January 2010


Known as the “Indian on the top of the world”, Mr Sassi is the crane operator at the world’s tallest building — the 819-metre Burj Dubai. His office, the cramped crane cab perched on top of the Burj, is also his home — apparently it takes too long to come down to the ground each day to make it worthwhile.

The heavenly journey of the Prophet forms a centerpiece of Muslim piety. Persian poets from the thirteenth century onward prefaced their epics with a colorful description of the micraj, the heavenly journey that brought the Prophet into the immediate presence of God. This miniature is particularly interesting as the Prophet is shown with his face unveiled, riding on the mysterious mount Buraq. Later pictures of Muhammad generally show him with a veil covering his face, and in more recent times even his entire body is usually symbolized by a white cloud or a rose.

“These organisations have been some of the single largest political contributors in the world over the past decade with $200 million being given to 354 lawmakers in the past 10 years or so. Yes, the United States needs low cost mortgages, but why should organisations created by Congress have to lobby Congress?

“Fannie and Freddie used the most leverage of any institution that issued mortgages or held mortgage backed bonds. At one point in 2007, Fannie was over 95X levered to its statutory minimum capital with just 18 basis points set aside for losses. That’s right, 18 one hundredths of one per cent set aside for potential losses.

“They must not be able to put humpty dumpty back together again. If they are to exist going forward, Fannie and Freddie should be 100 per cent government-owned, and the government should simply issue mortgages to the population of the United States directly since this is essentially what is already happening today, with the added burden of supporting a privately-funded, and arguably insolvent, capital structure.”

In what is supposed to be the most advanced capitalist society in the world, the institutions at the centre of the country’s key asset class – housing – were effectively operating without any capital. Go figure.

If that wasn’t enough to get the Commissioners to sit up and listen, Bass then gave them three key changes to protect people in future: separate retail banks from proprietary trading operations; ban off-balance sheet accounting; and cap bank leverage.

Thereafter, the risk-takers should be free to get on with it.

Bass said: “Capitalism requires failure and bankruptcy as a consequence in order to guide behavior. As the old adage goes – “Capitalism without bankruptcy is like Christianity without hell”. If we cannot allow a firm to go bankrupt, then we should regulate its activities so that it cannot engage in the sort of risky transactions that put it at risk of bankruptcy.”


Dr. KING: Many years ago, when Abraham Lincoln was shot – and incidentally, he was shot for the same reason that Mahatma Gandhi, was shot for, namely, for committing the crime of wanting to heal the wounds of a divided nation – and when he was shot, Secretary Stanton stood by the dead body of the great leader and said these words: Now he belongs to the ages. And in a real sense, we can say the same thing about Mahatma Gandhi, and even in stronger terms: Now he belongs to the ages. And if this age is to survive, it must follow the way of love and nonviolence that he so nobly illustrated in his life. And Mahatma Gandhi may well be God’s appeal to this generation, for in a day when sputniks and explorers dash through outer space and guided ballistic missiles are carving highways of death through the stratosphere, no nation can win a war. Today, we no longer have a choice between violence and nonviolence; it is either nonviolence or nonexistence.

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