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Can "It" Happen Again... Again?
Many have talked about it. More have eschewed it. But Minsky's hugely important insight in asking the question "Can 'It' Happen Again?" regarding the Depression remains critical reading for any- and every-one who opines day-in and day-out on how much we need or do not need Central Bank money-printing. As Bill Gross put it:
Minsky, originator of the commonsensical “stability leads to instability” thesis; the economist with naming rights for 2008’s “Minsky Moment”; the exposer of the financial fragility of modern capitalism; probably couldn’t imagine the liquidity trap qualities of zero-based money, because who could have conceived 30 or 40 years ago that interest rates could ever approach zero per cent for an extended period of time? Probably no one.
Nor, more importantly I suppose, can Ben Bernanke, Mario Draghi or Mervyn King. In their historical models, credit is as credit does, expanding perpetually after brief periods of recessionary contraction, showering economic activity with liquid fertiliser for productive investment and inevitable growth.
For a long-weekend, the full 30 year-old must-read paper here:
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You get the shovel and I'll grab the handcuffs.
I'm thinking tie wraps might work better than cuffs at this point.
http://hopegirl2012.wordpress.com/2012/08/25/while-you-were-asleep-the-story-of-the-2012-revolution-by-hopegirl/
And at the top of the chain of power is the elite, who control all of it through their main banking channel the Bank of International Settlements, which controls the international central banks.
Who are “The Elite”? They vary a little here and there but believe it or not most of it comes down to a handful of families in the world and those that work for them. Be sure to watch thrive to get a better idea of who they are. It’s basically an elaborate close knit network of a select few that give the orders and carry them out.
They control almost everything. They control ALL THE MEDIA (News, TV, Hollywood, entertainment)
They control the education system, they control the medical system, they control the food supply. Again, there is tons of documentation out there on this, start with the Thrive movie and look this stuff up for yourself, don’t take my word for it!
In addition to the pyramid structure above, you can break down the structure on a more detailed level as David Wilcock does in his blog here http://divinecosmos.com/start-here/davids-blog/1066-great-revealing.
Basically, a group of highly respected scientists, using a very fancy one of a kind computer ran a series of intricate cross referencing data analysis. They discovered that every company in the world was owned in some way by another company, which was owned by another company etc. The end result is that 50 companies control most of the wealth in the entire world. Those companies are (in order of their level of control)
Top 50 Companies that Run the World
1 BARCLAYS PLC GB 6512 SCC 4.05
2 CAPITAL GROUP COMPANIES INC, THE US 6713 IN 6.66
3 FMR CORP US 6713 IN 8.94
4 AXA FR 6712 SCC 11.21
5 STATE STREET CORPORATION US 6713 SCC 13.02
6 JP MORGAN CHASE & CO. US 6512 SCC 14.55
7 LEGAL & GENERAL GROUP PLC GB 6603 SCC 16.02
8 VANGUARD GROUP, INC., THE US 7415 IN 17.25
9 UBS AG CH 6512 SCC 18.46
10 MERRILL LYNCH & CO., INC. US 6712 SCC 19.45
11 WELLINGTON MANAGEMENT CO. L.L.P. US 6713 IN 20.33
12 DEUTSCHE BANK AG DE 6512 SCC 21.17
13 FRANKLIN RESOURCES, INC. US 6512 SCC 21.99
14 CREDIT SUISSE GROUP CH 6512 SCC 22.81
15 WALTON ENTERPRISES LLC US 2923 T&T 23.56
16 BANK OF NEW YORK MELLON CORP. US 6512 IN 24.28
17 NATIXIS FR 6512 SCC 24.98
18 GOLDMAN SACHS GROUP, INC., THE US 6712 SCC 25.64
19 T. ROWE PRICE GROUP, INC. US 6713 SCC 26.29
20 LEGG MASON, INC. US 6712 SCC 26.92
21 MORGAN STANLEY US 6712 SCC 27.56
22 MITSUBISHI UFJ FINANCIAL GROUP, INC. JP 6512 SCC 28.16
23 NORTHERN TRUST CORPORATION US 6512 SCC 28.72
24 SOCIÉTÉ GÉNÉRALE FR 6512 SCC 29.26
25 BANK OF AMERICA CORPORATION US 6512 SCC 29.79
26 LLOYDS TSB GROUP PLC GB 6512 SCC 30.30
27 INVESCO PLC GB 6523 SCC 30.82
28 ALLIANZ SE DE 7415 SCC 31.32
29 TIAA US 6601 IN 32.24
30 OLD MUTUAL PUBLIC LIMITED COMPANY GB 6601 SCC 32.69
31 AVIVA PLC GB 6601 SCC 33.14
32 SCHRODERS PLC GB 6712 SCC 33.57
33 DODGE & COX US 7415 IN 34.00
34 LEHMAN BROTHERS HOLDINGS, INC. US 6712 SCC 34.43
35 SUN LIFE FINANCIAL, INC. CA 6601 SCC 34.82
36 STANDARD LIFE PLC GB 6601 SCC 35.2
37 CNCE FR 6512 SCC 35.57
38 NOMURA HOLDINGS, INC. JP 6512 SCC 35.92
39 THE DEPOSITORY TRUST COMPANY US 6512 IN 36.28
40 MASSACHUSETTS MUTUAL LIFE INSUR. US 6601 IN 36.63
41 ING GROEP N.V. NL 6603 SCC 36.96
42 BRANDES INVESTMENT PARTNERS, L.P. US 6713 IN 37.29
43 UNICREDITO ITALIANO SPA IT 6512 SCC 37.61
44 DEPOSIT INSURANCE CORPORATION OF JP JP 6511 IN 37.93
45 VERENIGING AEGON NL 6512 IN 38.25
46 BNP PARIBAS FR 6512 SCC 38.56
47 AFFILIATED MANAGERS GROUP, INC. US 6713 SCC 38.88
48 RESONA HOLDINGS, INC. JP 6512 SCC 39.18|
49 CAPITAL GROUP INTERNATIONAL, INC. US 7414 IN 39.48
50 CHINA PETROCHEMICAL GROUP CO. CN 6511 T&T 39.78
These findings were published in a well respected Scientific Magazine earlier this year.
http://www.newscientist.com/article/mg21228354.500-revealed–the-capitalist-network-that-runs-the-world.html
I cannot praise this website enough. Even if expressly austrian, it posts material from deep neo-keynesian minds as Minsky and S. Keen. Valuing the ideas and analysis for what they are, and not whom they come from, is a distinctive trait of an enlighted mind, which nowadays we are in so much need of. You have my highest respect guys, please go on like this!
"It" will happen again. We even have a timeframe (2013-2014). The only questions are how bad will "it" be this time and who will come out on top after "it" is over.
No, it will never be the same. 'There is nothing permanent except change'.
Got any change?
So basically, when debt is able to expand exponentially everything is fine. When it isn't... Crash.
Who'd have thought.
To solve our current debt crisis all we have to do is devalue the currencies by an order of magnitude. Short period of turbulence and then another couple of decades of exponential debt expansion.
What could possibly go wrong?
"It" can only happen in a Keynesian World, because in a fully free market and where cronyism has not corrupted the process, capitalism is stable. In that economy, future investment comes from savings and the feedback mechanism is the time value of money over time. That is also called the yield curve.
In the upside down, inside out world of Keynes, since the ends (socialist utopia) is so urgently important (to the point of it being a religion), not a single aspect of the economy, and thus almost life itself, is outside of the grasp and control of government to achieve that goal.
When the time value of money is suppressed by massive supply to nearly zero, there is no incentive to save. What appear to be "savings" are only forced by government regulations. For example, insurance companies and pension funds that must keep a certain percent of their assets in liquid form to pay near-future claims. So investent comes from government money-creation, and in economic reality these real assets come by diluting the value of the money stock via embezzlement. The entire planning process is distorted and when the political means that drives such money printing and credit expansion are exhausted, the time value of money will quickly move towards a market-based value, meaning upwards.
Projects that were "sustainable" last week are suddenly no longer sustainable with higher interest rates. The bankruptcies that follow only destroy additional real wealth. No good thing comes when goverment suppresses the time value of money!
Amazing the posts ZH generates. Thanks!
Your dreamworld doesn't exist, though. There's not a single example from history of the "fully free market" and that "stable" form of capitalism.
The commitment to these beliefs is dogmatic, in direct opposition to every known economic record. You may as well be talking about the Flying Spaghetti Monster.
You can never be disproven, of course, because there's never going to be a way to *test* anything. Just like I can never be disproven when I say there is or isn't a god.
Good thing Bill Gross manages other people's money , as his calls have been wrong for at least 20 years