Gonzalo Lira On The Identity Of The False Religion Behind The Mask Of Economic "Science"

Tyler Durden's picture

Submitted by Gonzalo Lira

“Our God Is Money”: Economics Isn’t a Dismal Science—It’s an Ersatz Religion

Are you an Austrian?” I was asked recently, in the polite tones reserved for asking if I were, say, Jewish or Muslim or Christian.

I’d been asked the question while discussing macro-economic policy in the United States—
—actually, “discussing” doesn’t quite capture what I’d been doing:
I’d been lambasting the Neo-Keynesian drivel of spend!-spend!-spend!, which I deplore—“They’re like drunk sailors with the national credit-card—trawling for good blow and cheap whores in a Tijuana back alley!”—
—while at the same time ridiculing the Monetarists’ obsession with money supply—“Money-supply fetishists are just like foot fetishists—only twice as creepy, and only half as reasonable!”—
—all the while insisting that in this Global Depression, savings had to be the priority—austerity the only policy prescription that made any kind of sense.
Are you an Austrian?” came the question.
“I'm an agnostic,” I answered flippantly—but then instantly realized that my answer went to the heart of the problem with economics.
It’s no great insight to say that economics—the so-called “dismal science”—has had a dismal track-record in terms of predicting macro-economic events over the last forty-odd years.
And as for the last couple of years? Sheesh—a monkey throwing darts would have done a better job of predicting how the macro-economic picture would play out.

Very few people have been asking why this is so. Very few people have been asking why economics has failed so spectacularly at predicting the Global Financial Crisis, and very few people have asked why economics cannot seem to solve the Global Depression we are currently experiencing.
This is an important question—especially if we are collectively putting so much of our faith in economists and their dismal science, as the sherpas who will lead us out of this current mess that we’re in, and back up to the mountain top.
First of all, what is economics?
The dictionary definition is, economics concerns itself with the study of the production, consumption and transfer of wealth—everything from accounting to finance to macro-economics.
Now, I have no truck with micro-economics, generally speaking; accounting and finance. All good to me, within certain limitations. When I speak here of economics, I’m referring to macro-economics.
What does economics do, as a discipline?
The answer is obvious: Economics tries to predict the future.
Lots of sciences try to predict the future—and they succeed, too, without much controversy.
For instance, physics and chemistry claim that, if gasoline is mixed with air inside an enclosed cylinder, and then ignited, the force will drive a piston which will drive a crankshaft which will drive a car.
Lo and behold, several hundred million cars drive around the planet, amply fulfilling physics’ and chemistry’s predictions. Score for them.
But what about economics?
Well, economics claims it is a science—yet for all its “scientific” models, economics found itself in 2007 with its hands up against the wall and its collective pants down around its ankles, when it utterly failed to predict the Global Financial Crisis, and the subsequent Global Depression.
Actually, there were a number of non-economists whose predictions were far more accurate than any paid economists’. But all those eccy Ph.D.’s with all the academic trimmings? They got the big ol’ raspberry, when the Global Financial Crisis hit.
In fact, economics definitively showed itself to be a failed science much earlier: Back in 1998, the spectacular failure of Long Term Capital Management showed them up to be fools.
LTCM—run by legendary trader John Meriwether—was a hedge-fund that used “scientific” trading methods developed by Myron Scholes, Robert Merton and Fischer Black, who invented options pricing. In fact, Scholes and Merton won the Nobel Prize in economics for their work—in fact, Scholes and Merton worked at LTCM, applying their “scientific” methods to LTCM’s trading strategies.
Talk about the best and the brightest! Meriwether opened his shop in 1994 with these two Big Brains running the engine room, along with a host of other Big-Brains-in-Training—and what happened?
In less than four years, Long Term Capital Management blew up. A “once in a billion years event” happened in less than four years—which means that either LTCM was the unluckiest outfit in the world . . . or maybe economics and finance isn’t a science.
Why be coy: Economics isn’t a science—it never has been. It can’t be—because its subject matter is people: And people aren’t predictable.
Circumstances being equal, water will freeze at 0°C, and will boil at 100°C—every time, time after time, no matter what.
But people? You can never predict when they’ll freeze you out, or boil over in rage.
That hasn’t stopped economics from pretending to be a science. That’s why the discipline has spent the last 60 years importing math and physics wholesale: So as to create a veneer of scientific certainty and respectability.
So if economics isn’t a science, then what is it?
Well: What human activity pretends to higher knowledge of a super-human power that controls human lives and destinies? What human enterprise tries to convince other human beings that they—and only they—know what will happen next? What group of human beings claim that their secret knowledge uniquely allows them to know what will happen—and so therefore, you must listen to all that they say, and never ever question their commands, decrees or pronouncements, no matter how foolish?
Easy: Priests. Priests in the service of a religion.
Ancient Mayan priests used their knowledge of the stars and the planets to not merely predict the future—they used that knowledge to control the populace, and therefore get their own way.
That is exactly what economics has been doing, as of late: Claiming knowledge of the future, and claiming unique access to a higher truth—unavailable to the ordinary man and woman—so as to get the populace to do their bidding.
Just like religions, economics uses esoteric knowledge and language to discriminate between its acolytes and the unlearnéd, the elect and the unwashed.
Just like religions, economics builds sophisticated-seeming theoretical structures, that seem to explain reality.

They don’t, of course: The mathematical models economist spend all their time building are simply not up to the task of faithfully reproducing the macro-economic reality, and thereby predicting it.
Why? Because there are so many variables that human invention simply cannot cover them all. Human invention cannot predict all the moves in a game of chess—and chess only has six classes of pieces moving on a mere 64 squares.
Imagine something like a world’s economy: How many classes of pieces? How many squares? How many moves? How many variables?
Yet economics—ridiculously—claims it has models which can predict the future—but what’s even more ridiculous, there are many who believe them.
Just like all successful religions, economics is very good at convincing people that it is the One True Path to Wisdom—and not just unsophisticated or uneducated people: Actually, as all good con-men know, the easiest people to fool are sophisticated, intelligent, educated people. It’s precisely their sophistication, intelligence and education which makes them arrogant, makes them think they can’t be fooled: They think they’re too smart to be fooled.
So of course, they’re fooled most of all.
Just like all religions, economics is used to explain away the actions of its more powerful adherents, and to protect the interests of its most powerful patrons.
What did economists and the other clergy of economics claim, in the Fall of 2008? “If we don’t save the banks, we are all doomed!!!”
That was of course not true: If the banks had not been bailed out, they would have gone into bankruptcy, the stock holders would have been wiped out, the bond holders would have gotten a haircut (or a buzzcut, rather)—but life would have gone on.
In fact, the financial sector today would be healthier, if the Too Big To Fail banks had been allowed to fail, and then restructured along Sweden ‘92 lines.
But not one economist in any position of influence advocated the bankruptcy and restructuring of the Too Big To Fail banks. Some actually advocated a “hold your nose and get it over with” approach to the TBTF banks—
—which is unsurprising: Establishment religions are not in place to change a society, but to maintain a society. Establishment religions benefit those in power by maintaining the status quo—their job is to make sure the populace never questions the status quo, no matter how wide the gap between the stated principles on the one hand, and what is actually done on the other.
The fact that the TBTF banks were not allowed to fail—and instead were bailed out to the detriment of the economy as a whole, but to the benefit of a small, well-positioned minority—goes to show what the establishment religion of economics is used for: To shore up the interests of those in power, to the detriment of the society as a whole.
Not only that, the Religion of Economics is used to explain away blatantly hypocritical measures as part of The Grand Design.
“It’s a bad solution, but what are we gonna do? Let the banks fail? That will bring about a market collapse! The end of the free market! So we gotta hold our noses and get it over with.”: How many, many times did we all hear economists say this, about saving the TBTF banks? That it was systemically necessary to save the banks.
Are those the words of someone who truly believes in the “creative destruction” that is supposed to be such an integral part of the free markets?
No: They’re the words of a priest of the establishment religion, protecting the interests of his masters.
Just like all powerful religions, economics has different sects and denominations.
Marxism used to be a creditable example: It was one more cult in the menagerie of economics. But this particular sect was discredited by the collapse of the Soviet Union and the Warsaw Pact nations. The gross and blatant failure of Marxism made it impossible to argue that it was a viable macro-economic policy option—so its fiercest followers were driven underground. (But they’re still out there, by the way: Like Gnostic Christians, waiting for their chance to come back out.)
Marxism is an obvious example of economics-as-religion—but I would argue that all schools of macro-economic thinking are no different from Marxism. The reason is because, like Marxism, all the schools of macro-economic thinking come at their subject from an a priori perspective.
Thus, Austrians are no different from Keynesians, or Neo-Keynesians, or Monetarists, or Modern Monetary Theorists, and these all have absolutely no difference from Marxism: They all come from theoretically arrived at principles, which are then applied to the empirical data. If the data does not fit the theory, then the data is dismissed, and discounted as not germane to the problem at hand.
This dismissal is where the various schools of economic thought get in trouble: That which they dismiss is usually the brick wall they find themselves crashing into.
Neo-Keynesians are arguing spend!-spend!-spend! on stimulus and whatnot, up to and including war as a possible solution to the fall in GDP. The more insane among this crowd, like Paul Krugman, argue that the Obama stimulus package was not enough—it had to be bigger.
Neo-Keynesians don’t realize that no stimulus will ever be big enough—but if they have their druthers, they’ll bankrupt a nation.
Monetarists, like Ben Bernanke and his Lollipop Gang at the Federal Reserve, argue that increasing the money supply will create inflation—which will mean the economy is getting back on track.
Monetarists don’t realize that they’re committing several logical flaws, principal among them being the post hoc ergo propter hoc logical fallacy, with regards to inflation. If they have their druthers, they’ll drive the nation into hyperinflation.
Austrians argue that the government should cut spending and raise taxes, so as to balance the budget—and magically, the economy will improve, with no loss of GDP.
Austrians are smoking something—and whatever it is, it’s powerful. So I want some.
Just like all religions, the various sects and denominations confer membership to its believers. They invite you to belong.
Notice how economists of a particular school rarely question the fundamental orthodoxies of their sect. Sure, little spats here and there over minor, peripheral issues within their denomination. But about the big pillars of their order? Nary a quibble, nary a peep, nary a doubt.
In fact, debate within the various churches is so small-bore and trivial, that you quickly realize that the quibbles aren’t about economics: The quibbles are jockeying for position within the school of economic thought. Like peacocks, showing off their useless plummage? Like that.
The one thing all the sects of the Religion of Economics all agree upon is growth: All agree that an economy must grow every year—year after year—no excuses—no matter what.
This is where economics fails most of all.
Of course, perpetual growth is ridiculous: Nothing can grow every year without fail. Nothing should be forced to grow year after year. Trees need to be pruned, growth consolidated.
Nevertheless, the current leadership of the American, European and Asian economies are all under the delusion of the same orthodoxy—growth!-growth!-growth!
The American economic leadership in particular is a slave to this economic orthodoxy. But as I argued in The Short-Sightedness You Get From Staring At A Single Number, deliberately and systematically turning all your macro-economic efforts towards inflating the Gross Domestic Product inevitably leads to distortions in the overall economy.
Growth, in and of itself, is not a metric of anything—and it can easily be perverted. Much of the debt accrued by the U.S. Federal government over the last 30 years—and the last ten in particular—was used to goose the economy to levels of growth that were unsustainable, and which have led to the situation we currently find ourselves in.
And what is the situation we currently find ourselves in?
The United States government and the American people spend more money than they bring in. They have been doing this for going on 40 years—and now the bill has finally come due.
That’s America’s problem—it’s really not more complicated than that.
My solution to this problem? “Cut spending and raise taxes, so as to balance the budget. With a balanced budget, begin building a solid economy on a solid economic foundation.”
This apparently makes me an Austrian—Monetarists and Neo-Keynesians dismiss me, of course. They assume that, like all Austrians, I believe that cutting spending, raising taxes and closing the budget deficit will magically spur growth in GDP.
Actually, I don’t.
See, I’m not an Austrian. Not only that, I do not commune at the church of economics. Call me a son-of-a-bitch if you must, but don’t ever call me an economist.
Rather, I’m a pragmatist: At this time, the best thing to do in order to maintain long-term social stability is to cut spending, raise taxes, close the budget deficit, and have negative growth for three or four years.
In other words, stop trying to avoid the Global Depression, and fully dive into it. Avoid Japan’s fate of Lost Decades. Let the markets really do their creative destruction. Let the debt overhang be wiped out via bankruptcies. Let the chips fall where they may—let the whole unstable house of cards crash to the ground—just get it over with, once and for all.
Of course, this will never happen. The orthodoxies of economics won’t allow it.
So instead, we’re going to get a combination of Neo-Keynesian and Monetarist solutions, to the problem the United States has.
This will bring hyperinflation by December 2011; severe social disruption starting in Q3 of 2011 and accelerating through Q4, before really exploding in Q2 of 2012; the dissolution of the European Union by December of 2012; and very likely—insane as it might now sound—a de facto dictatorship in the United States.
But hey, I’m probably wrong. After all, I’m a heretic, in the eyes of this particular religion. In fact, I hear Brad DeLong wants to burn me at the stake.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
President Palin's picture

"... the dissolution of the European Union by December of 2012; and very likely—insane as it might now sound—a de facto dictatorship in the United States."


Hmmmm.... 2012... wonder who will be elected president in November 2012?  ;-)

walküre's picture

Complete and utter bull.

The EU will not be dissolved in the short term. If anything, the EU will expand and more countries will adopt the Euro in the foreseeable future.

Who cares which ass will get elected to occupy 1600 Penn Ave for the next term Presidency?

The show will continue, new hand selected and carefully groomed actors but the story is the same.


thermroc's picture

So no changes at all? We just continue as is, indefinitely?

You're deluded my friend.

Herd Redirection Committee's picture

Right now 'Experts' are our Gods, whether they are experts on economics, politics, religion...

That will change, as the people lose 'faith'.

IMO, everything (economic policy, gov't intervention, etc.) should be determined according to trial and error.  But first we have to reset the system.  


Exposing the oligarchy one psycho at a time.

Everyman's picture

Exposing the oligarchy one psycho at a time.


Now THAT is a quote!



hbjork1's picture

I agree with walkure>

The story does not have to "be the same".  Having had the opportunity to watch the American body politic through WWII and the decades since I think the populace is starting to "sober up" in terms of their expectations.  The grief isn't over yet and I am seeing some little signs that the inflation that will offend a lot of people, including me, is starting.  There will be demonstrations and political rancor but the public is beginning to be interested in what kind of people they are electing.  We will be more tired, even exhausted by the combination of deflation of income and inflation of costs and increase in random theft.  But, IMO the "movie star" model in politics will go out and the conservative ethical model will become more popular.  Those dramatically seeking attention will gradually give it up as they discover that no one is paying attention to that anymore. 

Yep, it will take 2 or 3 years.  A lot of honest people will have been somewhat cheated but the population will eventually support ethical governance.  For those who don't understand "ethical governence" that means penalties for fraud at all levels, including public office.  And there will be no real revolution because, when all is said and done, we do have a representative government even though it is a large land mass with big differences in climate and approaches to living.  Approach to exhaustion will be the pacifier.  Except for Canada, there will be no place that the middle American can go and be reasonably at home.

Folks who want perspective on the push toward WWII should read "Paris 1919"(Six Months that Changed the World) by Margaret MacMillian.  Not a hard read but a heafty book with detailed accounts of the people and events.  It details how the various deciders got to where they were and some indication of how the alignments of WWII were established 20 years later. 

Best I can do.  Time to park my keyboard and watch to see how it all turns out. 



chopper read's picture

great to hear your perspective.

Pondmaster's picture

Didn't you hear ?The Mayan calender is off on its alledged predictions. Besides who would listen to a bunch of child sacrificers . Now as to our Economic system . They are sacrificing everyone not in their "class". The unwashed if you will . Yes Wall St and the Banks and the Fed are acolytes of the one world religion . Money and Power . What did Saruman in the Lord of the Rings ask the UriKiah Orc ? "Whom do you serve?"  Mr Lira you are SPOT ON about this being a religion .  Have you read about Babylon in the Bible book Revelations ? That is where the real conclusions to your points are. 

Rahm's picture

President Palin, can I be your Chief of Staff?

Problem Is's picture

Lil' Rahm-Tard Has a Woody!
You mean: "President McMILF can I be your chief staff?"

staff : noun \'staf\ : a long stick or rod (see: Johnson).

Moonrajah's picture

Didn't you hear? Under Palin most current posts will be cancelled and new ones will be created:

Chief of Stuff (Treasury)

Chief of Huff (Propaganda)

Chief of Puff (Military)

Chief of Muff (Free Porn for sheeple)

Chief of Duh (Attorney General)

trav7777's picture

you are just threatened by powerful women

Moonrajah's picture

Intelligent women? Maybe.

Palin? I feel like I'm in a fucking slapstick for retards.

Walter_Sobchak's picture

how bout cut spending, cut taxes, end the fed, outlaw lobbying?

Oh regional Indian's picture

Actually even you may be surprised at who.

Also a new word (it was new to me) and one that near threw me off my chair when I first saw it...


academic political theoristRoger Griffin refers to fascism as "palingenetic ultranationalism". The best examples of this can be found with both Fascist Italy and Nazi Germany - Italy looking to establish a palingenetic line between the 20th century regime under Benito Mussolini as being the second incarnation of the Roman Empire, while Adolf Hitler's regime was seen as being the third palingenetic incarnation - beginning first with theHoly Roman Empire ("First Reich") then with Bismarck's German Empire ("Second Reich") and then resulting in Nazi Germany ("Third Reich").


Cannot make this stuff up, eh?

Now who will be the Veep? Let's save that for another day!



Cathartes Aura's picture

Palingenesis - love the concepts behind this word. . .

great find ORI!

Diamond Jim's picture

It is no science as the results are never reproduceable, ie. no one can take the same data and expect to get exactly the same result. People and markets are always in flux. They can predict, computer simulate (with biased data and models) and hypothesize....but then again so do climate "scientists".....

mikla's picture

Agreed that it is not a science, but disagree that they can "predict" and "computer simulate".

I'm not trying to be cute:  Economists are not smart enough to predict, nor to computer simulate.  They aren't even smart enough to do it in a "fake" manner.  (Steven Keen seems to be the lone exception, as he was an engineer before he turned economist, and remains disgusted at his own field.)

Quite literally, economists are murderers, morons, and mental midgets.

Again, I'm not trying to be cute:  They really *are* idiots.  They really *do* murder millions.  Just listen to Krugman, and feel your brain cells whithering away.


Herd Redirection Committee's picture

I think he was using irony, because he was referring to ClimateGate, the climate 'scientists' who were fudging data in order to provide the results they were looking for.

The real question is whether the oligarchy is dumb, or whether they benefit from the boom-crash economy.  The economists have been telling the ruling elite what they want to hear. 


Discussing the biggest issues, the oligarchy, currency wars, fraud, and Foreclosuregate.

mikla's picture

I think he was using irony, because he was referring to ClimateGate, the climate 'scientists' who were fudging data in order to provide the results they were looking for.

Ok.  My response is still that at least the people pretending to do "climate studies" actually have the good sense to fabricate plausible results, even if they have to hide their falsified data.  Economists are too stupid to do even that.

The real question is whether the oligarchy is dumb, or whether they benefit from the boom-crash economy.

They are mere snake oil salesmen.  The provide nothing, through deceit and fraud, in exchange for a paycheck.  They are comprised of (1) true idiots, and (2) mercenaries willing to rationalize any concept to curry favour from the central planners.

Citxmech's picture

According to Popper, science seeks the [small-t] pragmatic "truth" by posing questions in a falsifiable manner and disseminating the results for public scrutiny - thus a well-formulated hypothesis that yields the predicted results will be accepted by the scientific community...  until it doesn't.  Inconsistent hypotheses will be reconciled by continued attempts at falsification of the incompatible hypotheses until consistency is achieved.  A hypothesis that consistently yields good results will be elevated to "theory" status.  Re-evaluation of theories are scientific revolutions.  The big-T truth is, of course, never attained - but we get further from ignorance as the process continues.

Under Popper's paradigm, macro probably fits into the "pseudo-science" category with things like psychology, where complex inter-related dynamic systems are attempted to be understood by unfalsifiable gross oversimplifications.



Dismal Scientist's picture

Thanks, GL. The 'pragmatic' approach you label yourself with will resonate with many people, I suspect. Unfortunately not the TPTB though, or their political puppets. There's no mileage for them in such solutions.

Meanwhile, lets enjoy the hair splitting from the various factions in response to your post.

Sean7k's picture

I will start. Austrians do not advocate cutting spending, raising taxes, balance the budget. Austrians advocate minimum government or no government. No Taxes and no budget. If you will have a budget, it will be approved and paid by taxes the people have agreed to pay. They are against ALL intervention in free markets with the protection of private property the only legal commandment. 

They do not attempt to predict the future, because human action makes it a meaningless exercise. Further, Austrian economics is only truly valid in a free market and we have never had one and probably never will.

Austrians believe the greatest liberty exists when the individual is sovereign. 

This makes Austrian economics, in my mind, both a panacea and a plague. For the elites would never allow its' introduction and the elites have always been able to maintain rule.

jm's picture

Austrian economics is only truly valid in a free market and we have never had one and probably never will.


So it's fucking worthless, right?

walküre's picture

In "theory" your conclusions are completely correct. However practically, to concede your point wouldn't have a whole lot of upside to sell to the market.

In other words: People want to be lied to.

Keynes and his whole gang of Wiener Schnitzel economists figured this out.

jm's picture

Here's a policy prescription:

Ben needs to be the "anti-Ben".  For once, be exactly the opposite of the douschelord he is.  He would short-squeeze all the deserving for a change.

"Chicken salad on rye!"



Gordon Freeman's picture

"and a cup of tea!" LOL

Sean7k's picture

Within the current restraints of the system, yes, except for the purpose of providing an alternative viewpoint. Which allows us to see just how criminal monetarism is.

jm's picture

Then work out logical conclusions given current constraint of the system. To talk about how things should be when there is no realistic chance in hell of ever getting there from here leaves one more than a little baked.  Accept there are things that cannot be changed by you, concern yourself with things you can impact by your own effort, try to understand those things well, find mispricings, leave emotion out of it as best you can.

Or stand on the streetcorner passing out Austrian economics pamphlets to stoners.



Sean7k's picture

If you read my other posts, you will see exactly what my "logical" conclusions are and how to implement them. All guided by Austrian theory. I want to see the system destroyed- you want to live within it- good luck with that. I have a fall back position that mitigates the worst parts of monetarism- do you?

Any idea what your avatar really means? I just see a lot of Yin.


jm's picture

You and I both have to live within it.  There's no alternative. There is no grand revolution coming to the rescue that puts all the bad guys on the bottom (or jail) and ushers in a golden age of freedom and non-bullshit.  You should work for evolution.

Real revolutions leave everyone worse off, poorer, and most likely mourning the loss of loved ones.  And then a new set of skimmers takes over on top.

Russian peasants were all-in on killing the kulaks with a sickle.  A couple of years later Stalin was killing them with a hammer. 

zaknick's picture

I think you're wrong. There is no way these scumbags can get away with this murderous madness they call our reality. They've hollowed out the American economy (the true basis of their own power) handing out so-called free trade agreements which were just bribes in exchange for bankster interests in unfathomable wealth overseas (not in China's case where they finally obtained what they always wanted: slave laborers).

I also fail to see how most folks come out poorer after a revolution with the inequality rates of today. Do you not understand that the wealth production capability of this nation was stolen? Financial garbage was the biggest export by far in the US. A revolution that squeezes the oligarch's interests opens up economic opportunity for entrepreneurs which is 1. a job and wealth creator, 2.the way nature meant it to be until these bankster supported bandits took over the economy as if it was their own little plantation and we their slaves.

It is untrue that after major changes a new prosperous for all economy cannot emerge from the ashes of the curse of the present system, especially with the talent on tap in America and the gutting of decrepit monopolies and policies that stink of fascism.

jm's picture

Sure, I could be wrong. But venom and anger about how things are doesn't make a brighter future. 

You talk about "murderous madness"... injustice, sure.  It has happened everyday since humans lived.  But to talk of murderous madness is so rhetorically out of proportion that it is an injustice to people that have actually been killed and tortured and murdered.  There is real murderous madness in this world, but not here.  Let's both hope murderous madness never really happens here. 

You and I have every right to be angry about how awful things are, but it can't absolve everyone of responsibility.  I'm not going to try and assign blame, because everyone had a part in making this shit sandwich... everyone take a bite.  Shared sacrifice and time.

I'm all for innovation and entreprenuership.  But I'll let return on capital decide how nature decides on things.

Bankster bandits taking over.  People with money bribe politicians.  This is how it has always been and always will be.  Revolutions just make a new set of people that bribe a new set of politicians.  After the herd gets thinned out, of course.

No doubt that prosperity is possible here.  But when you talk about "emerging from ashes", that's an obstacle to it.  You unleash that and there's nothing but pain and trouble.  It is easy to trivialize this.  At everyone's peril.


zaknick's picture

There are literally millions of innocent people and children around the world and right here in the goood ole US of A who would disagree with you negation of murderous insanity.

As to everything else you said, I would rather be free than a slave to other men and their games. Dylan said something like, "you play with my world like it's your own little toy". That to me is un-freaking-acceptable. Capisce? Most of the misery in this world is man-made. I'll worry about the next bunch of fascists when the time comes, for now I'll concentrate of opposing them any way I can which is why I spout off so much around here.

Franklin, Jefferson, Lincoln, Garfield, JFK all knew and warned us of the dangers we face today. I have known peace and prosperity and I know it can exist no matter what you say.




Walter_Sobchak's picture

jm you are a defeatist. zaknick you are an idealist.  Civilization is fascism.

jm's picture



There is nothing defeatist in accepting the truth and pursuing one's own individual interests as best as possible.  Civilization is not fascism.  It does get hijacked by ideology and bed-time stories gone oh-so-freaking-wrong.  F. Hayek would be spinning in his grave reading some of these posts.

tmosley's picture

Not really.  Contrary to what the above poster said, Austrian economics can and routinely is used to predict the consequences of government actions.

Read "Human Action" and you will see.  If that is too dense for you, read "How an Economy Grows and Why It Crashes" to get the basic idea.

What the above poster SHOULD have said is that the ideal system proposed by Austrians would be a free market, and that anything short of that isn't really an "Austrian economy".  It's like saying because there is no such thing as a truly free market, then free market economics is worthless.  That doesn't really make much sense.

Sean7k's picture

What I meant is: in light of a post that attempts to measure the accuracy of economic theories, it is important to recognize a theory's limitations when appraised in an economy that is not a full expression of the theory. 

You may use parts of it, but it's predictability is compromised. I hope that makes more sense.

hugolp's picture

But this is part of hard science as well. This is part of everything.

B9K9's picture

My father, the long time MIC intelligence operative, taught me the most important rule:

He who complains has already lost.

Some may notice that my posts never promote any ideals, nor complain about how things actually are, or deplore that the pace of change is too slow, etc.

Nope, they're usually just straight observations about how things actually work, with a little bit of monetary mechanics thrown in to support certain conclusions.

Life is really quite simple: we are born, grow & develop, decline & die. During our peak growth & development stage(s), we must compete for scarce resources in order to support the offspring that typically result from successful mating strategies. Evolutionary pressures have resulted in the manifestation of certain behaviors centered around organizational power.

Societies & cultures are simply amalgamations of individuals, so they tend to mirror and replicate individual behavior. The quest for power consolidation is a key foundational element of government. Since most people are ill equipped to survive this type of environment, the strong always rise to the top.

However, and this is a huge however, as noted above, these self-same societies, cultures & governments are also subject to the immutable laws of nature: they are born, grow & develop, then enter a period of decline and die.

What does this mean to us? Simple - don't bother complaining. Just let nature takes its course. If a society/culture/government is presently in a growth & development stage (ie at its peak power), it is a waste of time/energy to complain or attempt to effect meaningful change. OTOH, if it is entering the decay/death cycle, one need not do anything other than perhaps give a gentle 'push'.

The USA, as it is presently constructed, is in terminal decline. The Fed cannot fight the math - they needed some incredible new growth component to bury the last decade of fraud. Sadly, at least for them, it is not forthcoming. The MIC is not going to take-one-for-the-team by accepting blame for two more lost wars. Anyone with the slightest heightened sense of awareness can tell that the marriage of convenience between the Fed & MIC (that is, $USD backed by military control of ME oil AND military control of ME oil backed by the $USD) is not going to end well.

Rather than endlessly engage in parlor room debates regarding various economic theories, it might profit one to think about the larger scale cycle(s) that are playing out in real time. From the ashes a new form of organization will arise - will you make it through the bottleneck and/or benefit from the new paradigm?

I suggest this is what people should be contemplating and planning.

DavidPierre's picture

"...it might profit one to think about the larger scale cycle(s) that are playing out in real time."


April 20, 2004

Gold $397.40 - Silver $6.92

The Rothschild Exit

Rothschilds withdraw from the gold markets.

Consider that the House of Rothschild has been rich for centuries.

Consider that they are born rich, grow up rich and die rich.

They consider themselves to be members of some type of aristocracy. Grubbing for money is certainly not their style and they would not stoop to the level of overt illegal criminal conduct and expose themselves.
The shortages for delivery that exist in silver and gold (these are legal contracts to deliver, after all).... have reached the point where a careful cartel participant may feel the LEGAL line of fraud is about to be crossed.

How can you make a promise to deliver what you don't have? Of course, if you don't expect anyone to ask for delivery, than the risk is slight. But that is not where we are now.

Their attorneys told them to save their skins and completely cut their ties to the scam.

The Rothschilds haven't stayed rich for so long by making of themselves big fat targets for avenging lawyers. Whatever the real story is, this is a sign of the strain the cartel is under today.

Rothschilds knew way back when what was coming down the pike.


via lemetropolecafe

zaknick's picture

That's what I mean, this corruption of the natural scheme of things cannot hold. You can either have a healthy economy or an empire but not both. Thank God!

Always did enjoy reading your comments.

philgramm's picture


This is one of the more profound posts I have read here on ZH.  There are very smart readers on this site but I often sense the immense frustration that the readers (myself included) feel with the current paradigm.  It seems the smart thing to do is try to prepare for the inevitable collapse in this boom/bust cycle and to try to live as true to oneself as possible without being a pawn.  Oh.......and try to have a laugh or two along the way (I can always count on ZH readers to provide my daily dose of yucks)

AnAnonymous's picture

I will start.



Abrahamic religions have this in common: they are the only true religion at the exclusion of others.

Thanks to your efforts, it appears austrian followers share the same convictions.

Dr. Acula's picture

"This makes Austrian economics, in my mind, both a panacea and a plague. For the elites would never allow its' introduction"

You misunderstand the nature of Austrian economics. AE is wertfrei (value-free) and can advocate neither low taxes nor high taxes. It is not a bunch of opinions, but rather a body of apodictic truths. It cannot be "introduced" any more than "1+1=2" can be introduced.

Cognitive Dissonance's picture

It matters not whether your followers have benefited from your preaching. It matters only that your disciples do as they are taught and continue to weave their wool and deceive their sheep.

As long as the economic shock and awe troops aka economists, money managers and financial product salesmen continue to support the masters of the universe, the followers will continue to get coal in their statements and be told it's divine diamonds in the rough.

zaknick's picture

Exactly. Like psychiatrists and psychologists (maybe not all) are just drug peddlers making up quackery as they go along with big pharma's part of the fascist plan. It really is criminal to push pills on somebody who's unwell emotionally for 30 years doing God knows what to them (the FDA sold out long ago) and never "fixing" the issue.


I could go on and on about so much corruption in the society but why bother... if you don't know by now, you're one of the sheep headed for slaughter.

Sabremesh's picture

You are missing the point. It doesn't matter if he has mischaracterised Austrian economics - it is still a dogma. Economics is the charlatanry of our age, and future generations will look back at us with the same contempt for believing in it that we currently hold for earlier civilizations who swore by astrology and divination by entrails.