Here's what Alex Tarrant reported on interest.co.nz in March 2009 about a run on big notes

Ah, thanks. The Reserve Bank obviously didn't mind mentioning it after the run was over.

Crime by a lawyer is unusual.

Discharge without conviction for a crime which potentially attracts a long jail term is unusual.

The NZ media reports the most amazing trivia when it suits their narrative.

Based on that, it's odd that the Garrett case raised not even…

They could have challenged the suppression order (as has happened in various cases with notable non-political defendants). I've seen no sign of this.

Fair call.

Not really, Russell. In 2005 Garrett was a nobody lawyer who might've been familiar to the membership of the iSST but certainly wasn't a national…

I read somewhere that 70% of coins overall never returned.

That's a lot of couches up and down NZ.

so look for a run on Gold and Silver

I suspect you're right on the money ... bar ETF calamities.
Mind you, a run on delivery might well fuel demand for the real McCoy.

Oh well, speculation.

Had read about the tungsten scam some time ago – thanks for the…

Another bit of currency trivia.

When all the coins got changed 5 or so years ago, what percentage of coins in circulation got handed/ cashed in?

All I needed to do was ask the Reserve Bank. Turns out over $80m of old coins are still out and about.

5c coin…

The run-on-the-bank panic sequence is pure Disney, and doesn't appear in Pamela Travers's stories. According to Valerie Lawson's biography of Travers, Mr Banks seems to…

Also in Mary Poppins. Young Michael Banks wants to use his shiny coin to feed the birds (tuppence a bag) rather than make his first deposit in his father's bank, and the fuss he causes ...

Ohhh ... that's spooky. Watch Media7 tomorrow night.

Damn! I should have referred to government-appointed bureaucrats having conflicts of interest instead!

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10675165

Who would have guessed it...

A bank run — if it were to happen — becomes self-perpetuating. You want to get your money out while there's still some in the vault to get.

>>Didn't this happen to/at Countrywide Bank at one point?

Also in Mary Poppins. Young Michael Banks wants to use his shiny coin…

It seems that in the US, at least, mortage issuers lied to…

Those people didn't earn enough to afford the houses they bought at the prices they were sold for. The financial fix for this didn't work – what's actually needed is a system that lets ordinary people have a decent house with secure tenure.

Well you need to look elsewhere than…

The competitive advantage, if any, enjoyed by investors and corporations in speculative trading, especially in complex derivatives, is unclear. Perhaps it is a lack of "horse sense" which, as stated by Raymond Nash, is "what keeps horses from betting on what people will do."

The author Thomas Pynchon warned: "If they can get you to ask the wrong questions then the answers don't matter."

Re Bollards story: Touche.

The global derivative market as of June 2009 totaled $605 trillion (source: Bank of International Settlements [BIS]). This is a large increase from less…

When all the coins got changed 5 or so years ago, what percentage of coins in circulation got handed/ cashed in?

And yet, by any conventional measure, the people in question are extremely bright and hugely knowledgeable.

I’m sure they are very bright, but I suggest they haven’t been prudent in their assessment of the situation. Looks like the default was to run with the crowd, rather than asking inconvenient questions.…

Those people didn't earn enough to afford the houses they bought at the prices they were sold for. The…

I agree the concepts "should/could" be figured out at a SC maths level. But that isn't the problem. See this from Mikare Curtis as he so matter- of-factly-put-it-as-if-it-happens-all-the-time-without-anyone-batting-an-eylid:

* Simply put, securitisation is when you sell the predicted interest stream on a group of loans. The bank…

It wasn't robust against a sustained fall in property prices causing a large proportion of the creditors to default.

Or against the kind of lending practices that went on the in the US. The intention seemed fine — to help poor people into home ownership by tapping the savings glut…

I don't buy that. The concepts are not that hard (obviously they're quite impossible to a politician or journo who scraped through school cert maths only by the efforts of their top decile educators).

The basic concepts aren't too hard. The implementation as we see it in the global financial…

Basically the problem was that the structure was robust against default by individual creditors at the…

I take your point. But I also think it's reasonable to expect that those who are in charge of a nation's monetary policy have the intellectual capacity to do so.

And yet, by any conventional measure, the people in question are extremely bright and hugely knowledgeable.

Interestingly, Bollard cites a…

My point being it is hard to sift the wheat from the dross

I take your point. But I also think it's reasonable to expect that those who are in charge of a nation's monetary policy have the intellectual capacity to do so.

. . . some country where they don't do irony ...

Bollard really hates Canadians. It says so in the book.

We'll run about 6 min on the show, and put the whole 23-minute interview online.

He clarified his qualms about "the media" during the crisis — it was one or two specific individuals whose judgement he fretted over.

And he signed a copy…

But the blog post you linked to isn't protected under Parliamentary privilege.

I wondered. Who'd have thought the oily one's recent trial and Garrett's outing would be quite so educational?

But the blog post you linked to isn't protected under Parliamentary privilege.

No, but we've been promised "more to come" which I suspect will be considerably less judicious, dropped in the House, not blogged and very carefully media-managed.

As we've seen far too many times over the years, it's very easy to make allegations under Parliamentary privilege that don't quite pan out in the cold light of day

But the blog post you linked to isn't protected under Parliamentary privilege.

I hope and trust it'll be tickety-boo. But I don't think this stuff is irrelevant.

Oh, I have great confidence in the judgement of the Ombudsmen's Office. Mr Cunliffe and his party on this issue? Not so much: As we've seen far too many times over the years, it's very…

And in other news, Cunliffe has drunk the Hubbard Kool-Aid:

Wellll ... I don't care about the Hubbard cult. But I'll be interested to see the Ombudsman makes of Botherway's links to the Torchlight Fund, which did very well from the bailout.

I hope and trust it'll be tickety-boo. But I…

The Chair of the Financial Markets Authority Eastablishment Board, Simon Botherway, now has no choice but to step aside pending the outcome of the Ombudsman’s inquiry into the mangament of his potential conflicts of interest in placing Allan and Jean…

Did anyone even know who Garrett was in 2005?

well he was at least potentially two people!
but did he know who he was?

They could have challenged the suppression order

Did anyone even know who Garrett was in 2005?

The run on currency lasted about a month before dropping back to normal levels. What is strange, however, is that it has not returned into the system subsequently.

note to prospective burglars – always check the mattress

You'd think they should have seen it coming like Xmas. Plenty of individuals in the blogsphere did

That sounds ok untill you realise that the blogshere (and this just the blogs I have read this morning ) claims that the english are returning to the true faith and everything in…

Although he does, remarkably, credit unnamed expert blogs with helping him understand the crisis as it began to unfold.

Well, if that ain't telling (and more than a little alarming) I don't know what is.
Long before the crisis unfolded, its inevitability was discussed in great detail in (alternative) financial/economic…

They could have challenged the suppression order (as has happened in various cases with notable non-political defendants). I've seen no sign of this.

Fair call.

They could have challenged the suppression order (as has happened in various cases with notable non-political defendants). I've seen no sign of this.

Or does this happen: They only need to pull back 2 or 3 mortgages and they can "pay back" what they were originally given to play with. ......So whose do they pick?

This sounds like a very short term liquidity problem, one that could be handled by taking out a…

So whose do they pick?

I'd be surprised to see a bank trying to use that when the bank got in trouble. For one thing it wouldn't work – because it would start a run on the bank if one already hadn't happened, and savings and internationals loans would be…

I have to ask my stupid question. What would they be getting back if they called in your mortgage? Real money? A piece of paper saying what exactly? A promisory note of what?

If you cannot repay the loan then they will take the property – it's no different than…

What Rodney Hide "did in his youth and now regrets"? National's plan to appoint Banks as a commissioner if he loses the super-mayor election? The real reason for the CERRA law?

One can but speculate....

And fairly wildly.

I don't think any of those fall into the good-of-the-nation circumstances attached…

Today Dr Bollard kindly obliged my request for a photo with the other Alan Bollard book. I feel like a fangirl.

Oh my god Robyn, I want that to be me! That is a very cool photo.

I liked what David Haywood wrote about the launch of the book, that…

What Rodney Hide "did in his youth and now regrets"? National's plan to appoint Banks as a commissioner if he loses the super-mayor election? The real reason for the CERRA law?

One can but speculate....

Today Dr Bollard kindly obliged my request for a photo with the other Alan Bollard book.

Awesome – straight to the pool room with that one

From memory, that was about the 1984 currency crisis, when some journalists agreed not to report what they knew, for the public good. I don't have a problem with that.

I don't think I do either.

But given that the normal role of the media is to take information that…

I'll ask him about this tomorrow

I look forward to it.

As an aside, amongst things I didn't report at the time were a well known businessman's not entirely light hearted comment at the height of the crisis along the lines of ``at least New Zealand has plenty of fresh…

The finance compaies weren't going under because of runs being made on them – in most cases it was either shonky practices or bad lending decisions coming home to roost.

But if they'd been the only ones left out of a deposit guarantee scheme? Much, much worse than anything we…

Or the shit the Obama Administration is catching from the very people who handed it the mother of all burning bags of dog shit in the first place — and don't feel obliged to offer any remotely reality-based alternative.

That comes through very clearly in the book. Geithner and other…

You won't see mortgage holders queue up to pay off their loan in full because the bank is in trouble (even though I suppose a bank could ask for its money back early – read the fine print in your mortgage and personal/business loan documents).

I have to ask my…

Also, I feel a system…

Oh, I think they knew a lot. It's striking how much they relied on others having imperfect knowledge to keep the situation stable.

Which is why three dudes got a Nobel prize in Economics for their work in looking at how asymmetric information explains some of the workings of the…

You look at what the British government had to do with Northern Rock et al and you count your blessings.

Or the shit the Obama Administration is catching from the very people who handed it the mother of all burning bags of dog shit in the first place — and…

How? It's perilously close to a civics man-splain to observe that the Governor of the Reserve Bank's powers do not include vetoing legislation or beating the Finance Minister over the head until he come back to the paths of fiscal righteousness.

Quite. And the book makes clear the pressures on…

Allan Bollard unfortunately sold us down the river at that point. He's a nice man but that is the unfortunate outcome. SCF was not a natural disaster so why are my kids still guaranteeing these shonky investments owned by mainly wealthy people? Thanks Allan.

How? It's perilously close to a…

OR they knew stuff but chose not report it or report it in full

Bernard Hickey says he declined to report multiple rumours of bank runs — for quite good reasons. No one wants to be that guy.

(I think on Media 7 once you had a guy who stated…

Okay, perhaps my interpretation was uncharitable, but the passages I cited (and there are others) did seem to indicate that Bollard was repeatedly relieved that journalists didn't ask questions he didn't want to have to answer.

Either way it says something interesting – either our financial journalists aren't very good…

How did Allan Bollard somehow never find out? I was in Auckland but surely he should have known more than me about it all even from The Terrace.

Oh, I think they knew a lot. It's striking how much they relied on others having imperfect knowledge to keep the situation…

I suspect I'm taking umbrage more with your interpretation of Bollard's account, ie that we weren't doing our job very well, rather the account itself.

Okay, perhaps my interpretation was uncharitable, but the passages I cited (and there are others) did seem to indicate that Bollard was repeatedly relieved that…

Well, it's more Bollard's account

I suspect I'm taking umbrage more with your interpretation of Bollard's account, ie that we weren't doing our job very well, rather the account itself.

I've not read the book yet so I have to rely on my colleague Brian Fallow's take on it in…

what are the possibilities of crowdsourcing cash issuance levels from banknote serial numbers?

Sounds like the potential for shit going awfully wrong would be quite high there.

Also, given that the media considers itself part of the financial system and wont deliver us inconvenient information, what are the possibilities of crowdsourcing cash issuance levels from banknote serial…

There's also the select committee meeting where he admits to being worried about journalists being in the room, and thus arranged with chair Craig Foss that the committee wouldn't ask certain questions he didn't want to answer. That's fairly interesting.

Fairly interesting indeed. I wonder if all the members bought…

I don't accept your criticism Russell.

Well, it's more Bollard's account, but I take your point. Bernard Hickey said something similar to me.

But the book does contain multiple instances (ie: more than those quoted above) where Bollard seems to feel he dodged a bullet because journalists didn't ask the…

I'm not sure that I or any of my colleagues at the Herald had any conversations with RBNZ about whether or not we would report the imminent failure of our banking sector before it was apparent, but we certainly often had these discussions amongst…

is the standard text. I'd recommend reading it through, then getting pissed with a few traders.

But no retail bank has the ability to immediately disburse all its deposits in cash, on demand. A bank run — if it were to happen — becomes self-perpetuating. You want to get your money out while there's still some in the vault to get.

Didn't this happen to/at Countrywide…

Is it really really that unstable?

Answers his own question. Yes it is.

Shit.

Actually, the big four Aussie banks who account for the large majority of the business in New Zealand were extremely solid compared to many others in the world.

But no retail bank has the ability to…

Is it really really that unstable?

Leveraged up the wazoo

including the international currency trade (How's it work? Who are these people? What's it for?).

Work on him. It is about time someone at the level of the Reserve Bank explained the damn thing in words of one syllable.

Reading what he has writ makes you wonder what sort of…

Yes, but does PA favourite Don Abel rate a mention?

Of course. He is an associate governor of the Reserve bank, you know.

Bollard clearly agonised about the scheme more than any other measure taken – he knew there would be a cost, he knew it would be gamed – but, in the end, settles for having fended off a collapse of the banking system.

Which put him in very good company that…

Interestingly…