Why is credit' the 'lifeblood' of our economy?

What ever happened to living within our means?

Lenihans comments yesterday betray the fact that Ireland's so called wealth is based on nothing other than the constant expansion of credit (much like the rest of the capitalist global economy. There would not have been a credit crunch if loans were being repayed at the same level that they are being lended out, if economic expansion was linked to the expansion of productivity or even if it was maintained at the level of inflation.

What has happened quite simply is that Ireland and the world made that elementary error that so many over enthusiastic (over greedy) entrapreneurs make and over traded, rushed to expand far too rapidly and refused to address issues of sustainability or medium term ability to meet the costs of expansion while taking enormous profits out of the company.

Irelands entire economic model was based on creaming a little bit of profit off a very large pie, This meant that a lot of wealth was being sucked out of the public sector (not just irish, but globally) and into the hands of private profiteers. That worked well when there was rapid expansion, but as soon as there was a tightening in the economy, we saw our 'wealth' disappear off a cliff and we have no reserves to see us through the tight times.

Every tax haven contributed to this imbalance, and every lax regulatory environment allowed the vultures to suck more and more wealth out of the hands of the workers and into the pockets of investors and unproductive speculators.

Now, now Akrasia, Ireland hasn't invented credit, and credit isn't bad when utilized properly for investment that produces returns in term of industrial and economic progress. Indeed, it's not bad when the average citizen purchases a dwelling in order to have somewhere to live; as long as they don't pay more for the property than its worth.

But your basic premise does have very real foundation and is put fairly succintly. It seems we have become addicted on credit to spur growth without seeing a great return in term of industrial and economic progress. The reason is very simple. When we pay intesest on the loans but haven't created any additional ongoing income we are deficit spenders. All that we're doing is paying for immediate satisfaction and forebearing future satisfaction through the tranference of future value to the bankers in the form of interest. The US is particularly good at this - it seems their great-grandchildren will be paying for the debts incurred today.

It's at the national scale that the whole thing becomes a wee bit murky for me. Our government, until recently, didn't have to borrow for infrastructure projects so there shouldn't be too much adverse impact there bar cost over-runs. Maybe the people, as an aggregate, borrowed too much and invested too much on property which doesn't return on-going returns unless they were landlords. However, if they were paying big over-inflated mortgages this wouldn't have had as productive returns as investing in some sort of industry. I suppose what strikes me are all the new motorways and upgraded roads with shiny new homes and shops but with very little new industry to go with all the other new yokes. I think this may have been a serious oversight by the Irish nation.

Responding to another strand of your thought, I can answer it on personal terms. We are going to zero debt and don't buy anything unless we can afford it. In fact, even if we can afford it, we are not spending right now and for some considerable time to come. I'm not responding to some armegeddon scenario. This recent credit crunch has opened my eyes. The solutions being enacted do not address the underlying problems of productive investment nor on regulation.

From now on, the simple life is life for me.

Akrasia wrote:

What ever happened to living within our means?

Lenihans comments yesterday betray the fact that Ireland's so called wealth is based on nothing other than the constant expansion of credit (much like the rest of the capitalist global economy. There would not have been a credit crunch if loans were being repayed at the same level that they are being lended out, if economic expansion was linked to the expansion of productivity or even if it was maintained at the level of inflation.

What has happened quite simply is that Ireland and the world made that elementary error that so many over enthusiastic (over greedy) entrapreneurs make and over traded, rushed to expand far too rapidly and refused to address issues of sustainability or medium term ability to meet the costs of expansion while taking enormous profits out of the company.

Irelands entire economic model was based on creaming a little bit of profit off a very large pie, This meant that a lot of wealth was being sucked out of the public sector (not just irish, but globally) and into the hands of private profiteers. That worked well when there was rapid expansion, but as soon as there was a tightening in the economy, we saw our 'wealth' disappear off a cliff and we have no reserves to see us through the tight times.

Every tax haven contributed to this imbalance, and every lax regulatory environment allowed the vultures to suck more and more wealth out of the hands of the workers and into the pockets of investors and unproductive speculators.

bank reserves have never been bigger. its just that they won't lend it to eachother because, as you allude to above, cash is king in the current environment (both to defend against takeovers and to acquire other failing banks!)

Some comments above remind me of something which I learned (or realised more like) recently, which is that NOTHING on the planet is sustainable if it grows exponentially.

Whether its the consumption of bananas or the expansion of the credit, even a 3.5%pa growth would mean a doubling every 20 years. That's 32 times growth in 100 years.

So really the constant pusing for growth is a fallacy. It cannot be sustained. It is a completely erroneous policy. And certainly our Govt. policy of trying to maximise economic growth is erroneous.

On zero debt, it's a nice place to be, and I am working harder this last year to achieve that. It will be a long road though.

EvotingMachine0197 wrote:

Some comments above remind me of something which I learned (or realised more like) recently, which is that NOTHING on the planet is sustainable if it grows exponentially.

Whether its the consumption of bananas or the expansion of the credit, even a 3.5%pa growth would mean a doubling every 20 years. That's 32 times growth in 100 years.

So really the constant pusing for growth is a fallacy. It cannot be sustained. It is a completely erroneous policy. And certainly our Govt. policy of trying to maximise economic growth is erroneous.

On zero debt, it's a nice place to be, and I am working harder this last year to achieve that. It will be a long road though.

yeah I was just listening to all the comments by Lenihan saying that people need to be able to borrow to buy cars and go on holidays and that's essentially why he risked the entire national income of the state for the next 10 years to bail out the banks.

I'm not joking by the way, he specifically mentioned holidays and cars. Since when is it a good idea to borrow money from a bank to go on a holiday (whos value decreases to zero the moment your plane touches down on Irish soil) And since when is it a good idea to borrow a fortune to buy a new car (whos value drops 30% the moment you drive it off the forecourt, especially if you borrow more money 2 years later to upgrade to the latest model)

People didn't used to borrow money for these things. If we couldn't afford a new car we bought a used one, if we couldn't afford to go on a foreign holiday we went to ballybunion. The minister for finance risking the future of our country so people can buy things on credit that we don't even produce in this country is utterly insane.

He also mentioned houses as things we should be able to borrow for. Grand, people have always had to borrow to buy a house, bu the level of borrowing has gone out of control and this is part of the reason why the banks are in such trouble. Giving the banks our money to support their reckless lending practises is an utterly irresponsible thing to do.

EvotingMachine0197 wrote:

Some comments above remind me of something which I learned (or realised more like) recently, which is that NOTHING on the planet is sustainable if it grows exponentially.

Whether its the consumption of bananas or the expansion of the credit, even a 3.5%pa growth would mean a doubling every 20 years. That's 32 times growth in 100 years.

So really the constant pusing for growth is a fallacy. It cannot be sustained. It is a completely erroneous policy. And certainly our Govt. policy of trying to maximise economic growth is erroneous.

On zero debt, it's a nice place to be, and I am working harder this last year to achieve that. It will be a long road though.

Except Ryanair, of course, because the Mick fella is never wrong.

Akrasia wrote:

EvotingMachine0197 wrote:

Some comments above remind me of something which I learned (or realised more like) recently, which is that NOTHING on the planet is sustainable if it grows exponentially.

Whether its the consumption of bananas or the expansion of the credit, even a 3.5%pa growth would mean a doubling every 20 years. That's 32 times growth in 100 years.

So really the constant pusing for growth is a fallacy. It cannot be sustained. It is a completely erroneous policy. And certainly our Govt. policy of trying to maximise economic growth is erroneous.

On zero debt, it's a nice place to be, and I am working harder this last year to achieve that. It will be a long road though.

yeah I was just listening to all the comments by Lenihan saying that people need to be able to borrow to buy cars and go on holidays and that's essentially why he risked the entire national income of the state for the next 10 years to bail out the banks.

I'm not joking by the way, he specifically mentioned holidays and cars. Since when is it a good idea to borrow money from a bank to go on a holiday (whos value decreases to zero the moment your plane touches down on Irish soil) And since when is it a good idea to borrow a fortune to buy a new car (whos value drops 30% the moment you drive it off the forecourt, especially if you borrow more money 2 years later to upgrade to the latest model)

People didn't used to borrow money for these things. If we couldn't afford a new car we bought a used one, if we couldn't afford to go on a foreign holiday we went to ballybunion. The minister for finance risking the future of our country so people can buy things on credit that we don't even produce in this country is utterly insane.

He also mentioned houses as things we should be able to borrow for. Grand, people have always had to borrow to buy a house, bu the level of borrowing has gone out of control and this is part of the reason why the banks are in such trouble. Giving the banks our money to support their reckless lending practises is an utterly irresponsible thing to do.

that was how to explain the matter to joe duffy listeners who borrow to go on their annual 2 weeks to fungerola!
however, for "credit" read seed capital, funds for investment, expansion (such as renewal of fleet of lorries), renovating, acquisitions, r&d expenditure etc.

Don't know about anybody else, but as a self-employed sole trader I couldn't function without credit. This is partly because, like any other small business, I'm effectively offering interest-free credit to my customers until they eventually pay.

Particularly in the current climate, I'm minded to resurrect an idea for a 'late payers' website.

ibis wrote:

Don't know about anybody else, but as a self-employed sole trader I couldn't function without credit. This is partly because, like any other small business, I'm effectively offering interest-free credit to my customers until they eventually pay.

Particularly in the current climate, I'm minded to resurrect an idea for a 'late payers' website.

Couldn't agree more - the smaller your enterprise the harder it is to get your customers to pay before time or on time - particularly if that company is far bigger than you.

I've just had to clear a crate of industrial goods into the country this morning and had to pay the revenue 150,000.00 euros up front - I wont see the sale of these goods for another 3 weeks and after that it will be 45 days before the customer has to pay me after receiving the goods - I have a credit facility at the bank for just these occasions as the Revenue does not do credit! - but in between salaries have to be paid,overheads and utilities have to be paid etc etc - the company is solvent - but cashflow is a pure bastard.

even taking the ministers examples of holidays and cars - the travel company has to pay up front to hotels and other accomodation suppliers for the special rates that it is then able to pass on to customers - they will borrow and payback at the end of the season. So so much of our economy requires this facility -its what keeps companies and people spending money and more importantly if you havent got credit - you will find it hard to have much of a future - credit enables people to think about tomorrow.

Ok we are seeing the excesses of all this now and absence of good regulation - but do you want to go back to the eighties - sure we went to Tramore for the holidays and it never did us any harm - but the unemployment rate was permanently in double digits, credit cost a fortune - if you were able to access it and after all the holidays to Ballybunion you were educated and shipped off to another country as there were no opportunities here.

Credit and access to credit is vital - look at any country and society where credit is restricted and you will see a stagnant, high unemployment economy.

Yes. Why not live within our means. The whole reason, on the Crown's side, for setting up the Bank of England in 1694 was to allow him to spend more than his revenues. Get rid of the central banks and get rid of inflation.

People on the left don't want this as they would have to give up the free lunch. The welfare state costs money. Everyone wants benefits but paying for it is to be someone else's problem, usually "the rich guy"

More importantly the big money spinner of warfare would be a thing of the past also. If the loodmouths had to actually put their hands in their pocket, in an overt fashion, to pay for Iraq then it would be over 5 years and 6 months ago.

All these derivatives must be eliminated back to their origonal purpose of being a type of insurance against a big fall in crop prices.

All guarantees should be taken away because the old saying is right, there are no guarantees in life.

Edo wrote:

ibis wrote:

Don't know about anybody else, but as a self-employed sole trader I couldn't function without credit. This is partly because, like any other small business, I'm effectively offering interest-free credit to my customers until they eventually pay.

Particularly in the current climate, I'm minded to resurrect an idea for a 'late payers' website.

....

Credit and access to credit is vital - look at any country and society where credit is restricted and you will see a stagnant, high unemployment economy.

All well and true, it is the norm to operate on overdrafts + term loans comercially, so maybe it is necessary to distinguish between commercial credit and lifestyle/image credit. The latter is certainly not vital, but maybe Lenihan was just appealing to the Joe Duffy brigade on that occasion.

youngdan wrote:

Yes. Why not live within our means. The whole reason, on the Crown's side, for setting up the Bank of England in 1694 was to allow him to spend more than his revenues. Get rid of the central banks and get rid of inflation.

People on the left don't want this as they would have to give up the free lunch. The welfare state costs money. Everyone wants benefits but paying for it is to be someone else's problem, usually "the rich guy"

More importantly the big money spinner of warfare would be a thing of the past also. If the loodmouths had to actually put their hands in their pocket, in an overt fashion, to pay for Iraq then it would be over 5 years and 6 months ago.

All these derivatives must be eliminated back to their origonal purpose of being a type of insurance against a big fall in crop prices.

All guarantees should be taken away because the old saying is right, there are no guarantees in life.

1. getting rid of central banks won't get rid of inflation, unless you want to retreat to a barter economy (i don't, because i don't want to have to deal personally with the potato farmer, the dairy farmer, the shirtmaker, the cobbler...)
gettting rid of fiat money also won't prevent inflation as if more gold is found the the price of gold coins vis a vis milk and other products will fall. fiat money takes the control over inflation from private mining companies to the government.

2. credit did not begin in 1600s. i believe that the people in the old testament were well acquanted with credit as references are scattered throughout the books.

3. i fail to see any connection with wars and credit. man has been well versed in war long before credit was ever thought up. so the current US administration borrowed to invade iraq? credit has been used for good too.

4. derivatives have a time and place. i'd make directors personally sign off on a legally binding statement that they are fully aware of all implications to the company of every derivative entered into.

EvotingMachine0197 wrote:

Edo wrote:

ibis wrote:

Don't know about anybody else, but as a self-employed sole trader I couldn't function without credit. This is partly because, like any other small business, I'm effectively offering interest-free credit to my customers until they eventually pay.

Particularly in the current climate, I'm minded to resurrect an idea for a 'late payers' website.

....

Credit and access to credit is vital - look at any country and society where credit is restricted and you will see a stagnant, high unemployment economy.

All well and true, it is the norm to operate on overdrafts + term loans comercially, so maybe it is necessary to distinguish between commercial credit and lifestyle/image credit. The latter is certainly not vital, but maybe Lenihan was just appealing to the Joe Duffy brigade on that occasion.

True - I think he was breaking it down for the Listenership.

As regards lifestyle credit - you are preaching to the converted - I have a credit card and overdraft facility, but rarely use both - just end up paying the facility fees on both every year - just useful to have "in case of the unexpected"and I have learnt my lesson a long time ago in regard to the discipline needed to have these work for me - from my paycheck every month -after pension,savings/investment funds, health insurance,rent,utilities,travel and the food budget have been catered for, only then do I know my "discretionary" fund for the month - holidays and large items are paid for out of savings.

I think you and possibly Akrasia are referring to the "Repayment" Culture that has seeped into Ireland big time from the US in the last decade - funding a lifestyle on the back of revolving debt - the size of which is only determined by the "repayment" capacity of the month salary check - In this you are dead right and is yet another area in which I wish we were a heck of a lot closer to Berlin than Boston.

you'd rather be like those fun-lovin-germans rather than an american?????

hein, ich habe nicht loans und lotz auf der geld but seriously ve germans know how to haff a gud time, ja! now vere is my rekord of 99 luft balloons fur mein super fun partei?

There was no inflation between 1800 and 1900 in the US. Between 1900 and 2000 there was about 2000%.

We will see soon enough how things play out. People think that they can bail themselves out. This is the greatest illusion of all time.

There seems to be a tendency to believe that the government is going to make everything fine and dandy. I am looking forward to this debacle.

zakalwe wrote:

you'd rather be like those fun-lovin-germans rather than an american?????

hein, ich habe nicht loans und lotz auf der geld but seriously ve germans know how to haff a gud time, ja! now vere is my rekord of 99 luft balloons fur mein super fun partei?

I said closer to Berlin - but not crossing the Rhine!

Then again if a date with Alexandra Maria Lara could be arranged - I could well tempted to go the whole way to the Brandenberg Gate.

youngdan wrote:

There was no inflation between 1800 and 1900 in the US. Between 1900 and 2000 there was about 2000%.

We will see soon enough how things play out. People think that they can bail themselves out. This is the greatest illusion of all time.

There seems to be a tendency to believe that the government is going to make everything fine and dandy. I am looking forward to this debacle.

dan,
no inflation due to several reasons:
unlimited land
free labour (slavery)
america's wealth which surpassed france and russia in mid 19th century was due to the two above.

secondly, the 1800-1900 period was not devoid of financial crises (see panic of 1837 where there was a problem with specie (i.e. gold and silver) money due to excessive and reckless lending by banks which led to lots of banks failing. now where did i hear that before?

I don't know of a modern economist who doesn't argue that inflation is directly correlated to money supply. They may all be wrong but I tend to agree with their logic. So interest rates have a very real impact on the economy, and these days on the level of credit that's made available to people. Money supply and attendant inflation rise when interest rates are low, and imo central banks have kept rates articifically low since the beginning of this millenium if not before.

Strangely enough I don't think any of our observations really get to the heart of Anarakasia's original post which I believe is really asking why we are so willing to borrow (spend) today and repay more through interest tomorrow. I have a couple of observations in this regard.

One reason we like to borrow is for instant gratification but I think there's more involved to this. I oftened wonder why people use credit cards to make purchases like TVs and such medium priced items. It is so much cheaper to get a personal loan than to pay credit card interests rates. Some argue that the minimum monthly payment is why some do it but I think the ability to pull out a wee plastic card makes the transaction so much easier and adds a buffer to the borrowing transaction. The credit card user only feels like he/she's purchasing and not really feeling like they are borrowing at the moment of transaction. For a personal loan, they would have to go to a bank an fill out an application form for a new loan to buy the TV. The terms and conditions (principal + interest) would be in front of them and they would know exactly how much more they are spending than the actual purchase price. Borrowing has become a painless exercise in so many cases. Spend today think about the ramifications later.

Secondly, there has been a sea change in regulation and the ways governments view debt in many countries. There are many conspiracy theories floating around the universe and if you sort of reverse engineer what been happening since the Reagan era you could come up with some pretty plausible theories. Imo, I think a confluence of real events surrounding oil (and other commodities), economic theory, financial infrastuctural growth, declining manufacturing bases and just the way Western democracy works has lead us to this current crisis; and will probably lead us into others. Make no mistake about it, the bankers in most Western countries have loved this explosion in money supply created through personal and industrial debt accumulation. They have a major future call option (interest paid on loans) on nearly every economic activity taking place. Add a wee bit of bubble mania and greed to the mix and the regulations go out the door. We all know about about banks ignoring LTVs, shoddy due diligence on income verification, 100% mortgages and so on.

Really, the confluence of events which I'm talking about would take a well written book or doctoral thesis to explain. Suffice to say, most governments are loathe to tell their people that the days of surplus wealth as evidenced by increasing manufacturing output are over in the West. So many service jobs just don't pay anything like the equivalent values as manufacturing jobs did. Every year more and more workers actually don't work for a company any more. They essentially work for employment holding companies such as agencies. There's no benefits, the pay is often poor and chances for advancement nearly non-existant. In place of the living standards wage-earners used to expect as a right, they now have debt to fill the gap between expectations and reality. Reality has to catch up at some time. What government wants reguators going too deeply into the whole affair? What government wants an independent regulator to go public during a boom and call a halt to the good times? I haven't come across one yet.

I think the biggest lie (a word I always use with caution) has to go to Greenspan when he claimed he couldn't identify when a bubble had occured until it was over. Ok, the average joe might fall for all the hype, greed and general dissonant mania attached to a bubble. However, people like Greenspan have all the latest data and a wealth of historical knowledge to identify when the economy or a sector of the economy is over heating. Many, many times the Fed and other central banks have put the brakes on in the form on interest rake hikes in order to slow inflation and an over heating economy. I just think Greenspan can't admit that he doesn't know, given the government's priority to keep the standard of living charade going, when the true amount of cheap money they produce through loans overwhelms the economic system. They know they have to keep printing the money through loan issuance, and they know that real returns in the form industrial production isn't commensurate with the amount of loans being produced, they just don't know when the tipping point occurs with enough precision. But they definitely know when bubble conditions have been created. So bankers have had a tendency to to err on the side of exuberance to the detriment of prudence. Afterall, if you're too big to fail, the government (tax payer) will bail you out in one form or another.

and William Jennings Bryan and his vision of America being marytrd on a Cross of Gold?

Also wasnt there a massive collapse after reckless speculation on the railroads that resulted in a massive collapse of the US banking system and a great depression in which there was no growth in the US economy for 13 years straight in 1870/80/90's - all in the era of Laissez- faire and no government intervention?

BTW - good post Rocky

You are getting central banking and gold backed currencies mixed together. You could get rid of the central banks and still have fiat currencies.

Also what have bubbles to do with gold backed currencies. A bubble is a bubble whether it is a tulip bubble when all money was gold or the dot.com bubble when the money was fiat. A panic is a panic whether it is 1929 with a gold backed currency or 1987 with a fiat currency.

What we have today is massive looting. What will be seen is a currency crisis and then a good lesson will be learned quickly.

Rocky, you seemed to have cloned Akrasia and Anorakphobia together. That would be some combination.

youngdan wrote:

You are getting central banking and gold backed currencies mixed together. You could get rid of the central banks and still have fiat currencies.

Also what have bubbles to do with gold backed currencies. A bubble is a bubble whether it is a tulip bubble when all money was gold or the dot.com bubble when the money was fiat. A panic is a panic whether it is 1929 with a gold backed currency or 1987 with a fiat currency.

What we have today is massive looting. What will be seen is a currency crisis and then a good lesson will be learned quickly.

Rocky, you seemed to have cloned Akrasia and Anorakphobia together. That would be some combination.

who issues the currency?

do you believe in a lender of last resort?

who does the govt "bank" with? (who issues welfare payments? pays the civil service? hold/issue govt bonds?)

the common thread between the 1837 panic, the 1929 crash and the 2008 crash(?) is lack of regulation/oversight/accountability. from the US pres van buren not believing that the US govt should be in the banking sector at all, to the crazy practices on wall street in '29 to the asset bubble and lack of regulation of financial sector coupled with the toxic mix of subprime lending and exotic derivatives (whom no one really understood) in 2008.

Who do you think issues the currency.

Who do you think issues government bonds

rockyracoon - this isn't the answer to Akrasia's question but it is a very good answer to what has caused this economic crisis.

Quote :

Really, the confluence of events which I'm talking about would take a well written book or doctoral thesis to explain. Suffice to say, most governments are loathe to tell their people that the days of surplus wealth as evidenced by increasing manufacturing output are over in the West. So many service jobs just don't pay anything like the equivalent values as manufacturing jobs did. Every year more and more workers actually don't work for a company any more. They essentially work for employment holding companies such as agencies. There's no benefits, the pay is often poor and chances for advancement nearly non-existant. In place of the living standards wage-earners used to expect as a right, they now have debt to fill the gap between expectations and reality. Reality has to catch up at some time. What government wants reguators going too deeply into the whole affair? What government wants an independent regulator to go public during a boom and call a halt to the good times? I haven't come across one yet.

US living standards have been stagnant for 30 years and the last few Presidents have relied on expansion of personal credit to the middle and working classes to keep people disarmed, while the wealthy accumulated billions thanks to tax cuts for the rich, deregulation and wars funded with borrowings.

The money has run out and the wars can't be won. Is the panic and desperation from Paulson and co because they see their bolt money evaporating and the collapse of the dollar if the Chinese decide to cut their losses?

Quote :

Afterall, if you're too big to fail, the government (tax payer) will bail you out in one form or another.

Globalism is a double edged sword. There are trillions of dead money out there. I'm not sure that this time the government is big enough to bail them out.

Edo wrote:

and William Jennings Bryan and his vision of America being marytrd on a Cross of Gold?

Also wasnt there a massive collapse after reckless speculation on the railroads that resulted in a massive collapse of the US banking system and a great depression in which there was no growth in the US economy for 13 years straight in 1870/80/90's - all in the era of Laissez- faire and no government intervention?

Heck, there were regular banking collapses in the 1300's, Northern Italy - same problem, bad lending, compounded then by the use of specie and the absence of any lender of last resort. If one bank failed, it usually took the others down with it. It's fundamentally a result of fractional deposits - but places which didn't allow fractional deposits didn't become business hubs.

ibis wrote:

Edo wrote:

and William Jennings Bryan and his vision of America being marytrd on a Cross of Gold?

Also wasnt there a massive collapse after reckless speculation on the railroads that resulted in a massive collapse of the US banking system and a great depression in which there was no growth in the US economy for 13 years straight in 1870/80/90's - all in the era of Laissez- faire and no government intervention?

Heck, there were regular banking collapses in the 1300's, Northern Italy - same problem, bad lending, compounded then by the use of specie and the absence of any lender of last resort. If one bank failed, it usually took the others down with it. It's fundamentally a result of fractional deposits - but places which didn't allow fractional deposits didn't become business hubs.

When it comes right down to it, we might as well face it that capitalism is a bit of a f. up.