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Marc Faber Blasts "A Corrupt System That Rewards Stupidity"

Tyler Durden's picture




 

Authored by Marc Faber, originally posted at The Daily Reckoning blog,

For the greater part of human history, leaders who were in a position to exercise power were accountable for their actions. If they waged wars or had to defend their territories from invading hostile forces, they frequently lost their lives, territories, armies, power and crowns. I don’t deny that some leaders were irresponsible, but in general, they were fully aware that they were responsible for their acts and, therefore, they acted responsibly.

The problem we are faced with today is that our political and (frequently) business leaders are not being held responsible for their actions. Thomas Sowell sums it up well:

“It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong.”

When political leaders or economic policymakers are seen to fail, the worst that will happen to them is that they won’t be re-elected or reappointed. They then become a lobbyist or an adviser or consultant, and give speeches, earning in the process a high income on top of their pension.

Similarly, many corporate executives and fund managers who have no personal stake in the business that employs them will receive generous pensions even if they fail to do their job properly and are dismissed. (This doesn’t apply to hedge fund managers, most of whose wealth is invested in their funds.) In other words, probably for the first time in history, we have today a system where leaders are not only not punished for their failures, but are actually rewarded…

Recently, Warren Buffett said that the Fed was the world’s largest hedge fund. He is wrong. The world’s largest hedge funds are owned by people who are risk takers with their own money, since they are usually the largest investors in their funds. The academics at the Fed are playing with other people’s money.

However, if we consider that the Fed, led by its chairman, is the most powerful organization in the world — because by printing money, it can finance the government (fiscal deficits) and wars, manipulate the cost of money (interest rates), directly intervene in the economy by bailing out failing institutions (banks) or countries (Greece, etc.), intervene in the foreign exchange market and even influence elections — then the question arises whether it makes sense that so much power should be given to Fed members, who are “group thinking” academics and most of whom have never worked in the private sector. In my opinion, the enormous power of the “academic” Fed is a frightening thought. My friend Fred Sheehan recently quoted from Johann Peter Eckermann’s conversation with Goethe, Feb. 1, 1827. We talked about the professors who, after they had found a better theory, still ignored it. From Eckermann and Goethe:

“‘This is not to be wondered at,’ said Goethe; ‘such people continue in error because they are indebted to it for their existence. They would have to learn everything over again, and that would be very inconvenient.’

 

“‘But,’ said I, ‘how can their experiments prove the truth when the basis for their evaluation is false?’

 

“‘They do not prove the truth,’ said Goethe, ‘nor is such the intention; the only point with these professors is to prove their own opinion. On this account, they conceal all experiments that would reveal the truth and show their doctrine untenable. Then the scholars — what do they care for truth? They, like the rest, are perfectly satisfied if they can prate away empirically; that is the whole matter.’”

Fortunately, there is an institution that exercises control over the academics at the Fed; it is called the market economy. As I have just explained, the Fed is an immensely powerful organization, but over time, the market economy is a more powerful force that can outsmart the academics because it is adaptive and dynamic. Just consider the following. Since the implementation of QE1 at the end of 2008, money supply has exploded, but the “real” economy has hardly responded.

I know that the neo-Keynesians will argue that the Fed didn’t expand its asset purchases sufficiently. But then, as I’ve mentioned before, Mr. Bernanke opined at a press conference held on Sept. 13, 2012:

“We do think that these policies [QE3] can bring interest rates down — not just Treasury rates, but a whole range of rates, including mortgage rates and rates for corporate bonds and other types of important interest rates.”

And what has happened? Interest rates have increased. According to David Rosenberg, it is actually the fifth-worst sell-off in the 10-year Treasury note since the 1960s. Whereas we can all agree that many factors other than the Fed’s policies have had an impact on the economy (regulation, Obamacare, etc.), it is crystal clear that the Fed’s QE3 and QE4 policies have completely failed in their stated objectives. This is now an instance where the market economy has badly humbled the professors at the Fed.

When the Fed announced QE1 in late 2008, it was clear to me that monetary inflation would lead to some price increases somewhere in the system. My initial thought was that QE1 would boost gold and commodities (in December 2008, oil touched a low of $32 per barrel) as well as equities around the world, which were at the time extremely oversold. But it didn’t cross my mind that money printing would most benefit gaming stocks and the high-end luxury sector of the economy (art, vintage cars, wines, high-end real estate, etc.).

But in hindsight, it is clear that monetary inflation doesn’t flow equally into all sectors of the economy; in the current conditions, it has boosted the wealth and incomes of the most affluent people (unlike in the 1970s, when negative interest rates in real terms boosted wages and consumer prices).

According to the Pew Research Center:

During the first two years of the nation’s economic recovery, the mean net worth of households in the upper 7% of the wealth distribution rose by an estimated 28%, while the mean net worth of households in the lower 93% dropped by 4%. From 2009-11, the mean wealth of the 8 million households in the more affluent group rose to an estimated $3,173,895 from an estimated $2,476,244, while the mean wealth of the 111 million households in the less affluent group fell to an estimated $133,817 from an estimated $139,896.”

The Pew Research Center further notes:

“The Census Bureau data also indicate that among less-affluent households, fewer directly owned stocks and mutual fund shares in 2011 (13%) than in 2009 (16%), meaning a smaller share enjoyed the fruits of the stock market rally. Likewise, fewer had individual retirement accounts (IRAs) or Keogh accounts (22% in 2011 versus 24% in 2009), and the same share had 401(k) or Thrift Savings Plan accounts (39% in both years).

 

“Among affluent households, there was also a decline in the share directly owning stock and mutual fund shares during this period (59% in 2011 versus 62% in 2009), but a slight increase in the share with IRAs or Keogh accounts (70% versus 68%) and a larger increase in the share with 401(k) or Thrift Savings Plan accounts (65% versus 61%).”

I should add that if we took just the richest 0.2% of all households in the world, their capital appreciation since 2009 would be far higher than the 28% wealth increase of households in the upper 7% of the wealth distribution (most likely in excess of 100%). During the press conference that followed the Fed’s decision not to proceed with a “taper,” Mr. Bernanke was asked why most Americans saw no income and wealth growth. The money counterfeiter responded that this was not the Fed’s problem.

Clearly, it has never occurred to the professors at the Fed that Fed policies favor only large asset holders and, by creating bubbles, destroy the assets of the majority. Thus, two factors have benefited the gaming industry.

First, the Fed’s monetary inflation has boosted the wealth of the world’s most affluent people through rising asset prices and the U.S. current account deficit, which shifted money to Asia and to resource producers (mostly oil producers) because money printing boosted oil prices. Wealthy Asians, Russians and Middle Easterners have a higher gambling propensity than Westerners and make up a large share of high rollers.

Second, we had highly expansionary fiscal policies, which permitted entitlement programs to expand and ordinary people to gamble in casinos. Gambling in casinos and online has, of course, been encouraged by the public’s loss of faith in the stock market, which they perceive to be rigged.

Alan Newman, who writes the excellent Crosscurrents newsletter, recently commented that “the charade endures” and that “the markets are not fair. Equal treatment is a myth. While the SEC would insist that all investors are equal, it is patently clear some ‘investors’ are more equal than others.”

 

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Fri, 10/11/2013 - 21:39 | 4047024 Dre4dwolf
Dre4dwolf's picture

So lets all get stupid and rich.

 

Fri, 10/11/2013 - 21:43 | 4047032 Incubus
Incubus's picture

I think we've got the first part down.

Fri, 10/11/2013 - 21:53 | 4047050 fonzannoon
fonzannoon's picture

Marc....WTF man?

"Clearly, it has never occurred to the professors at the Fed that Fed policies favor only large asset holders and, by creating bubbles, destroy the assets of the majority"

Really? The fed is not fully aware of this? This was not their intention? 

Wake up Marc

Fri, 10/11/2013 - 21:55 | 4047053 Incubus
Incubus's picture

Bernanke is religious, right?

 

You'd think a dude like him would be kind of pseudovirtuous for the sake of his own afterlife.

 

He's pretty reckless,  I can only image what'd be in store for him if "hell" were true. 

Fri, 10/11/2013 - 21:59 | 4047065 Enslavethechild...
EnslavethechildrenforBen's picture

Those that are printing themselves money for nothin know full well that they are stealing from all of us.

Fri, 10/11/2013 - 22:15 | 4047088 mvsjcl
mvsjcl's picture

"...pay no price for being wrong.”

 

They're richly rewarded for doing what they're told to do. They pay a dear price when they don't do what they're told to do. Right and wrong don't enter into the picture.


Fri, 10/11/2013 - 23:03 | 4047148 superflex
superflex's picture

"...pay no price for being wrong.”

That needs to change, now.

Sat, 10/12/2013 - 00:52 | 4047253 Manthong
Manthong's picture

“‘They do not prove the truth,’ said Goethe, ‘nor is such the intention; the only point with these professors is to prove their own opinion"

If you can get this (prevailing) attitude out of "modern" education, this might be the USA again in 30 or 40 years.

Sat, 10/12/2013 - 05:06 | 4047342 Supernova Born
Supernova Born's picture

"On this account, they conceal all experiments that would reveal the truth and show their doctrine untenable. Then the scholars — what do they care for truth?"

Gold is the standard. The weight and the measure. Its foundational value yields to only one other reality.

Calling gold a "barbarous relic" is the "BIG LIE" and the ultimate irony.

The Hobbesian truth of the human condition is what will inevitably prevail when the civilized standard of gold is rejected.

Violence is the barbarous state of nature when the simple, elegant truth that gold represents is denied.

Violence will never be relegated to an academic reliquary by "scholars". It is a fundamental reality of our physical existence held only at bay by the rule of law and the practice of honest commerce.

The question isn't gold or baseless fiat, the question is gold or violence.

Sat, 10/12/2013 - 10:52 | 4047583 DoChenRollingBearing
DoChenRollingBearing's picture

+ 1, nicely written.  Gold is the only attractive asset to hoard that causes no economic consequences to the rest of society.  If you hoard silver, you raise the prices of all products that use silver (many many products).  Same with platinum.  

Gold has so few industrial uses that its highest and best use is as a Store of Value (pure wealth).

Sat, 10/12/2013 - 15:36 | 4048259 kayl
kayl's picture

@supernova Born

Really, you haven't been practicing your doublespeak. It's not a lie, it's a big joke.

Etymologie of barbarous comes from Old French/Latin-->Barbare/Barbarus--> Middle English--Barbarous, a depreciative adjective.  A term used to describe a person with different speech or customs.

You must admit they definitely have different speech and customs. They have a classical education and much gold over many generations. I doubt the talking heads on TV even know what the joke is about.

Sat, 10/12/2013 - 05:03 | 4047346 Boris Alatovkrap
Boris Alatovkrap's picture

Socialism is work until run out of other people money... unfortunate, "other people" is most OUR CHILDREN and GRAND CHILDREN as WE are object of purchase by corrupt statist at beckon of corrupt corporatist.

Sat, 10/12/2013 - 10:43 | 4047564 RaceToTheBottom
RaceToTheBottom's picture

Hey Boris, what we have has little to do with Socialism. It is more welfare state, first for the banksters, and then, in response to the corporate largess, welfare for the lower class and some gov projects. The people with no welfare are the middle class and should be planning their exit from this country.

Sat, 10/12/2013 - 13:51 | 4048103 NeedtoSecede
NeedtoSecede's picture

Or start new ones.

Secession anyone?

Fri, 10/11/2013 - 22:27 | 4047098 Pegasus Muse
Pegasus Muse's picture

The problem we are faced with today is that our political and (frequently) business leaders are not being held responsible for their actions. Thomas Sowell sums it up well:

“It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong.”

When political leaders or economic policymakers are seen to fail, the worst that will happen to them is that they won’t be re-elected or reappointed.

====

As much as I admire Marc's work in general, I disagree here.  There will be a steep price -- the ultimate price -- scumbag politicians, ass-kissing federal regulators, over-educated intellectually deficient Federal Reserve bureaucrats, and most of all the theiving Gangster Banksters will pay for their treachery.  They can run but they cannot hide.  

http://tinyurl.com/q6omxgq   

If not in this life, in the hereafter.

 

 

Fri, 10/11/2013 - 23:11 | 4047155 Anusocracy
Anusocracy's picture

"It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong.”

Like military drone operators and quite often, cops.

Then there are the government employees and welfare recipients that vote.

Sat, 10/12/2013 - 08:44 | 4047442 acetinker
acetinker's picture

What if:

There's no such thing as an afterlife.

There's no justice absent human action.

St. Peter is a fiction.

What then?

Sat, 10/12/2013 - 09:25 | 4047477 fockewulf190
fockewulf190's picture

If you believe that, then that means you need to grab your gun Ace and start hunting.  Don´t say "the Devil made me do it" though if you get busted.

Sat, 10/12/2013 - 12:13 | 4047849 acetinker
acetinker's picture

Busted by whom?  The fkn criminals themselves?  What if I said that this belief that God will sort it all out for us simultaneously comforts, and immobilizes?

Seems like an elaborate mind-fck, to me.  Plays right into the enemies' hands.

Sat, 10/12/2013 - 10:10 | 4047507 Andre
Andre's picture

And what if there is an afterlife?

An intersting conversation about this yesterday, where the concept had been misused to control people. "step right up and get your rewards here! Untile then, OBEY!"

Any concept can be abused. I happen to believe in an afterlifr. I just don't think an afterlife absolves one of responsibility in this one.

Sat, 10/12/2013 - 19:15 | 4048804 acetinker
acetinker's picture

Duh!  If there's an afterlife, I'm gonna ask God if I can come back and kick some asses.

Fri, 10/11/2013 - 22:44 | 4047100 wee-weed up
wee-weed up's picture

 

 

The article says...

"When political leaders or economic policymakers are seen to fail, the worst that will happen to them is that they won’t be re-elected or reappointed."

Unfortunately, thanks to the failed public education system...

The union-dues-supported-Democrats have give us for the last decades...

The electorate was not only stupid enough to give us..

A woefully unprepared little community organizer as president in 2008...

But then the stupid idiots re-elected him after 4 years of total miserable failure on top of that!

 

Fri, 10/11/2013 - 23:16 | 4047158 mumbo_jumbo
mumbo_jumbo's picture

that same eletorate voted Bush 2.0 in for a 2nd term as well, ANY ONE who thinks we've gotten here based on the which side of the isle is in the white house (or congress for that mattre) is simply not paying attantion.....which is what the PTB are counting on.

Sat, 10/12/2013 - 01:48 | 4047277 wee-weed up
wee-weed up's picture

 

 

Definitely NOT the same electorate!

Look - I hated Bush as much as anyone...

But Obama is many magnitudes worse...

And anyone who thinks otherwise...

Is obviously a fool for the MSM and their bullshit!

All the things they excoriated Bush for...

Obama is doing on steroids...

And their silence is deafening!

Sat, 10/12/2013 - 07:48 | 4047408 RKDS
RKDS's picture

Put up another draft-dodging insurance-mandating job-destroying entitled sociopath and we just might vote Obama a 3rd term.

Sat, 10/12/2013 - 10:42 | 4047566 RiverRoad
RiverRoad's picture

It was a deal made in heaven/hell:  Ted Kennedy anointed Obama for president to avenge his brothers' assassinations and Obama grabbed it for the millions in speaking fees he could get when he was out.

Fri, 10/11/2013 - 22:23 | 4047095 john39
john39's picture

what religion do think the powerful adhere to?  ever see kubrick's eyes wide shut?  the truth is in plain view.  their job is to enslave the rext of us.  that is their heaven, our hell.

Fri, 10/11/2013 - 23:43 | 4047197 Skateboarder
Skateboarder's picture

Servants and servants' quarters. And for the real playas, servants' servants and servants' servants' quarters. Yaaaah!

Sat, 10/12/2013 - 02:19 | 4047307 Imagery
Imagery's picture

Bernank and the boys are living their eternity today - on Earth - and they know it.  Any student of the Bible knows Jesus rarely engaged in anything but love - but on those two or three ocasions where Jesus extolled outright anger and disgust it was exclusively at / against the moneychangers, ie banksters!

Sat, 10/12/2013 - 10:54 | 4047563 fiftybagger
fiftybagger's picture

People may change, customs may change, and laws may change, but He never changes.  It is still coming:

1 Behold, the LORD maketh the earth empty, and maketh it waste, and turneth it upside down, and scattereth abroad the inhabitants thereof. 2 And it shall be, as with the people, so with the priest; as with the servant, so with his master; as with the maid, so with her mistress; as with the buyer, so with the seller; as with the lender, so with the borrower; as with the taker of usury, so with the giver of usury to him. 3 The land shall be utterly emptied, and utterly spoiled: for the LORD hath spoken this word. 4 The earth mourneth and fadeth away, the world languisheth and fadeth away, the haughty people of the earth do languish. 5 The earth also is defiled under the inhabitants thereof; because they have transgressed the laws, changed the ordinance, broken the everlasting covenant. 6 Therefore hath the curse devoured the earth, and they that dwell therein are desolate: therefore the inhabitants of the earth are burned, and few men left.

17 Fear, and the pit, and the snare, are upon thee, O inhabitant of the earth.

18 And it shall come to pass, that he who fleeth from the noise of the fear shall fall into the pit; and he that cometh up out of the midst of the pit shall be taken in the snare: for the windows from on high are open, and the foundations of the earth do shake.

19 The earth is utterly broken down, the earth is clean dissolved, the earth is moved exceedingly.

20 The earth shall reel to and fro like a drunkard, and shall be removed like a cottage; and the transgression thereof shall be heavy upon it; and it shall fall, and not rise again.

21 And it shall come to pass in that day, that the LORD shall punish the host of the high ones that are on high, and the kings of the earth upon the earth.

22 And they shall be gathered together, as prisoners are gathered in the pit, and shall be shut up in the prison, and after many days shall they be visited.

23 Then the moon shall be confounded, and the sun ashamed, when the LORD of hosts shall reign in mount Zion, and in Jerusalem, and before his ancients gloriously.

Isaiah 24

King James Bible

Sat, 10/12/2013 - 14:10 | 4048133 worbsid
worbsid's picture

And I thought I was a Doomer. 

Sat, 10/12/2013 - 05:14 | 4047349 The Persistent ...
The Persistent Vegetable's picture

 bernanke should be different from the rest of us? almost none of us make decisions based on  what effect its going to have on our afterlife.

If Kate Upton and Salma Hayak want to tag team me, then I'm gonna let em, regardless of what Jesus says. And if ben can do his masters bidding, while living large, hes gonna do it and worry about Jesus later.

Sat, 10/12/2013 - 11:19 | 4047668 sunnyside
sunnyside's picture

Pussy....undefeated throughout time.

Sat, 10/12/2013 - 05:16 | 4047350 The Persistent ...
The Persistent Vegetable's picture

 bernanke should be different from the rest of us? almost none of us make decisions based on  what effect its going to have on our afterlife.

If Kate Upton and Salma Hayak want to tag team me, then I'm gonna let em, regardless of what Jesus says. And if ben can do his masters bidding, while living large, hes gonna do it and worry about Jesus later.

Fri, 10/11/2013 - 23:35 | 4047189 PlausibleDenial
PlausibleDenial's picture

Fonz, I am not sure that Faber is not right.... I've read of number of books that essentially characterize these Phd's so believing in a methodology that they really lose the reality of it.  For example, consider that travesty that occurred in Latin America as a function of the Chicago econs (uncle milton's boys)  that were testing their methodologies on a unwitting class of folks.  Then consider the same for the Harvard boys (goons) that followed.   I know there is collusion and conspiracy, but.....  Now then, back to sipping some Ron Zacapa.....

Sat, 10/12/2013 - 01:13 | 4047274 MiltonFriedmans...
MiltonFriedmansNightmare's picture

Tyler,
Where is Francis?

Sat, 10/12/2013 - 12:25 | 4047879 Pumpkin
Pumpkin's picture

Stupid is cover.  Being stupid is not a crime.  What Ben and the Fed do is a crime.  They thank you kindly for considering them stupid.

Sat, 10/12/2013 - 15:35 | 4048253 Teddy Tenpole
Teddy Tenpole's picture

 

 

Bingo!!!  What is truly amazing is that we are actually experiencing this massive rally while still in a Bear Market!  What the Boomers and Doomers around here lost sight of is the old adage, "Don't Fight The Fed".  Oh well.

Surprised Marc Faber isn't simply content with his Thai Girly Boys?  More to life eh Marc?  F n doomer douche.

Fri, 10/11/2013 - 21:56 | 4047060 max2205
max2205's picture

The Saudi's and oil companies don't like low oil prices......

Fri, 10/11/2013 - 21:46 | 4047035 Hedgetard55
Hedgetard55's picture

I just finished reading H.G. Wells' "The Time Machine".  Every ZH reader should read this. Eloi and Morlocks, sheeple and banksters... quite prescient. FWIW, the book is nothing at all like either movie.

Fri, 10/11/2013 - 22:02 | 4047070 Hedgetard55
Hedgetard55's picture

Thanks!

 

In the book the Eloi are 4 feet tall. The Morlocks are wimps as well, just not as wimpy as the Eloi.

Sat, 10/12/2013 - 08:58 | 4047457 sunnyside
sunnyside's picture

Yvette Mimieux was absolute smoke.  The filthy things I did to her in my mind would make make Jamie Dimond blush.

Fri, 10/11/2013 - 21:52 | 4047051 fonzannoon
fonzannoon's picture

Take a walk around Manhattan. It's already Eloi and Morlocks.

Fri, 10/11/2013 - 22:57 | 4047137 monad
monad's picture

Which 3 books?

Fri, 10/11/2013 - 21:47 | 4047033 AssFire
AssFire's picture
Not just Stupidity- Exceptional Stupidity;  Amurrika
Fri, 10/11/2013 - 23:29 | 4047182 Jim in MN
Jim in MN's picture

What about Whenizuela???

http://www.bbc.co.uk/news/world-latin-america-24500362

US ship detained by Venezuela in Guyana disputed waters

The government of Guyana says the Venezuelan navy has entered its territorial waters and detained a US-operated ship.

Fri, 10/11/2013 - 21:44 | 4047034 pndr4495
pndr4495's picture

Read a little bit about Cincinnatus.  His biography should be required reading for anyone seeking a position of power.

Fri, 10/11/2013 - 22:20 | 4047093 Jethro
Jethro's picture

Our leaders are only taught Nero, Caligula and Diolcletian.

Fri, 10/11/2013 - 23:32 | 4047187 Incubus
Incubus's picture

not roman, but i was taught diogenes.

Sat, 10/12/2013 - 20:23 | 4048996 StychoKiller
StychoKiller's picture

Add Marcus Aurelius to that list.

Fri, 10/11/2013 - 21:47 | 4047038 Duc888
Duc888's picture

Marc, it's by design.

 

That's how shit works.

Fri, 10/11/2013 - 21:46 | 4047040 IridiumRebel
IridiumRebel's picture

*REPOST*
*REPOST*

Living in a Kondratieff Winter
by I. Rebel

Opening bells ring, are you listening,
On the Street, blow is glistening
A beautiful sight,
We're happy tonight.
Living in a Kondratieff Winter,

Gone away is Bernanke
Here to stay is Ms Yellen
A taper love song,
And we go along,
Living in a Kondratieff Winter,

In the White House we can Hail! Obama!
And pretend that everything is well,

He'll say: Are you employed?
We'll say: No man,
But you can have free shit
While you're down!

Later on, we'll conspire,
As we dream pitchforks and fire
To face unafraid,
The debt that we've made,
Living in a Kondratieff Winter.

In the White House we can Hail! Obama!
And pretend that everything is well,

He'll say: Are you employed?
We'll say: No man,
But you can have free shit
While you're down!

IRS rings, taxed to death yet,
NSA taps, are they listening?
A beautiful sight,
The USSA just ain't right,
Living in a Kondratieff Winter...

Living in a Kondratieff Winter!!!!

Fri, 10/11/2013 - 22:59 | 4047139 wisehiney
wisehiney's picture

Most excellent, IF we make it two more months.

Fri, 10/11/2013 - 23:20 | 4047163 IridiumRebel
IridiumRebel's picture

Tough crowd

Sat, 10/12/2013 - 02:26 | 4047308 Pareto
Pareto's picture

+100 "but you can have free shit while you're down."  perfect.

Fri, 10/11/2013 - 21:46 | 4047041 americanspirit
americanspirit's picture

The only question is- when will retribution begin. It is long overdue.

Fri, 10/11/2013 - 22:00 | 4047066 Peter Pan
Peter Pan's picture

Neither retribution nor redistribution bring about a lasting balance for more than a short period of time.

The key is sustainability in all that we do, whether it is eating, drinking, spending, working or investing.

Fri, 10/11/2013 - 22:21 | 4047092 mvsjcl
mvsjcl's picture

When markets aren't manipulated, sustainability takes care of itself.

Fri, 10/11/2013 - 22:25 | 4047101 Peter Pan
Peter Pan's picture

That I can agree with but with the proviso that governments are contained in size. Otherwise you could have a free market but with a high taxing/high spending government that leads to disasters even though there is no manipulation.

Sat, 10/12/2013 - 02:02 | 4047299 tip e. canoe
tip e. canoe's picture

one can never guarantee that any given market is not manipulated.

(the cynical one will assume that it's always a given)

so what does one do in that case?

avoid all markets

or

only enter markets that have a higher degree of transparency/honesty/efficiency/etc. that they can personally observe

?

MANIPULATION IS IRRELEVANT

IF YOU WANT IT

Fri, 10/11/2013 - 22:10 | 4047078 Peter Pan
Peter Pan's picture

So will retribution pay off your credit card?

If so, please tell me how.

Fri, 10/11/2013 - 21:57 | 4047056 Peter Pan
Peter Pan's picture

After debt is taken on by people it soon becomes the income of the lenders and the corporations once again. The process repeats itself until everyone has borrowed to the point that there is no longer any equity upon which to lend. The banks have by then become the de facto owners of all real assets.

 

Fri, 10/11/2013 - 22:04 | 4047068 Peter Pan
Peter Pan's picture

The  USA does not want a low oil price because a low price needs fewer dollars to buy and would therefore make it harder for the USA to print more.

If anything a high dollar price of oil is just what they want deep down.

Fri, 10/11/2013 - 22:08 | 4047079 ak_khanna
ak_khanna's picture

The true extent of slowdown in the world economy can be judged by the data points which are not subjected to adjustments by the government. Eg. Change in Electricity and Fuel consumption, Ratio of working population to the total population of a country, Miles driven, Baltic Dry Index, Change in commercial Rental Rates etc

Countries around the world are taking on more debt without any fruitful attempts to curb their expenditures. This has resulted in a much more fragile and artificially held up financial system which is on a much shaky ground than it was in 2008. In 2008 companies failed due to excessive leverage and debt and now countries are likely to default because they took on the same bad debt on themselves. 

There is no economic recovery because all the efforts of politicians, government, central banks etc are focused on saving banks instead of targeting job creation which is the only way economy can recover. 

The weakness in the democratic process ensures the victory of the Wall Street over the Real Economy for the foreseeable future. Things are definitely going to get much much worse before they get better for the real economy i.e. for more than 90% of the population.

http://www.marketoracle.co.uk/Article40231.html

Fri, 10/11/2013 - 22:15 | 4047085 HowardBeale
HowardBeale's picture

It is not "stupidity" that drives the criminals at the Fed to continue to give the wealth of the nation to a few psychopaths; thus, you ask: What is it then? 

Answer: It is as simple as it gets; and that is to say, it is that disease that is as old as the first Darwinian "friends": peer pressure. 

I would venture to say that every single person who reads these words has "covered for"--aka, not ratted out--a sleaze ball at your place of employment that made everyone's life at least a little bit harder; that made everything you do a little less meaningful; that made you respect yourself at least a little bit less--and that is the rosy scenario.

America is run by criminals, for criminals, and they are friends. They won't stop protecting each other until someone or most of the someones are dead.

Fri, 10/11/2013 - 22:19 | 4047090 Jethro
Jethro's picture

This article doesn't go far enough with regards to accountability. This holds true for Federal, state and sometimes even local governments as well. Only rarely are politicians, agents and local authority figures held accountable for poor decision making. Even when lives are lost, are these bureaucrats taken to task. Our system is broken. We had a Republic once, but it slipped away, piece by piece, out the side door, in the pockets of criminals.

Fri, 10/11/2013 - 22:32 | 4047108 Bobportlandor
Bobportlandor's picture
Liberty Rising Radio: Jail Time For Doctors? Dr. Dave Janda on “ObamaCare”

 http://thenewsdoctors.com/liberty-rising-radio-dr-dave-janda-on-obamacar...

You will definitely want to hear this.

DID WE VOTE ON THIS!. HOLLY SHIT!!

 

Fri, 10/11/2013 - 22:52 | 4047124 yogibear
yogibear's picture

The corrupt have doctors jailed for not playing along. Seeming more like Stalin  and Hitler. Convincing the sheep total government control is good for them is working.

 

Fri, 10/11/2013 - 22:51 | 4047128 Bobportlandor
Bobportlandor's picture
Liberty Rising Radio: Jail Time For Doctors? Dr. Dave Janda on “ObamaCare”

 http://thenewsdoctors.com/liberty-rising-radio-dr-dave-janda-on-obamacar...

You will definitely want to hear this.

DID WE VOTE ON THIS!. HOLLY SHIT!!

 

Fri, 10/11/2013 - 22:49 | 4047129 wisehiney
wisehiney's picture

I dig you faberooni. You are freaky cool enough to talk grade shit to them, and get PAID for it. For you I would recommend Firestone tubes.

Fri, 10/11/2013 - 23:02 | 4047145 ebworthen
ebworthen's picture

"“It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong."

Say what you will about Marc Faber - but he tells it like it is.

"Brevity is the soul of wit."

Fri, 10/11/2013 - 23:20 | 4047166 wisehiney
Fri, 10/11/2013 - 23:33 | 4047188 Miffed Microbio...
Miffed Microbiologist's picture

+1 Eb

However, Marc Faber should note the fate of Louis XVI in 1793 and the subsequent Reign of Terror. His justice cometh and that right soon. I hope they pay dearly for their complacency.

Miffed;-)

Fri, 10/11/2013 - 23:17 | 4047162 gafgroocK
gafgroocK's picture

 

 

 that great Philospher and Holy Woman, Sally Fields once said "Stupid is as Stupid does"

When Obama won the Second Term, the answer Farber is looking for is right before his eyes. 

To the question of" putting those decisions in the hands of people who pay no price for being wrong."?

The American people made that Ultimate decision, and no confirmation process was required or asked for.

Fri, 10/11/2013 - 23:21 | 4047168 Bunga Bunga
Bunga Bunga's picture

Faber is wrong. It should mean "A Corrupt System That Rewards Crime"

 

Fri, 10/11/2013 - 23:41 | 4047193 The Burning Planet
The Burning Planet's picture

Actually, I got to disagree with you. It's NOT criminal behavior when you make the laws, or pay the men who make the laws. In that case whatever you decide to make legal, is legal (by definition). But as Nicole Foss of Automatic Earth said, just because it is "legal" doesn't mean that such apostasy will go on forever. The system is fracturing and can only stand so much before it implodes. I think we may be getting close to that time. Not starving people in the street and Mad Max, but definitely a catastrophic failure in fiat currency and the virtual reality economic system. The latter for sure.

Sat, 10/12/2013 - 07:43 | 4047400 Clowns on Acid
Clowns on Acid's picture

"Just cause you can, doesn't mean you should,

Just cause you should, doesn't mean you can"

Fri, 10/11/2013 - 23:28 | 4047176 Money Squid
Money Squid's picture

Im stupid, so where is my reward?

Fri, 10/11/2013 - 23:29 | 4047177 Serfs_Up
Serfs_Up's picture

Fuck Mrs DebtFire. There I said it again.

Fri, 10/11/2013 - 23:32 | 4047185 The Burning Planet
The Burning Planet's picture

Rewards ruthlessness that is. I don't think that is synonymous with stupidity.

Fri, 10/11/2013 - 23:51 | 4047206 Richard Chesler
Richard Chesler's picture

That's a fucking mouthful for "OBAMANOMICS.

 

Sat, 10/12/2013 - 00:10 | 4047221 disabledvet
disabledvet's picture

Here's "the Book" for those still not in the know: http://en.wikipedia.org/wiki/The_New_New_Thing Michael Lewis would go on to write many more amazing books as well. I agree with the premise that "this is all about markets." but not all markets have "existed." in fact the very idea of a market is quite new. it all started with a guy from Upstate New York by the name of George Eastman. he created the idea of "marketing." the idea of "markets" however is...and it is ironic that this article has someone who is bashing intellectuals while extolling "markets"...is something "entirely created in the human mind." don't get me wrong...they were originally based upon something real...but as it "became" understood in New York a "market" was not a place where buyers and sellers would meet at all but in fact a quantifiable object in its own right...something of size or scale that for reasons unknown to the buyer "would simply be bought" (meaning at ANY price.) even today this is a very radical theory. in other words a "true" market is not where you go to buy or sell stuff (a place) but in fact was/would be a place where "things would be demanded" irregardless of price...thus to a large extent "existing merely in your mind." the study of application of this theory began in the late 1800's in New York because first and foremost there was a gold standard and second and more importantly people understood then the chances of a gold standard remaining were pretty slim. great minds were to put to work to deal with the inevitable "what if" scenario. and the solution they came up with "was oil." everyone knew what enormous value it had upon its discovery...but what wasn't understood...and still isn't in my view...is the proper way to "value" it. by that i mean "how to make it more than it was worth in and of itself." everyone knew it had tremendous...almost unlimited value...but how to unlock it's true "meaning" or "economic potential" was a whole 'nother thing entirely. and of course there not only was an academic discussion but an academic answer as well: the gold standard was obliterated to make way for the Fed thus the reaction was "make the oil market big enough and it will become money" in the economic sense of the term. this in fact did happen and led to in my opinion the greatest economic boom in world history...certainly in the history of fiat money...namely the Roaring 20's...it is also my view "it ended with World War II"...since oil powered everything back then...and "all we got from WWII was the petro-dollar." meh. "game over." i have since had to "revise and extend my (internal) remarks" based upon the oil and natural gas "revolutions" currently underway. you have to understand that i originally brought up North Dakota five years ago as a kind of "joke" or "off topic subject" to talk about something other than "the real joke" namely "the total annihilation of Wall Street by Wall Street itself." I gotta say while i could see the value of the oil production coming out of the Bakken back then...i never imagined that it would rise to the level of a "market moving event." In other words...to paraphrase Joseph Stalin of all people..."quantity has a quality all its own" meaning "the sheer size of the thing creates its own money creation." Thus the book The New New Thing is a must read because long before my "hypothetical" (which is now as real as Jeff Bezos buying the Washington Post as a play thing) i had already read about the conceptual basis for "marketing itself as a market" in this book about "some guy most people still have never heard of." (go get the book if you want to find out.) And while i unfortunately did not participate in the realization of this book's thesis i sure did observe its realization first hand. Simply put i'd never seen so much wealth creation "and the requisite arrival of humans as a consequence." As such it gave me a rather...odd sense of proportionality...when it came to the idea of "just how much money really can be made out there" (answer: "beyond imagination) especially when it came to "people you'd never heard of before" and "you might wind up meeting at a bar or coffee shop for some reason." In others words..."something of striking fluidity." Needless to say this iteration hasn't disappointed...or should i say "surprised to the upside even me." Some of the numbers bandied about for things i would never buy even if i had the money have been pretty amazing. Here's an example: http://en.wikipedia.org/wiki/One57

there will be other big numbers appearing soon however because when you start producing energy on a scale that makes the Middle East look small "these things just happen." i do find questions relating to a "money market" that are brought up here very interesting as a consequence. The idea of a "money market" itself i find to be very interesting since "why would i need even banking itself if i have a properly functioning money market?" obviously this is a very radical idea and in no way am i saying it is true...just "one of those things" i guess. obviously a properly functioning market for "money" would if it were functioning correctly have a "very high rate of demand" which in theory would be expressed in the form of an "interest rate" (meaning "i will pay for cash itself.") it would have to a very big number i imagine...say a trillion dollars or something.

Sat, 10/12/2013 - 01:19 | 4047275 Flammonde
Flammonde's picture

Disabledvet, your observation about markets and about money and energy come together like Fasces.   Fraud--non-money- is a crucial component of the modern market framework.  Totalitarians are anti-wealth creation which in modern economies requires true money as Capital over time as a representation algebraically of human energy.  To the extent industrialism freed labor to think we have come some way from the Middle Ages.  Industrial civilization promoted industrial warfare and standardization for the multitude and fraud for the ruling elites but it has brought us tools for good or ill, one of which is economics.

Sat, 10/12/2013 - 07:41 | 4047398 Clowns on Acid
Clowns on Acid's picture

Using paragraphs would help you enormously... keep on keepin on...Vet...

Sat, 10/12/2013 - 00:43 | 4047240 Savyindallas
Savyindallas's picture

What's made this all possible (without a revolution) is that these wealthy thieves own and control the President, the Congress, academia and the mainstream media. Brilliant that they could pull this off  -they know their con can't go on forever  -that's why we have dramatically increased the magnitude of the Orwellian Police State and Homeland Security is arming up for one hell of a civil war against the American sheeple  -who hopefully will discover their humanity and capacity for rational thought again- soon I hope  -or we are toast.    

Sat, 10/12/2013 - 00:45 | 4047245 q99x2
q99x2's picture

Nice article.

Sat, 10/12/2013 - 01:08 | 4047267 Sizzurp
Sizzurp's picture

I think the Fed is destroying the dollar, and with it world trade.  We are heading towards a barter economy, a new dark age that will make the 30's look like a cake walk.  The destruction of capital and collapse of credit is the essence of hyperdeflation though, not hyperinflation.  Real money disappears as the economy implodes and unemployment skyrockets.  

Sat, 10/12/2013 - 05:18 | 4047352 surf0766
surf0766's picture

All wealth is being transferred up. The 2 class society is almost complete.

One day.. Chairman Mao Christmas balls will be on everyone's tree

Sat, 10/12/2013 - 01:24 | 4047280 shinobi-7
shinobi-7's picture

This is rhetorical but why are we required to get a license to drive a car whereas politicians who "drive" a far more complex machine are not required to know anything about the economy? Doctors are supposed to know their trade, lawyers, engineers, everybody except politicians. This should change. To enter politics, you should have a minimum of training in economics, public accounting, social sciences and the likes. It may not improve the dialogue but it would weed out a few imbeciles.

Sat, 10/12/2013 - 01:45 | 4047290 Professorlocknload
Professorlocknload's picture

"Doctors are supposed to know their trade, lawyers, engineers, everybody except politicians."

Well, politicians do know their trade. They are Political Scientists, and their trade is the art of coercing, purchasing, extorting or stealing your vote for personal gain and power. If asked, I'd say they are pretty well accomplished at that art.

Sat, 10/12/2013 - 04:11 | 4047327 shinobi-7
shinobi-7's picture

That is indeed the cynical reality of our time. Sometimes people reject it and try to build something better. This is clearly not one of these times.

Plato or Socrates, I forgot once said that the price of not being interested in politics is that you end up being governed by your inferiors!

 

Sat, 10/12/2013 - 20:36 | 4049030 StychoKiller
StychoKiller's picture

Alas!  Your solution requires INTELLIGENCE; what would happen to all the Stupid people?

Sat, 10/12/2013 - 01:59 | 4047295 JailBanksters
JailBanksters's picture

Why not just get the FED to add 1 Billion into everybody's Bank Account, then everybody will be rich, no class wars, nobody living in Poverty, every thing would be just peachy. Can't be any more clown crazy pants than what they are currently doing.

Sat, 10/12/2013 - 02:11 | 4047302 Incubus
Incubus's picture

because it isnt about economic freedom, man.

 

It's about control.  We're their cattle.

Sat, 10/12/2013 - 07:14 | 4047384 pndr4495
pndr4495's picture

chattel

Sat, 10/12/2013 - 04:16 | 4047328 notadouche
notadouche's picture

Oh they pay a heavy price.  Their brethren (partners in crime) censure them.  That must be the worst kind of torture.  I would sure hate to break the law or make a bad decision that turns out catastrophic for millions of citizens and have to face the indignity of being censured.  That 2 hours or so must be excruciatingly uncomfortable and wating for the next day to go back to normal must cause them to toss and turn for 30 minutes so before they can fall asleep.  

Sat, 10/12/2013 - 04:29 | 4047331 Balvan
Balvan's picture

I've stop reading after "Marc Faber". Charlatan, doomsayer and goldpumper.

Sat, 10/12/2013 - 04:39 | 4047334 bunnyswanson
bunnyswanson's picture

Why do you think anyone cares what you read and when you stop reading?

Sat, 10/12/2013 - 04:46 | 4047332 falak pema
falak pema's picture

For the greater part of human history, leaders who were in a position to exercise power were accountable for their actions. ..

In their own eyes they represented the march of time; these leaders. 

Julius Caesar paid his dues during the Ides of March.

Napoleon at Waterloo. England, France, Germany in WW1 & WW2.

Now its Pax Americana's turn. Hubris is a strange aphrodisiac. Under its spell we think we are invincible and that the world lies at our feet like a subdued and enticing woman.

When the wall fell you could feel the exultation in the American elites. It was not to sing freedom to the world, it was to sing : Now its OUR turn and we ride with our boots on and our naked spurs shall be blood ridden in the sands of those Saddam niggers. 

The rest is the inevitability of the historical thread and those the Gods drive mad before their own fall; and we fall with them as this black energy rape to shatter the earth is worse than the temporary demise of the fiat monetary line.

When you debase, deplete, natural resources that nature has accumulated over millions of years in two centuries of frenetic activity and your only reaction to this conundrum at wake up call is : MORE! MORE! you have once again crossed the Rubicon, and this is not one man, this is civilization fall.

We desperately need a renewable energy replenishment pipeline for a world of 8 billion human ants, ready to be frazzled like that giant kebab in Kazan. 

AS for the FED, Faber has it all wrong. These men are puppets, who dress up the ideology like a suit that fits the monarch of the day; the Oligarchy class. That this is a runaway train is an evidence. But its a runaway train with a very powerful purpose; not to serve the interests of "fuddy duddy" professors gone mad. These guys are not financial and economic Dr Strangeloves caught in their own fickle dreams, these guys are the servants of the Caesar class, who don't want to sacrifice "our way of life, the feel of imperial purple come what may!"

And more than the financial thread its the energy thread that is the most damning evidence against this outrageous manifestation of collective hubris in the new Jerusalem on the hill, the land of "fully grown men, land of the free and home of the brave". 

I've been to Rome and seen what transpired there, under the march of time, once the barbarians said : I'm top dog here from now on. 

Sat, 10/12/2013 - 07:28 | 4047394 shinobi-7
shinobi-7's picture

These men may be "puppets" but the monarchs are all of us! A barrel of oil represents more or less the energy of a lifetime for a human being and this is what each of us spend on a long haul flight. Thanks to oil, we've all been living like royalty. With a lower eROI, we may be approaching the end of the good times. That, I believe is the tragedy of our time. Apart from that, I agree with your comment.

Sat, 10/12/2013 - 20:45 | 4049047 StychoKiller
StychoKiller's picture
Ozymandias

I met a traveller from an antique land
Who said: Two vast and trunkless legs of stone
Stand in the desart. Near them, on the sand,
Half sunk, a shattered visage lies, whose frown,
And wrinkled lip, and sneer of cold command,
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them and the heart that fed:
And on the pedestal these words appear:
"My name is Ozymandias, king of kings:
Look on my works, ye Mighty, and despair!"
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare
The lone and level sands stretch far away.[

Sat, 10/12/2013 - 04:56 | 4047344 kurt
kurt's picture

Give the money to the people who will spend most of it.

Sat, 10/12/2013 - 20:47 | 4049053 StychoKiller
StychoKiller's picture

Your "solution" will only be a repeat of History (yet again!)

Sat, 10/12/2013 - 05:17 | 4047353 Element
Element's picture

The criminal stupidity of "the system" is endemic Marc, a fruit who's seed is within itself. Top to bottom, irredeemable, not worthy of being defended or supported by anyone. But "the system" is of course a SUM expression of the monumentally warped minds of billions of quite deliberately undermined, fowled and ruined human minds.

Other than that I'm confident a financial and political reset will make it all good.

Sat, 10/12/2013 - 07:28 | 4047383 Element
Element's picture

Just yesterday I watched some bankster-apologist-puke saying how the IMF now provides the, "... core of development ..." in Europe.

For when things get so bad, that the US-owned 'IMF' shell-game is needed to backstop the US and European fiat collapse, in a potential US default, then Darth-Farce suddenly has to pretend, and talk-up the IMF, as being capable of doing a damn thing at all, as an emergency 'backstop'.

But to then go so far as to claim the IMF represents the very "core of development"? ... they clearly didn't understand why you must never, ever, go-full-retard.

Sat, 10/12/2013 - 06:26 | 4047369 N57Mike
N57Mike's picture

It's worse than that Marc....Half of Americans pay no federal taxes yet they Vote in the politicians who in turn have no accountability ....

Sat, 10/12/2013 - 06:49 | 4047378 bozzy
bozzy's picture

In other words, Faber hit the nail right on the head. (and not for the first time).

All pervasive unaccountability. Stupendous rewards on a "BEST EFFORTS" basis. I wish I could get some of that.

Sat, 10/12/2013 - 06:49 | 4047379 thisandthat
thisandthat's picture

 

A Stupid System That Rewards Corruption

FTFY, Marc.

Sat, 10/12/2013 - 06:57 | 4047380 U4 eee aaa
U4 eee aaa's picture

The ironic part is that, via the ballot box, we have the greatest ability to control and stop these excesses, yet the people refuse to make their voices heard. Maybe the 1%ers of recent history weren't so stupid after all to give us the vote. Clearly letting people *think* they are in control is the greatest opiate of them all and enough to keep them as harmless as lambs

Sat, 10/12/2013 - 08:16 | 4047407 falak pema
falak pema's picture

the illusion of "free will" and the dictatorship of the ephermeral media show, à la "only on CNN Iraq" and Fox Diatribes and American idol,  are the new opiates of this age where once religion filled that role; all to the benefit of the New Aristocrats. 

They never stomached the Englightenment and the resultant horizontal construct that it intiated for the first time in History on such a nation state scale both in France and fledgling USA. Its back to neo feudalism with a vengeance as PLANNED by the elites under Ronnie and Maggie, the new catholic kings of globalist oligarchs built on universal slave labour. This is their legacy and like during the Spanish Inquisition it has its NSA...

Maggie even had the gall to sell to her people St Francis's preachings; he that represented in the Christian church the defense of the weak, when she sang : For there where there is Discord we bring Harmony.

And she immediately proceeded to eradicate the presence of the Unions, as did Ronnie.

What you say and what you DO in name of Harmony! Machiavelic, and trickle down logic while the rich banquet on WS asset fire sales and ZIRP burps. 

Sat, 10/12/2013 - 09:27 | 4047479 WillyGroper
WillyGroper's picture

Bit ironic they both succumbed to Alzheimers.

Sat, 10/12/2013 - 11:06 | 4047621 Ckierst1
Ckierst1's picture

It is a myth that the people are in control at the ballot box.  In truth, it is a two party controlled two party system and the party orgs and leadership control the system.  Candidates are heavily vetted and those not going the line are pariahs and always a target for replacement by the insider power brokers.  There are considerable barriers to entry for any third or fourth party.  The venues for debate and exposure are heavily controlled by the MSM and academia and public employee goons in uniform make sure that the party orgs dicta are enforced at party state and national conventions.  In addition, if there are any unfilled delegate slots in non primary states then the state party org selects those delegates and they also tender vetted slates of delegates to the national conventions and as national electors.  Those slates are made up of state incumbents and officers and insiders and their spouses.  it's a rigged game.

Sat, 10/12/2013 - 18:37 | 4048671 hidingfromhelis
hidingfromhelis's picture

I'll paraphrase Ron Paul and say that it's not a third or fourth party that we need, but a second party!

Sat, 10/12/2013 - 07:20 | 4047386 Duude
Duude's picture

Thomas Sowell is one of my favorite economist, author, and columnist today. Unfortunately, the vast majority of America has no idea who he is. Highly recommend reading any time he puts a pen to a page. 

Sat, 10/12/2013 - 07:36 | 4047397 Clowns on Acid
Clowns on Acid's picture

Agreed Duude - But there is a reason for Sowell being largely unknown (same for Walter Williams) ...he is blacker than Obama, and if one is blacker tha Obama and disagree with his policies (what critical thinking person could possibly agree ?) you will never be invited onto Lame Stream Media.

Sat, 10/12/2013 - 09:10 | 4047469 shovelhead
shovelhead's picture

LOL.

Thomas Sowell on Oprah or the View.

The best they could hope for would be dumb, incomprehendable looks as he speaks or heads would explode and hilarity ensues.

Never happen.

Sat, 10/12/2013 - 08:59 | 4047455 GMadScientist
GMadScientist's picture

Duplicitous Affirmative Action Boy hits home run for Chicago School of Rational Expectations!

Sat, 10/12/2013 - 08:15 | 4047423 RazvanM
RazvanM's picture

The actions of US FED have the sole purpose of transferring wealth from everyone to it's handlers. It was gradually for a very long time - now the process has accelerated, but it's still not perceived for what is it.

Let's play a game: I claim to have 1 Trillion $ and my claim is backed by some 0s and 1s in some banks computers. Do I have that Trillion? What if my debt is 1 Trillion, but is well hidden, NSA secret, and nobody comes to make a claim for it as long as I play by the rules? This fucking system is a fucking scam.

Sat, 10/12/2013 - 08:52 | 4047452 GMadScientist
GMadScientist's picture

"For the greater part of human history, leaders who were in a position to exercise power were accountable for their actions."

Way to open with something untrue on it's face, Faber; I blast the corrupt system that rewards this fat twinkie of a man.

Sat, 10/12/2013 - 08:57 | 4047456 shovelhead
shovelhead's picture

Just as the banks have privatized gains and subsidized losses, so too have politicians done likewise. No constraint or consequence for bad behavior or poor performance.

The Game of Thrones should be a very tough business because the rewards are so high.

Time to get medieval and remind them of King Charles I.

Who wants to be Cromwell?

Sat, 10/12/2013 - 10:25 | 4047518 RiverRoad
RiverRoad's picture

When the 1% run the Fed, what do you expect?  Don't actually expect them to do anything to increase jobs either.  No jobs.....no $$$.....no inflation.  They like things just like they are.

Sat, 10/12/2013 - 10:55 | 4047587 RaceToTheBottom
RaceToTheBottom's picture

The Bernank and the Keynesians know just what they are doing. They will ride the dollar as long as the world will allow them. This will be a lot longer than anyone thought because all the world fiat currencies are doing the same.

Then they will manage the switch to the new world currency. It will not be based on one country. It will be a basket of Fiats or the UN currency already floated.

It would not be based on Gold. Why would they ever do that. They will be in control for the switch and it will be to a basket of Fiats. And the game will go on....

Sat, 10/12/2013 - 11:32 | 4047705 ZH Snob
ZH Snob's picture

steal a little and they throw you in jail

steal alot and they make you king


        Bob Dylan


Sat, 10/12/2013 - 12:15 | 4047848 rosiescenario
rosiescenario's picture

Different set of rules for the rulers....insider trading: OK; no social security payments: OK; better health insurance: OK; use of the taxing authority for political gain: OK; etc.

 

We're now just another banana republic....for sale to the highest bidder....run for the benefit of a few special interest groups.

Sat, 10/12/2013 - 18:45 | 4048702 hidingfromhelis
hidingfromhelis's picture

This:

“‘This is not to be wondered at,’ said Goethe; ‘such people continue in error because they are indebted to it for their existence. They would have to learn everything over again, and that would be very inconvenient.’

 

“‘But,’ said I, ‘how can their experiments prove the truth when the basis for their evaluation is false?’

 

“‘They do not prove the truth,’ said Goethe, ‘nor is such the intention; the only point with these professors is to prove their own opinion. On this account, they conceal all experiments that would reveal the truth and show their doctrine untenable. Then the scholars — what do they care for truth? They, like the rest, are perfectly satisfied if they can prate away empirically; that is the whole matter.’”

Can be summed up as:  "It is difficult to get a man to understand something, when his salary depends upon his not understanding it!"  --Upton Sinclair

Sat, 10/12/2013 - 20:45 | 4049048 Wilcox1
Wilcox1's picture

Is there video of this interview anywhere?

Do NOT follow this link or you will be banned from the site!