how economic growth occurs anyway. Remember: (i) it is in the nature of the human condition that there can never be a shortage of demand; but (ii) if it is not preceded by commercially evaluated production, demand is completely useless and can never be satisfied.

Keynesian economics--the headlong pursuit of increasing aggregate demand--is a failed attempt to refute Say's Law. Production must precede consumption. This is irrefutable; i.e., one cannot consume what has not been produced. One's production becomes the currency by which one consumes, via an indirect medium of exchange (money). Dr. Frank Shostak is fond of reminding his readers that all REAL exchanges are exchanges of something for something. Keynesian exchanges, especially via money printing, are exchanges of something for nothing and are nothing more than rationales for capital consumption.So few understand the importance of Say's Law. It could use your special touch that reaches so many.

   Patrick Barron, Professor of Economics, Universities of Iowa and Wisconsin

"Emile does write up some interesting essays, this one is particularly to the point, and should be distributed for debate, in universities.

Good reading et à bientôt."


[Roland Huet-Gundill, Languedoc Luncheon Club, on Economic Perspectives - 25]

"Strong stuff! Long may you continue to expose these charades."

[Richard Elias, Director of major insurance group]
" Excellent, as usual. What a bunch of boneheads we have running the country!"  

Thank you for that, Émile!

However, you seem to forget that if we leave the warm and ample bosom of the EU we are all doomed. It will be the end of the world as we know it. All industries and all financial companies will leave. All graduates in circusology, gender studies and even basketball physiotherapy will take their talents elsewhere. So flee, sell all your assets and apply for some other - any other - citizenship before it's too late.

Alternatively, just sit back and hope (there is nothing more you or I can do...) that Brexit is not sabotaged by the Guardian Readers.

Nigel McGown


Wonderful essay. I hope you send it to your MP, the Times, Guardian, Telegraph, BBC, ITV, etc.

The principle that subsidies and tariffs harm only the country’s own citizens is applicable to money printing, too. Debasing one’s own currency, usually to spur exports, is a transfer of wealth to foreigners and a temporary transfer of wealth to one’s own exporters at the expense of one’s countrymen.

I love the last line. May we never have a bilateral trade agreement!

[Patrick Barron, Professor of Banking Economics, University of Iowa, USA]
"Excellent, Emile. Scathingly accurate. The banks' increased capital levels will be written off in the next financial bust."[Pat Barron, Professor of Austrian Economics, University of Iowa]

"Enjoy reading it? I did, I did!!" [Steven Spencer, Spencer Associates, Commodities Consultant]

"Quite. And why should the banks worry about risky lending? They now know that when things go pear-shaped they will always be bailed out by Government - with our money!  It amounted to £20,000 for every man woman and child in the UK last time round!"  [ Ian Francis, Commissioning Editor, Earth & Environmental Sciences]

"Emile, as usual, you are 'right on the button'. The automotive world, in which I have a specific interest, is definitely the next 'sub prime' bust that will arrive. When was the last time that you saw a car advertisement showing the actual list price of the vehicle? £30,000 or £40,000 or even £50,000, or more, looks like a lot of money to the average buyer - but £299 per month does not. The whole industry is heading for a cliff edge before very long." [James Luckes, Chairman, Languedoc Gentlemen's Economics Forum]

" Insightful and, I fear, you are spot on in your analysis"  [Sid Bright, Chartered Accountant]


Actually, the memory of 10 years ago is being completely suppressed in the U.S. as any controls of the banks (read Dodd Frank) and other lenders are being eliminated in the rush to expand lending and otherwise giving them carte blanch to make deals.

Nice piece.

[Donald R Dann, Leading Conservationist - 15-8-17]


Dear Emile

What a fantastic CV!! I will only repeat what I have often said to you – what a pity no one here listens to you.

Thank you for sending it to me

15 - 8 - 17 - Don Bailey OBE


"Dear Emile

The answer is “no”. I didn’t enjoy reading it as it spells gloom and disaster. When will the EU stop quantitative easing? Every time I pass a car dealership and see the millions of pounds stuck on the forecourts I ask myself “who is ever going to buy this lot!!"

15 - 8 - 17