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Après Moi, le Déluge!

Leo Kolivakis's picture




 

Via Pension Pulse.

The Guardian reports, French strikes over Sarkozy's pension reform bill roll into second day:

French
unions extended a rail strike into a second day and blockaded oil
refineries in protest at pension reforms today, but there were signs
the stoppages could be losing steam as broad participation wavered.

 

With
the pensions bill due to be approved within days by the senate,
President Nicolas Sarkozy's conservative government stood firm on its
flagship reform, despite a national strike yesterday that brought more
than a million marchers on to the streets.

 

Union leaders said
local meetings throughout France had voted almost unanimously in favour
of extending the stoppage in the state railway sector, the bedrock of
the protests. But they acknowledged turnout had fallen.

Strong
support for an extended strike would raise the pressure on Sarkozy,
whose government would be significantly weakened by a climb-down ahead
of elections in early 2012.

 

"The stoppage has been extended until
at least Thursday, which will be a decisive day for its continuation,"
said Bruno Duchemin, the secretary general of the FGAAC-CFDT
railworkers' union.

 

France's state-run SNCF railways said only
about a quarter of its workers had walked out today, down from 40%
yesterday, with two-thirds of high-speed trains and more than half of
regional trains running normally. Some 135 schools were affected today,
compared with 357 yesterday, the education ministry said.

 

In the
energy sector, workers halted the transport of fuel from eight of
France's 12 refineries and blockaded a handful of the country's 160
fuel depots, raising the spectre of petrol shortages. With unions at
five refineries starting to shut down production and France's biggest
oil port at Marseille hit by a two-week-old strike, the oil sector
lobby UFIP has said localised fuel shortages could hit petrol stations
by the middle of next week.

 

The
government, which says 1.23 million marchers took to the streets
yesterday compared with union estimates of 3.5 million, said it would
press ahead with a reform its says is needed to restore state finances
to health and retain France's AAA credit rating.

 

"I'm not denying
there were a lot of people in the streets but at the same time what
can we do? Not reform the pension system?" the labour minister, Eric
Woerth, told RTL radio, saying only minor amendments were possible
before senate approval.

 

Sarkozy's
government says the reform is essential to balance a pension system
which would otherwise bleed €45bn (£39.6bn) a year by 2020. The
legislation raises the minimum retirement age from 60 to 62, and raises
the age at which workers become eligible for full pension from 65 to
67. Opposition and government senators said they hoped to end
discussion of the bill soon, possibly before the weekend.

 

Unions,
which overturned a 1995 attempt to reform the system with 24 days of
strikes, said protests would continue regardless of whether the bill
passed in the senate.

 

Analysts said
the main risk to Sarkozy was if protests spread to university students
and those angry at his broader agenda. In an attempt to defuse tension,
his UMP party said yesterday that it would review an unpopular tax
ceiling for the rich.

 

"There is an increasing probability the
government will seek deeper negotiations over the proposed reforms to
counter the increasing protests," said Barclays analyst Laurence Boone.

The
French and Greeks aren't shy about protesting against pension and
economic reforms. You got to admire their tenacity as they exercise
their democratic rights. Unlike the electronically lobotomized
population of North America, they still believe in fighting for social
justice.

Unfortunately, it's a lost cause. As I watch the Foreclosure-Gate scandal
play out, I'm starting to believe that this "epic" financial crisis was
in the making for years and will be used as an excuse to ram through
sweeping social and economic reforms. Meanwhile, Bubble Ben keeps the
printing press going, and the financial elite are reaping huge rewards:

Just
two years after the global financial crisis that threatened to destroy
the banking industry, Wall Street bonuses have hit a record high. According to The Wall Street Journal, employees at America's biggest banks are set to reward themselves with $144 billion in compensation and benefits this year — a 4 percent increase over last year's record haul. The
hefty bonuses come as many industries continue to struggle in the face
of difficult economic conditions and the jobless rate holds steady at
9.6 percent. Has Wall Street overstepped yet again? (Watch an MSNBC discussion about the record bonuses)

All this makes me wonder, is the end near? My good friend, Jonathan Nitzan, and his collaborator, Shimshon Bichler, will be presenting later this month at a conference on "Crisis of Capital, Crisis of Theory," Organized by the Forum on Capital as Power:

Is
capitalism about to collapse? Like every other mode of power,
capitalism rests on confidence in obedience: the confidence of the
rulers in the obedience of the ruled. Emperors are sure of their rule
over obedient subjects and slaves; lords are certain they can rule
their obedient vassals and serfs; and capitalists trust the obedience
of their underlying masses. The confidence of rulers is mediated
through their dominant dogma: when the dogma holds, the rulers are
hubristic, steadfast and ruthless; when the dogma disintegrates, the
rulers, gripped by systemic fear, become hesitant and lose their
ability to rule.

 

Systemic fear often culminates
in systemic collapse. The downfall of the last Babylonian emperor,
Belshazzar, the collapse of Easter Island, the French Revolution
against the ancien régime, the fall of Soviet Union and many more such
episodes were all preceded by systemic fear: for whatever reason, the
rulers lost faith in their dogma and confidence in their subjects’
obedience. But their systemic fear remained elusive: we know of it only
anecdotally, subjectively, and always retrospectively – after their
mode of power lies in ruins.

 

Modern finance
has made systemic fear transparent. For the first time in history, we
have an objective, numerical measure of the rulers’ confidence in
obedience – and this measure is available not in retrospect, but here
and now. The indicator in question is forward-looking capitalization:
the financial ritual with which capitalists discount to present value
their expected future profit. This ritual stands at the heart of the
modern capitalist dogma, and it is currently broken: for the past
decade, capitalists have been looking not forward to the future, but
backward to the past. In other words, capitalists no longer trust their
own dogma: they are no longer confident in the obedience of the ruled
or in their own ability to rule.

I invite my readers to download Jonathan and Shimshon's paper, Systemic Fear, Modern Finance, and the Future of Capitalism.
Before you dismiss it as neo-Marxist rhetoric, I warn you, Jonathan was
an Associate Editor of the BCA Emerging Markets team, and he's
extremely familiar with the frivolity of modern day portfolio theory and
the deficiencies of neoclassical economic theory which dominate our
classrooms. He's one of the smartest guys I ever met, and I just love
listening to him and Tom Naylor get into it at our Men's Club meeting
every quarter (last time I wrote about this "prestigious club" was when Bilderberg was plotting to sink the global economy).

I keep things simple. The power elite have every intention to keep Casino Capitalism going for as long as they possibly can. It's in their best interest to do so. That's why all of Wall Street is playing the 'Bernanke put'
taking on as much risk as possible to reap even more bonuses than the
previous year, prompting David Weidner of MarketWatch to rightly
observe, the death of pay for performance:

Clawbacks,
deferred compensation — they sounded like good ideas at the time. But
regulators, at the urging of the industry, shunned any long-term of the
review of Wall Street pay structure.

 

“Trust us,” Wall Street said.

 

And what has it brought? A new study of 2010 compensation by The Wall
Street Journal found that the industry will pay out a record $144
billion this year. The compensation represents a 4% increase from 2009.
It also slightly outpaces a 3% revenue increase at the big brokerages —
most earned in the early part of the year. See WSJ report on Wall Street pay.

 

The
numbers starkly contrast the reality for most Americans. Those lucky
enough to have work are seeing little, if any, rise in wages. The pay
figures also sharply underscore how reform, bailouts and aftermath of
the financial crisis failed to influence pay.

 

In the most heated days of the financial crisis, some banks moved forward. Morgan Stanley adopted
reforms that put more emphasis on deferred pay. Some banks in Europe
adopted clawback provisions or built bonus pools invested in toxic
securities.

 

But most Wall Street banks only
accepted pay rules forced upon them through the Troubled Asset Relief
Program, and even those rules were only targeted toward those which
received exceptional aid: American International Group Inc. , Bank of America Corp. , Citigroup Inc., General Motors and Chrysler.

 

How onerous was pay czar Kenneth Feinberg? Well, no one’s missed a meal.

 

That said, pay does seem to be changing in the financial world. Up
until the crisis, those who took inordinate risks resulting in
short-term profits took heaps of money home despite the long-term
consequences of their bets.

 

Today, it appears pay goes up whether or not those bets create any value at all.

The
distributional effects of this financial crisis are rarely discussed.
Americans got a  glimpse into the ultra secret world of
high-frequency trading on 60 Minutes this past Sunday, but that's only the tip of the iceberg.

The shadow banking business has not dried up. Pensions, in their insatiable quest for "alpha",
are still pumping billions into hedge funds and private equity funds.
And the Fed and other central bankers are pumping trillions into the
financial system.

And what's the end game?
Who knows? It's in every financial player's interest to keep this sucker
going for as long as possible. New bubbles in commodities
and other sectors are forming at this very moment. And political and
financial leaders like Sarkozy and Bernanke must be thinking, "Après moi, le déluge".

 

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Wed, 11/10/2010 - 06:34 | 715689 cheap uggs for sale
cheap uggs for sale's picture

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Thu, 10/14/2010 - 13:23 | 649768 kevinearick
kevinearick's picture

the world is awash in starters, who find themselves in back when coasting stops and the climb starts, but is depleted of finishers.

Fri, 10/15/2010 - 01:37 | 651940 guidoamm
guidoamm's picture

It can't be any other way. The political process, particularly the electoral political process, ensures that we only get starters. If you are elected, by definition your time in power is limited.

By extension, an autocracy could in theory provide finishers. However, autocracies too have proved historically to be short lived and/or mismanaged (i.e. any African country) thus creating an environment rich in starters with no finishers.

Thu, 10/14/2010 - 16:44 | 650719 tip e. canoe
tip e. canoe's picture

nice to see you around again kev.   time to fire up the tesla coils yet?

Thu, 10/14/2010 - 10:14 | 649098 tip e. canoe
tip e. canoe's picture

for those interested in exploring a possible 3rd way:

http://www.kelsoinstitute.org/downloadable-books.html

Thu, 10/14/2010 - 09:52 | 648691 Bob
Bob's picture

Wall Street is playing the 'Bernanke put' taking on as much risk as possible to reap even more bonuses than the previous year . . .

Leo, given the developing avalanche in MBS and related instruments decending upon the banks, I'm curious what you think of this theory that I have put out in other threads:

If I were stockholders--or auditors--I would demand that the banks hold back all that "bonus money" as reserves against foreseeable losses (whether from write-downs or legal settlements) that would otherwise jeapordize the very survival of the firms. They have no contractual claim for Gov bailouts. 

The news is out.  There is no way the banksters meet their fudiciary duties if they pay out that bonus money. 

Under the circumstances, it would clearly constitute looting the companies.

And it would be prima facie evidence of a premeditated plan to once again blackmail the public for another massive bailout to avert "systemic collapse." 

Thu, 10/14/2010 - 07:20 | 648671 Sudden Debt
Sudden Debt's picture

At least the French are protesting, the Americans are taking it up in the ass.

Thu, 10/14/2010 - 08:24 | 648749 Confused
Confused's picture

+10

 

Thu, 10/14/2010 - 06:36 | 648647 fwiw imho
fwiw imho's picture

If 1.3 million Frenchmen took to the streets on June 14, 1940 to stop an invasion,........oh well, never mind.

Thu, 10/14/2010 - 09:22 | 648922 destiny
destiny's picture

Make that 3.5 millions !!!!that's how many there were in streets this past tuesday

Thu, 10/14/2010 - 07:25 | 648674 Bob
Bob's picture

Looks to me like they learned a vital lesson in a tragically painful way. 

It is my hope that we won't need to suffer something similar ourselves in order to stand up against the forces of tyranical madness. 

Thu, 10/14/2010 - 07:23 | 648673 Sudden Debt
Sudden Debt's picture

Unless you're 80 years old, you're acting like a fool.

Did you know the English helped America fight the Indians in the 1700 hundreds?

You forgot right?

You stupid fuck.

Did you know the French helped the Americans in fighting the English to become independent?

You forgot right?

You stupid fuck.

Did you know all the technical inovations that made America become great, actually came from Germans helping Americans?

You forgot right?

You stupid fuck.

 

Thu, 10/14/2010 - 09:39 | 648979 fwiw imho
fwiw imho's picture

"Did you know the French helped the Americans in fighting the English to become independent?"

So are you saying the last good thing the French did was in 1776?  If so, I'd might agree.

Does WWI and WWII count for your stupid fuck responses?  If the shoe fits, stick it up your ass.

Thu, 10/14/2010 - 08:35 | 648768 nmewn
nmewn's picture

Did you know the Dutch were the first to import Africans as slaves to North America?

You forgot right?

You know the rest...stones, glass houses...etc ;-)

Thu, 10/14/2010 - 06:27 | 648640 nmewn
nmewn's picture

Here's your "socially responsible" public employee type helping the little guy update Leo;

"Oct 13 (Reuters) - Steven Rattner, the former head of the U.S. auto task force, is close to settling with the Securities and Exchange Commission over charges he took part in a pay-to-play pension scheme, media reports said on Wednesday.

 

Both CNBC and the New York Times said a settlement with the federal regulator could be announced on Thursday.

 

The SEC declined comment. So did the Office of the New York Attorney General, Andrew Cuomo, whose corruption investigation of the state's pension fund has produced seven guilty pleas, most recently from former State Comptroller Alan Hevesi."

http://www.reuters.com/article/idUSN1327967520101013

Odd that I have never seen you comment on the ex Car Czar Leo ;-)

 

Thu, 10/14/2010 - 07:04 | 648663 Leo Kolivakis
Leo Kolivakis's picture

The car Czar? Sure I have referred to that rat on my blog, on chooching pension funds:

http://pensionpulse.blogspot.com/2009/07/chooching-pensions-funds.html

Saw that article but thanks for bringing it up here.

 

Thu, 10/14/2010 - 08:19 | 648738 nmewn
nmewn's picture

Thanks for the clarification...and I do realize it has nothing to do with France per se...but it does point to the wolves in sheep's clothing aspect to all this.

It would seem the ruling class has over promised and underachieved world wide...LOL.

Whenever the statist's get done screwin around with their central planning schemes and they can root out known carpetbaggers like Quadrangle (it was under investigation at the time of his appointment to Car Czar if I recall) maybe we can get back to business ;-)

Savings is the problem Leo.

Workers don't have them because too much is being confiscated from them by the state with a promise to repay later. Once you deduct federal income tax, social insecurity tax, medicare taxes and in some cases state taxes you are left with between 2/3 and half of what you worked for before you can even make it to the bank depending on your bracket.

Then you get to drive home which requires gasoline...& of course another tax (gasoline taxes) & licensing fees, tag fees etc...a rose by any other name. God forbid you get in a hurry as Barney Fife lurks behind every billboard and hill in the road waiting to pounce on you for exceeding the speed limit on an empty highway.

Once at your home...which is also taxed...you flip the light switch which generates a bill from the electric company along with their government mandated imbedded fees & taxes. You kick off your shoes and fire up the computer to check your trades/news/sports which generates another bill from your provider company along with their government mandated imbedded fees & taxes.

You crack open your bottle of Crown (also heavilly taxed) light up a smoke (which heavilly taxed & is akin to throwing babies in the air and catching them on a sword these days) and sit down and read of the plight of the poor public sector employee unions (the French railway system is state run, that is, public sector) that you pay the salary of...and how they are so upset about not being able to pillage more of my labor...for example;

http://www.washingtonpost.com/wp-dyn/content/article/2010/04/21/AR201004...

The distribution of wealth is indeed a problem...it is going to the least competent people to make those decisions. Your article is proof of it.

Thu, 10/14/2010 - 06:18 | 648637 Escapeclaws
Escapeclaws's picture

Capitalism is a fantasy based on the mythology of the invisible hand. It only seems to work in its beginning stages before the monopolies take over. Like the hundreds of car companies before Ford and GM or the hundreds of computer startups.

Capitalism these days is Gotcha Capitalism. The huge air-filled bag of potato chips that turns out to be one quarter potato chips. It's turned into a tawdry extortion racket.

Thu, 10/14/2010 - 04:19 | 648589 max2205
max2205's picture

Silver bubble will hit MSM this weekend. Look out. Gold ain't shit Ben. Betcha didn't think silver would moonshot Ben. Ben?!

Thu, 10/14/2010 - 04:17 | 648588 max2205
max2205's picture

Protesting, another drinking sport. Call me when they actually murder officials.

The US doesn't even have vigilantes with a shit.

Thu, 10/14/2010 - 04:18 | 648587 guidoamm
guidoamm's picture

@ RockyRaccoon 5:26 - this was supposed to be an answer to your comment but something went wrong in clicking the answer button...

Exactly! Spot on.

In a debt based fiat monetary system, capitalist characteristics are more prevalent at the outset (in the particular case of the USA the outset is 1913) but as the dynamic of debt based currency develops, the system must gradually but necessarily become more statist. The logic of debt based money must necessarily lead to the state becoming progressively more intrusive as it gradually and by necessity becomes the largest actor in the economy.

By implication, this means two things - first: at the outset, nominal and intrinsic value are closely related but as the dynamic develops nominal value decouples from intrinsic value at increasing speed (financial value decouples from intrinsic value) - second: as financial value runs away from intrinsic, profit gradually concentrates in fewer and fewer sectors till towards the end only the financial sector enjoys any profit.

Today, most capitalist aspects our economies may have displayed till about fifteen or even ten years ago, no longer exist. The logical progression of debt based money sees to it that the economy implodes in a statist supernova. We're there now.

 

 

 

Thu, 10/14/2010 - 15:27 | 650315 RockyRacoon
RockyRacoon's picture

Yes, I think we are there now.  It might be the case that all we can do is watch the fireworks.   Another misnomer is that we have a "democracy".  That's BS as well.  But that's a topic for another time.

Thu, 10/14/2010 - 04:01 | 648577 johny2
johny2's picture

even though i have been lucky enough to make money in this market, i really dont have much good to say about it. it is corrupted, and my advice to anyone is to not gamble.

furthermore i have lived both in communist and capitalist systems, and the problem is that in both of them population is made of all kinds of people...eventually system fails becouse power corrupts.

where or how soon, the next revolution is going to start, i dont know, but i think we are going to see it happen.

Thu, 10/14/2010 - 02:23 | 648534 FreedomGuy
FreedomGuy's picture

"Is capitalism about to collapse? Like every other mode of power, capitalism rests on confidence in obedience: the confidence of the rulers in the obedience of the ruled."

As others have pointed out. This is a seriously flawed view of capitalism. Capitalism is at its heart a voluntary association without coercion or direction. There are no rulers and ruled in capitalism. We have no unfettered or untortured capitalism anywhere in the world today. What we see today is the failure of numerous flavors of socialism and central planning.

I assert that capitalism is what you find when you remove the state and coercion. It is back to the tribal, "I will trade you 6 bananas for two fish." You take the deal, don't take it or make a counteroffer. No force or planning or currency games. The aggregate of these decisions is what we call an economy.

I find that socialists invent new definitions and forms of what they call capitalism every day. Any economic play that fails is termed capitalism and of course requires more central planning in the form of regulations and control. What we are really seeing is the inevitable failings of central planning in its various forms. When it crashes, what will arise will be closer to true capitalism. Socialism and central planning always fail over time. Always. Its what drives the modern statist nuts because they cannot change its nature any more than they can change the laws of physics.

This article is not only inaccurate but self serving for someone with an agenda.

Thu, 10/14/2010 - 02:42 | 648544 blunderdog
blunderdog's picture

That's not capitalism.  That's just a market.

 

Thu, 10/14/2010 - 02:13 | 648533 Moonrajah
Moonrajah's picture

Maybe it is a bit off-topic, but I do recall a wonderfull video-game Deus Ex that came out in 2000. It was a rare example of a rich and deeply thought out piece of entertainment that had a strong social and political message. I've recently replayed it and found the issues discussed to be chillingly close to what is happening right now. A couple of plot-points may still seem too far fetched, but I just don't know anymore. Maybe we, as a society ruled by a handful of corrupt and self-serving animals, still have a ways to go down before people have really nothing left to lose anymore.

Intersting tidbit. The game pictured New York without WTC towers. And that was one year prior to 9/11.

Thu, 10/14/2010 - 00:59 | 648433 wake the roach
wake the roach's picture

End of capitalism? Pfft, no... Man has always been capitalist, always will be... Capitilist meaning we use knowledge and technology to increase efficiency per unit energy allowing increased production of goods and services per energy unit consumed...

The end of the PROFIT system is what is occuring... What did everyone expect, the globe and thus growth is tapped out?

When a worker/consumer receives unequal income for his/her labor relative to the embodied energy of the goods and services his/her labor has produced. 

And/or the goods and services labor produced are sold at a greater nominal energy price than is actually embodied in the goods and services sold, it only means one thing...

THE NOMINAL ENERGY VALUE OF ALL THE GOODS AND SERVICES PRODUCED GLOBALLY AT ANY TIME IS ALWAYS GREATER THAN THE ENERGY INCOME OF ALL WORKERS/CONSUMERS!!!! PONZI....

We have tapped out global wage arbitrage, consumer debt and energy resources that can be produced with sufficient net energy gains to even allow the system to maintain equilibrium (let alown increased and infinite growth)...

THE PROFIT SYSTEM IS FUCKING OVER, EITHER WE CREATE A COMPLETELY NEW ENERGY ALLOCATION/SOCIAL SYSTEM BASED UPON EGALITARIAN PRINCIPLES AND RESOURCE SUSTAINABILITY, OR WE SPEND THE NEXT 100 YEARS FIGHTING FOR THE LAST SCRAPS OF CIVILIZATION, ALL THE WAY BACK TO THE STONE AGE...

That is the cold hard truth... Leo (et al), here is an investment I recommend for you...

http://www.amazon.com/Entropy-Law-Economic-Process/dp/1583486003

Thu, 10/14/2010 - 05:51 | 648618 THE DORK OF CORK
THE DORK OF CORK's picture

The solution is simple - all utilities cannot be allowed to extract profit - the French understood the nature of the monetory system since the second world war and had no choice as a goverment with at least some republican ideals to instigate capital projects that would increase the wealth of the nation while showing negative profit.

EDFs nuclear venture into America ended with predictable results - America has no concept of capital creation and just wants to extract.

The act of building anything of substance that creates wealth is almost impossible in this present monetory system and needs a extremely focused executive that has at least partial independence from bankers who know nothing else but capital extraction.

Thu, 10/14/2010 - 13:25 | 649772 GoinFawr
GoinFawr's picture

Another win from Cork. If we ever meet, I owe you a shot of Bushmills and a pint of the black stuff, Beamish that is.

Thu, 10/14/2010 - 01:04 | 648444 blunderdog
blunderdog's picture

Do you know who's in command here, soldier?

Thu, 10/14/2010 - 01:41 | 648488 wake the roach
wake the roach's picture

Ahhh, YEAH...;-) And its not colonal kurtz, pope Benedict XVI or Bernanke himself...

Its the laws of thermodynamics that drive this freight train, we're all just along for the ride... But we can collectively choose to throw the rail switch to the track of energy equilibrium but I don't believe we will. Atleast, not in time to save the overwhelming majority of mankind... Believe me when I say that I'm not a pessimist... Just a realist... I do not underestimate the challenge of convincing the masses of the need (and benefits) of a total systemic change away from the profit system but what choice do we have??? The negative connotations of the words socialism and communism are so deeply (and falsly) engraved into the psyche of the masses that they would die to defend their slavery within an unsustainable sytem that will eventually kill us all anyway... And most of those who come closest to understanding the totality of our little predicament will choose the safety of what they know (competition)... Most men are truly weak. Mentally, where it counts...

Thu, 10/14/2010 - 01:57 | 648517 StychoKiller
StychoKiller's picture

Is the surface of a planet the right place for an expanding technological civilization?

Thu, 10/14/2010 - 02:39 | 648541 blunderdog
blunderdog's picture

So long as thermodynamic efficiency is what we choose to expand with our technology, hell yeah.

The sun provides the energy to sustain life for BILLIONS of years.

That shit's been demonstrated, yo.

This is no happy-hippie "solar power will save us" nonsense.  This is a straightforward assessment of how biological systems work.  They gorge for awhile, then they contract, then they achieve equilibrium.

Our "gorging" period is coming to an end.  We're getting to the moment of truth: equilibrium or extinction.

I paid attention in some of the science classes in high-school 'cause I thought the stuff was kinda interesting.  I didn't believe most of it at the time--not intuitively, anyway.  It took about 15 years for me to catch up on the understanding front.

Thu, 10/14/2010 - 00:14 | 648358 Printfaster
Printfaster's picture

Anyone who has ever been to Charles DeGaulle airport knows that the French are definitely the most revolting people in the world.

 

Thu, 10/14/2010 - 00:13 | 648357 zen0
zen0's picture

I like that..............ferderal............it is like folderall.........heh.

Wed, 10/13/2010 - 23:51 | 648328 Augustus
Augustus's picture

The indicator in question is forward-looking capitalization: the financial ritual with which capitalists discount to present value their expected future profit. This ritual stands at the heart of the modern capitalist dogma, and it is currently broken: for the past decade, capitalists have been looking not forward to the future, but backward to the past. In other words, capitalists no longer trust their own dogma: they are no longer confident in the obedience of the ruled or in their own ability to rule.

 

This whole statement is based upon flawed premises.  The capitalist idea that a view of the future is required to plan investment still holds true in every way.  Capitalists have long known that government promises could not be fullfilled.  It seems now that the government is finally finding that out and whispering about it to the population.  No real changes yet or great defaults, just modest jiggering and suggestions of changes.

Based upon past methods governments have used to try and avoid the problem of explaining that the promises have been lies, capitalist are concluding that they cannot rely upon their governments to uphold any past contracts with them or to respect any private property rights.  After reaching that conclusion, capitalists have determined not to engage in buying the lottery tickets being offered by the government Casinos.

Wed, 10/13/2010 - 23:59 | 648326 williambanzai7
williambanzai7's picture

The electronically lobotomized have very high tolerance for exploitation. Thank goodness, because when that tolerance finally breaks down, I think the behavior of Americans during the Civil War will provide you with a startling insight of what could happen.

We are the most violent of the violent tribes. 

Now I am thinking of the Revolutionary War, it took us a while to get the ball rolling in that one as well, but look what happened.

Thu, 10/14/2010 - 00:12 | 648353 zen0
zen0's picture

I don't think it will happen. The civil war was government sponsored. The resistence has no government money.

I like your art, but unless you go into the ferderal reserve and put a bullet in Bernanke's brain, nothing will change.

Sure, it would be symbolic, but that is how wars are won. See Ground Zero.

 

Thu, 10/14/2010 - 01:02 | 648440 blunderdog
blunderdog's picture

zen0?  I remember you.  You're the guy who proved the arrow can never hit the apple because it has to travel half the distance an infinite number of times, which would have to take forever.

Thanks for your input.  Run along now.

Wed, 10/13/2010 - 23:49 | 648296 michigan independant
michigan independant's picture

What is needed to prevent any further credit expansion is to place the banking business under the general rules of commercial and civil laws compelling every individual and firm to fulfill all obligations in full compliance with the terms of the contract. If you have to convince a group of people who are not directly dependent on a solution of a problem, you will never succeed. Only to bureaucrats can the idea occur that establishing new offices, promulgating new decrees, and increasing the number of government employees alone can be described as positive and beneficial measures. The issue is always the same: the government or the market. There is no third solution.  Mises

“Insanity in individuals is something rare - but in groups, parties, nations and epochs, it is the rule." -- Friedrich Nietzsche

 What you fail to recognize or acknowledge is that a free market capitalist system is doomed to fail. 

 You fail to understand that we are not operating under a free market capitalist system in any sense of the word.

I understand markets and economics well enough to have this discussion with you. 

I find you have no understanding how markets work.

 

 

 

Wed, 10/13/2010 - 23:31 | 648291 Nihilarian
Nihilarian's picture

DEMOCRATIC
You have two cows.
Your neighbor has none.
You feel guilty for being successful.
Barbara Streisand sings for you.

REPUBLICANISM
You have two cows.
Your neighbor has none.
So?

SOCIALIST
You have two cows.
The government takes one and gives it to your neighbor.
You form a cooperative to tell him how to manage his cow.

COMMUNIST
You have two cows.
The government seizes both and provides you with milk.
You wait in line for hours to get it.
It is expensive and sour.

CAPITALISM
You have two cows.
You sell one, buy a bull, and build a herd of cows.

AMERICAN BUREAUCRACY
You have two cows.
Under the new farm program the government pays you to shoot one, milk the other, and then pours the milk down the drain.

AMERICAN CORPORATION
You have two cows.
You sell one, lease it back to yourself and do an IPO on the 2nd one.
You force the two cows to produce the milk of four cows. You are surprised when one cow drops dead. You spin an announcement to the analysts stating you have downsized and are reducing expenses.
Your stock goes up.

FRENCH CORPORATION
You have two cows.
You go on strike because you want three cows.

JAPANESE CORPORATION
You have two cows.
You redesign them so they are one-tenth the size of an ordinary cow and produce twenty times the milk.
They learn to travel on unbelievably crowded trains.
Most are at the top of their class.

GERMAN CORPORATION
You have two cows.
You engineer them so they are all blond, drink lots of beer, give excellent quality milk, and run a hundred miles an hour.
Unfortunately they also demand 13 weeks of vacation per year.

ITALIAN CORPORATION
You have two cows but you don't know where they are.
While ambling around, you see a beautiful woman.
You break for lunch.

RUSSIAN CORPORATION
You have two cows.
You have some vodka.
You count them and learn you have five cows.
You have some more vodka.
You count them again and learn you have 42 cows.
The Mafia shows up and takes over however many cows you really have.

TALIBAN CORPORATION
You have all the cows in Afghanistan , which are two.
You don't milk them because you cannot touch any creature' s private parts.
You get a $40 million grant from the US government to find alternatives to milk production but use the money to buy weapons.

POLISH CORPORATION
You have two bulls.
Employees are regularly maimed and killed attempting to milk them.

BELGIAN CORPORATION
You have one cow.
The cow is schizophrenic.
Sometimes the cow thinks he's French, other times he's Flemish.
The Flemish cow won't share with the French cow.
The French cow wants control of the Flemish cow's milk.
The cow asks permission to be cut in half.
The cow dies happy.

CALIFORNIA CORPORATION
You have millions of cows.
They make real California cheese.
Only five speak English.
Most are illegals.
Arnold likes the ones with the big udders

Thu, 10/14/2010 - 01:20 | 648472 chindit13
chindit13's picture

CHINESE CORPORATION

You have two cows.

You wish they were pigs.

You don’t milk them because you have plenty of melamine.

You build them five barns.

You put both cows in just one of the barns, along with 300 migrant laborers from Ginsu Province.

You paint the other empty barns red, green and gold.

You get an Honorable Comrade Mention for doing your part for GDP.

You name your combination farm enterprise and real estate conglomorate Double Lucky Golden Fortune Happiness & Sons.

Thu, 10/14/2010 - 14:13 | 649978 akak
akak's picture

WALL STREET CORPORATION

You own two cows.

You obtain one million cows from debt-drowning farmers, under questionable legal title.

You then invent ten million "paper cows", and borrow milk against their imaginary production.

People begin demanding real milk, and not just milk IOUs.  Bankruptcy looms.

You go to the government and demand that they confiscate ten million cows from the American public and hand them over to you, otherwise society will collapse and zombies will roam the land.

The government meekly obliges.

You pay your top officials bonuses of one million cows.  Life is good.

 

Thu, 10/14/2010 - 22:27 | 651671 GoinFawr
GoinFawr's picture

Nice one!

Thu, 10/14/2010 - 00:36 | 648389 HungrySeagull
HungrySeagull's picture

A Homebuyer has learned to take care of and raise two cows.

However the Homeowner's association has ruled against this practice.

Your local law enforcement hits you with noise penalties from the mooing at 4 AM

You are sued by your neighbors for the odors emanating from the cowpies in your back yard.

By the time you have learned to buy a proper farm and move there to really get into the cow business, your family will now have a cow because they must get up at 4 am to milk thier breakfast and butcher thier dinner quickly before the heat of the coming sunrise ruins the meat.

Thu, 10/14/2010 - 00:13 | 648355 GoinFawr
GoinFawr's picture

hehe. Read some of these before, but some I haven't seen; yours?

Seen this?

http://www.moronail.net/img/1910_capitalism_fascism_socialism_anarchy_hedonism

Wed, 10/13/2010 - 23:19 | 648260 Kreditanstalt
Kreditanstalt's picture

Those protesting pension cuts are only more hands asking for bailouts.  But the wealth simply isn't there.

In a sense, what we are going through now seems sometimes to be a crisis of lack of productivity rather than a "financial crisis" at all.  There simply isn't the wealth - or the production of wealth - around to support everyone's aspirations in terms of standard of living.

Am I being simplistic in suspecting that the entire publicly-funded worldwide pension system - indeed perhaps the entire welfare state - is probably insolvent?

Thu, 10/14/2010 - 00:53 | 648422 akak
akak's picture

Am I being simplistic in suspecting that the entire publicly-funded worldwide pension system - indeed perhaps the entire welfare state - is probably insolvent?

 

Simplistic?  Certainly

Accurate?  Probably

Thu, 10/14/2010 - 06:42 | 648649 destiny
destiny's picture

Well geez, what degree did you get to figure that out ? France actually borrows money to pay 10 to 20 % of the actual pensions. 

Thu, 10/14/2010 - 13:47 | 649897 akak
akak's picture

Well geez, what degree did you get to figure that out ?

Hey, they don't call them "BS degrees" for nothing!

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