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Cockamamie Casino Capitalism
Submitted by The DeathFlation Blog
The original intent and “raison d’etre” of our market based financial system was to facilitate capital formation in order to encourage investment and credit for enterprise expansion, through the establishment of efficient free market capital exchange frameworks, so as to advance productivity and facilitate trade in the underlying economy.
Regrettably, the capital markets of today have entirely degenerated, morphed into a sanctioned global gaming racket, whereby the market venues and electronic trading vehicles have disconnected, transmuted into capital investment in of themselves, with little or no relation to the real economy on the ground. Capital chasing the tail of advantageously positioned market capital is not the same thing as constructively invested working capital in actual human enterprise. One is speculative and self-seeking in nature, while the other is creative and generative in nature.
This financial free-for-all fracas drains substantial funding from substantive investments in tangible productive enterprise, creating gross misallocation of precious capital which is actually destructive to the underlying economic growth. The F.I.R.E. industry has become parasitical to the productive economy, and now serves primarily to extract value out of it, infrequently adding value to it.
Capital is best invested via local channels where the formation, operation and expertise in an enterprise is best understood. Today’s massive capital transfers of frenetically furious fast-money flows, extending from one overseas over-leveraged global banking Goliath to another, offers suspicious socio-economic merit and is often destabilizing in it of itself.
This synthesized, swiftly streaming, approach to capital formation has brought us the following disastrous abominations:
1) Gross misallocation of genuinely productive investment capital, stifling the crucial SME sector
2) Excessive market volatility which stymies business development and trade
3) Repeat massive asset bubble formation dislocations
4) Lethargic economic activity
5) Extreme income inequality
6) Facilitated fantastic fiscal deficit spending sprees
7) Encouraged off-shoring of the manufacturing base
8) Conceals real inflation
9) Decreases income & job growth
10) Eviscerates the very essence of money itself
The gambing Fed-house monetary authorities and their most favored TBTF Casino whales were so fearful of losing their mountain of comped chips, that it necessitated them to abandon the free market principles this country was founded and built upon, and synthetically manipulate the now completely capture Equity, Bond and Gold markets.
These self-serving parasitical derelicts drive the damaged demented markets exactly to where they desperately require them, in order to keep the roulette ball constantly and continuously in play. This classless new breed of casino captains has spent in the past seven years what the classy old school owners had collectively spent in the previous 100 years to do so, sure feels like they are most desperate and about to recklessly lose all the marbles.
Are they finally cashing in their worthless chips?
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Cashing out. That's almost funny. I'm not busting on you SMC, but I get a mental image of one of these " Kings of the World" selling and having giant positive cash accounts..... In dollars!
I hope I live to see it. Surely thought it would have happened by now.
Indeed!
And here I cashed in my chips years AGO !
I'm too old to comment. Going to take another nap now.
What free market?
What Casino, the Bernanke said HFTs offer liquidity to the markets making it all good.
It works like this, they ramp everything up, you buy, then they take it down on you until you sell.
They make money. It's all good. Right? Anyhoo, he also said high valuations make you feel good too.