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Redefining The "Art Of The (Im)Possible" As The Last Gasp Of A Failed Politico-Economic Regime
- Bank of England
- Ben Bernanke
- Bond
- Central Banks
- China
- Federal Reserve
- France
- Gilts
- Gross Domestic Product
- International Monetary Fund
- Japan
- Keynesian economics
- keynesianism
- Monetary Policy
- Monetization
- New York Fed
- Newspaper
- Purchasing Power
- Quantitative Easing
- Unemployment
- United Kingdom
- Yield Curve
Many are quick (and correct) to blame Keynesianism for the current near pre-collapse state of the entire developed world. After all, the economy of the western world now functions strictly on an auction to auction basis (or, as is better known in layman's terms: "living paycheck to paycheck"): a state in which the US Federal Reserve and the global central banking cartel is responsible for making sure that not one hint of possible bond auction failure trickles down to the broader population. The fact that primary dealers, which are essentially the monetization vehicles of the New York Fed, account for taking down well over half of each auction is not lost on those who wonder what could happen in a world in which Ben Bernanke's organization were to lose its power, authority and market intervention capacity. Yet Keynesianism is merely an offshot of a far older thought experiment: that developed by Otto von Bismarck in the aftermath of the Franco-Prussian war 140 years ago. The "welfare state" regime created by Bismark is one that predates Keynesian economics, and serves as the nexus of today's rancid, nebulous and very much destructive intersection of economics and politics, at whose core, like a black hole which no wealth created through honest labor can escape, resides the "central bank" apparatus of status quo perpetuation. Luckily (for most), the welfare state experiment is ending. And as it departs one last time, it will expose the "depredations" of developed world governments for all to see, without the benefit of the cloak of the insurance provided by "welfare state" premises, which made the wealth transfer of 7 generations acceptable to those who knew they could extract at least something in exchange for the fruits of 140 years worth of labor. In his latest report, Bill Buckler, of the very highly recommended Privateer report, explains why and, more importantly, how this will happen.
From the October 3 edition of The Privateer, authored by the inimitable Bill Buckler
“The Art Of The Possible”
That quote is attributed to German Chancellor Otto von Bismark, the man who is also responsible for the creation of the modern welfare state. The original “wherewithal” for Bismark’s welfare state came from reparations payments extracted from France in the aftermath of the Franco-Prussian war of 1870-71. Prussia, with Bismark as its Chancellor, was victorious in that war. The victory allowed Bismark to bring together the various German principalities into a German nation. The French reparations allowed him to buy the allegiance of the people by offering them “insurance” against unemployment and the infirmities of old age. This was the welfare state, and politicians all over the world have been following Bismark’s lead ever since.
Otto talked about “the art of the possible”. He did not elaborate. He did not define what he meant. “The Possible?” - for whom? - by what means? - to what purpose?
Taking It To The Limit:
In all so-called “developed” nations, the welfare state is the mechanism which makes government depredations acceptable to the public. To establish and enhance the power of government, an ever larger portion of wages and salaries are sequestered through taxation and an avalanche of rules and regulations are enforced via government fees and charges. Some “compensation” must be found to make this bitter financial medicine go down without becoming dangerously unpalatable. This is where the welfare state comes in. The only way to ease a situation in which it is difficult, to the verge of being impossible, for an individual to take care of him or herself is to create a situation where the State takes over the role. Or at least the State promises to take over the role, should it become “necessary”.
This mechanism can “work” - for a while - but the result is that there are more people dependent on the State than there are people who are able to create the wealth on which the State depends. This situation is inherent in all welfare states, approaching in most of them, and already here in one. That state is Japan.
In Japan today, 23 percent of the population is over the age of 65. Forty years from now in 2050, given present Japanese birthrates, that will have blown out to 40 percent. At present, the ratio of retirees to working-age Japanese is 35.5 percent. In ten years that ratio will be 48 percent and in forty years (again given present Japanese birthrates), it will have blown out to the literally impossible ratio of 76.4 percent.
Saving the worst for last, today, more than half (56 percent) of Japanese workers rely on financial support from their parents or other sources to cover their living expenses. These are the same people who will, in future, be expected to perpetuate the ever more bloated Japanese welfare state. This stark and obvious impossibility is the current situation in Japan. It will soon be the situation right across the developed world. The “solution” will be a rapidly increasing sell-off of rapidly diminishing “assets”. Most of these assets will be paper claims to wealth which does not exist and never did.
Going Beyond The Possible - With Debt-Based Money:
In rational economic thinking, economic “growth” is only taking place when REAL wealth is being produced faster than it is being consumed. There is not one “developed” nation in the world today where that is taking place. Every one of them is now and has for some time in the past been in the process of capital CONSUMPTION. This is true even in nations like China where massive construction has given an impression of whole new cities springing up from the ground over the past two decades.
The real wealth used in this construction has been consumed, but the means to service, maintain, and eventually replace it has NOT been produced. The mechanism used in its creation is debt created out of thin air. A debt, any debt, is an UNFINISHED transaction to be completed when and ONLY when all capital and interest has been repaid in full. The repayment has been deferred indefinitely.
Take a look at any political program of “stimulus” undertaken anywhere in the world. What do you find? You find a government acquiring the required economic goods and services by issuing IOUs, known in more polite circles as government bonds. You find these governments selling these bonds for “money”. This money, in all cases, must be accepted in “payment” for all debts, public and private. The money is “legal tender”. It is money because the government says it is and forbids the use of anything else.
The bonds and the “money” in which they are redeemable are DEBT-BASED. Since that is true, the activities governments “finance” with this paper are also debt-based. They cannot be anything else. Government produces NOTHING in the form of REAL wealth. The point has long since been reached right around the world where the servicing of all this debt-based government activity has been eating up the existing store of real wealth. We are living in a global era of capital consumption on a massive scale.
This guarantees that these debts will NEVER be repaid in the wealth which was consumed by them.
Exploring The Possible - Sound Money:
First things first. Money is a medium of exchange. That is ALL it is. The other attributes popularly associated with money are secondary effects of its efficacy as a medium of exchange. In modern economic textbooks, money is defined as having three (sometimes four) “separate” functions. Besides being a medium of exchange, it is also said to be a unit of account, a store of value, and a standard of deferred payment. But two of these “functions” are inherent in money’s basic facility of being a medium by which goods and services can be exchanged. The other, the idea of a store of value, is true of any unconsumed economic good, not just money.
For almost all of recorded history, economies have worked by means of indirect exchange with money as the one item common to all exchanges. Without money, economic calculation is impossible. Indirect exchange in which units (defined by weight) of money are exchanged for goods and services brings forth prices expressed in terms of units of money. These prices are the raw material of economic calculation. Most economic goods, especially raw resources, can perform many different services or be a component in many different kinds of production. But how can we find the most economical use of the good in question? That is the role of economic calculation. It is not infallible, the future is uncertain. But as long as the money employed is SOUND, the prices formed by exchanges in the market give the means by which economic calculation can be made. Tamper with the money and all prices are falsified.
Exploring The Impossible - Debt Used As Money:
A sound money is a defined unit (gram, ounce, pound, kilogram, tonne) of the economic good which has proven (in exchanges between individuals) to be the most easily tradeable good. A government never has and never will CREATE a sound money. What they can and have done is to arrogate to themselves, by law, the ability to decree what will be used as money - or else! When a government does that (and sooner or later all governments in history have done it), the path to an UNSOUND money is assured.
There are two ways to acquire wealth. One can produce it or one can take it from those who have produced it. The first method has often been called the economic method. The second method has many names. It has been called stealing, or usurpation, or expropriation, or “eminent domain”. Whatever, the description, there is one constant. It has always been called the political method. A government cannot produce but must consume in order to function. It must extract the means from the people it governs. That is true even of a government pared back to its essential services of the protection of life and property. But when government IS pared back to those limits, its costs are minute by modern standards and the burden of paying for it is easily bourne. A government which protects against criminal acts is cheap at twice the price. A government which indulges in them becomes, over time, impossible to afford.
And because it is impossible to afford, a new method must be found to “pay” for it. When taxes and charges prove insufficient, government can no longer live off the wealth its subjects have already created. It must live today off the wealth they are expected to create tomorrow. It must BORROW. “Money” created in the act of incurring a debt is UNSOUND by definition. It cannot function as a medium of exchange because no exchange has taken place. It cannot cancel a debt because it is itself a debt. It is said to be based on the “full faith and credit” of the nation which issues it. But neither faith nor credit has ever brought an atom of REAL economic wealth into the world. What unsound money literally does is to put the future “in hock” to the present. Sooner or later, the present catches up. That is what is happening all over the world today. And it is unsound money which has done it.
Nobody would accept a promise of indentured servitude for themselves and their progeny in return for something of no value. Yet that is what unsound money promises, and nobody has any choice in the matter of taking it in exchange for their goods. That is bad enough in itself, but when prices become increasingly distorted as the amount of debt “money” increases, the “art of the possible” falls on its face.
An Illustration - What Is REALLY “Growing” Today?:
When contemplating the antics of modern central bankers in general and the US Fed and Mr Bernanke in particular, it is best to keep some things in mind. First of all, there were historical periods of high renown when such practices as alchemy and phrenology (the claimed relationship between character and the shape of the skull) were taken seriously and practiced by honoured “professionals”. Secondly, the practice of providing “bread and circuses” for the masses has a long history. And perhaps most important of all, the vital motive force in human history is ideas. The more outlandish the idea, the more justification is required to “sell” it and the more exalted become those who do the selling.
The problem is that the message of those doing the selling is getting so garbled that it doesn’t seem to be working anymore. On the one hand, you have the IMF recently doubling its global “growth forecast” for this year. On the other hand, you have central bankers everywhere, led by the Fed, talking in public about the likely need for further “stimulus” by means of monetising their government’s debt paper. The polite term for this is “quantitative easing”. The accurate term is inflation.
How can an economy be “growing” in an era of capital consumption? The answer is that it can’t. When modern economists and central bankers measure economic “growth”, what they are doing is adding up prices. That is how GDP is derived. What they are actually measuring is not an increase in production, it is a decrease in the purchasing power of money which has resulted in higher prices. The purchasing power of money is being depleted because it is being created out of thin air.
The Fed’s “Mandate”:
Like all central banks, the Fed has a “mandate”. The original idea was to provide an “elastic currency to meet the needs of business”. That has grown to encompass all economic activity. This was inevitable given the fact that control over money DOES encompass all economic activity. In its most recent legislative version, passed in 1977 and amended in 1978, 1988 and 2000, here is the Fed’s “mandate”:
“Federal Reserve Act”
“Section 2a. Monetary Policy Objectives”
“The Board of Governors of the Federal Reserve System and the Federal Open Market Committee SHALL MAINTAIN LONG RUN GROWTH OF THE MONETARY AND CREDIT AGGREGATES commensurate with the economy's long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”
(Emphasis by The Privateer)
The emphasised part of the above quote is the meat of the matter. That task alone IS - and always has been - the Fed’s mandate. As the depreciation of the US Dollar worsened, that mandate became ever more important. Once the US Dollar became a purely fiat currency with no official link to sound money at all, it became crucial. This “modern” version was first legislated in 1977, six years after the US Dollar became a purely debt-based currency. It has been adhered to with religious fervour ever since.
The problem for the Fed and all other central banks today is that they have used up all the means with which to “maintain long run growth of the monetary and credit aggregates”. That is the major reason why Mr Bernanke is so terrified of the spectre of what he calls “deflation”. When all prices and all economic calculation are based on money based on debt, the only way to keep the system functioning at all is to maintain the prospect of the soundness and eventual repayment of this debt. The only way to do that is to maintain the perceived value of the collateral which supposedly underpins this debt. But, as we pointed out in our last issue, most of this collateral is itself debt paper - notably government issued paper.
The Fed is facing the end of the road for the “art of the possible”. In the US, another political hurdle is coming up on November 2. After that comes the countdown to print or perish time.
The Cracks In the Facade Are Opening:
A September 27 headline from the UK Telegraph newspaper reads as follows: “Savers told to stop moaning and start spending”. This referred to a TV interview given by the deputy governor of the Bank of England, Mr Charles Bean. Reportedly, Mr Bean said that savers could afford to suffer and should not expect to live off the interest on their savings. He went on to say that a big part of the strategy of lowering official interest rates to the vanishing point (0.50 percent in the UK) was to force savers to start depleting their capital because their returns on investment were insufficient to meet their living expenses.
In short, the British central bank is doing everything it can to leave those who have managed to accumulate capital with no choice but to consume it. No clearer illustration of the desperate straits of the modern “money managers” could be imagined. While there is anything left to squander, the central bankers will NOT give up on their desperate efforts to grow the “monetary and credit aggregates”.
Needless to say, those who HAVE managed to produce more than they consume in the UK were outraged by both the TV interview with Mr Bean and the Telegraph story which reported on it. As one man put it: “For years we have been told to put money aside for retirement only to find that interest rates have sunk and now we have to use our savings just to pay the bills.” That is indeed what Britons are finding, the latest statistics show that the amount they save has shrunk by 20 percent since the start of 2010.
The idea of “perpetual bonds” goes back to the 18th century in the UK when they were issued as “consols”. Some of these still exist but the idea is even more tenacious. From the 1750s until the end of WW II - a span of two centuries - a “gentleman’s” income was measured by the annual interest payment spun off by his investments in “perpetuals” or “consols” or “gilts”. All were government bonds. All were expected to pay interest in perpetuity. That idea dies especially hard in Britain, where it was born. That is one major reason why Mr Bean’s outburst has been met with such outrage.
Back To The Main Game - In The US:
On September 27, the long end of the Treasury’s yield curve - for debt with maturities from five to thirty years - hit its lowest level since the near financial death days of December 2008. Back then, the Fed’s response was to lower its official interest rate to 0.00-0.25 percent, thus ending the ability of conventional “monetary policy” to resolve the situation. Three months later in March 2009, the Fed added “quantitative easing” to its repertoire. On August 10, 2010, it announced a second tranche of same.
Ever since that August 10, announcement, the US financial markets have been holding a gun to the head of the members of the FOMC. The Dow has been rising steadily ever since it dipped briefly below the 10,000 level on August 26. The market for Treasury paper has also been going higher and higher. For both markets, the rationale is that the Fed cannot afford NOT to embark in a SERIOUS second tranche of “quantitative easing”, one far bigger than the tentative program announced on August 10.
Americans in particular who are rushing into Treasuries as their ultimate form of financial safety should take a long and hard look at what has happened to the UK over their post WWII history. They should also contemplate the fact that a central bank literally monetising the government debt of the nation is the absolute last gasp of the “art of the possible” as far as the unholy alliance between politics and economics is concerned. It is the act of “saving” the system by destroying its foundation, the money.
All that it is accomplishing is to put as “healthy” a facade as is possible on the US economy as the days and weeks wind down towards the US mid-term elections. Elsewhere in the world, almost every election which has taken place since the onset of the GFC has seen a change in government. In more recent times, the tendency has been towards “hung” parliaments or no party forming a government as voters abandon the major parties in quickly growing numbers. Otto von Bismark’s “art of the possible” is not possible when the promises which gave it life in the first place are no longer believed. That is the case everywhere today, not least in the US. What remains to be seen is what will rush in to fill the void.
(And, as always, much more in the full Privateer Report)
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I've got to say Mr. Tylers. You keep harping on this bond auction failure angle which will never impact anything. There never will be a bond auction failure and bond market will never have any bearing on anything. The only thing that impacts a debt based system is taxation failure.
No flow. No go.
If you are theorizing that since the Elite buy their own debt bonds will never fail, why do you not suppose that neverending self payment for taxes would take place in much the same manner?
It's all presto money after all, how could any payment of debt fail?
It creates a wall. Without the people feeling entangled with the government then you don't have a will oppostion to overcome. Therefore you don't have a pathway to conform. The simple act of billing people is indebting. The complicated act of advanced tax codes and making people fill out forms to pay them is really just a humilation mind fuck. You don't OWE the government a damn thing so they can't bill you. So they make you sit down and try to figure out how much you owe them based on rules and regulations. It's a broken in time tradition contract. You didn't negoitate any governmental services when you were born. You just get naturalized to the process. It's a power trip. The government asks you questions you answer. The government sends out a form. You fill it out. Or at least thats the way it used to be. I'm sure the census mind fuck you back people pulled has them really worried.
Try this. Get pulled over by a cop. Ask him questions, refuse to answer any of his questions. See what happens. First thing that happens. You have no rights. Until the officer arrests you and reads them to you, you don't have them. Another mind fuck. It's the wild fucking west without any rules at all until you're handcuffed and on your way to A JAIL. Then all of sudden you have rights. There has to be the conflict of will constantly between the government and the citizen to keep the connection, maintain the connection and keep the mind fuck and intent of this place which is nothing more than amplifying assholes and demeaning good people with extra brute sauce for trouble makers. There is no karma, if your life sucks it's because you're a threat and you're being risk arbitraged.
Rules are for the little people, TurboTax or not.
Your statement seems both truthful and sarcastic. I would state it more along the lines of: There are two set of people, those in "the club" and those not in the club and different, yet no less restrictive rules apply to each. Official laws, governmental and financial, are of course made by those in the club to control those not in the club.
However, to remain in the club one must act according to club rules or be the one that sets the rules for the club. If not, then you are tosses out of the club. (obeying governmental and financial laws are not rules of the club)
Star-Bellied Sneech, anyone?
if we needed so much government then we would routinely seek it out rather than the other way around.
We do tend to seek it out. 5-10% of Colonial Americans spurred the Revolution. The rest are content with slavery. The only option in the US will be escape to any possible safe haven left. It will then be a pleasure to watch those who clamored for their enslavement get exactly what they asked for, good and hard.
Planet Goldilock is a little far off with current technology.
+1.
5-10% of Colonial Americans spurred the Revolution. The rest are content with slavery.
Same as today.
Actually, it was more than 1/3.
Yep. Confusion sets in over simple matters these days; questioning "authority" being the most fearful. Makes me want to put the CAPS LOCK on whenever I'm speaking of reality.
Inflation is theft.
Taxation is control.
Gov't is force.
"Oh, you must be one of those conspiracy theorists."
IT'S NOT COMPLICATED. MISERY WILL ENSUE IF YOU IGNORE MATHEMATICAL GRAVITY.
i call it 'the laws of financial physics', and i feel your pain on the CAPS LOCK dilemma.
It's the wild fucking west without any rules at all until you're handcuffed and on your way to A JAIL.
Good argument otherwise, Herphaseus, but I would caution you not to test those rights you cite on the way to jail.
95% of all cases are plea bargained and 95% of trials end up with guilty verdicts. That's how we ended up with the world's highest rate of imprisonment and a prison industry that consumes more GDP than (I believe) any other country on earth spends on its military.
Which, of course, only serves to amplify your thesis. Just sayin' .
Perhaps so, but China has a more liberal philosophy toward capital punishment. Death is still cheaper than incarceration, and skews those numbers.
So there you have it...the choices, under the current regime are termination, or Bubba's BFF.
The reason why there are so many people in jail is because they have not been taught how our judicial system works, which by the way operates exactly like the commercial contract under the Uniform Commercial Code (UCC).
1. Jurisdiction-- Since most people have not filed a UCC 1, you are a debtor under the law, and you are basically incompetent in handling your commercial affairs.
2. The judge is operating under color of law. He looks like a judge and acts like a judge, but until you give him jurisdiction he has no power over you.
3. The court case is a commercial transaction, though the accused doesn't even know it. The minute you show up to court and state your NAME, you are admitting that you are a corporation under the jurisdiction of the court. You are guilty and will be found such.
4. The lawyer is part of the American BAR association. BAR stands for British Accreditation Registry, so the American BAR is a branch of the Crown. Your lawyer is in a foreign jurisdiction, and his oath is to a foreign power. Do you honestly believe he is going to represent you?
5. Once you've unwittingly placed yourself under their jurisdiction, they are presenting you with a bill, a presentment, a claim so to speak. The claim is a dollar amount relative to the offence. For example, a felony is one million dollars. When you state you are not guilty, you are dishonoring the debt. You are saying you are not going to discharge a valid claim. (This part of the court proceedings is documented in a book called Clerks Praxis published in the 1800s. It is a historical book on the procedure of law under the kings of England.) Once you are in dishonor, you are found guilty since in a debt-based monetary system it is a dereliction of duty to refuse to discharge debt.
6. Behind the scenes, the judge and the clerk of the court are filling out Standard Forms SF23, SF24, and SF25. You put yourself under their jurisdiction, and you've refused to discharge the claim. So they fill out the presentment, the performance, and the payment bonds for you. Essentially, they turn your dishonor and guilt into a security. These securities are underwritten and sold as mortgage backed securities through Paine Webber. Look up the American Corrections Corporation and find out what business they do. When you end up doing time, you are the warehoused chattel and actually, not figuratively, paying your debt to society. The lawyers, judges, and the jails get to dip into your social security exemption (credit) account at the Treasury and transfer money into their hands for your upkeep.
7. If you fill out these SF23, SF24, and SF25 bonds yourself, called "bonding up your own case," you own your case, and the court does not have a claim against you. When you fill out 1099OID forms and present them to all involved-- the judge, the prosecutor, the clerk of the court, and your own lawyer-- then you are claiming yourself as the principal and owner of the debt. File it with taxes correctly and you get money back.
There's a bit more involved. For example, when the judge asks the defendant if he understands the charges and has any last words, the person says yes and he didn't commit the crime. This is a way to get the person to volunteer himself as a prisoner. He says yes he knows what is happening. He is agreeing with the court, where in fact the guy doesn't even know what hit him. Then, he states he is not guilty, which puts him in dishonor with the court for not discharging the debt.
All court cases are a demand for an amount of money, and you must respond by discharging the debt.
I've heard this argument before. Have you ever used it as a defendant?
Given that you say it is a system modeled on the Brits, is it not curious that the incarceration rate in England is 139/100k vs. 737/100k in the US? http://en.wikipedia.org/wiki/Incarceration Surely that isn't because the English are so much better in the know about your/their system?
I don't think the Brits are securitizing prison terms yet. The privatization of prisons in the US has really spurred the incentive to incarcerate. The American Corrections Corporation is making tons of money. Give the Brits time.
I haven't used it personally, since I'm a law abidding citizen. However, I filed the UCC 1, discharged a foreclosure, discharged state taxes, and posted a 50 million bond with the Treasury with my signature. I'm working on the redemption of the birth certificate and doing a recoupment of all the house loans I have ever made. So far so good.
Corrections Corporation of America
Exchange - NYSE
Price - 24.87
Change% - (0.77%)
Volume 754.754
Corrections Corporation of America is the nation's largest owner and operator of privatized correctional and detention facilities and one of the largest prison operators in the United States, behind only the federal government and three states. CCA currently owns and operates more than 60 facilities including 44 company-owned facilities, with a design capacity of more than 85,000 beds in 19 states...
Im going to buy some stock, incarcerations are going to be skyrocketing soon, espcially if you are a member of Zerohege :)
Corrections Corporation of America Exchange - NYSE Price - 24.87 Change% - (0.77%) Volume 754.754 Corrections Corporation of America is the nation's largest owner and operator of privatized correctional and detention facilities and one of the largest prison operators in the United States, behind only the federal government and three states. CCA currently owns and operates more than 60 facilities including 44 company-owned facilities, with a design capacity of more than 85,000 beds in 19 states... Im going to buy some stock, incarcerations are going to be skyrocketing soon, espcially if you are a member of Zerohedge :)
ain't that the truth.
http://www.snopes.com/politics/guns/blairholt.asp
I´m much obliged for your correction, eye in the sky :)
really? we had one in 2008. Our CURRENT fed chairman went so far as to lie before Congress to say "we did not monetize the debt." Our fearful leaders are arresting Roger Clemens for lying before Congress--but not Ben Bernanke. Why?
For Tyler Durden: BISMARCK IN HIS OWN WORDS (read it closely boy...)
http://www.scribd.com/doc/10163218/Bismarck-on-Jews-Bankers-and-the-Amer...
By the way, Israel Did 9/11 and the US is bankrupt because of it.
http://theinfounderground.com/forum/viewtopic.php?t=5367
Did Israel's Talpiot help pull off 9/11?http://www.iraq-war.ru/article/116064
Bismarck:
The death of Lincoln was a disaster for Christendom. There was no man in the United States great enough to wear his boots. And Israel went anew to garner the riches of the world. I fear that Jewish banks with their craftiness and tortuous tricks will entirely control the exuberant riches of America and will use it to systematically corrupt modern civilization. The Jews will not hesitate to plunge the whole of Christendom into wars and chaos in order that "the earth should become the inheritance of Israel.".
Comment:
Bismarck's first Reichstag speech was stamped 'anti-Semitic' (Treitschke, Deutsche Geschichte im XIX Jahrhundert), and this continued to be his general attitude - with occasional "art of the possible" political
compromises.
Lincoln never suspected these underground machinations. He was anti-slavery, and he was elected as such. But his character prevented him from being the man of one party. When he had affairs in his hands, he perceived that these sinister financiers of Europe, the Rothschilds, wished to make him the executor of their designs.
un-junk
"...arresting Roger Clemens for lying before Congress--but not Ben Bernanke. Why?"
Because Ben is a tool and Clemons is a distraction.
hahaha.... Ben is a tool.
Always amusing to see the failures of deregulated capitalism hoisted upon the back of old JM Keynes...knee-jerk fallacious pablum, but it sure is fun to say, apparently.
Leverage, securitization, deregulation, globalization, and differential taxation.
Keynes? Uh, no.
If you think the U.S. Market is deregulated, I'd hate to see what you think regulation is.
why don't you look at the 1940's through the 1970's. you're ignorant.
Interesting series of comments. Can you lay out the specifics of "...the 1940's (sic) through the 1970's (sic)."? I'd like to see what you are referring to. Thanks in advance.
(Note: The year designations do not require an apostrophe, which would indicate a possessive. Often referred to as a greengrocers' apostrophe.)
wage and price controls. I LOVE it. When do we start?
monopoly centralized 'money' creation and planning is a far cry from 'deregulated capitalism'.
you keep living in denial, and i'll keep making money off the blunders of your chosen politicians as you defend "Keynesian economics".
too bad my ancestors who arrived on the Mayflower, and whose descendants fought in every major american war, now find us surrendering our last bits of freedom to your flawed ideologies. oh well, hope you FEEL like a "good person".
Keynes? Uh, yes.
FDR? Uh, yes.
The Fed? Uh, yes.
Smarmy know-it-all treasonous twats like you? Uh, yes.
no worries. I've got plenty of gold. I've got plenty of guns. come and get 'em, pussy.
"Smarmy know-it-all treasonous twats"
Best line I've seen in ages. Cheers!
You need to read more. Seriously.
No, Sethco, YOU need to read more, a lot more, and very seriously. You're like some know-it-all permanent student.
Keep your guns (you'll need something to put in your mouth when the beans in your bunker run out) and I'm sure I'd get quite a laugh out of whatever PM an idiot such as yourself may have managed to bury in the backyard over a lifetime of ignorant scratching.
Heee-larious that you fools fear the Fed while ignoring the credit-bubble blowing skills of Wall St and the TBTF....as if that and securitization would change once you've somehow abolished the central bank. Perhaps one of your dipshit ancestors can tell you what fun a non-elastic currency and routine bank panics can be while you look for a job in the 1/6-scale economy a gold standard would dictate.
The point is, almost all the stretch is gone in that elastic currency.
Our American political (if not genetic) ancestors, who believed in the Classical Liberalism of a limited government - whose primary function is to protect life, liberty and property, would probably tell you that hard, inelastic assets like land and other forms of physical property would see you through just fine in times trouble like those which we are about to see.
Wall St. can securitize whatever the hell it wants but without the government's original and ultimate facilitation of easy credit, there are no funds (or a whole lot less) to buy those products in the first place.
I've never claimed that monetary control was beyond abuse. If it was up to me, the Fed would have a substantially different structure and accountability, and a more narrowly-defined charter, but fractional reserve lending, securitization, and reverse repo shenanigans allow the big 5 to create much more easy credit than the Fed.
If that weren't the case, Ben could've reflated the bubble by now.
I'll grant you that what we have now is an unholy combination of the two (Maiden Lane I-III, monetization, etc ad nauseam).
The problem we are dealing with was created by private pseudo-lending and the Fed is just trying to control the damage the only way it knows how. If the money supply was fueled by government created, interest-free debt citizens would only get ripped off once by the inflation created by publicly injected dollars... as it stand the economy gets inflated once when the governments spends the borrowed dollars and twice when it prints the money to pay back the loans to the private sector. I'm still kind of trying to get over the fact that credit is de-facto money printing...something I've only come around to understanding since 2008... I think if more people fundamentally undertsood that, the Fed would very likely be dismantled... it's organized theft. Can't wait for the audit should it ever take place in a truly transparent manner (fat chance!) I still believe that government has a role to play beyond defense and contract law though and that most Americans likely believe that health care is a human right and NOT a privilege for those who can afford to pay for it. That's just fucked up. Single payer health care systems with varying degrees of private health care have been functioning fairly well in most jurisdictions of the Western World. While there are indeed serious problems with entitlement programs those could be handled if people would get realistic about what they cost. But that's another debate altogether. The single biggest problem with our Civilization is that private institutions (banks and financial divisions of large corporations) have been creating money out of thin air (with full approval of that other private institution - The Fed) for the benefit of the Global Kleptocracy. While austerity is clearly in the cards, so is intelligent spending on things that will lay a foundation for future growth once the global economy has returned to something resembling equilibrium... Funny how prices go up and down but somehow GDP is only "allowed" to go up in perpetuity... ain't gonna last forever.
The non-elastic currency part is more than made up for by the lack of parasites feeding of the productive people part.
Regards Ozzy
Sure, it hampered JP Morgan soooo much.
wow, you're really clever, Snowball. I do not even wish to know how you've got that name. but i digress.
i'm happy to end fractional reserve lending, too. and FDIC insurance. modern day banks are just an extension of our centralized money planning system causing the privitization of profits with the socialization of losses. moral hazards created by government 'solutions' has only made boom/bust infinitely worse.
who ignored Wall Street? they made me a bunch of dough on the way up, then down, and when the TBTF were bailed out it was 'game on' in gold. The Democratic 'stimulus' was a legendary blunder that has created new waves of gold buying. please, please, call your Congressman, our President, and our US Treasury Secretary and demand more 'stimulus', then sell me your gold, because this is the easiest money I've seen since the dot com mania.
Snowball, if that is your REAL name, i believe you need to read a few more books. do you really believe that regional boom/bust bank runs were worse than the Great Depression and what we are about to experience? Government and The Fed promised to our ancestors the end of boom/bust, but have succeeded in giving us larger booms (roaring 20's, dot com bubble, real estate bubble) causing unrealistic euphoria, then absolutely devastating busts leading to suicides, divorces, and world wars.
Following, just for you Snowball, are highlighted descriptions about the period in America where there was no income tax or other major 'redistribution of wealth', and there was no centralized (communist) policy for money planning. Ideas and wealth were pouring into America with this more favorable business environment. The "gap" between the wealthiest people and the poorest was, of course, boundless, but the additional REAL wealth creation came in from overseas via massive exporting, and, in addition to the entrepreneurial "rich" creating manufacturing jobs, they threw parties and built homes that created jobs, and they funded universities and hospitals to secure their legacies (as the mega-rich very often do). They also brought art and worldly treasures to our shores that sit in our museums today. Importantly at this time, ambitious immigrant workers were certainly no less "exploited" than anywhere else in the world and, unlike the restrictive class barriers and lack of upward mobility in Europe, new and existing Americans were becoming millionaires by the tens of thousands. This growth was not agrarian via slavery (this ended in 1865) or cotton, but rather industrial via steel and ingenuity and, most importantly, via the power of property rights (including virtually no taxes, i.e. "right to your own wealth") and free markets. This unprecedented growth happened decades before "the roaring 20's" of easy credit, and before the Federal Reserve was ever created.
Here is an excerpt from Bill Bryson's recent book "At Home" about this particular period:
"The Eiffel Tower was the most striking and imaginative large structure in the world in the nineteenth cetury, and perhaps the greatest structural achievement too, but it wasn't the most expensive building of its century or even of its year. At the very moment that the Eiffel Tower was rising in Paris, two thousand miles away in the foothills of the Appalachian Mountains in North Carolina an even more expensive structure was going up - a private residence on rather a grand scale. It would take more than twice as long to complete as the Eiffel Tower, employ four times as many workers, cost three times as much to build, and was intended to be lived in for just a few months a year by one man and his mother. Called Biltmore, it was (and remains) the largest private house ever built in North America. Nothing can say more about the shifting economics of the late nineteenth century than that the residents of the New World were now building houses greater than the greatest monuments of the Old. America in 1889 was in the sumptuous midst of the period of hyper-self-indulgence known as the Gilded Age. There would never be another time to equal it. Between 1850 and 1900 every measure of wealth, productivity and well-being skyrocketed in America. the country's population in the period tripled, but its wealth increased by a factor of thirteen. Steel production went from 13,000 tons a year to 11.3 million. Exports of metal products of all kinds - guns, rails, pipes, boilers, machinery of every description - went from $6 million to $120 million. The number of millionaires, fewer than twenty in 1850, rose to forty thousand by century's end. Europeans viewed America's industrial ambitions with amusement, then consternation and finally alarm. In Britain, a National Efficiency Movement arose with the idea of recapturing the bulldog spirit that had formerly made Britain pre-eminent. Books with titles like The American Invaders and The 'American Commercial Invasion' of Europe sold briskly. But actually what Europeans were seeing was only the beginning. By the early twentieth century America was producing more steel than Germany and Britain combined - a circumstance that would have seemed inconceivable half a century before. What particularly galled the Europeans was that nearly all the technological advances in steel production were made in Europe, but it was America that made the steel. In 1901, J.P. Morgan absorbed and amalgamated a host of smaller companies into the mighty US Steel Corporation, the largest business enterprise in the world had ever seen. With a value of $1.4 billion it was worth more than all the land in the United States west of the Mississippi and twice the size of the US federal government if measured by annual revenue. America's industrial success produced a rollcall of financial magnificence: Rockefellers, Morgans, Astors, Mellons, Morgans, Fricks, Carnegies, Goulds, du Ponts, Belmonts, Harrimans, Huntingtons, Vanderbilts and many more basked in the dynastic wealth of essentially in exhaustible proportions. John D. Rockefeller made $1 billion a year, measured in today's money, and paid no income tax. No one did, for income tax did not yet exist in America. Congress tried to introduce an income tax of 2 per cent on earnings over $4,000 in 1894, but the Supreme Court ruled it unconstitutional. Income tax wouldn't become a regular part of American life until 1914, and in the meantime any money that was made was kept. People would never be this rich again." wake up and smell the dogshit, Snowball. I'm still your countryman and i'm depending on you as much as i can while still protecting myself and my family.
"Between 1850 and 1900 every measure of wealth, productivity and well-being skyrocketed in America."
Panic of 1857
Panic of 1873
Long Depression
Panic of 1893
Panic of 1907
Whitewashing history: double-plus not smart.
Not one of those events refutes that statement. Double-negative aint not stupid.
No, but lauding a monopoly (US Steel) built under the proposed policies as evidence that it was necessarily better for the country than a fiat system...definitely not all that bright.
Pretending that there weren't legion pissed off, hungry and unemployed people during the entire timeframe? Disingenuous at best.
Claiming that meteoric growth is meaningful when punctuated with panics and depressions every four fucking years? Willful ignorance.
if its so much better now, then SHORT GOLD, Snowball.
those panics where far less painful than the great depression and what we are about to experience. the point stands, dipshit.
People in trouble. Friends come and help.
Everyone in trouble. Suffer.
That's the idea behind centralization. We fuck this up everyone suffers. So do as we say.
those panics where far less painful than the great depression and what we are about to experience. the point stands, dipshit.
Try again; most of those panics were deeper and/or longer than '31 and there was no six year span that was free of some kind of financial crisis.
You claim that your economic preference for a gold standard leads to more stable economics; history demonstrates otherwise, repeatedly, ignoramus.
Even your Wikipedia links discredit you.
And the economy and it's people recovered far faster then than now. Your drinking some bad cool-aid 777.
i'm on the gold standard for everything outside of working capital. its working out famously, fuckwit. how's it working out for you?
so things were worse before Nixon removed us from the gold standard? things were worse before The Fed? ...perhaps for politicians and TBTFs.
put your money where your mouth is and SHORT GOLD, you thick-headed grasshopper.
I'm laughing at your foolishness and will enjoy trading my silver for the last piece of bread while you stand in the cold whining about how unfair it all is. then when you desperately attempt to break into my home to steal my silver and gold so you can feed your children I will enjoy cutting you to ribbons with my .357.
checkmate, pussy.
Did any of these "panics" significantly affect the massive rise of prosperity and standard of living that was going on? How many farms and factories shut down? I'm guessing they were nothing more than blips on the overall landscape, since most people in those days were not in debt and did not have bank accounts.
basically, Strongbad, these regional panics, booms, and busts are the reality of prosperity and risk-taking. the great depression, and what we are about to experience, are the reality of 'government solutions'.
Snowball, i hope your viewpoints spread to all of your friends. please, tell your family to bet their lives on your viewpoints. i'm going to enjoy hearing about your suffering, and those who continue to promote your flawed ideas.
seriously, mate, i'm laughing all the way to the bank and there is nothing you can do about it. THANK YOU, Snowball, for everything you represent as it relates to my opportunities in the markets.
i hope you vote for President Flounder the next election, too; gold $5,000.
i hope you vote for President Flounder
who dat?
ooooooo. You're a meany. Don't forget the booze. If you're looking for a selection go to Bardstown and they'll be happy to oblige.
How exactly would a bank run be possible without fractional reserve banking?
On the point of the inelastic currency, fair enough but perhaps we should give the power to create currency to the people who use that currency via taxes on their hard-earned pay cheque as opposed to private institutions.
As far as I can see the primary dealers have a licence to print money rolling government debt at 3% and borrowing at FED rate.
This is outright monetization and as such there will never be deflation for very long.
+1.
fractional reserve lending is designed by bankers to serve bankers. ...crime against humanity.
So you acknowledge then, that the problem isn't solely the Government.
The Fed, its policies, and fractional reserve lending are clearly the culprits. hands down.
the creation of FDIC insurance, FNMA, and Freddie Mac have created dire moral hazards as they relate to reckless lending.
deficit spending, however, is accelerating our rapidly approaching demise, Wyndtunnel.
big government, let alone big government with borrowed money, is a millstone around our necks.
it is a broken window fallacy to suggest that any government "creates jobs".
this is why i find those who chant for Keynesian spending to be traitors of the highest order. the average american suffers.
deleted
He wasn't defending Keynesianism, you decendant of war heroes, you. Over the last 30 years we have been at historically low tax rates and levels of regulation, financial or otherwise. People like you are going to love the disintegration of civilized society. You're not going to lose any freedoms, douche. You're going to have too many. Think: Somalia. Guns and Gold won't save you, and you sound like a Wall Mart Shopper, Glen Beck watcher. Get yer guns at Wall Mart, get yer gold from Glen Beck. You are a small potatoes fool, with no thoughts of your own. Turn off the TV.
It's a sad day when someone thinks Somalia has too many freedoms.
I junked you because you obviously do not work in private business if you believe the last 30 years have been light on taxation and regulation. Regulations quadruples (from 46 pages to over 160 pages) in 2000 for the Professional practice act, and that's just ONE regulatory agency. All of the expenses I used to deduct when I started practice...... GONE!! Oh and you misspelled descendant.
bud, i don't watch too much TV outside of cooking shows, and i sure as f*ck don't get my information from Glenn Beck (although i do not believe he is part of the problem right now).
read my addition directly above this post and you'll know exactly where i stand. either way, i'll be fine. i'm just trying to help. small potatoes? you sure about that?
i appreciate that you feel you are right, and seeking solutions. the lack of banking regulation that concerns you is a failure of banking as we know it; namely centralized money planning, fractional reserve lending, and fiat money. more regs on a rigged game is like a band-aid on a bullet to the head.
again, i appreciate the debate, but the sensational Glenn Beck is the least of our problems.
Glenn Beck is Mormon and Jew Puppet....
http://theinfounderground.com/forum/viewtopic.php?t=11614&p=47977
What's up? Disapointed that turn out to the rally didn't meet yer' expectations? Or is it that you got yer' ass handed to you, and the stink has created a foul mood?
Mr. Sethco, I admit to a junking here, but I'm not sure I could post a cogent reason why. The comment was just disjointed and contradictory. It made my brain sizzle.
Yeah, whenever I see people quoting books about 19th century economics, my first impression is, "that guy must shop at Wal-Mart."
Wait ... what?
Strongbad, that was the first (and so far only) comment of many that I have read here today that literally made me laugh out loud. Touche!
Historically low? What is the rate of increase in lines of the US Code over the last 30 years, and how does this in any way indicate less regulation? We got along for over 125 years without income taxes, or the alphabet soup of agencies, violating the Constitution by illegally legislating, usurping freedom, and telling us that which a modicum of common sense already should.
Not going to lose any freedoms? Elizabeth Warren has plans for you, sunshine.
"Leverage, securitization, deregulation, globalization, and differential taxation.
Keynes? Uh, no."
Hey, you must be new, dude!!
Who ever said that Keynesianism had anything to do with Keynes?
It's the new, improved and extensively revised version called Neo-Keynesianism!
The old dead white guy just managed to get his name attached to the monster, through little fault of his own. You don't think for a minute that the improvers and modifiers would be foolish enough to attach their own names to this witches brew, do you?
no doubt Keynes is turning in his grave. I get the fact that the entire theory is based on spending government surplus, a far cry from todays activities.
however, governments, by definition, do not allocate capital as efficiently as private enterprise. so, any 'surplus' should be returned to the taxpayer. that 'rainy day fund' is ivory tower bullsh*t.
i'll tone down my vitriol when you, and the mathematically gifted JM Keynes, get real.
What definition are you using for THAT?
With private enterprise being places like Walmart and Starbucks, what sort of efficiency results in the construction of a store on every block?
What sort of efficiency led to our banks giving home loans to out-of-work drywall installers?
I agree that private enterprise beats gummit on efficiency, but try to find the TRULY private enterprise these days.
It's virtually all state capitalism. And the few examples that do appear to be legitimately "private" (Walmart and Starbucks, for example) don't seem to me to have done anything too brilliant with their capital.
But this is a simple-minded view. Maybe the inefficiencies I'm perceiving are the absolute best we can do as a species, because after all, we're just a bunch of hairless apes.
Whenever I get hungry, I start throwing food at the wall, and every once in awhile a piece bounces off and lands in my mouth. It's the most efficient way I know to eat.
private enterprise gains your hard-earned money through a peaceful process, by offering some really great software that makes your life easier or more enjoyable, for example. Gummit takes your money, and private enterprise money, by force.
who knows how to allocate money more efficiently, those who earn it peacefully by giving folks what they want, or those who take what they have not earned? golly, i don't know.
but i do know that taxing so we can hire gummit workers to paint stop signs purple, then yellow, then back to red again is not "creating jobs", but rather a broken window fallacy. apparently, the market agrees, because gold is going through the roof, so don't take my word for it, just watch the tape.
when a businessperson, like myself, keeps more of my money, then i can allocate it to where i believe i can profit from the risk. this often times creates a few jobs. if it turns out that what i am doing is making money, then i'll expand and create a few more jobs. the marketplace is happy to finance this job creation, blunderdog.
As I said, I agree that private enterprise allocates capital more efficiently than the government.
But when even private enterprise does SUCH A COMPLETE FUCKIN PIECE OF SHIT CUNT JOB of doing it, I believe we may as well pony up to the fact that we have a real structural problem that cannot be addressed by cutting taxes or laying off government employees.
Endemic problems require radical solutions. Solutions are coming one way or the other.
I get your rant, it makes perfect sense up to the point that must be made: There is becoming less and less differentiation between government and big business. Government has made it easier for the big corporations and big banks to suppress competition, absorb their competitors, and create monopolies of a sort. When the "free enterprise" system is undermined by government then your argument dilutes. Only a true, free, small businessman can demonstrate free-market principles. Look at what the SBA defines as a "Small Business". It's a joke. Now State and local governments are getting into the national governmental act by passing zoning laws, sales tax and income tax relief, and other administrative licensing and permitting that stifles "small business". I'll never start another one, and I have owned 6 of them as an entrepreneur. No way I'll do it again... because of government at all levels.
+1.
government lobbies and subsidies are not 'free enterprise'. any corporation without bailouts and subsidies (ha, ha) can otherwise suffer the consequences of their poor capital allocation decisions.
corporations have improved our quality of life in some cases, and made it much worse in others, but a failing corporation is as 'evil' as it gets when attempting to survive at our expense. corporate welfare dwarfs social welfare, and i despise both only because each weakens our country over the long-term.
-exactly RR, exactly...when my current gig is up I am done, my brains and work/moral ethics will be withdrawn...unless things change. Maybe work for the forest service counting fish or something, and step up my dumpster diving time allotment...;)
"there are levels of existence we are prepared to accept..."-The Architect
Same.
Excellent post.
Yes, totally agreed, although personally, I'd take it a bit further than that--you've only sussed one half of "my argument." I think it's more of a "view" than an argument. Wealth inequality can only be driven to a certain level before systemic failure. I think we've passed that level in the US.
Setting unrealistic expectations for future returns is SO entrenched in every industry I've had the misfortune to be abused by that I question the entire premise about allocation of capital by "markets" in the first place.
The examples of dominant falsehoods are everywhere. The stock market gains 5%/year. Real Estate never goes down. The Internet consumer market will grow indefinitely. Starbucks (/Walmart/Target/etc) will sell enough overpriced coffee (/plastic crap) to support every store we can possibly open. Advertising and marketing generate revenue.
I live in NYC, and watched over a period of 2 years while touch-screen LCD panels were installed in the back of EVERY taxicab in the city solely to push unwanted ads at passengers. What pile of lies had to be believed to encourage a business model that depends on making the lease and maintenance payments on hardware from the revenue generated by selling advertising to businesses which are virtually guaranteed to be unable to confirm a real return from that service?
Meanwhile, there's neither money nor effort to provide better information infrastructure that people might actually have WANTED. No, can't put touch-screen police boxes or bus/subway information kiosks because there's no "return." Even something as simple as better street signage would actually improve lives.
Only a fool or the wilfully-blind would ever have believed there'd be a profitable return on piping loud annoying audio at cab-riders.
The small businessman has it as bad as the peasantry. He *has to* try to find a way to survive when every card is stacked against him. But small business hasn't ever been a priority for government because no small businessman can afford to finance a national election.
Even local government is better served currying favor from big business and big Feds than actually trying to do what citizens want. Just as small business is better served trying to win business from a bigger business than it is trying to develop a product any normal human being might want.
Now sure, anyone could be an individual who would personally benefit if Medicare/SS ended tomorrow and those payroll taxes were gone. He'd be in the minority, but whatever--it's a reasonable point to raise that the programs are causing undue suffering to some folks. The problem is: if Medicare/SS is actually causing you any personal hardship, you're POOR.
And if you're POOR, you're not being well-served by a system which continues to aggregate power and control of resources in the hands of the top 1% of the population. You're just fighting with the rest of us for the scraps.
But but...we don't want to admit we're poor. We've got cars and houses and guys who mow our lawns. How can we be poor?
Because collectively we own a *tiny* share of the country.
At least it's far nicer to be poor in the USA than almost anywhere else. Whether you work or not.
Private enterprise adopts the religous model of a cargo cult. But instead of every lasting peace and plenty that never comes because it's in the future and you have to suffere for it. They offer cleaning products and toys.
Oh yes, A hyper faxcist state or better yet a lucky sperm dynasty. How efficient it will be.. Our lords dispense largess in an ever so efficient manner... So much better than millions of people making decisions based on local information. You are a tool..
Oh yes, A hyper fascist state or better yet a lucky sperm dynasty. How efficient it will be.. Our lords dispense largess in an ever so efficient manner... So much better than millions of people making decisions based on local information. You are a tool..
Nothing, nothing is perfect but if it were how could you tear down the best functioning system and install your own set of fascist bastards (one of your professors) I'm sure.. Go back to study hall now!
Not that new, just not afraid to spook the savages who've never actually read the man's Treatise on Probability (wonder if that might have some relevance in this age of market uncertainty) or the General Theory of Employment, Interest, and Money.
Labels make it easier to avoid rational thought...that's why these yahoos love em.
Labels like "yahoos". Just what the people want. Lead by example. Do you need meds for cognitive dissonance? Or might it be possible to just use honesty?
Snowball, that is the wisest statement yet. "Labels make it easier to avoid rational thought." I whole-heartedly agree. when we attach a label ourselves we become slaves to how that label is publicly defined, and we are plotted against each other by label advocates. labels become our prisons. i personally accept no label of race, politics, or religion. they all pander to our 'sense of self' to our peril.
all i need to do is make good decisions to protect first my family, then my friends, athen my countrymen, and finally my fellow global citizen. ultimately, the best long-term decisions are in the interest of my fellow global citizen, but i never forget that life is a competition and my fellow global citizen may actually be happy to cut my throat if it would save his/her child. such is life.
Truer words never spoken. I'd like to steal that and use it when I next hear about how the Democrats/Republicans will solve the problems.
+1.
"its us against them" and politicians will save us all!!!
Whether or not what we call "Keynesian-ism" operates exactly how Keynes himself would have wished isn't really important. It seems to be close enough, we have to call it something and "Keynesian-ism" is a perfectly serviceable term in the sense that everyone knows generally to what you are referring.
How many times have we heard that "true communism has never been implemented" or that "Marxism has little to do with Marx." Big deal, it's close enough and it doesn't work. Expect your sons and daughters in twenty years time to be lectured by beret-wearing fuckwits about how "PURE Obamunisim was never allowed by the capitalist elites so OF COURSE it didn't work..."
A nice deflection, but it doesn't excuse your lack of understanding. If you prefer the taste of sand, so be it.
Keep up your faith in the Fed and central planning and you'll be tasting the jackboot.
Since when does a desire to see some specificity in the use of terms been equated with advocacy, much less religious belief?
Maintain your inability to distinguish one thing from another, and you'll BE the jackboot.
My point is you're needlessly splitting hairs and getting hung up on academic terms. Whatever system we have now...a system manifested by the Fed's recent actions, TBTF policies, credit as a civil right, and the executive branch's apparent ability to create instant bureaucracies out of thin air with unaccountable, perpetual power to regulate everything under the sun...is clearly an attempt at a more centrally planned economy. Call it whatever you want but it's all going to end in tears.
Yes. The whole point of Obummercare is to create a new layer of government: vicious, unaccountable, adding nothing but with unlimited power to destroy. Who would start a business now?
D-E-C-E-N-T-R-A-L-I-Z-E. governments are not our friends unless they are actually or friends. i'm not that close to anyone is D.C., so i'm reluctant to give then powers over my state and local government. How would anyone in D.C. know what is best for me? more likely, they are stealing from me on behalf of themselves and friends. Surprise!!
Love the touch of humor in your comment. It's a hoot that the centralized government takes the money from the States and then sends it back to them (with a little skimmed off for their own pockets and a bit extra for the military projects in the States of the more powerful Congressfolks). But then any financial advisor will tell you, "Pay yourself first".
"oh, Rocky, are you implying that governments (and the individuals that populate them) are GREEDY?"
"oh, my, that never crossed my mind."
"that would never happen here.",
"people are different now.", "we do not need an armed population anymore.", etc., etc.
Sayeth he who admittedly despised labels only a few lines above.
That said, what might you call our current system? Unfettered Capitalism?
Same argument the libertarians and freemarketeers make when the "Market" produces results contrary to their numinous beliefs. Well the market was not allowed to be truly "free" and therefore OF COURSE it didn't work. Sorry the economy was destroyed.
There are no free markets.
Well there's more free and less free. More free has a much better, long term, world-wide track record than less free. The U.S. residential housing market of the last ten or twenty years (and arguably much longer) was much less free in retrospect than most participants realized at the time due to direct and indirect government subsidies.
The real estate market also bubbled/bursted due to a widespread mispricing and misunderstanding of risk and is a much more complex issue.
And why is it that there are no free markets? Actually, there are billions of 'free markets'. Every goddamn relationship is a free market. WTF, you have a free market with yourself, if I interfere, it is no longer by strict definition a free market. At the point that I enter your realm it becomes political. And so the argument then is free markets to a greater or lesser degree and dominance/submission.
I prefer maximum domination/ refusal of submission within what should be a reasonable amount of personal space.
ahh, but "the economy" wasn't destroyed. the "idea of an economy" has been destroyed but not "the economy." indeed it appears to be morphing and it involves "the american people no longer paying their taxes." and to think "it's the weirdo on the left" who has "gotten it" since day one: his name is Tom Keene and he has always understood "as a humble economist" that if "you don't create jobs BOTH Wall Street and DC are DONE." While I am not surprised to hear no complaints of this reality on this site I am surprised when I hear it with striking regularity on CNBC. When last I checked while certainly "fingering the subset" was always in that network's interest and certainly one of their specialities I've never really understood how a "jobless prosperity" was ever in the interest of "free market capitalism" at least at it relates to anyone "in power." Of course sometimes we are all forced into corners and rather than question our beliefs will instead vehemently demand a strict adherence to them. (All of us are human.) Needless to say as CNBC has so loudly proclaimed with "The Movie" the only belief they have is in paper wealth. Interestingly I look at a 1 dollar Silver Certificate that I have framed dating from 1957 and wonder "where is the debate over this then?" It says "payable in silver" right on the note.
you mean the government broke their promise? ...must have been 'for the good of the people'.
i'm allocating my non-working capital absolutely nowhere but gold in diversified safety deposit boxes and home safes. ..."fractionally-reserve-lend" that, central money planners.
Doolittle:
Have you ever heard of the name Eustace Mullins?
Do you really understand what the American Populist movement was about in detail?
Aren't Black Markets truly 'free'? From what I hear, they work pretty well for the peasants.
Got that little 'loophole' covered with the free medical 'gift. Isn't it the 1099? At any rate, comprehensive it certaintly is.
Who ever said that Keynesianism had anything to do with Keynes?
Exactly!
Misnomerization seems necessary to fully incite the passions of the less educated by opposing absolutists who would have society embrace the opposite extreme, which in this case would be elmination of "welfare," aka publicly institutionalized charity. Which, of course, is an easy case to make if you're one of the current "haves," especially under cover of idealistic assertions that an anarcho-capitalistic system would literally inspire love and care not only for one's fellow man but also their children (whom most middle class people actually despise), but very difficult to reasonably foresee resulting in anything more than malthusian ecstacy in practice.
Extremism is a bitch.
It depends upon dishonest vilification of opposing schools of thought and their misrepresentation. It's the same everywhere. Consider Marx and the bastardization of his ideas by Lenin and Co. You see it even now in the widespread red herring claims that the US is "socialist." It sure works to incite passion over reason, though where it gets genuinely dangerous is when smart people start applying their reason in service of those passions.
Of course, in a country that worships a two-party "democracy" which cultivates and supports a primitive bipolar collective vision of reality, its absolutely (if I may abuse that vice myself) necessary to keep the crazy pot boiling.
The longer I live, the more I think Buddha had it right--salvation can be found only in the middle path.
Which is not to say that we should not eliminate the Fed. We sure as fuck should, imo.
Best comment I've read all day. Thank you.
Someday, the sheeple will find out that they have no idea what words like 'socialism' really means, or how their gov't really works. I hope that day is soon.
I too hope that day is soon. I am not holding my breath, however.
seriously strong soap Bob.
duality's a bitch ain't it?
Always amusing to see people assert that the economic "system" we have bears even a thrice-removed resemblance to capitalism, unregulated or otherwise.
+1
I hear you. I respond to people who tell me we have capitalism with something like this:
The Fed and Government determine what money is, how much of it there is, and what the cost to borrow it is. As money is one of the most important pieces to an economic system, how could we possibly have capitalism or free markets?
Recently, the rights of corporations, have extended to even include "free speech". Corporations have all the same rights as us, but also have "limited Liability", therefore human beings are at a disadvantage to corporations as we don't have limited liability.
YES! thankyou. While "Keynesianism" may not be the correct response to what caused the crisis, I don't ever hear much on this site or anywhere else about the 30 years (or more) of, for lack of a better term, Friedmanism, going back to abandoning the gold standard (which Nixon did on Friedman's advice) to lowering taxes to an extreme degree (especially on the weathy), through deregulating everything and finally abandoning our economy for "free-trade globalism". "Friedmanism" will do just as well to describe what happened in this country then as "Keynesianism" will to describe what is happening in response. I think the banks should have been allowed to fail, the economy allowed to implode. That was politically impossible.
What are these "low taxes" on the wealthy you speak of? You claim to want precision in terminology. So clarify. What is your definition of "wealthy"? What is your definition of "low [taxes]"?
You are aware that in the United States, the top 20% of earners pay 65% of all income taxes collected, right? And the top 1% pay 23%.
And what is this economic "deregulation" you speak of? Everywhere I look, I see massive government intervention in all areas of the economy, from health care to banking to agriculture to technology. In some cities they are ticketing children's lemonade stands for health/permit violations. Ever try to run a business in California? Go do it and then come back and talk about deregulation.
Not to worry. Obama understands that the REAL problem in this country is that people (and families)who make more than 250K per year get to keep too much of their money. A nice jump in taxes on "the rich" is all we need. Imagine all the good the government will do with that extra money. How can we expect gumment to work, after all, with the puny amount of revenues it gets? I mean, once 2.3 trillion dissappears (http://www.youtube.com/watch?v=3kpWqdPMjmo) from the Defense Department alone, there's virtually nothing left!
Seriously, what are all those conspiracy theorists talking about when they say that the real beneficiaries of taxes on the "rich" are the super rich, since the super rich take their interests offshore and their potential competition is stymed.
+100. just be aware that 50% of the population now lives off the government dole in one way or another whether or not they are actively carrying out a daily routine in a government job or sitting at home getting their checks reading zero hedge. The tipping point is here. so don't be too concerned at these junkers for believing that government IS THE ANSWER TO EVERYTHING.......
+ 1. exactly, hardmedicine. then when it all goes tits up they'll start calling people who hold gold 'domestic terrorists' as they attempted to do in missouri. its always someone elses fault.
...mob rules 'group rights' democracy over the constitutional republic of individual rights. oh well, it was good while it lasted, but it is probably human nature to eventually seek out a dictator.
"it is probably human nature to eventually seek out a dictator. "
yes, maybe, if human nature chooses to seek the same path even after it knows full well the consequences of seeking said path.
That is phony baloney & has been disproved some time ago. 65%? yea right. Why do people keep using those ridiculous numbers?
Disproved by whom? Merely stating it does not make it so. I researched before I posted, and I can provide cites. If you have better information, then by all means share it.
But suppose my numbers are indeed off. Let's say that the top 1% pay "only" 20% of all income taxes collected. Or 18%. Or 12%. The point remains. As we travel up the income ladder, the income tax burden increases disproportionately. There are no "low taxes" for the rich, as the original poster claimed. Anyone making the claim that the rich don't "pay their fair share" needs to answer two simple questions: what is rich, and what is fair?
Another thing to keep in mind is that there is no change to tax rates that will fix the current problem, which is at base a spending (not revenue) problem. You could tax the rich to the poorhouse, and you will only get ever-higher spending and a bigger government with more resources to intrude on the lives of the citizens and harass them. It's not like the government will raise a few trillion and suddenly everyone will have good healthcare, or a nice house, or a 12-hour work week. What do you think government is going to do with that money? Make your life better? Not a chance, unless you're a government employee, I suppose.
The problem I see is that your claim rests on the assumption that Federal taxes pay for the majority of Federal expenditure.
They don't.
Biggest expenditures are Medicare and Social Security, which are very heavily weighted to the low end of income earners because they cap at a relatively low income.
MMW
... er ... because they are close to true?
But you can try this experiment at home: search for '"income tax" quintile'
Here's some help:
http://www.taxpolicycenter.org/taxtopics/currentdistribution.cfm
and that is from the Brookings Institution, so it must be right ;-)
- Ned
Wow. That's a lot.
What percentage of their income is paid in taxes?
33% (includes FICA)
I understand that that might be their tax rate, I was wondering what percentage they actually pay in taxes as a percentage of gross.
The free box of swiss miss hot choclate they get when they open up their swiss bank account.
rocky, i always look for you because you are always dispensing the awesome red pills. The uber rich have so many avenues and schemes at their disposal to hide their wealth. I would like to be able to give you the percentage of gross the top 1% pay in tax here. uno momento.....
Looks like the latest number is around 21% for the top 1% according to IRS.
fromhttp://www.taxfoundation.org/news/show/250.html
Source: IRS see table 8
Looks like my ploy to drag cxl9 into the truth of the matter failed.
Marginal rates and effective rates are somewhat different.
Just ask GE.
GE: 7,000 tax returns, $0 U.S. tax billFriedmanism is correct. We never should have gone off the gold standard. At that time I was 16 or so, and my grandfather railed against Nixon going off the gold standard. He said it was the worst thing that Nixon could do. My grandfather said that someday we would come to regret Nixon's action & he was right. My grandfather was a very wise man.
You shouldn't criticize capitalism and free markets until you try them, something we haven't done for over 100 years. To call the US a capitalist country is a joke.
Leverage, tree
Securitization, tree
Deregulation, tree
Globalization, tree
Differential taxation, tree
Take a peep at the forest every now and then; All of those things tie in to the need to expand margins in the face of a monetary policy-induced margin squeeze.
but by my count, that's five trees. ;-)
- Ned
Doesn't that add up to tree fiddy?
http://www.youtube.com/watch?v=Q8iHPC-dGKY
US will default. If an argument develops, a certain country will become glass.
End of story.
I agree with you on that..But I got a feeling that these guys in the big house now cant win a fight...
hate to agree but i do. it is this simple.
Fuckin' A.
FED buying USTs is a bond auction failure
And through its surrogate client nations for how many years has there been failure?
exactly.
Just loved these little jewels from Bill Buckler:
I just got my issue of The Privateer at midnight last night. Downloaded and printed it. Can't wait to dive in!
+1.
+100
+100
Not in the Lingua Franca of George Orwell.
Thank you! If I had not read your statement I was going to write a few paragraphs pointing to that conclusion. Yes, when a government (private party/gov. authority i.e. fed) must fund the purchase of an auction including the over bid, we all must agree that is a FAILED AUCTION? When you print the auction that is failure!
If your view is correct how did society care for the demographic bulge when they were between the ages of zero and 12? Under your true capitalist system they can be put to work at 12 or 13 but how did society care for them before that and why then should it not be possible to care for them when they are between say 72 and the grave? Your arguement stinks and the fallacy is that everything that is done for profit, create wealth in your language is good. Many things yes, but not everything.