Covert CIA links stretch back to the Vietnam war

Caught on the hop, the predictable response from the top brass here was a knee-jerk denial, with disingenuous offers to the media of guided tours around this or that Thai (not US) base, where, obviously, all would be sweetness and light.

Actually, covert Thai-American military cooperation goes back a lot further than the Thaksin era focused on in your editorial of March 6 - to the Vietnam War at least - and is unlikely to change much because of the 2007 Constitution.

The CIA doesn't make a habit of soliciting parliamentary approval for its undercover operations.

The real questions are: what access to, and how much control over, US military installations situated within Thailand's borders do the Thai authorities have?

The answers, I suspect, are little or none.

CITIZEN JANE

BANGKOK

Fault banks, not mortgage holders, for the credit mess

Within the last six months the property market bubble, the stock market bubble and the derivatives market bubble have burst. Demand for consumer items has fallen dramatically. Demand for raw materials, commodities, has slumped.

Headlines shout about how in the US, 650,000 people have been laid off just in February, raising total unemployment to 8.1 per cent. Leading exporting nations China, Japan and Germany have seen their export trade crumple with big layoffs.

In the media, especially the pro-business media, the cause of all this chaos is just put at the door of the defaulting mortgage borrowers and how they messed up the credit system.

This is simplistic nonsense. The real cause is the "securitisation" or rather securities-based credit system of loans by banks, investment banks, etc, since the old system of issuing credit changed in the 1990's.

The modern system is now based on the securitisation of credit-based personal and corporate loans or mortgage-based loans by banks, big mortgage brokers.Until recently they derived vast profits from leveraging 30-1 or more on these now very complex derivatives crafted from the original simple loans.

 These derivatives were distributed in-house or sold to pension funds, insurance companies, hedge funds that equally made vast profits until quite recently. But these instruments have lost their value by 50-80 per cent or more.

This downward-facing pyramid of debt was only actually created from a very small amount of "real" assets.

But once the bubble of ever rising property prices and the defaulting of mortgages started, this greedy and very foolish method of making "paper" profits and the getting of large bonuses ceased.

From this a mighty crash of part of the derivatives market in turn created the credit crunch. Here banks were afraid and had to keep their balance sheets intact.

Thereby they were also afraid to lend to each other in case they would have to accept even more toxic assets for security.

As a result it is very difficult to obtain credit to run a business, personal finances.

Also as a result of their greed, pride and stupidity, no US, UK, or European bank is now really solvent. Then came the bailouts.

The greedy bankers, big investors, stock market pundits, got the now terrified US, UK governments, to bail them out with taxpayers' money.

This allowed the banks in the US to stave off nationalisation. Why are bankers still sitting pretty while the worldwide recession/ depression falls on the vast majority who did nothing or gained nothing by their strategies? Why?

G W FARROW

PHUKET