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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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it has been reported that they need you back at your site. Click link below to teleport yourself.
http://www.dailykos.com/
um, dude, these folks are not replacing themselves with as many chil'ren. hence, once major portion of the calamity. two parents can take care of one child, but one child struggles to take care of two parents. not-to-mention, last time I checked, old folks have a lot more health problems than kids. its that whole 'aging' thing.
...glad to see you are using the shit between your ears before you lash out at our author.
Forgetting that children can be seen as having a future return for investment. I know every time I give my kid a ham sandwich , I am thinking of all those Guats she'll be replacing out in the family tomato fields, ten years hence ( she's only one, give her a break) . Grandma, on the other hand, is unlikely to be usable even for spares more than ten years out. You gotta think " long term " , guy ..
Pretty solid, though I do have one no so insignificant nit to pick;
"First things first. Money is a medium of exchange. That is ALL it is."
No, first & foremost money is what extinguishes all debt. It is a means of exchange because of this.
The only true money is gold, since only gold will extinguish all debt, thus giving gold the highest utility of any commodity.
Bucker wrote:
which is technically correct, but as AUD points out, gold is the ultimate amongst unconsumed economic goods, being that it is never actually consumed at all. All others are eventually consumed or suffer the depredations of entropy too quickly.
But I'm preaching to the choir.
Absolutely outstanding perspective offered by Buckler, once again.
I continue to be of the opinion that this is the natural and almost unavoidable solution.
Agreed, an outstanding exposition on money.
Scary story from Mr. Bean. Just as I thought, the whole thing is a con, you work and save for 30 years and then it all turns to ashes. In short, there is neither a free lunch nor a reliable pension. Sad but true it would seem.
apparently, the real work is convincing someone to give you a massive line of credit, after which it is smooth sailing. Our hard working ancestors have done their bit, as we've now got the biggest loans.
'how to succeed' 101: figure out how borrow more than your neighbor. class dismissed.
yep, this is going to last.
Agreed. That might be as bad as the Charlie Munger "suck it up" missive.
http://oddlyspecific.com/2010/05/05/funny-signs-suck-it-up-pansy/
dare i say, "gold, bitchez."?
The FED has become a political necessity to fund government. Congress created the debt which is now serviced by the FED. FED monetization originated with politcal greed. Now the FED is the only means to inflate the debt away.
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The idea that sovereign debt in perpetuity is normal or acceptable is a curious concept. It really has no basis. The issue of large sovereign debt must be tied to a national emergency, like a world war, in order to justify its use. The difficulty is that sovereign debt is not an affective driver of growth. That is, any use of it should be temporary and retired in a organized manner in line with achieving some special national goal that justifies the advance use of money.
Debt in perpetuity, is a reckless concept. Without planned retirement of debt there can be no justification.
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The payment of interest on debt is a national loss. To pay interest on uncontrolled debt is supreme stupidity. Every cent of interest paid is a cent wasted. The use of tax revenue without any benefit to the tax payer. Tax should be used to benefit the people who pay it and not bond holders.
Mark Beck
http://espanol.video.yahoo.com/watch/4397309/11788984
Either no one saw the movie or if you put the Big Lie out there, you remove the power.
Mark, as soon as you use the operative word "should", you're sunk. One of the primary issues facing "regular people" (aka serfs) is failing to recognize that morality is a purely artificial human construct. And why was it created? I would posit that it was developed to provide yet another tool which could be utilized in order to maximize survival for those who understand its true purpose.
Along a similar vein, while the original exposition was excellent, it only hints at the concept that higher survival principles (of the architects and those "in the know") were the core motivating factors behind the creation of the modern welfare state. As such, it fails to adequately expand on identifying essential first principles in order to understand the driving need behind why it was created at all.
Here it is in a nutshell: Darwin was right. Not only is Darwin right, but the NWO crowd knows he's right. They don't waste their time bantering about silly, inane doubts regarding peak oil, heritable intelligence, etc. Rather, they let (actually, guide - why do yo think they own the MSM?) the clueless engage in false debates which serve as primary diversions for today's crop of sheep. No, they operate clear of all these distractions while purposely using every means at their disposal to make sure they and their progeny survive.
It's always been about survival, and as in love or war, everything is fair game. Everything - nothing is 'off limits'. One mechanism enacted towards achieving that goal entailed creating a system which on its surface appears to deliver certain benefits to its adherents. However, in actuality this system is nothing more than a lure, a trap, in which to ensnare unsuspecting dupes so that the hunters can enjoy the feast.
Is it a better system than simply having a jack boot at one's throat? Who can say? Yet, it does demonstrate the power-elite are incredibly adaptive. How did they react to the invention of the printing press and wide(r) spread literacy that spawned greater awareness? Why, they became much more sophisticated in their control systems, and began utilizing a more subtle and, at least on its surface, benign system which had cross appeal to many different factions.
But make no mistake, this mask will be dropped if it no longer serves any useful function. Then we'll be back at square one. But we're heading to a meeting at the OK Corral, and the outcome isn't guaranteed for either side.
+1.
"turnpike lane...turnpike lane....you spiked my arm...but you missed the vein." and i think i know what i want! no wait...I KNOW I know what i want.
I'll take care of it, just get the Fed's coffins ready...
Seriously, it's time for a new era of personal responsibility.
+1.
+1.
+1.
I first read about the idea of continuity of government during the latter part of The Cold War, my first thoughts were, "What good is government, when there is nobody left to govern?"
From the depths of cynicism, I stumbled upon exactly the point that you make. Words like "modrin", civilized, and compassion are a smoke screen for the idea that when the gloves are off, it's essentially Mutual of Omaha's Wild Kingdom.
+1 ... The Golden Rule. (I won't repeat it ... you all know what it is).
B9, you should really read Darwin's book on earthworms.
http://books.google.com/books?id=-ccRAAAAYAAJ&printsec=frontcover&dq=act...
i think you would enjoy it immensely, especially the section called 'the power of suction'.
Depends upon your perspective. An owner of the Federal Reserve might find that proposal preposterous! Those yacht payments must be made -- oh, I forgot, they pay cash.
Silbergeld Hündinnen!!!!!!!
"...the idea of a store of value, is true of any unconsumed economic good, not just money."
Well argued post, but the writer makes no mention of the reasons gold (and indeed any decent money worth its salt) has a primary role as a store of value.
A good money should be durable. Portable. Fungible. Sufficiently scarce.
The writer claims that any commodity ~ "unconsumed economic good" ~ can fulfill this role. But try it with apples, barrels of oil, fish or houses...apples rot, oil is cumbersome, houses deteriorate...they all have problems, pointing out the distinct difference between "unconsumed economic goods" and money.
i doubt gold and silver were called 'money' when they came into use. its more likely that someone was buying some silver with a bag of apples, because they had an orchard full of apples and none of the shiny stuff.
the meme of 'money' only gets confusing when it no longer represents a hard asset with which to barter. we have not had that hard asset backing 'money' since 1971. The 'faith' is eroding, and the perceived value of the brand name is nearly lost. hence, the stampede back into gold.
I'm just glad I'm one of that herd.
Coins were stamped at least back to 600BC. Whether they were called money or not doesn't change the fact that it became conscious in society that small, measured quantities of precious metals could act as a form of currency accepted by all. I doubt anyone even had to make a law stating that the coins must be used in all transactions.
However, it would be quite absurd for someone to have made a standardized piece of parchment stating that it had a set exchange value for ALL goods, yet backed by nothing but a promise AND it must be accepted at par.
History has repeated itself so many times now with fiat that you cannot help but relate it to the Matrix. Bernanke is currently the architect and I would think gold is Neo. The architect will eventually accept reality and allow gold and silver(and those aligned with those two assets) a safe passage on to the next version of the Matrix(fiat).
The process will start from scratch again until it once again reaches it breaking point. Fiat is a wonderful idea that can never materialize in the long-term. Much like the concept of world peace. Hopefully, the next version of the Matrix will be one I never have to leave for the rest of my life and I can quietly take the blue pill until the end of my days.
Medium of exchangeWhen money is used to intermediate the exchange of goods and services, it is performing a function as a medium of exchange. It thereby avoids the inefficiencies of a barter system, such as the 'double coincidence of wants' problem.
Unit of accountA unit of account is a standard numerical unit of measurement of the market value of goods, services, and other transactions. A unit of account is a necessary prerequisite for the formulation of commercial agreements that involve debt. To function as a 'unit of account', whatever is being used as money must be:
Divisible into smaller units without loss of value; precious metals can be coined from bars, or melted down into bars again.
Fungible: that is, one unit or piece must be perceived as equivalent to any other, which is why diamonds, works of art or real estate are not suitable as money.
A specific weight, or measure, or size to be verifiably countable. For instance, coins are often milled with a reeded edge, so that any removal of material from the coin (lowering its commodity value) will be easy to detect.
Store of valueTo act as a store of value, a money must be able to be reliably saved, stored, and retrieved – and be predictably usable as a medium of exchange when it is retrieved. The value of the money must also remain stable over time. In that sense, inflation by reducing the value of money, diminishes the ability of the money to function as a store of value.
Standard of deferred paymentWhile standard of deferred payment is distinguished by some texts, particularly older ones, other texts subsume this under other functions. A "standard of deferred payment" is an accepted way to settle a debt –and the status of money as legal tender, states that it may function for the discharge of debts. When debts are denominated in money, the real value of debts may change due to inflation and deflation, and for sovereign and international debts via debasement and devaluation.
Thanks for the refresher. Helps to keep the conversation focussed.
"Gold is Money and Nothing Else"
JP Morgan’s statement to the US Congress, 1913
I have gold and will buy an election to maintain my economic advantage. - JPM
contradicting yourself again, Snowball?
+1.
another head fake by ol' JP?
How about this in regards to accepting a piece of parchment:
"Accept either this parchment for payment or this fuc*ing sword between your ribs. Your choice"
Always a great offer when the counterparty has no sword or spine.
hard to fight with a paper bag over your head.
Even more amazing:
http://www.eagleworldnews.com/2010/08/13/archaeologists-discover-ancient...
http://www.israelnationalnews.com/News/news.aspx/139066
+1.
Kreditanstalt , the consumability argument is contained in the word "unconsumed". It encompasses the deterioration of either edibles or chattel. This is not a shortcoming in Bill Buckler's argument. It is a concept that you have not assimilated in an attempt to be argumentative.
I've read your past comments and you are better than that. Your comments are always thoughtful and pertinent.
I think QEII and UST current actions constitute a de facto default. There is nothing in the size of the deficits, debt, or any likely change on the horizon to imply the situation is temporary. USD reserve currency status is keeping the balls from hitting the floor.
After that, Soyanara. Good bye. Auf wiedersehen. Adios. Ciao. Aloha.
Inheritance is the least American thing about our financial system.
Think about it. If you disagree you are either an aristrocrat or a hypocrite.
Which would you rather be?
There was a time, uberfinch, when Americans passed wealth as inheritance. Believe it or not, this is what helped us accumulate land, physical & intellectual property.
Now, sadly, we pass burden. We use up the home's wealth (reverse mortgage) and life insurance (pre paid up).. now we pass debt to the next generation.
It may have helped YOU accumulate land. But it did not help US. Or USA.
I will agree, however, that inheritance of debt is as equally unfair and probably worse for America asinheritance of wealth.
land is not necessary to accumulate wealth. innovation is. do not fault the ancestors of others for accumulating wealth. 'spreading the wealth around' does not make our country more wealthy, but quite the opposite, uberfinch.
believe me, i was not born into wealth, but i do not blame those who have been unless they have acquired their wealth through violent means. the fruits of peaceful enterprise should pass to offspring, I believe.
if the offspring of successful people do not know the lessons of success, then they will soon be paupers in a few generations anyway. "a fool and his/her money soon part".
i think we can agree that the best thing we can pass onto our children is a 'system' to achieving success.
either way, if my kid is clever and hard working then she'll be fine, if she turns out to be not-so-clever but hard working then she will be fine, if she is clever (can offer good ideas) and lazy then she'll be fine, but if she insists on being not-so-clever and lazy, then i've messed up as a parent somewhere; however, i will not be blaming others.
i don't want to inherit that debt, that's for sure.
Realistically you can't blame Keynes... he never advocated the running up of huge structural debts of national goverments/the "bailing out" of failed financial institutions, to be "economic stimulus", in the same way you can't look at communism as being a "failed experiment". Was it ever practiced in it's pure form as prescribed by the Communist manifesto?
Not that I'm a communist. I just find it funny... the point where economics and politics diverge...at the end of the day doesn't always come down to the "bottom line"?
Updated GOLD monthly chart:
http://stockmarket618.wordpress.com
zerohedge does a good job of denouncing the quackonomics of keynes but the real sinister voodoo witch doctor is milton friedman and the harlotry of monetarism....the two evil twin sisters of economics are collaboratively responsible for the destruction of the currency which results in the destruction of morals and society.....fuck keynes and fuck friedman....
I'm must be missing something on Uncle Milty..... wouldn't be a first. Seems they all get co-opted like Mr. Andrea Mitchell-Greenspan.
But Freidman did work in FDRs government spending team, saw it didn't work, and moved on in his thinking. I liked Freidman because he said taxes were just coercion and force of the state and money was better spent and more efficient for the economy when left in private hands. He debated big liberal spenders of the day and made toast of them all. They were just hoping to land butter side up when he got through with them. Maybe spending under Reagan after the Carter malaise? But much spending was also cut, too.
He did fix Chile's 1000% inflation after they begged him -- he said to cut taxes and reduce spending. He also consulted with China at their invitation 25 years ago how to develop free market economies out of communist central planning. That helped.
Coolidge kicked ass when he cut government spending by 20% and slashed taxes. Who was his guy? I think that's who I want.
Keynes looks to be good gone dead and not coming back unless Krugman can revive him.
I see a great deal of talk about private enterprise being so much more efficient than a similar configuration of monkeys with a different label, but I can't say that I've seen this in action at any of the corporations for which I've worked over the last few decades. Mostly I see the same bureaucracy (managers, inventory control, secretaries, etc) except that it costs more because it is all financed and running on a tilted treadmill from the word jump.
In theory, markets clear...but...how is your market 'efficient' when people like John Thain can run a house like Merrill into the ground and then step from the burning rubble into their next CEO gig without a pause?
Access to all that easy credit negated the need for efficiency, no?
I guess that's my point...funny money can come from govt largesse or a broken banking system and is detrimental to the efficiency of systems fed by it either way, but only one of those two is demonized by the TeaPotDomeExpressVII crowd.
You don't need Keynes for fractional reserve lending, dark pools, and securitization and you end up in the same debt-deflation spiral on the far end of the bubble's collapse.
Thanks for being our token econ PhD. It shows.
Thanks for being our self-imposed authority figure with nothing meaningful to say. We care.
Snowball, i love how you maintain an elitest perspective when you are a commoner and you do not even know it. what a chimp.
Reguardless of the past and present systems, I see neither solution or success in this continued process. The old saying pick your poison comes to mind! I belong to a small political group that meets once a month to drink and discuss past, current and future events, we come from all walks of life, political, financial and employment. We seem to share the same thoughts about what the end results should be, however getting there seems to be so very painful no matter which path is chosen. I am currently working with persons from Argentina and their description of what occurred in the late nineties should scare many of us. Debt destruction does not come without consequences. Failure to tax enough, borrow enough leads to debt destruction. I see no way out without the miracle of extended cheaper energy. Most of what we enjoy today is the natural result of expontential cheap energy over human effort. This has come to an end and a painful one at that.
what's wrong with "harlotry"? and is that even a word? if so "is it bad word"? and if so "how, exactly."
God, I hate fucking communists. At this point in my life, I like to think I have learned something from experience. Jesus H Christ. I would say the best place to start is where we are, as humans, as learned from evolutionary biology - Fuck religion and ignorance- Fuck it all to Hell. As creatures - we obviously have a concern for our children- it is probably one of the most obvious things to ALL humans- well, that, and backsiding any 17 year old who bends over - but, the most strong impulse is for people to help their children. Is that good- well, fuck, yes. Why, as a society do fucking peabrain losers keep trying to say that SOCIETY is a higher priority? Why,the fuck, should we be taxed TWICE for our work - once when we make the money, and once when we die? CRIMINlnL!! If I hear one person say that , "we are all equal at birth, and no baby should be born into money" = well, fuck off and die. Jesus- work for YOUR living, before you take my money. This shit has got to end - STOP fucking taking from the people who fucking work!!! END OF FUCKING STORY!! I have watched this crap for decades now- and, it is pretty obvious that people work to get money - when you start taxing it all away, people stop making the extra effort. STOP trying to make it all equal, ASSHOLES, pay as you fucking go. People are differnt - it is based in fact- diffrent fucking abilities- you produce or you fucking die- this is not new, it has been around for several fucking million years. Produce- THE FUCK, or die. Got it?
Thinking about it a little more- you know- this is what is so important about Gold- it is fighting the same problem - it is fighting how our societies have been , until now, unaccounatble - there was a disconnect between fiat money and actual value. Well, that chicken is coming home, and Uncle Sanders is gonna screw that pooch, deep fried, legs all sticking up in the air out of a bucket. The same thing applies to the welfare state - there has GOT to be a absolute, no freaking question, correlation between WORK, and getting money. NO, you don;t get money for flatbacking in a trailer, and having kids; no, you dont get money unless you learn something, and do something. The beautiful thing about the depression was that, for a generation, people Learned the value of edcucation and work. We have lost it in last twenty years - the only good of it is, I look forward to meeting all those "Granite Counter Top" kitchen, soccer moms - I look forward to getting a "Big Gulp" BJ from them, out back of the 711 dumpster, in the next few years. Gag me with a Godamned Tractor!! Granite fucking CounterTOPS, BIITCHEEZZ!!!
+1 (but without the aneurism).
+1. Is this your spittle on my keyboard?
Ever notice who is always rioting and striking? Gubmint workers. Next will be welfare loafers and looters rioting and burning things down when the checks stop rolling in. That's why the national guard has all those guns :-)
Yay! Who could ask for better buddies than the National Guard! I can't wait to show them my fullest hospitality.
You're kidding, right?
+1.
Progressives/Liberals view "social Darwinism" with fear and loathing -- too bad for them that Nature runs reality that way. What you're advocating is known as "Survival of the fittest.", in my view, there's nothing wrong with that -- time to acknowledge reality for what it is. Progressives/Liberals world view never gets over a 6-year-old's ideas of fairness; well guess what idjuts, LIFE IS NOT FAIR! If you want fairness, then take care of the people you care about and STOP robbing others (or getting Big Brother to do it for you!). I'm always disgusted by these Progressives -- I never hear anything about THEM donating to charity, it's always: "Get the Rich to do it!"
I trust that you don't mean to, but the view you advocate could easily summarize the position of Wall Street sociopaths. Why do we almost inevitably end up painting ourselves into the corner of promoting such extremely polarized views?
Is there really no way to find a middle gound? I suspect that if you were interested in doing so, it could actually be found with the "progressives."
Back to the RepublicRATS will save us I see. So let's see. One side has figured out how to buy the most votes with OPM. How would you propose the other side compete with that? They have to come up with something. Nether side has principles, nor it seems, do those electing them. Telling people how to spend their own wealth is every bit as bad as telling people they cannot sodomize their goat in their own living room.
Wall St. could not do what it is doing/has done without the sanction of elected officials (who just want everyone to love them), unelected bureaurats, and victims alike...because the drug rush feels so good.
The question we should be asking, "Are we at all capable of dispassionately following the rules agreed to live by?" It appears not.
And when you've produced enough. Go home. Let somebody else produce some. Oh wait. We dont' don't do that. Let me hog all the responsibility for producing this and then complain when you don't produce. After all I'm better at it. You're just an idiot who can't do anything right. blah blah blah blah blah.
Hey, Mack, I sense a little hostility and cynicism in your comment, no? It's about time you spoke your piece. Congratulations.
Mack:
I kinda' like it--how does the concept of Hell enter the anti-religious discussion?
Otherwise, well, spot on!
- Ned
+1000, the last 30 years have been screw the hard working, honorable, moral, destroy all that is good and reward all that is bad.
Still the same drivel.
The article starts with a sound observation. It came from war reparations. In other words, from successful expansion. It was not created out of thin air but from the REAL (to quote) wealth extracted from the defeated France.
After that, the article devolved into the current denial tactics, that is blaming Keynesianism, blaming welfare state etc...
What is going on today is expansion running its natural course. At one moment in time, expansion always hits a wall making the process no longer possible to sustain because there is no longer room to expand on.
It seems that this reality is very hard to get especially for US citizens whose entire nation was built out of a scheme of fast expansion. This article is so much dishonest in this regard it can only outline how duplicity is the US trademark.
What about the Homestead Act? 1862. Predating Bismarck's implementation of welfare state. Same stuff though. The Government handing down wealth to agglomerate people together, or to (to quote) bribe people to get together.
The incapacity of US citizens to accept themselves as the roots of some trends is baffling. With the US, it is always an exterior cause, never themselves.
So maybe time to come back to some proven ideas like you cant extract blood from stone. Topical to the scheme laid up by the US.
I'm not in the expansion camp if you mean government expansion.
The oldest political trick in the book is to tell gullible people what they want to hear to get elected, which is that they can get something for nothing. The Pols then chronically misused Keynesianism to oblige them on a credit card and through stealth confiscation from the productive people through willful debasement of their savings so Pols didn't have to resort to unpopular raising of taxes.
Fast expansion? We have 47% of our population that do not pay taxes, and that % does not include the illegal economic refugees. We effectively have 50% of the USA on the dole. That's fast expansion alright, but not the kind we in the other 50% wanted.
The mass media outlets here are for socialists, by socialists. So most people outside of the USA don't hear the adult voices here saying what you are saying. But we're here and that's pretty much what the Tea party is about -- T-axed E-nough A-lready -- get it?
It's a long overdue austerity movement, same thing that is being imposed in Europe by the EU and IMF, post-collapse Greece. Too late Iceland. Look out Spain, Portugal, Italy, Ireland....telling them to abandon socialised medicine, transportation, etc and privatize them -- to save money and become sustainable. Germany is the Tea Party of the EU.
1862 Homestead act... Not sure that qualifies as welfare. I think that was to encourage settlement and territory expansion in the West to connect the coasts, especially since the central banks of Europe used the armies of Britain, France, and Spain to invade and occupy Mexico in 1861-2 after they defaulted on loans. The armies occupied Northern Mexico posing a threat to our southern border and interior at a time of our civil war and threatened to come in on the side of the Confederate army. Homestead act signaled US intent to exert authority over interior territories. It's little known, but Russia sent warships at Lincoln's request to sit in American harbors on both coasts as a warning to the occupying armies in Mexico not to try anything.
Expansion...as in bubble...as in credit.
Would we even need 'government expansion' (i.e. a social safety net) but for the wildly idiotic distribution of income in this country?
Let us know when the 'austerity' includes closing Rammstein and bringing the troops home.
Would you care to come to our group meeting? We seem to share many of the same questions and it would be nice to see if you have interesting answers.
My answers included horrendous results ending in population reduction. I fear that our never ending need of the WORLDS SAVINGS will result war. Many of these political signs arrive everyday, fishing boat, trade ban, battle ship groups moving in large numbers, missile tech for aircraft carriers tested, virus attacks, dollar devaluation. War provides the ultimate in distraction for the bread and circuses crowds.
We would have already fallen into chaos without social safety nets which many people here seem to think we do not need. I think it is Todd Harrison (Minyanville founder) who has come to the same conclusion. Which would you rather have the car cash or the cancer? My fear is we have chosen both!
Read twice and still dont get it.
Territorial expansion is expansion.
The bankers have a large back.
The Homestead Act is a welfare act aimed at performing as the other.
I am sure that some guy around can write a similar piece of rationalization over the welfare state enacted by the Germans.
The point was that the US stole land from the Indians (expansion ponzi scheme) and used it to perform welfare to the US population.
The bankers and stuff, just drivel. Expansion is now running its natural course.
I see what you are saying. Perhaps what is missing is that Bill Buckler is Australian and The Privateer is published from there. The part that you read above is only a bit of the bi-monthly 12 pages which covers the world situation. Having been taken out of context, the article above is not complete. It would be a mistake to say the the article does not cover all of your arguments. Mr. Buckler has done that in other issues. You are not that far apart, but it would be easy to assume that based on the relatively small focus of the article above. I subscribe to The Privateer and it made sense to me, but I am used to having more context.
+1,400.
Keynes gets the blame, just like Marx and Engels, because they deserve it.
Economic Theory, like Political Philosophy, is required to observe the natural laws. There never will be a Perpetual Motion Machine and Central Planning is the antithesis of Human Nature. To develop government and monetary policy based on Utopian dreams that do not exist in the physical world is irresponsible.
Therefore, Marx and Engels get the blame for Stalin murdering 20 million people and creating a 50 year Hell on earth. And Keynes gets the blame for destroying the economic base of the western world.
Couldn't agee more.
Central planning can no more create and control an intricate economic system than it can create and control the ecosystem of a tropical rainforest. They're both dynamic living systems that develop and can't be imposed.
Central planners can't make everybody do what central planners want without force and coercion. It denies basic human drives and only satisfies the motivations of a few. When it doesn't work they scratch their heads.
It's nuts.
gwar5--
Pretty much can stop there. Evidently even force and coercion don't work, e.g. Stalin, Mao, and Tricky Dick all failed with rather different levels of force. I'd prefer when it doesn't work, off with their heads, but that's just me.
- Ned
Extra Credit: who were the principals of Nixon's wage and price control regime?
As a dystopian, I require utopians in which to balance my ideology. The whole yin-yang thing. The universe must be in balance or you get anarchy...oh,wait...I'm an anarchist also. Hmmm. Oh hell. Anyway, off to the gun show.
LOL.
Let me know if you spot one of these at the gun show:
.357 Magnum Snubnose Revolver - Chiappa Rhinohttp://www.youtube.com/watch?v=k3MPSx_TQpY
dang, at least it won't break your wrist from pitch torque. might cause a compression fracture. Is that barrel long enough to burn all of the powder before bullet exit?
- Ned
Who gives a shit! The sight of the weapon alone will send them scampering.
Mine will be here first of next week. Not that easy to get... yet.
"...governments, by definition, do not allocate capital as efficiently as private enterprise."
"To develop government and monetary policy based on Utopian dreams that do not exist in the physical world is irresponsible."
How are you supposed to reason with people who can handle these kinds of internal inconsistencies?
That's just it--the facade of reason that covers extremist philosophy serves to vaccinate people against genuinely questioning their fundamentally emotion-determined beliefs.
Few can acknowledge their own humanly inevitable inconsistencies. So we continue to "debate" like a rioting mob.
And nothing fundamentally changes . . . until it swings to its equally insane and deplorable counterpart.
the first comment was mine, and the explanation is simple.
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.
snowball, just do us all a favor and put your money where your mouth is. please, please, please, SHORT GOLD.
I have to wonder if you have permission from Mr. Buckler for such lengthy excerpts. I have subscribed for about twelve years and have never seen the main body of Buckler's comments so freely copy/pasted as I have here in the past two months. Anyone give a damn for copyright?
As a principle, no ... it's a state-granted monopoly privilege with no place under natural law. As a practical issue, why not ask Mr. Buckler rather than casting unfounded allegations here?
"[Copyright is].. a state-granted monopoly privilege with no place under natural law."
Um... so you view "real estate" (say) as a monopoly that is Caused By "natural law."
Nothing to do with the State, by gum!
But you see Copyright as a monopoly granted by the state.
Classic! Let me guess. You live in, and own real estate on, the cherokee nation, err, "Usa" or whatever it's called on maps currently?
Sorry for the sarcasm, but it's often the quickest way to respond to utter confusion.
By the way it's best to Capitalise "Natural Law." Always capitalise any call to Meaningless Important-Sounding Words. Hyphenation and latin helps, too.
sighhh! ... if you don't understand the difference between individual property rights under natural law (ie. human understanding and conventions for ownership of scarce resources that goes back hundreds of thousands of years before written statutes ... "this is my hut, get out"; "those are my fish, put them down") and the artificial construct of state-enforced intellectual property claims ("I invented the wheel, so you can't also make one for your chariot"; "I whistled that tune first, so stop whistling it too") then I'm not going to go into it here. Read up on it before you bring your sarcasm to me.
http://mises.org/daily/3682
+ 1
I second that motion.
Let's try to bring some order to your thought process or "argument" here.
You appear to be attempting to define "Natural Law" as something to do with..." human understanding and conventions for ownership of scarce resources that goes back hundreds of thousands of years before written statutes"
Thus, you completely support slavery?
In tribal systems, the Chief owns everything, particularly your soul and body.
For "hundreds of thousands of years" the only, sole, organisation of homo sapiens was a primitivist, tribal society where the Chief had total control over everyone's body and soul. Including yours.
This describes all of human existence until very recently.
What happened very recently?
Very recently - call it 5000 years ago - there was an utterly wild, bizarre, right-angle, spectacular change from this system. The idea that you "own your self" came to being, i.e. you have a monopoly over deciding on what happens to your body - not the chief.
Much later ideas came along that the various things you produce or perhaps claim are also "owned" by you, i.e. you have the monopoly over deciding what happens to them.
In other words your colourful examples here .. summarising as you understand anthropolgy and history the last "hundreds of thousands of years" .. "this is my hut, get out"; "those are my fish, put them down" ......
Unfortunately what you mean is more along the lines of "this is my slave" "that is my slave" "this [the brain inside your head] is my snack to eat" and so on.
Of course, you're now going to moan that you didn't mean slavery and of course slavery is wrong and that's not what you meant by what humans have done for 100,000s of years.
Of course, what you meant is, um, what humans have done since ... let's see ... since Greek and Roman times, that's it. Right?
Hang, on - everyone was a slave in Greco-Roman times. The medeival .. not looking good. China ... 4000 years of pure totalitarianism. OK! I've got it!
What you mean is it's just plain obviously natural law because that's what we've done FOR AT LEAST 365 YEARS and all over the world. Ooops, ok Africa doesn't really work a lot like that, well actually only in Britain then.
Hell, what you're really talking about is the traditions of English Common Law - that's it! It's natural! It's what at least 2% of humans have done for well over, err, a couple centuries! In Over One Country!
Yes, it's so obvious.
At best, the argument you're trying to make is that intellectual property is a newer idea (it is say 100-200 years old) than real estate (which is 300-400 years old).
(The history of real estate -- the "real" is the spanish word for Royal -- is basically that Kings owned everything, and then with Magna Charta some powerful dukes had the novel idea that they too could own stuff, not just the king. In a word this eventually filtered down to serfs and finally you. We, as it were, Europeans went to the new world, slaughtered all the tribalist Chieftain-owned natives and divvied up the Usa, Australia etc in to neat plots. Real Estate! Buy some today, you have total ownership and the local State has no control over you at all, really. It's pure libertarianism!)
So, I'll now allow you to moan about how you didn't really mean slavery and that wasn't the, um, part of the last 200,000 years you were looking at.
The only argument you really have here is that intellectual property is a bit more recent ("the odd hundred years") than real estate property.
If you don't like intellectual property, go live (as it were) in a society that doesn't have it. If you don't like real estate property, go live in a society that doesn't have it. You'll soon be running back.
Ye 'ole pecking order.
I've been to West Africa several times, and I can tell you that they are the happiest people on the planet. I don't know exactly what it is, maybe it's the fact that they directly access their food, either from the forest, or the sea. Maybe it's the strong "village", or "tribal" support system, no one goes hungry, or without shelter. Or maybe it's the true local "free enterprise" ( by skilled artisan's ) that is tolerated ( not taxed ). Practically all enjoy the benefits of village life, directly accessing food, and the joy of being a "hunter - gatherer", "a fisherman" or "a local farmer".
It would appear that going with hundreds of thousands of years of genetic programming is healthy. Imagine that!
You're a legend in your own mind, Fat Ass.
Your understanding of anthropology and its implications for the development of civilization through the millenia is, well, infantile, not to say paranoid.
Societies and individuals compete, cooperate, influence one another, fight with one another, and so change through time. New ideas (memes) are developed, and either spread or die out. Reading and writing have been popular for the last few centuries and made a lot of inroads -- slavery is less popular but making a comeback in non-state-supported forms as the economy deteriorates.
Human society is not anything like as simple as you make it out to be.
I'm sorry ... I don't debate with [historically ignorant] morons.
Get off your Fat Ass and go to a library.
True. If the original intent of Copyright were honored, Mickey Mouse would have been public domain for decades now. I wonder why that'll never happen...
i also get the captain's newsletter and consider it the best dollar i ever spent on information. i would not consider giving up my copy because of excerpts here , ricks picks or one of a dozen other sites. his writings are classics and should be discussed here and anywhere else. my wife and kids tell me that i am the cheapest person they know. i had to promise to stop going thru dumpsters before my wife would marry me and if bill didn't charge me for a subscription i would send him a donation.
-heheh...my wife married me BECAUSE I dumpster dive....;)
"near pre-collapse" ...
This is a horrible turn of phrase. What you mean is either "near collapse" or "pre-collapse." Combining the two is silly.
A better way to express what you're getting at is to set aside the "state" word and talk more directly: something like "Many are quick (and correct) to blame Keynesianism for the imminent collapse of the entire developed world."
(Imminent means "about to happen.")
Here's Margaret Thatcher's quote (again),
"The problem with socialism is that eventually you run out of other people's money."
"The problem with capitalism is that eventually you run out of other people's money."
That's not a problem for capitalism. Don't build anymore widgets.
However, when a society is built up on entitlements and social programs, aren't you forced to keep them going. Isn't that what govt debt has done? Social debt has its limits.
Just to add, if everyone was in total control of their own money, cash and debt, the system would be much more dynamic and fluid. Perhaps, it could never reach debt saturation as a whole. Unfortunately, this is not the case. Who determines the debt load for the citizens?
It is a problem for modern capitalism...ask any hedgie, mutual fund manager, or other ponzi curator.
You may want to take a closer look at how much of the sov debt was really from 'entitlement', how much from ag subsidy, how much for weapons programs, etc
The citizens have only themselves to blame. If they taken on personal debt and vote for people who want to outspend the Ruskis while pretending to be for smaller government, that's their problem.
You know modern capitalism is also called fascism.
"The citizens have only themselves to blame."
Not true. This only applies to some, not all. The sellouts of human freedom.
I assume "Snowball" is in reference to a big cold thing rolling down a hill and not a character in a book.
Most people are not educated properly. Is this by accident?
Unfortunately, the outcome of society is determined in the middle stages, the end is just the result. I would hope "We don't get fooled again", but the question is, is it too late already?
Snowball being an ambiguous reference to Trotsky, Buffett, or ice missiles, depending on context.
In my most conspiratorial moments, I believe we keep most of our citizens too busy to properly educate their children (and, make no mistake, that is the only way to truly do so) with the intention of keeping them supplicant to the system, consuming with or without need, and unable to perform the most basic exponential mathematics involved in the finance of their perpetual servitude.
I think it is a matter of timescales...the farther out you zoom, the more progress is evident. It gets dramatic around these inflection points, but ultimately I think we're becoming more difficult to bamboozle in the aggregate.
Now its a matter of tuning (lack of precision can take you far afield over the long timeline) and sharing (often difficult in the land of the poo tossers, so much chaff, so little wheat).
Regarding the education part, is it an accident that history is glossed over and that US is made to look like it has done everything right, from the american side? The education system, as a whole, makes the united states look perfect and that it is everyone else's fault. How many Americans recite "the pledge" after they leave the public school system.
I cannot speak for other education systems. Original thought, controversial thought, individualism, and such ideas really do not exist in public education. Critical thought and logic have taken a back seat to conformity and equality.
Do you blame children for believing in Santa?
A definite editorial bias towards the more jingoistic aspects of American exceptionalism, to be sure...and only becoming more so with the pernicious influence of textbook peddlers from our less-sophisticated states attempting to expurgate even our more notable founding fathers.
Critical thought requires the bravery to be wrong or at least put your beliefs under the knife and microscope and most are more interested in something they can fit on the back of their car that doesn't make the other monkeys cluck their tongues.
i like that. a "ponzi curator." does that job pay? i'm fairly low maintenance.
you're right, Snowball, you and the others have yourselves to blame, as well as those who support 'progressive' republicans like the bush regime.
do you ever stop contradicting yourself? you make perfect sense in some cases, then completely refute your arguments in other posts. perhaps you should just log off and have a conversation with both of you.
The problem is that I ain't got enough of my own money left to run out of after paying everybody else's bill for looting me.
what was that movie where the kid wanted his dollar back? i still want my dollar back and "the money doesn't mean anything." maybe that's our problem...we're all busy....looking for meaning.....
+1 Quadrillion, due to hyperInflation
All of the incessant chatter by the MSM, USG and the FED about "economic recovery" reminds me of a scene from the 70's remake of "The Invasion of The Body Snatchers" with Donald Sutherland.
Sutherland's character is a health inspector in SF and he is visiting a Chinese restaurant. He is inspecting the kitchen and says to the owner: "Chang, there are Rat t*u*r*ds in your Won Ton soup."
Chang: "No, you are mistaken... those are Capers."
Sutherland's character pulls a pair of tweezers from his pocket and extracts an item from the soup pot, holds it up to the light and says: "That's a Rat t*u*r*d
Time to wake up.
Screeeeeeeeeeech!
illusion and the psychology of marx, Lenin, modern central bankers, central planning and economic theory to support same: the discussion on ZH revolves around a central issue which very rarely gets discussed.
Human failings.
If you ask the question: why has communism. socialism,fascism, any so called modern progressive state, and the economic theories used to support same always failed?
The answers for the supporters of above is always ..it was never pure communism or keynesianism, that's why they failed.
No ,what the founders of America understood is the eternal human problem: we are all flawed-
they strove to make the federal government clumbersome and difficult to operate ,with a much separation of power as was possible in the 18th century thinking.
They were men who deeply distrusted "Bankers" and a central Bank that only served the bank and it's owners (genius when looking at today's mess at the fed)..money was to be backed by PM's, the people of that time understood that as a given.
Today we have still have dreamers who see a all powerful central government as possible.
I ask as I think the founders of America asked themselves , where are the Angels to run these all powerful governments?
Giving more power to those who seek power by definition will breed a new leader?? less despotic than Mao, or Hitler or Stalin or pol pot??
That is the question that I have to all you progressives where is the system that can be run by MEN that avoids Tyranny??
http://bit.ly/aqNpRn
Snow,yes ,your reply is right..you will get all twisted up trying to answer that question.
best to avoid it at all cost. as you have done.
"Democracy is based on the assumption that a million men are wiser than one man. How's that again? I missed something.
Autocracy is based on the assumption that one man is wiser than a million men. Let's play that over again, too. Who decides?" - Heinlein
- okay, USA is a Republic, not a Democracy.
WAIT, They took 'er Republic !!
Anarchy is the only solution. Creation of any "external authority" in the first place is a crime against the will of the individual.
When there is no such thing as authority, crimes and corruption of individuals tend to be weeded out by concerned locals, who really are the best judges of what's wrong with local affairs.
Unfortunately, it also means no one has any logical theory to appeal to when others disagree with them, and the will of the concerned locals may turn out to be capriciously enforced.
This isn't economics. This is also why it doesn't make a lick of difference whether it's BIG SOCIALISM or BIG CAPITALISM.
Collection of power (whether governmental or economic) in the hands of few increases misery for the many.
Oh, well.
"Anarchy..."
i would be very careful when using that particular word to describe THE ONLY solution. besides like you say, by original definition, the principles of anarchy dictate that there is not one solution, but as many solutions as there are people.
I appreciate the rejoinder, you're correct. I was just trying to answer that last question concisely:
"where is the system that can be run by MEN that avoids Tyranny??"
You can't formalize it. You have to destroy the system and exterminate your own desire for one.
It's risky.
indeed agreed on the futility of formalization blunderdog. but does not exterminating your own desire (and thus need) for any system in essence create the system's destruction through obsolescence? no need to actively destroy anything except within your own mind. and even then, there is a question as to whether you need to concentrate on destruction even there, or whether it's better to simply focus on something else and let those thoughts wither and die from lack of focus & attention.
betamax didn't die from people fighting it and wanting it dead. betamax died from enough people not giving a shit about it.
that is to say, attention whether positively or negatively charged, is still energy directed at the object of attention and it is the energy that keeps it alive.
Yes. The wise reader sees I got a bit bombastic.
It's futile to direct all your energy to not think of an elephant.
we all get a bit bombastic my friend...and for good reasons sometimes, especially when the veil of illusion is lifted to reveal a core of utter corruption underneath.
it's a question of tactics which i choose to believe is the most vital question to discuss considering the intricate sophistication of the virus that ails us. do we apply brute force or wu wei?
still...i feel enthused when he says it. "our backs are against the wall, we're gonna die...now let's kick some ass." Yeahhh!
My question is, as always: "When do supermarkets start to empty out?"
Until then...
12:53PM EST, September 23, 2012
Remember to start shopping at least 48 hours in advance, as others will have this date entered into their calendar.
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Gold has not always been money and money has not always been gold. It is notable that gold has been money more times than anything else has been money. OK, silver has had quite a few runs as well. The point is that we are in a period where a transition is likely. Paul Volker prevented an earlier attempt at a transition but today we have no Paul Volker. We only have immitators and imbiciles to do the job that he once did. The odds that we will have chaotic financial conditions that will lead the people to clamour for an honest money system and force the politicial hand are rising every day.
like your mug. the question as I see and as wishfully stated by ZH is "when is paper money TRANSFERABLE into gold." We have not always had fiat money and the ludicrosity as "the market becomes us" of "what are we" is really manifest here. if you're a trader "you always take the other side of that trade" because if "there's no free market captialism" well..."there's always a market." The "big ones" open on Monday, early AM. I like smaller one's myself...like "the puppy dog market" or "the market for bathtub farts."
+1.
the regime has awarded 10 billion dollar contract....to BLACKWATER
http://www.wired.com/dangerroom/2010/10/exclusive-blackwater-wins-piece-...
Blackwater or Xe or whatever they're calling it now is the regime, everybody knows that. Plausible deniability is passe, these days all anybody expects is a paper-thin separation of formal authority.
test1
Welcome, is this all you have say?
test2
testy, testy
keep cool. just checking.
Wait a minute. You criticize this statement:
Reportedly, Mr Bean said that savers could afford to suffer and should not expect to live off the interest on their savings.
on the ground that it "punishes" those who have managed to accumulate capital, yet what this quote is saying is that these accumulators are not being productive, but rather reyling on the same payments for simply having (what we might call 'rent' on their money) rather than being productive. This is a blatant contradiction in your argument, which is obviously ideological.
Why should be believe you when you can't even keep contradictions out of your claims?
I think I can make an arguement from fairness: given that the government and banking industry have de-facto conspired to preclude the option of saving excess capital in a time-stabilized form, forcing the savers to put their savings "at risk" in a fractional-reserve environment, is it not then fair for the savers to demand that their risk is fairly paid in real interest?
Instead, because of currency devaluation, the interest AND the principal loose value in real terms over time, and the whole point of saving is negated.
In social contract terms, this situation is a violation of the rights of the savers by the government.
If you punish thrift and hard work you get wastefulness and laziness.
The thrifty and hardworking build the wealth that supports the lazy and wasteful.
That is about to end because of the perverse incentives of the stupid are making us all socialists (i.e. lazy and wasteful). The world is changing. We can no longer afford to support the drones, so we won't. Either you are productive or you die. Most of the US population will die, not because anyone wishes them to but because there is no wealth left to support the useless and unproductive.
The government can steal a little and get away with it. When it steals a lot either the productive people quit being productive, the productive people leave for better lands, or the productive people revolt. The first two are already happening. The last is about to happen. Get prepared.
Speaking of bonds, virtually everyone who has bought this ETF the last 5 years is in a winning position. So where is the incentive to sell?
Even if the Fed has been eating half of the auctions, they are also sitting on a winning position.
By the way, in a scant 2 1/2 years after the biggest financial meltdown in 70 years, where large numbers of "too big to fail" firms failed.....
The collapse in interest rates has re-ignited the "Animal Spirits", which in turn has allowed the Wall St. Alpha Dog PigMen to get richer than ever.....
Virtually every Bugatti and top of the line Ferrari is sold out.
http://noir.bloomberg.com/apps/news?pid=20601109&sid=aNxK6ORGuWBI&pos=13
Stay nimble and quick, RT. Love your work, but we can't all watch the ticker until the cows come home. The fat fingers scare the crap out of me, and I'm hedged six ways to Sunday. Retail accounts are a bitch with bells on.
i love that volume in Treasuries. Needless to say "Bill Gross should be building a collection and not a position." And according to what Erin Burnett told me "I think he's a cutie."
Good article.
Government does not serve the people, it serves itself. All people are self-interested and do what is their best interests. This is the essential truth upon which all correct political economy is based.
This is why Communism failed, why socialism is failing, why corporate socialism (Fascism) has failed and is failing.
The only system that ever has, or will ever, produce human freedom and material progress is one that acknowledges the essential selfishness of all people, restrains the behavior of individuals with minimal laws to prevent selfishness from escalating to outright predation, and cripples governments efforts to steal the production of citizens (thereby eliminating their incentive to produce).
Charity is an individual act where people trade wealth for self-esteem, personal salvation, or their neighbors admiration. Govts don't give charity, they trade other people's money for power. This was true when kings gave estates to nobles in return for fighting men and is just as true when congress critters trade "entitlements" for votes.
Eventually, the burden increases on the peasants (or taxpayers) so much that they revolt and try to kill the parasites (nobles or elites). However, this rage is usually incoherent and is hijacked by those with experience in manipulating their fellow men (i.e. nobles or elites) ensuring that at the end of the day the names of the parasites change but the system changes little.
The Bolsheviks created a new nobility (apparatnicks) to replace the Romanovs that was much worse than the original. At least some of the nobility was restrained by morality and tradition to feel a quasi-paternalistic, if ineffectual, responsibility to their charges. Stalin killed for fun and because the only source of his power was fear. Nicholas II did not have to prove his legitimacy and could, occasionally, be kind, without fear of appearing weak.
We have, in the modern world, destroyed the old system of traditional rulers, and replaced it with a system where men with a lust for power must kill or bribe their way to it. Countries are either awash in blood, debt or both.
Once, the debt based government system collapses when it can no longer borrow or tax (because both these methods destroy wealth leaving nothing to loan or to confiscate), will the elites turn to murder to achieve power or will we, the governed, be willing to restrain our would be rulers, by force, or threat of force, and return to a system of government where freedom means the freedom to fail, private charity relieves some of the suffering of the failures, and fear of poverty and starvation places constrains on the stupid behaviors of our neighbors? Only time will tell.
However, one thing is certain. The "new socialist man" that gives according to ability and takes according to need has never existed and never will. Only a system that allows men to benefit from their efforts will ever produce anything, other than misery. Only a government, restrained by productive citizens and prevented from buying power by subsidizing drones and parasites will ever produce prosperity.
The utopia of socialism, communism, federalism, whatever, only existed because the wealth, accumulated over generations, was frittered away to buy power for professional politicians. That wealth is now gone and all that could borrowed to keep the Ponzi going has been borrowed.
Those believing in the Republic (founded 235 years ago on the blood of men were willing to die in its aid) will once again have to die, and kill, to restore its original form. This battle will be horrible and the outcome is far from certain. Thousands, perhaps tens of thousands, of repressive governments have existed over the centuries. All the governments based on individual liberty and economic freedom that have ever existed can be counted on one hand. Which will we get? It depends on you as much as on anyone else. Your suffering and possible death will buy no certain outcome just as many good men died to found our nation with no certainty of any reward. However, if we are unwilling to sacrifice toward the faint hope of building a better society based on the precepts of founders, than it is certain that freedom will disappear from this planet and the best that can be hoped for is pleasant bondage.
I, for one, wish I did not live in these times to face this struggle. However, if I am unwilling to fight this battle then it will be lost. Arm yourself and prepare for the struggle. It is coming without question.