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Nassim Taleb On #OccupyWallStreet And His Updated Views On The Global Banking System

Tyler Durden's picture





 

There was a time when Nassim Taleb media appearances were a daily thing. Then he decided to take a sabbatical from the public's eye, and literally fell off the face of the planet. And while over the past year or so, he has gradually resurfaced, his extended discussions on various topics are still almost as rare as a double digit move in the Dow Jones Industrial Average. Tonight he broke his vow of silence, and joined Bloomberg TV's in discussing the "Occupy Wall Street" protest, which he expects to devolve into class warfare, as well as his view of the global banking system. And an interesting tangential discussion to develop is his observation of applying the principles of the "Hammurabi's Code" to the banking system.

 


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Tue, 10/18/2011 - 21:58 | Link to Comment frank
frank's picture

Marxism. Coming to a country near you (unfortunately).

Tue, 10/18/2011 - 22:07 | Link to Comment Pladizow
Pladizow's picture

Nassim has been his own Black Swan.

Eventhough it has been easy to agree with him, his investment recomendations have performed less then stellar.

Tue, 10/18/2011 - 22:16 | Link to Comment TruthInSunshine
TruthInSunshine's picture

Taleb has done quite well, actually, though he trades options for outsized events, and uses a philosophy that counts on the inevitable big and bad happenings, every so often, to more than offset the small bleeding of a thousand paper cuts.

For the uninitiated on Taleb (most on ZH are familiar, though), here is must read synopsis of his philosophy, using the backdrop of a compare and contrast true story of his dealings with Victor Nieferhoffer.

Even for those who are familiar, and who haven't read this, should read it.

It's that good.

Blowing Up

from the New Yorker

DEPARTMENT OF FINANCE

How Nassim Taleb turned the inevitability of disaster into an investment strategy

1.

One day in 1996, a Wall Street trader named Nassim Nicholas Taleb went to see Victor Niederhoffer. Victor Niederhoffer was one of the most successful money managers in the country. He lived and worked out of a thirteen-acre compound in Fairfield County, Connecticut, and when Taleb drove up that day from his home in Larchmont he had to give his name at the gate, and then make his way down a long, curving driveway...

gladwell dot com - blowing up
Tue, 10/18/2011 - 22:25 | Link to Comment I think I need ...
I think I need to buy a gun's picture

They got us no matter what,,,,,I'm watching CNBC special about prisons.....they have inmates working for 2 cents a day MAKING GOODS TO SELL.....China has just met their match,,,,Instead of doing things right and having it set up so people have jobs in private industry so they don't end up in prison.....They have it set up so everyone is going to prison and working for 2 cents a day building everything and anything and the prisoners apprecitiate the pay.

There are a whole bunch of people at the top making a TON of money not only from China  trade but every aspect,,,this isn't going to change no matter what,,,,,WE ARE OWNED bitchez,,,,,get your gold while its still cheap because it will be gold 50000 and we have $6.75 an hour jobs available everywhere after this. They didn't tell you gas will be 5 dollars a gallon and the tolls to work will be on every street because they own those too.....So you'll have a little for food after a days work

Tue, 10/18/2011 - 22:34 | Link to Comment Crisismode
Crisismode's picture

When it is time

 

To hold the throats of the rich

 

to the chainsaw of Justice

 

And watch thier heads spew forth the blood of their vile hideous infamy

 

Only then will the scales be balanced.

 

In the End,

 

There can be

 

only One.

Tue, 10/18/2011 - 22:48 | Link to Comment i-dog
i-dog's picture

"......the throats of the rich......"

It's shit like that that foments class warfare!! The chainsaw should be applied to your throat (or to whoever first published it).

The problem is not the rich, the problem is the thieves that have used the guns of the government to steal your money ... ie. any banker or business that has received a bailout, or subsidy, or single-bid government contract above market rates.

Tue, 10/18/2011 - 22:58 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

+1

Wed, 10/19/2011 - 01:28 | Link to Comment AldousHuxley
AldousHuxley's picture

Nassim Taleb's Marc Faberishly humorous quotes highlighted:

OBAMA

  • "[Obama] administration seems to be completely impervious to any rational behavior concerning the crisis"

 

BANKING

  • "Banks have made 2.2T past 5 years. It is a business that doesn't make money. And projected 5T next 10 years....It is tax on citizens"
  • "You make money, you keep it. You lose money, society backs you up. It doesn't exist in any other world."
  • "You need something to break the bank cartel for the sake of the financial industry"
  • "Banks have been able to hide their real economic P&L...Banks are in a busines of hiding risk"
  • "We are serving them [banks], rather than them serving us"
  • "Banks have never made money in the history of banking"
  • "They themselves don't know what risks they have"

 

ECONOMIC SYSTEM

  • "The system we have now is not a normal economic system"
  • "We are not living in capitalism, we are not living in socialism, we are living in some weird combination with a cartel"
  • "Capitalism is about incentives, but also disincentives"

FED

  • "Federal Reserve policy is there to help the banks."

 

BANK BONUSES

  • "They caused the crisis, we know that. Last year, they had a record bonus. This is not something that is rational"
  • "They are hijacking the American economy then saying that you need to pay us bonuses'"
  • "The core of this situation is a problem concerning bank compensation"
  • "The only information you get from bank earnings is the compensation. Only valuable information you can get from [bank earnings] is how much they pay themselves"
  • "Anything above zero is too much money....if we bail you out, you should not be paid a bonus"
  • "If you are a banker, and we will bail you someday, then you cannot earn more than a civil servant of a corresponding rank"

GREECE

  • "European banks don't mark Greece at what it should be marked at"

 

 

 

Wed, 10/19/2011 - 02:56 | Link to Comment Ghordius
Ghordius's picture

Love Taleb

keep it simple:

BREAK THE MEGABANKS CARTEL

Wed, 10/19/2011 - 03:15 | Link to Comment gojam
gojam's picture

Not really thought through though, is it ?

Wed, 10/19/2011 - 04:54 | Link to Comment AldousHuxley
AldousHuxley's picture

perhaps somewhat paranoid as seen in the video? CIA and FBI looking into character assasination? Banksters talking to Putin about how to proceed with polonium poisoning?


http://en.wikipedia.org/wiki/Alexander_Litvinenko_poisoning

 

 

Also, he is exactly on point when he says OWS is second generation marxist class struggle.

 

For those who have watched too much Fox News or never bothered to learn what Karl Marx actually said....

 

Capitalism according to Marxist theory can no longer sustain the living standards of the population due to its need to compensate for falling rates of profit by driving down wages(what US had last 30 years in comparison to real inflation), cutting social benefits (austrity) and pursuing military aggression(wars, wars, wars).

 

Marxist analysis leads to the conclusion that capitalism oppresses the proletariat, the inevitable result being a proletarian revolution.

 

Capitalism's faults are not being dealt with fairly and labor is waking up. This will lead US into socialism or worse communism. this is what Nassim is worried about. When the rules of capitalism is not enforced, people will vote for socialism and true capitalists will be punished along with faux capitalists (ie. AIG)

 

 

 

Wed, 10/19/2011 - 06:38 | Link to Comment YHC-FTSE
YHC-FTSE's picture

Every time I run into one of your posts, I'm startled by the material at your fingertips. You must be a walking political almanac! Thanks for contributing mate.

Wed, 10/19/2011 - 21:32 | Link to Comment Thomas
Thomas's picture

Not sure we go the distance that you  describe, but I believe that we need to look into the abyss.

Wed, 10/19/2011 - 09:58 | Link to Comment Christophe2
Christophe2's picture

@AldousHuxley / Nassim quotes:

Ultimately, I was rather unimpressed by what this guy had to say in the end (even if I liked quite a bit of it).  In fact, I'd say instead that he was quite right about his solution being too little too late, and it not being likely to be acceptable to the protesters:

- what about prosecuting the banksters for the massive frauds they committed?  Reduced / eliminated bonuses in the future is NOT ENOUGH

- what about corporate person-hood and the fact that our politicians are all inevitably 100% bought out?

- what about our criminal wars and permanent state of abuse abroad?

-...

 

We have some major problems besetting us, and just cutting down on some banker bonuses is not gonna cut it, IMO...

=> that being said, I liked the Obama comment, in particular :P

Wed, 10/19/2011 - 10:24 | Link to Comment YHC-FTSE
YHC-FTSE's picture

+1 Here, here (On your bold bits)!

Didn't comment on the video before (It wouldn't play), but just seen it and unlike you, I'm quite impressed with what he had to say about the banking cartel (Not his delivery, which was sadly terrible). Sure, it's nothing to a regular visitor to ZH, but coming from Taleb on an msm channel, it made my day. 

Tue, 10/18/2011 - 23:58 | Link to Comment Seer
Seer's picture

Still missed the target!

When will people stop whacking away at the branches and go for the roots?

No, it's not the "rich," it's WHAT THEY DO AND WHAT THEY REPRESENT that is the problem!

Who was it, GW Bush?, who is now going around saying that we need people to work up plans to give us 4% growth or something.  WTF?  We DON'T have the resources to do that, not now, not ever (again)!

The "rich" are junkies (the rest are just casual users who would love to be able to afford a full blown habit) of the drug GROWTH, even though it will KILL them!

Setting your consumption based on totally unsustainable activities is the road over the cliff.  Anyone what can't get this simple idea ought to be recipients of the Darwin Award.

Yes there's corruption, always has been, always will/would be, but the reason why it's gone so terribly bad is because the music has stopped.  WE ALL PARTICIPATED in the game of "let's pretend we can grow indefinitely!"  And now since we're finding that our little fixes aren't there we're hollering at those that are still drugging it up!

The "rich" have no problem giving us a different set of laws and in executing us.  What is it that religions ask of people?  Convert else you'll go to hell?  Well, they best start showing some sense of conversion otherwise it's a sure thing that they'll be seeing hell.  History tells us that mass de/re-programming is a bitch.  Not saying that I'm FOR it, just saying that it's just the return side of "what goes up."

Wed, 10/19/2011 - 00:30 | Link to Comment Oh regional Indian
Oh regional Indian's picture

Git yer roots right here. If you dare.

ORI

Knowledge for OWSers

Wed, 10/19/2011 - 01:15 | Link to Comment Things that go bump
Things that go bump's picture

Sorry, i-dog, no need to foment class warfare, it is always simmering just below the surface. Warren Buffet has stated publically that his class is winning.  The throats of the poor are where the rich put their boots, but the throats of the rich are the traditional meal of the guillotine.  A mob doesn't care about guilt or innocense, it cares about vengence and it will take it where it finds it.    

Wed, 10/19/2011 - 01:29 | Link to Comment Milestones
Milestones's picture

abort!!

Wed, 10/19/2011 - 06:07 | Link to Comment Stylianos Kyriacou
Stylianos Kyriacou's picture

spot on

Wed, 10/19/2011 - 18:06 | Link to Comment ATM
ATM's picture

The "thieves that have used the guns of government" I think the chainsaw should be applienot to the recipients of the bailouts but to those that take our money and give it to these pukes.

It's the bureaucrats who deserve the chainsaw because they use the guns of government to steal, to feather thier beds and live like kings but don't have the messy money to deal with. They can let the bankers have that because when you control the money you don't actually NEED the money.

Tue, 10/18/2011 - 23:00 | Link to Comment Harlequin001
Harlequin001's picture

He missed it, the cause is nothing to do with class warfare or bankers.

The system is inherently insolvent and begets greater insolvency the more you bail it out. It's a mathematical fucking certainty.

It just plain doesn't work. Sure everyone's pissed at bankers making huge bonuses but the problem is that government is too big and relies on banks for funding.

He missed the whole point. We need smaller government, and the only thing that can return it is a new gold standard.

Tue, 10/18/2011 - 23:15 | Link to Comment Libertarians fo...
Libertarians for Prosperity's picture

 

 

The system is inherently insolvent.....   the problem is that government is too big and relies on banks for funding...

Can you explain when this happened?  When did guuubbbermint get too big?  When did it go insolvent?  What amount of debt was the trigger point and why?

Also, can you tell me what would happen to all our debt if we took Ron Paul's advice and went to a gold standard, which you're advocating as well.  Wouldn't a gold standard suddenly collateralize all our debt?

Is it possible that you're just puking up an endless amount of cliches and, in actuality, you have no idea what you're talking about?

 

 

 

Tue, 10/18/2011 - 23:26 | Link to Comment i-dog
i-dog's picture

When did guuubbbermint get too big?

A: The very day that it was first formed!!

There is nothing that a government does that cannot be more efficiently performed by private enterprise ... including private insurers against unemployment, privately funded defense, and private subscriptions to active charities.

Tue, 10/18/2011 - 23:28 | Link to Comment Libertarians fo...
Libertarians for Prosperity's picture

 

 

LOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOL

LOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOL

THAT'S FUNNY!!!!!!!!!!!!!!!!!!

THE GUUUUBBBERMINT IS 2 BIG AT ANY SIZE!!!!!!!!!!!!!!!!!!!!!!

 

Wed, 10/19/2011 - 00:04 | Link to Comment Seer
Seer's picture

And when all those "private" entities can (just as is/would be the case with govt]) no longer keep the growth game going, then what?

Wed, 10/19/2011 - 06:52 | Link to Comment i-dog
i-dog's picture

The "growth game" is a function of population growth ... and governments promoting population growth to line up future taxpayers. It's not like the world didn't already have enough mouths to feed 20 years ago, 50 years ago, 100 years ago.......!!

As for resources needed to satisfy desires of even a stable population, scarcity and increasing prices will do wonders for rational allocation of diminishing resources ... especially when combined with stewardship of declining resources at a community level. Farmers don't destroy their environment for the opportunity of just a single bumper crop ... communities are the same with their water and energy resources (except for the religious nutters on Easter Island a few centuries ago -- but nature removed them from the gene pool) ... whereas distant state or federal governments don't give a shit about your environment when they are satisfying a need of a lobbyist hundreds or thousands of miles away (just as multinationals don't care about your neighbourhood when they frack it, poison it, or flatten it)!!

Wed, 10/19/2011 - 00:24 | Link to Comment Rick64
Rick64's picture

Idog

 I understand your viewpoint and agree with most of it, but I think there is a balance between having an adequate government and having a huge and ever growing monstrosity that has its fingers in everything. There was a time when the government wasn't so imposing and many laws, regulations, policies were dealt with on a local or state level, but the big money still dominated those areas as well and they had their share of corruption, fraud, and crime. Maybe it was on a smaller scale but it was still the same outcome. The only difference I can see is that the taxpayers weren't on the hook for everything, but the reason for that could be that the tax system wasn't really developed then. I agree that private corporations are going to run on the basis of making a profit (providing there is no chance they get bailed out by the gov.) where the government doesn't have the need to make a profit, but without any regulation wouldn't those government programs that were privatized be prone to taking advantages of its citizens?

Wed, 10/19/2011 - 06:47 | Link to Comment i-dog
i-dog's picture

There's never really been an opportunity in the past for communities to learn to manage themselves and live in peace with their neighbours. First we had feudalism under the control of a nobility and the church. Then, as soon as we broke free from that, statism reared its ugly head to replace the monarch and their retinue of local administrators (lords, knights, bishops and priests) with a government that simply started growing.

Nearly all wars, then and now, have been caused by fighting over religious ideology (including the religion of "Statism ... our way!"). Though the churches have been the most voracious parasites of all, they have also encouraged governments to adopt their hierarchical system of top-down control ... so that they could always control governments merely by fraternising at the top (as they did with the pharaohs and kings). It's still going on today.

An exception was the American colonies. They negotiated with the indians to purchase their lands and lived without the colonies going to war with each other (or the indians) for quite some time ... until the European monarchs stepped in and attempted to exert control over (ie. tax) the independent colonies as they started to flourish. It's too complicated to go into here, but most of the problems in the US prior to federation were caused by external factors (as well as a population explosion that was beginning to alarm, and encroach on, the indians).

We have an opportunity now to rethink attitudes to population explosions and exporting ideologies (both religious and social) behind imperialist armies ... since the planet is already 'FULL!' ... to remove those factors going forward.

Wed, 10/19/2011 - 22:05 | Link to Comment Rick64
Rick64's picture

There will never be a perfect opportunity for this to happen. There will always be outside influences with more money and power. Mans greed is something that can't be extinguished. If a society like the one you are describing ever established itself, it would always be vulnerable to these influences and you will need some kind of government to fend off these threats.  The way around government getting too big or exerting too much control is too put more power in the peoples hands where they would demand accountability. IMO

Thu, 10/20/2011 - 01:26 | Link to Comment i-dog
i-dog's picture

"you will need some kind of government to fend off these threats"

Please explain how "some kind of government" is more able to defend a small state than a voluntarily citizen-funded, privately-owned, for-profit, defense force - particularly when all the citizens are also armed? (Hint: there's no profit if there are no customers/subscribers willing to continue paying for poor or corrupt service).

"put more power in the peoples hands where they would demand accountability"

Do they indeed demand accountablility? Didn't the FF put an amazing amount of power in the people's hands? ... And warn them of the consequences of failing to remain vigilant? ... Then immediately proceed to lead an army against the people to collect an unconstitutional new tax (George Washington), sell out the new national currency to the bankstaz (Hamilton), and embark on imperial expansion (Jefferson)? ... All under the cover of a carefully crafted republican constitution that "the people" still worship!?!

The best form of defense is self-defense.

Thu, 10/20/2011 - 02:22 | Link to Comment Rick64
Rick64's picture

Please explain how "some kind of government" is more able to defend a small state than a voluntarily citizen-funded, privately-owned, for-profit, defense force - particularly when all the citizens are also armed?

  If I understand your ideology (from previous posts and this one) then you are saying that states should be independent and without a federal government. Lets just say for an example: another state decides to attack your state because you have more oil and they don't have enough, but their military force is bigger as well as their population. Would your private military be able to fend this attack off and would you have enough funds to pay them if the conflict dragged on. Wars are costly. How loyal would they be if they thought you couldn't pay them or they were outnumbered. Private companies are willing to sell their loyalty to the highest bidder. So what if another state offers them a better deal and then you are left without a defense force. This idea would leave you vulnerable to an easy coup attempt.   Is there any example of this in history?

Do they indeed demand accountablility?

No they didn't and don't that is the problem. There has to be a way that the citizens would be motivated to be involved. You will get no argument from me about this or the fact that our government was corrupt from day one. The forefathers were just like our politicians today, saying one thing then doing another.

Thu, 10/20/2011 - 07:25 | Link to Comment i-dog
i-dog's picture

"Lets just say for an example: another state decides to attack your state because you have more oil and they don't have enough"

You mean like the US in the Middle East? LOL. We are arguing from different perspectives: I from the perspective of an entrepreneur/trader (think ancient China, modern Germany, Sweden, Norway, Japan, etc); you from the perspective of the predator/thief (think imperial Britain, modern USA). I'm not directing this at you personally, but at the education you've absorbed.

From my perspective, if I don't have something, then I'll trade something else for it. From your perspective, if I don't have a car, I should find an auto dealership that has some and steal one from them at gunpoint!

Politics is about forming mutually beneficial alliances to guard against the predators - in the manner of how an entirely voluntary neighbourhood watch protects the little old lady from being robbed by the teenagers down the road; or how Venezuela and Iran have managed [so far] to avoid being invaded by the US - because powerful friends OR nuclear weapons are a major deterrent to the predator! Predators only go after easy targets.

You need to think outside "the American Way"!

Thu, 10/20/2011 - 14:29 | Link to Comment Rick64
Rick64's picture

I was trying to come up with a worst case scenario. I think its important to look at things from all perspectives not just one. I have overcome most of my educational brainwashing. I was thinking more along the lines of Russia, Ukraine, Georgia ect.. than the ME.  Venezuela and Iran have both had to fend off attacks, but they don't have a privatized for profit military.

 I am not disagreeing with you because of ego or because of my education, and I don't reject your ideas infact I agree with them for the most part.  The part I have trouble with is the privatized military and zero federal government .  Many ideas sound great until you break it down and find things that might have been overlooked. If I understand you correctly you would like each state to be its own sovereign country? My idea is that we remain the U.S. but the federal government plays a reduced role as well as drastic downsizing, and the states have the power to govern without federal interference. I enjoyed the discussion.

Wed, 10/19/2011 - 01:15 | Link to Comment AldousHuxley
AldousHuxley's picture

Obviously never worked in a giant Fortune 50 corporate.

 

When you have hundreds of thousands of people in an organization, you will have more corruption, bureaucracy, and inefficiency than smaller organizations simply due to sheer size. Well US government has 2 million employees. It doesn't matter private, public, non-profit NGO....huge organizations are all useless just existing to keep the monopoly with heavy subsidies. Economy due to scale gets offset by scalability issues and overhead.

 

Key is to break large organizations up so that they compete against each other. Break up the banks!

Wed, 10/19/2011 - 06:23 | Link to Comment i-dog
i-dog's picture

"Obviously never worked in a giant Fortune 50 corporate."

Thanks for the gratuitous insult!

I've been employed by the biggest as a regional manager and as a consultant to 2 others in the top 10 (and around 30 of the Fortune 500, as well as some governments) and have successfully implemented a version of anarchy (decentralisation and autonomy) into all of them. They and I know that it works, which is why I got so much repeat and referral business. ;-)

The US federal government only has 2 million employees because it was allowed to start with a handfull in the first place! There is no competitive limit to growth with government, which is why it will always grow until it runs out of food (tax revenue).

Statism Is Dead!! Let go and give it a decent burial ... but, in the meantime ... SECEDE NOW!!

Wed, 10/19/2011 - 06:33 | Link to Comment Harlequin001
Harlequin001's picture

i-dog, yes, it grows because they create pointless jobs for nothing so that they can claim that unemployment is falling.

Then they use these people to regulate everything so that they can justify their existence, when in reality we would be better off without all this regulation and overhead so that everyone was once again responsible for their own due diligence.

And if they didn't want to do any DD they could simply hold their money in gold and do nothing.

But then how would government create so many utterly worthless and pointless jobs so that they could then tell us they were doing so well?

Wed, 10/19/2011 - 09:49 | Link to Comment Christophe2
Christophe2's picture

i-dog, I usually tend to agree with you, but in this case I find you are generalizing far too much, all in ways that seem to suit a pre-conceived bias (that 'all government is bad').

 

What about accountability?  Public institutions are accountable to the taxpayer and morality, while publicly traded companies are solely accountable to their stock price and are thus inherently amoral.  Granted, a good public image is important to your bottom line, but clearly the majority would rather spend on PR and advertising to craft a falsely positive image than concern themselves with morality or the long-term good.  There are good and bad private companies - can't there be good and bad implementations of public ones?  Can't you see the need, in certain cases, for moral rather than profit-seeking institutions?

 

What about inherently monopolistic businesses?  You will only have one cable company available at your location, just like you'll only have one line for electricity, one pipe for water and sewage (each), so the idea that these private companies are competing against one another is laughable: they parcel out the land amongst one another and inevitably fail to truly compete, since their customers are all captive!

 

What about job security?  There is no reason for us to accept the typical union demands for iron-clad job security, just like there is nothing to stop us from implementing "decentralization and autonomy" in a public/government environment...  Government institutions should be accountable to the public, just like the TBTF banks should be too...

 

In an era of secret societies having full control of the state and media/information (as well as the large corporations), with purely-evil think tanks scheming and implementing operations like 9/11 (and WW1, WW2, etc.), I think it is absurd to look at the failure of government and to conclude that such failure is inherent for all government institutions, or that the solution is no government.  Clearly, the secret societies and their conniving fraudsters need to be annihilated, our public policy determination need to be made completely transparent, and then we have a hope of seeing the good that government can do.

 

For example, public health care makes a lot of sense, IF DONE RIGHT (nothing makes sense when done wrong).  It is immoral to deny basic healthcare to anyone (especially children), or to bankrupt people for it, and it is absurd to think that committees aren't deciding who and what gets covered, be it in a public or private scheme.  It is also absurd to assume that it has to be all private or all public: there is nothing stopping people from getting (relatively very cheap) extra insurance to cover conditions or services that are not covered by the public option.  I could go on at length, but here's where I think the typical generalizing breaks with health insurance: compare it with your car or home insurance, and you'll realize that you can easily live without your car if it gets stolen or damaged, but you can't live with virulent cancer or a blood-gushing wound, and hence that it is ridiculous to try to make them comparable.  Car insurance can work well as a wholly private implementation, but private health insurance is inevitably immoral.

Wed, 10/19/2011 - 09:57 | Link to Comment TruthHunter
TruthHunter's picture

idog says "Statism is dead"

 

Your decentralization works because it increases personal responsibility. Good government is simply

leadership and cooperation. Even a Baboon troop needs it to survive. The toxic element is exploitation.

Whether its corporate or government, its the psychopaths and sociopaths that are bringing

down the system for short term gain. Their modus operandi is to steal credit and shift blame.

 

 

Thu, 10/20/2011 - 04:31 | Link to Comment Not For Reuse
Not For Reuse's picture

all hearsay & high school fantasy; thanks for the faux insight though, and good luck with your nondischargeable debt

Wed, 10/19/2011 - 06:46 | Link to Comment chindit13
chindit13's picture

"privately funded defense"

I believe that this is somewhere between civil war and warlords, i.e. 1970's Lebanon and Mandarin China.

The US is trying this now with Blackwater/Xe.  Doesn't seem like such a good thing.  Are you really Eric Prince hiding behind your sleeping Snoopy avatar?

I happen to live in a land where---while there is a government military enterprise, albeit an arm of a self-appointed junta---there are a dozen or so private armies.  Some are ethnic automony movements, while others are the military branch of a "pharmaceutical export venture".  Just like Macys and Gimbels, these guys like to compete.  Get caught in the middle of one of their business disputes, and it ain't pretty.  Reminds me of the Star Spangled Banner...all the rocket's red glare, the bombs bursting in air

While I'm not often in agreement with the US' current military advantures, I do think it is the lesser evil if the alternative is privatizing defense.

Wed, 10/19/2011 - 08:14 | Link to Comment i-dog
i-dog's picture

While it is frustrating debating with someone who is quick with the snide remarks but has no creativity or problem solving ability, I'll give it a shot...so that you'll have some ideas to start with:

Firstly, if there is no government, then there is no seat of power (ie. tax collection) to be captured and turned to the invader's advantage. Additionally, if the populace is well armed, as in the US and Switzerland, an occupying force (for what reason, pray tell?) would need to be of about the same order of magnitude as the population they are invading, lest they get bogged down in a very expensive guerilla war. Iraq, Afghanistan, Vietnam come to mind; Costa Rica doesn't even have a standing military.

Secondly, if there is no government carrying out enforced mixing (or genocide) of minorities, then there would be no need for an "ethnic autonomy movement" to carry out armed resistance.

Thirdly, if there are no national laws prohibiting certain naturally occuring pharmaceuticals, then there would be no need for an armed "pharmaceutical export venture".

Fourthly, competition between small-scale defense providers -- each with advanced weaponry (hopefully including at least one MAD alternative) and acting in the interests of those actually paying for their manpower and equipment -- would self-limit their scope to "go rogue" (certainly less scope than the current FEMA, ATF, FBI, DHS, CIA have right now!).

Fifthly, situations like Somalia (*sigh*...the old Somalia argument trotted out ad nauseum), where a failed state is being fought over by regional and international religious and statist powers attempting to impose a new government before anyone else gets any ideas about "leaving the reservation", are actually a lot more peaceful than the captive MSM would have you believe...and in much better social shape than any of their neighbours.

Finally: It's nice to know that you occasionally disagree with US military adventures...since I believe you actually work for them in an "unofficial" capacity. ;)

Wed, 10/19/2011 - 11:13 | Link to Comment YHC-FTSE
YHC-FTSE's picture

I like your posts i-dog, and your views are understandable to anyone who has even the slightest knowledge about the monstrous behemoth that is the federal government which desperately needs to be cut down. But just like "zero govt", another passionate poster, I think your preconceived ideas of having no government is not quite well thought out. Especially privatising security in an elementary game theory scenario.

 

They are good ideas, in the same vein as John Lennon's Imagine, but just as it is fantasy to believe that governments can be the drivers for growth, peace and prosperity instead of being the natural haven for sociopaths, oligarchs, and crooks milking the system for all its worth, it is a fantasy to believe that those same sociopaths, oligarchs and crooks would not prosper even more without the framework of an authority, which given the right personnel should be protecting its citizenry instead of protecting the crooks from retribution, and even rewarding them for their crimes. 

 

It's always down to personnel. I dare say humanity really ought to be ruled by incorruptible machines (No, not Skynet, but something much more benign), that cannot be coerced, bribed, drugged, sexed, or plain old killed by powerful, wealthy criminals constantly trying to undermine a good system of goverment that should be working well if kept to a manageable size. The thing I've learned about people is that you can give them great ideas, philosohies and concepts, but once they have it, they will always manage to subvert it and fuck it up. Barring the election of an algo for president, Ron Paul might be the right sort of "personnel" we need in the WH. 

 

As I said, I really do enjoy your posts mate, so I hope I haven't pissed you off too much with my views. 

Wed, 10/19/2011 - 20:33 | Link to Comment i-dog
i-dog's picture

Thanks for the compliment, FTSE. It's people like you, who offer reasoned counter-arguments without ad hominems and snide remarks, that keep me coming back to ZH (well, that and Tyler's rapier wit).

"government ...... the natural haven for sociopaths, oligarchs, and crooks milking the system"

That's exactly why any "system" (ie. anything other than true anarchy, self-organising and reorganising fractally under natural law) is always destined to failure: A system is always able to be subverted (hacked). "Build it, and they will come"...

You even recognise it yourself!...

"The thing I've learned about people is that you can give them great ideas, philosohies and concepts, but once they have it, they will always manage to subvert it and fuck it up."

Anyway, don't worry about me: Though I occasionally attempt to dispense advice, I'm a sovereign individual and live in [very] happy isolated anarchy while surrounded by all the worker bees busily feeding the queen and raging against the machine! I have no rage ... and certainly no expectation of seeing true anarchy any time soon -- particularly not in fanatically religious America. "The System" won't allow it. :)

Thu, 10/20/2011 - 06:48 | Link to Comment YHC-FTSE
YHC-FTSE's picture

;) Cheers. I can only spend 20 mins at a time during weekdays to enjoy the posts at zh, but it's quality time well spent, even when I disagree, thanks to people like you. 

Tue, 10/18/2011 - 23:27 | Link to Comment LowProfile
LowProfile's picture

Can you explain when this happened?

1913 (Fed)

When did guuubbbermint get too big?

1939 (Roosevelt, devalued dollar, seized gold, taxed future Americans)

When did it go insolvent?

1964 (Johnson, to pay for the "Great Society" & Vietnam)

What amount of debt was the trigger point and why?

Hard to say, but it was when government started using debt to fund it's growth.

Also, can you tell me what would happen to all our debt if we took Ron Paul's advice and went to a gold standard, which you're advocating as well.  Wouldn't a gold standard suddenly collateralize all our debt?

Pretty much, but if you don't own any now, I bet you won't like the price...

Is it possible that you're just puking up an endless amount of cliches and, in actuality, you have no idea what you're talking about?

Possible, but unlikely.

More likely that you're trollin' for a beatdown. 

Done!

Tue, 10/18/2011 - 23:39 | Link to Comment Libertarians fo...
Libertarians for Prosperity's picture

 

 

Your post is absolute nonsense. Truly idiotic.

All you've gone is posted a series of randomly selected dates without the slightest bit of evidence or supportive information for the claim at hand. 

For instance, what proof do you have that the United States went insolvent in 1964? 

Do you even know what "collaterize our debt" means?  From your response, you clearly don't.  Yet you responded, anyway?

All in all, a fantastically dumb post.

If this were a test, you'd get an F. 

 

Wed, 10/19/2011 - 00:59 | Link to Comment Harlequin001
Harlequin001's picture

which is precisely what you have done.

' All you've gone is posted a series of randomly selected dates without the slightest bit of evidence or supportive information for the claim at hand. '

Couldn't have said it better myself. Now if you wouldn't mind giving us some kind of even very basic argument to rebutt it, I think we'd all feel somewhat better about your pointless and unsupported blurb...

Wed, 10/19/2011 - 00:12 | Link to Comment Seer
Seer's picture

So, none of this had to do with (preexisting) fractional banking?  Fractional banking IS OK?

Elephant in the room: perpetual growth on a finite planet.  Federal Reserve or not.  (Even) fiat or not.  This kind or govt or That kind of govt.  NONE changes the destiny of humans running into the brick wall of insufficient resources (unless we all figured out how to manage ourselves on a sustainable level); the only affect is on the time-frame.

Wed, 10/19/2011 - 03:14 | Link to Comment Woodyg
Woodyg's picture

For the record - federal debt as of jan 1981 - less than 1 trillion

Debt as of jan 1989 3 trillon

Ole raygun raised the fed debt more than every president from washngton to carter Combined.

200% in 8 years.

Thats one i bet even obomber can't beat

Tue, 10/18/2011 - 23:30 | Link to Comment Demonoid
Demonoid's picture

Can you explain when this happened?  When did guuubbbermint get too big?  When did it go insolvent?  What amount of debt was the trigger point and why?

You used to be a child. Now you're an adult. Can you explain when this happened? Which day of your life did you definitively slip out of childhood and transform into an adult?

Insolvency, like aging, is a process, not an arrival. Over time, more and more people notice that you're getting older; over time, more and more people begin to realize that a government's finances are well and truly screwed. When enough people realize that, market psychology takes over and begins an unexpectedly rapid and unstoppable rebalancing of the system.

One can study reconstructions of the onset of ice ages as an example of how nondeterministic, bi-stable systems switch from one strange attractor to another. In short - quickly, violently, utterly.

 

Tue, 10/18/2011 - 23:50 | Link to Comment Libertarians fo...
Libertarians for Prosperity's picture

 

 

*LOL*

Is that really your answer?  Insolvency is sort of difficult to pinpoint?

Do you even know what insolvency means?

Can you explain why the United States is able to finance our debt at WORLD RECORD low rates while we're - supposedly - insolvent?

You guys just puke up cliche after cliche after cliche, and have absolutely no idea what you're fucking saying.  The fact that you have the ability to vote is terrifying.

 

 

Wed, 10/19/2011 - 00:39 | Link to Comment Harlequin001
Harlequin001's picture

It's what happens when you print up paper money and 'invest' it in a bank under a fractional reserve system that can then buy 9 or 10 times as much debt back from you with it's 'asset'. Hence the ultra low interest rates; we won't talk about Op Twist II because that might really ruin both (what appears to be) your argument and your day.

The problem is when people start taking money out of banks or governments can't continue to put more in because prices are rising because the collapse is equally as fast, which is precisely what will happen when people stop storing their wealth in imploding property, collapsing stock markets and defaulting government debt, which is an inevitable consequence of rising inflation and with it interest rates. That's when you find out the scale at which government deficit is too big, i.e. can't fund itself under any circumstances and collapses.

You might want to go look at Greece, because this is what happens after the 'fix' is gone...

Coming to a country near you soon, inevitably...

But I suppose we can all take comfort from knowing that people like you had the vote all along. Now where was our mistake?

Wed, 10/19/2011 - 00:49 | Link to Comment Libertarians fo...
Libertarians for Prosperity's picture

 

 

holy fuck. 

It's abundantly clear that you've just puked up a bunch of random libertarian buzzwords/phrases and attempted to compile them into a meaningless post.   

What question are you even answering? Are you trying to give a Grade F explanation of how a country goes insolvent?  I don't even know wtf you're trying to say.  Like I said.... random libertarian buzzwords/phrases that amount to nothing.

Truly, you guys seem highly opinionated about a subject matter you know absolutely nothing about.  Just cliches and buzzwords. No substance. No historical precedent.  Nothing but buzzwords.  You guys romanticize life without the Fed and unfettered capitalism without having the slightest understanding of the consequences.    

 

 

Wed, 10/19/2011 - 01:02 | Link to Comment Harlequin001
Harlequin001's picture

It's this kind of gibberish that we've come to expect from you. Now then what was your point again?

There is not one piece of constructive conversation in this entire comment...

funny that...

Perhaps we shouldn't refer to Greece as 'insolvent' just so as to not offend you or ruin your argument. But then we still don't know what your arguement is do we?

We're not talking about the Fed, we're talking about money and the way in which the Fed undermines it.

Surely you can grasp even that very basic concept...

Wed, 10/19/2011 - 01:11 | Link to Comment Harlequin001
Harlequin001's picture

That's the nice thing about internet trolls, and especially those that support the system of fiat money; you can't argue with mathematics and the simple fact that someone somewhere is going to ask not for their money but for their value back, and you don't have it.

These arguments always end the same, we pick you up, turn you over, give you a very public spanking and then drop you like a bag of cold puke.

Blog away Lib, we've got you covered...

Tue, 10/18/2011 - 23:31 | Link to Comment TheMerryPrankster
TheMerryPrankster's picture

Who owns the government debt?

The federal Reserve- most of the debt is interest.

Destroy the Fed, issue government bonds and pay the interest directly to the people who buy government bonds.

Remove the Federal Reserve and you restore democracy and financial stability.

Tue, 10/18/2011 - 23:53 | Link to Comment Libertarians fo...
Libertarians for Prosperity's picture

 

 

Remove the Federal Reserve and you restore democracy and financial stability.

*LOL*

You might have well just posted, "I have absolutely no understanding of American banking history or American economic history between 1865 and 1913. I pay my taxes, and so I have a right to be highly opinionated on subjects that I know nothing about!"

 

Wed, 10/19/2011 - 00:26 | Link to Comment Harlequin001
Harlequin001's picture

but why would he need to when you already have?

Perhaps you would be good enough to, instead of just telling everyone that they don't know what they're talking about, explain to us why we don't really need these bailouts, why we don't really need these deficits so that we can all understand your truly enlightened understanding of the reality that is not?

Because I'm curious as to why with all this financial collapse under this fiat system you don't seem to think that financial stability under a gold standard is anything more than idiotic...

But then some people are incapable of learning, which is by definition, stupid...

The floor is yours...

Wed, 10/19/2011 - 00:48 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

1865 and 1913

That's when the world went off of the gold and silver standard!  Good work.

Tue, 10/18/2011 - 23:55 | Link to Comment FEDbuster
FEDbuster's picture

First this quote:

"When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes... Money has no motherland; financiers are without patriotism and without decency; their sole object is gain."
- Napoleon Bonaparte, 1815

 

No need for government debt.  Listen to this common sense solution from Bill Still:

http://www.youtube.com/watch?v=qoVlcWvxffc&feature=channel_video_title

Wed, 10/19/2011 - 00:18 | Link to Comment Seer
Seer's picture

And what about fractional banking?

P.S. How can "democracy" be restored with the word/phrase doesn't even exist in the US Constitution? (see for yourself: http://www.archives.gov/exhibits/charters/constitution_transcript.html)  Kind of makes it a bit awkward for those warmongers to use the excuse of "spreading democracy" as they pillage, eh?

Wed, 10/19/2011 - 00:30 | Link to Comment Rick64
Rick64's picture

Fractional reserve banking's best friend? War = massive borrowing or debt.

Wed, 10/19/2011 - 07:14 | Link to Comment AldousHuxley
AldousHuxley's picture

US is a constitutional republic where constitution only guarantees a "Republican Form of Government"

 

republic guarantees avoiding feudalism where head of state is elected instead of a hereditary monarch, and avoiding democracy of majority mob rule by following the rule of law except in case where government powers are limited by the bill of rights + amendments

 

But history tells us that what is written on paper can be violated time and time by those in power and most forms of government in the past and present are oligarchies with other forms of government mixed in at different levels since you can't have true form of any government in reality.

Plus all of this government theories do not really matter to 99% of people whom just labor then die off.

Forms of government only matter to those who are elite who want to challenge the super elite.

 

Wed, 10/19/2011 - 10:21 | Link to Comment Harlequin001
Harlequin001's picture

Yes, the only thing that can survive is the 'cycle of life' as we move from one system to another and then back again and so forth.

A gold standard will bring stability to the financial system only for a short while, until people demand more welfare and the money printing starts again  under a different guise.

Wed, 10/19/2011 - 00:20 | Link to Comment Harlequin001
Harlequin001's picture

Libertarians fo...

It seems that you have your answer already.

and clearly one of us has no idea what he/she is talking about.

Did you know there was a bank bailout once? Do you have any idea why we 'needed' it?

We can start from there and go downhill very quickly if it helps.

Maybe we should start at deficits, and who pays for them... and what happens to the value of my assets when 'nobody' does?

You do know what a deficit is don't you, and why we have them?

You don't seem to have much of a clue about anything else...

Wed, 10/19/2011 - 00:05 | Link to Comment Sgt.Sausage
Sgt.Sausage's picture

==> the only thing that can return it is a new gold standard.

 

We DONT WANT a gold standard.

A "Gold Standard" is nothing more than more fiat - Government, by decree, setting the value of gold. Gold standards have been tried an uncountable number of times in the past, and they have all failed. You cannot fix the dollar to gold. Or any other currency.

Yes - the dollar needs to be backed by gold. No - that value needs to float freely according to world market conditions.

The closest thing to ideal at the moment is Another, FOA, and FOFOA and their "freegold" movement - but even they, in their infinite wisdom, have got quite a few things wrong about how this should play out.

 

 

Wed, 10/19/2011 - 00:37 | Link to Comment dr.charlemagne
dr.charlemagne's picture

yes sarg, thats the right track

Wed, 10/19/2011 - 00:46 | Link to Comment Harlequin001
Harlequin001's picture

Well sarge, Actually I couldn't agree with you more.

It is simply easier in some conversations to refer to gold backing as a gold standard though I understand that they are very different, and that one is good and the other undermines it...

Wed, 10/19/2011 - 03:37 | Link to Comment macholatte
macholatte's picture

 

 

If the personal freedoms guaranteed by the Constitution inhibit the government's ability to govern the people, we should look to limit those guarantees.

-- Bill Clinton

 

Wed, 10/19/2011 - 05:24 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

To hell with Clinton and the many other potential tyrants that see the constitution as a nuisance because it limits their tyranny over the citizens.

Anyone that didn't see this coming when the azz hats passed the Unpatriot Act is a fool.

America entered a downward spiral when J F Kennedy was murdered and no one was held to account.

There are two Americas... Berfore JFK's murder... After JFK's murder... and they bear little resemblence to each other.

Wed, 10/19/2011 - 07:04 | Link to Comment Optimusprime
Optimusprime's picture

+10.  Thanks for the reminder.

Wed, 10/19/2011 - 02:59 | Link to Comment aha69
aha69's picture

Thanks TruthInSunshine for the link about Taleb/Niederhoffer. Have just experienced my own catastrophic loss and desperately need some solace. I sense a bit of light at the end of this tunnel now.

 

Wed, 10/19/2011 - 04:04 | Link to Comment Bob the Horse
Bob the Horse's picture

You have been sucked into the hype he has created.  His whole argument is that everyone else is rubbish becuase they don't understand probability but that he does.  Then he claims to be brilliant because he buys tail risk becuase he expects the unexpected.  But the facts are that his investment track record is crap.  Why?  Well, because tail risk is quite expensive!  Becuase the markets aren't as stupid as Taleb likes to claim.

Everytime something bad happens, Taleb claims he predicted it because he always said somethign unexpected would happen.  It's total nonsense.

Wed, 10/19/2011 - 07:07 | Link to Comment chindit13
chindit13's picture

Tail risk is only expensive when you're standing on the butt.

Another video (Kyle Bass) had an astonishing example.  Bass, who thinks Japan is screwed because they can no longer generate enough domestic savings to fund their deficit---and must compete with the US in international capital markets---said he bought $5 billion worth of multi-year downside protection (in his case naked) on JGB's for six tenths of one basis point.

250% Gov't debt to GDP, a negative savings rate, exports dropping, population ageing, population dropping, wildly underfunded pension system, and nuclear worries...point six percent sounds cheap.  Of course it was written by "a major US bank", so the taxpayer has the bank's back.

Wed, 10/19/2011 - 23:13 | Link to Comment Not For Reuse
Not For Reuse's picture

gotta disagree with you here. It's possible to buy extremely cheap "tail" insurance on almost any instrument at almost any time. And that's because the insurance almost always expires OTM. "Black Swan" theory is like reverse engineering Nostradamus. Eventually someone will be right about something

Wed, 10/19/2011 - 05:15 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

End the Fed... Thanks for the post of the Victor Niederhoffer blow up. I remember that blow up but don't recall where I read about it... some time ago.

A few, like VN, are fortunate and guess correctly many times in a row. After a while they begin to think that they are impervious to failure or a run of bad calls. Then they are wiped out by a black swan and realize that most of what they have attributed to their own intelligence was nothing but a run of good luck... otoh, Taleb could die of a thousand tiny cuts instead of going bust in one day. I wonder how Taleb calculates and quantifies the effects of Fed manipulation of asset mkts?

Also, I find it interesting that both Taleb and Rickards have used the term 'public utility' in the same sentence with 'banks' within the past week. Maybe Rickards is right and the Volker Rule will turn the banks into another form of public utility...and if this happens banker pay should be equivaletnt to that of a public servant and bonuses should be eliminated. If bankers are not brought into check Taleb could very well be correct about civil unrest spiraling quickly out of control.

Rickards post is at KWN if you are interested.

Wed, 10/19/2011 - 06:24 | Link to Comment max2205
max2205's picture

Here's why some euro countries won't be joining ows:

ZURICH (Reuters) - Global wealth could rise 50 percent to $345 trillion over the next five years, spurred by a near doubling of total household wealth in China and strong growth in Asia Pacific, Latin America and Africa, a Credit Suisse report released on Wednesday said.

The Global Wealth Report 2011 from Credit Suisse research said total global wealth jumped 14 percent between January 2010 and June 2011, ending the period at $231 trillion, with Asia Pacific countries responsible for 54 percent of the rise.

"These are times of unprecedented economic change, and a radical reconfiguration of the world's economic order is taking shape," said Osama Abbasi, Chief Executive Officer for Asia Pacific at Credit Suisse.

"Emerging markets are important drivers of the global recovery and remain the key growth engines of global wealth."

With an expected $81 trillion, the United States is seen remaining in the top spot in 2016 in terms of total household wealth, while China is set to leapfrog Japan into second place by almost doubling its household wealth to $39 trillion.

Adults in Switzerland, Australia and Norway are the richest in the world, with Swiss adults holding average wealth of $540,010, the only country where the average adult has more than

$500,000.

The net worth of the average Swiss person when measured in U.S. dollars, was bumped up by the strength of the Swiss franc, which rose about 10 percent in value against the greenback from the start of the year to the end of June.

Wed, 10/19/2011 - 07:03 | Link to Comment YHC-FTSE
YHC-FTSE's picture

Re: gladwell dot com - blowing up

 

The only Nassim Taleb's book (outside academic papers), I've read is "Fooled by Randomness", and although there were nuggets of real importance (interpretation of dumb luck, for instance) I didn't think much of it. I have real problems with his assertion that randomness is a real construct of the universe instead of a man-made conceptual device to explain the unexplainable. I know what he says about rationalizing random events, but to me, blaming randomness for an unforeseen event is like blaming voodoo or a deity of your choice. 

 

Anyway thanks for the recommendation. It was a really good read.

Thu, 10/20/2011 - 03:06 | Link to Comment Not For Reuse
Not For Reuse's picture

if you are still around, read Mallarmé's Un Coup de Dés. Reading Nassim's tripe is like listening to Bush talk about conservative values, or Obama talk about progressive values

Thu, 10/20/2011 - 06:42 | Link to Comment YHC-FTSE
YHC-FTSE's picture

Just noticed the reply. Thanks mate. 

Thu, 10/20/2011 - 02:57 | Link to Comment Not For Reuse
Not For Reuse's picture

except the truth is that 99.99% of the flock have already bled to death by that time. At least that's what's happened so far... Maybe we'll finally get that asteroid crash one of these days...

Tue, 10/18/2011 - 22:42 | Link to Comment Unprepared
Unprepared's picture

Bleak Swan with a devilish Volatility Smile bitchezzzzzzzzzz

Tue, 10/18/2011 - 22:47 | Link to Comment iNull
iNull's picture

Give him (let me look at my watch) a few more weeks.

 

Tick tick bitchez.

Tue, 10/18/2011 - 23:56 | Link to Comment your neighbor
your neighbor's picture

Nassim from 2008 "Definitely I am not voting for Ron Paul"

Anyone have more links for Nassim on his positon on militarism?

http://fora.tv/2008/02/04/Nassim_Nicholas_Taleb_A_Crazier_Future#fullprogram listen to last chapter 29 Q13

Wed, 10/19/2011 - 04:13 | Link to Comment fonestar
fonestar's picture

Doesn't take a genius to tell a black swan from a rubber chicken in these markets.

Wed, 10/19/2011 - 05:14 | Link to Comment Squishi
Squishi's picture

no mark to market.........................

bank cartel biatch! 

Tue, 10/18/2011 - 22:18 | Link to Comment chump666
chump666's picture

 chaos  baby

Tue, 10/18/2011 - 23:50 | Link to Comment buyingsterling
buyingsterling's picture

This Taleb fellow is talking about a banking cartel, which 'we all serve', and which grossly overcompensates its minions. This is the biggest hitter I've heard to date speak about the banks as a cartel. An encouraging sign. Even if he isn't talking about dumping fiat, he's talking about treating banks like utilities, and about a purer form of capitalism, ruled by an iron code of responsibility.

Wed, 10/19/2011 - 00:25 | Link to Comment Seer
Seer's picture

"ruled by an iron code of responsibility"

And then everyone wakes up from this wet dream to find that, surprise!, corruption is once again running rampant.

People WANT to be lied to.  This is why politicians are so successful!  Do folks think that people want to know that living standards can no longer go up and that they are going to go down because humans cannot extract enough resources to match growth demands?

Wed, 10/19/2011 - 00:50 | Link to Comment buyingsterling
buyingsterling's picture

"everyone wakes up from this wet dream to find that, surprise!, corruption is once again running rampant."

"humans cannot extract enough resources to match growth demands?"

 

This is fatalistic defeatism, in addition to being pure and unadulterated steaming bullshit.

As Taleb says, banksters and their minions are going to siphon off $5 trillion in wealth in the US alone over the next decade - just in BONUSES and compensation, not to mention rape through fiat. Let's start there. That's real wealth that's essentially stolen from its owners and walled off from productive purposes. Then let's unwad our panties about nuclear power. Bigness corrupts everything, apparently, so let's start using these little hyperion reactors: http://www.physorg.com/news145561984.html

Now that the resource problem is solved, let's look at reality and see if an 'iron code of responsiblitiy' is a realistic possibility. Now? No. Hows about after the system totally implodes, riots turn to murder, and food distribution is interrupted? You think maybe in the aftermath of that kind of mess, people will stop wanting to hear lies? This isn't serious yet, not even close. Once it gets serious, so will the people.

Wed, 10/19/2011 - 09:38 | Link to Comment Truffle_Shuffle
Truffle_Shuffle's picture

Infinite growth.....meet peak resources.  Not sure how much longer we'll be riding the bumpy plateau before exponential decline kicks in.  Soon enough I'm sure. 

Tue, 10/18/2011 - 23:16 | Link to Comment JW n FL
JW n FL's picture

 

 

 

frank,

Just becuase Systemic CORRUPTION is being put to an end.. doesnt mean communism is next stupid.. it just means you or your children will have to work for a living instead of get in on the lucky sperm club card.

with the FED Killed off..

with the Lobby Killed off..

there will be NO MORE BULLSHIT!

and if there is, maybe we should enact some real protections for "We the People" instead of what is on the books now?

I dont get you people with your wanna be "Commies are Coming" bullshit.

You dont even grasp who and why this information has been made available.. did Obama do it? cause he is a Muslim? LOL!!

Go back to Huffington Post and finger paint with your own shit all over your own kind.

Tue, 10/18/2011 - 23:38 | Link to Comment TheMerryPrankster
TheMerryPrankster's picture

communism, cause you gotta have a bogeyman and "terroristz' is just too abstract to even fool your average joe 6pak.

Without our kindly bankers doing god's work, why we' be over run by communist. red right down to their underwear I tell ya.

even the propaganda machine is starting to implode under the weight of the lies and chicanery.

Wed, 10/19/2011 - 00:35 | Link to Comment Seer
Seer's picture

No one would really give a shit about corruption if they were able to get Theirs.  It's only when things contract and we find that we aren't getting those easy "fixes" do we start to get all uppity.  Reminds me of my animals when I'm a bit late feeding them, they start acting a bit weird.

The music (GROWTH) has stopped and now we're blaming the music.  We knew we were playing Musical Chairs.  How could we NOT know what was going to come?  There are not enough chairs!  Yeah, sure, some may have MORE chairs, but those who have MORE chairs don't have enough for everyone who doesn't: not to mention that those with more chairs (many acquired through "inheritance") usually tend to not care that others don't have chairs (usually lambasting them for not getting their own chairs).  The chairs represent physical resources.  The music represents growth.  The Fed, the Lobby, etc., only represent the type of music and or the style of chair- they're only Part of the game, they don't cause the game.

Wed, 10/19/2011 - 05:33 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

Good post JW but if citizens didn't rise up in arms when that bull shit 'Patriot Act' was passed I suppose it will take real hunger to budge them.

A few are beginning to stir now and if Oblammer doesn't get off his azz and at least put some high profile banksters on trial he is going to have a real civil problem that will not be easy to stop.

Wed, 10/19/2011 - 04:20 | Link to Comment fonestar
fonestar's picture

Healthy population cull.  Follow the food supply.... cheap oil.

Wed, 10/19/2011 - 04:22 | Link to Comment fonestar
fonestar's picture

+1

Wed, 10/19/2011 - 04:22 | Link to Comment fonestar
fonestar's picture

I concur

Wed, 10/19/2011 - 07:31 | Link to Comment iNull
iNull's picture

Oh, who gives a fuck. All your "ism"s.. People are hurting dude. How 'bout soulless-ism bro? You ever think about that?

Wed, 10/19/2011 - 06:31 | Link to Comment Budd Fox
Budd Fox's picture

Now, even asking to the capitalism to apply his vaunted rules is marxism...I am more and more convinced is time to line up the fascists against a wall and open fire!

Kill'em all and let'em try to mess with the Almighty...cauz we had enough of fascist bigotry

Tue, 10/18/2011 - 21:59 | Link to Comment Youri Carma
Youri Carma's picture

Much apreciated always Nassim Taleb.

Tue, 10/18/2011 - 22:11 | Link to Comment WonderDawg
WonderDawg's picture

Sorry, I could only watch 5 minutes of this. What is this, he thinks he's giving us a revelation? No shit, the banks are hiding their insolvency, tell me something I don't know. I couldn't get past the first few chapters of his book, either, and I finish just about anything I start reading. Taleb is a pompous clown, IMO.

Tue, 10/18/2011 - 22:29 | Link to Comment Pladizow
Pladizow's picture

I got through about 75% and then went into a coma!

Tue, 10/18/2011 - 23:00 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

A black swoon?

Tue, 10/18/2011 - 23:02 | Link to Comment Harlequin001
Harlequin001's picture

I didn't bother; why pay money to someone stating the blindingly obvious...

Tue, 10/18/2011 - 23:05 | Link to Comment iNull
iNull's picture

Really. Just the opposite. I found the interviewer's style a little irritating but Taleb's comments riveting.

Try focusing on the content of the message rather than the charisma of the speaker. Or, if you are imposed with a 5 minute attention span then maybe you just need to Tivo Dancing With The Stars.

Tue, 10/18/2011 - 23:19 | Link to Comment WonderDawg
WonderDawg's picture

iNull, I've found myself agreeing with some of your posts, but other times, I find you to be a bit of a tool. If you truly believe in EW theory, and socionomics, try reading Black Swan from the socionomic perspective and see if you can make it past the first couple of chapters without throwing the book across the room.

Tue, 10/18/2011 - 23:52 | Link to Comment iNull
iNull's picture

That's cool. Sometimes I find myself to be a bit of a tool as well. But you have to give me more to go on than just ad hominem. I'm a math geek with degrees in physics, math, and applied mathematics. So Nassim naturally resonates with me. Granted, he is not the most engaging or charismatic of speakers or the best writer. It takes patience and love for the subject matter, e.g., kurtosis and "fat tails" which I do not expect more than 1% of the population to have, so I accept the criticism. As far as EWP goes, I'm still pretty sold on and a pretty vigorous defender of EWP. I think we have a few more weeks before the big KABOOM! See Dan Erics charts. He does such a good job I don't even bother anymore.

P.S. I did not give you the -.

Tue, 10/18/2011 - 23:57 | Link to Comment WonderDawg
WonderDawg's picture

Thanks, I read Daneric's posts every day. He's been pretty spot on the last few months.

Wed, 10/19/2011 - 00:37 | Link to Comment iNull
iNull's picture

Yeah, just a note of caution. Corrective waves are almost impossible to measure or predict. I think Dan has a reasonable W2 target but a 2 wave can retrace (as you probably know already) the entire 1 wave. There's no rule against that. People laugh when they hear shit like this. "Well then, what good is it?"

Hey, I'm not telling ANYONE to trade it. Laugh all you like but I think in Nov we will see the big Kaboom. By then no one should be laughing. More like looking in the pantry and seeing how long they can last on their stored food.

Wed, 10/19/2011 - 06:47 | Link to Comment Hephasteus
Hephasteus's picture

I have a good pumpkin pie recipe. Divide the circumferance of the pumpkin by the diameter.

Here's a philosphy question for ya. Why doesn't math work in the universe? Because math has an equal sign for everything it models and the universe doesn't tolerate equality.

Wed, 10/19/2011 - 00:37 | Link to Comment Seer
Seer's picture

"I'm a math geek with degrees in physics, math, and applied mathematics."

OK, then, you should be able to answer this one: What is the result of perpetual growth on a finite planet? (it's a math question!)

Wed, 10/19/2011 - 01:10 | Link to Comment Diet Coke and F...
Diet Coke and Floozies's picture

Hmmm, it should look like the answer to the question "What is the square root of -1 divided by 0?"

Wed, 10/19/2011 - 01:19 | Link to Comment iNull
iNull's picture

Seer, I've answered that question umpteenth times, i.e., a LOT. In fact, I recently answered that question on the commodities thread earlier today: http://www.zerohedge.com/news/guest-post-who%E2%80%99s-right-about-commodities-bears-or-bulls

For you to challenge me on this is like challenging Mahatma Ghandi on his vegetarian principles.

Tue, 10/18/2011 - 23:09 | Link to Comment TuesdayBen
TuesdayBen's picture

I had same experience with T Friedman's World Is Flat drivel

Tue, 10/18/2011 - 23:49 | Link to Comment iNull
iNull's picture

Same here. Now that guy deserves the fucking "Tool of The Year" award. He and Krugman should have shared the Nobel Prize in "Toolery."

Wed, 10/19/2011 - 05:46 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

Friedman is an idiot. His book 'Lexus and Olive Tree' (or whatever the name of it was) was a long version of Koombaya with a smattering of why it's ok for a tiny per cent of the people to have almost all the wealth... while the wealthy dangle the 'carrot' of 'you too can be super rich' in front of the masses that go hungry.

People actually paid good money for that drivel... they would have been better off buying a self help tradesman book and learning how to do something useful.

Tue, 10/18/2011 - 21:59 | Link to Comment wang (not verified)
Tue, 10/18/2011 - 23:26 | Link to Comment TheMerryPrankster
TheMerryPrankster's picture

I agree with your sentiment, F-Bloomberg, but sadly they are one of the best of the lamestream media. They sued the Fed and got the records that showed the FED bailed out foreign banks during the 2008 Crisis - aka when the shit hit the fan Part1. CNN didn't do that, ABC/Disney/CIA didn't do that.

The tiniest shred of jounalistic excellence and a free press appears to lurk somewhere at Bloomberg, its just you gotta slog through a lot of same old shit, to find the diamonds.

Wed, 10/19/2011 - 00:41 | Link to Comment Seer
Seer's picture

Bloomberg constantly fans the fires of BS.  Go ahead, read the headlines if you don't believe me.

Sorry, so what if they took a swing at the Fed.  Like that's done a fucking thing...  Politicians often vote a certain way in order to look good, knowing full well (and often setting it up so) a bill or resolution will fail (or will be killed in committee).  Maybe you could check this by asking them what their sales were for those times that they publishing about how they were doing "the people" a service?

Tue, 10/18/2011 - 21:59 | Link to Comment saulysw
saulysw's picture

"and literally fell off the face of the planet"

No he didn't. Gravity is a bitch.

By the way, the vid auto-played which is a bit of a no-no.

Tue, 10/18/2011 - 23:03 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

Every time I make a post and the page reloads the video plays. Then I have to scroll up and pause it.  And its gonna happen to me again right now...

Wed, 10/19/2011 - 07:34 | Link to Comment w a l k - a w a y
w a l k - a w a y's picture

Try Flashblock, it prevents all Flash content from loading. It then leaves placeholders on the webpage that allow you to click to download and then view the Flash content.

Tue, 10/18/2011 - 22:02 | Link to Comment wang (not verified)
Tue, 10/18/2011 - 22:04 | Link to Comment wang (not verified)
Tue, 10/18/2011 - 22:14 | Link to Comment chump666
chump666's picture

hahahahah

Tue, 10/18/2011 - 22:09 | Link to Comment chump666
chump666's picture

He is right occupy movement is going to snowball.

Tue, 10/18/2011 - 23:05 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

Yes, but like Snowball in Animal Farm.

Tue, 10/18/2011 - 22:12 | Link to Comment sgt_doom
sgt_doom's picture

Now here's the peanut gallery's take:

We continuously hear the propaganda meme that people are afraid to borrow from the banks --- but the truth is that banks have been refusing to loan at record numbers.

The bankers want to spend all their free government money in speculation across the markets and foreign investment.

Therefore, in a period of record low interest rates, when housing prices have fallen considerably, few can buy at this time.

A recent United Nations economic report on food prices explained that investment in commodity speculation (speculation on foodstuffs, etc.) has increased from $13 billion in 2003 to $260 billion by 2008, a 2,000 percent increase.

Now that may appear to be a large increase, but it dramatically under reports the increase when one understands that the amount has been leveraged to a great extent; a conservative estimate would be from 10,000% to 50,000% leveraging on that $260 billion in commodities speculation --- thanks to securitized financial instruments, credit derivatives, and further manipulated with the use of credit default swaps (CDS), another category of credit derivatives.  (CDSes are often referred to as “unregulated insurance”  -- if they were regulated, they’d be outlawed!  This is what they mean by “shadow banking.”)

Another recent report, this time by the Commodity Futures Trading Commission (USA) explained that 95% of commodity futures trades was pure speculation, not for purposes of hedging, or spreading risk, as the Wall Street bankers are forever claiming.

So we can extrapolate that massive and unwarranted speculation in food pricing (commodity futures) is a formidable cost driver – resulting in much human turmoil and tragedy while accomplishing nothing of value – except increasing the wealth of the speculators.

Of course, the same situation has been concurrently taking place in oil and energy markets, precious metals markets (gold, silver, etc.) and the healthcare sector, all affecting prices.

So to understand the massive roiling of international and national markets, using phantom money and funds, is to understand the enormous detrimental and destructive forces on people’s lives which is decidedly anti-progress in human affairs.

Understanding the connections and linkages allows one to better grasp seemingly unrelated world events:  the cornering of the chocolate market awhile back, then a few months later serious political troubles erupt in the major chocolate-producing country, Ivory Coast (Africa), thus causing upheavals in chocolate (futures trading) market prices.

Behind the scenes one sees money flows between certain financial groups to certain countries’ rulers (the Ivory Coast, in this case) – and a few people are enriched, while many die and many other innocent lives are destroyed in the process.

Now we have been told another propaganda meme – that  this global economic meltdown resulted from a slight mortgage default rate a few years back – a preposterous notion, given that had there been zero defaults the same meltdown would have occurred – it is unsustainable for the banksters to continue selling $100 to $1,000 worth of debt for every $1 of debt on hand – a relatively recent occurrence, all made possible by relatively recent changes in laws, regulations and legislation --- in other words, absolute corruption.

This is exactly how Wall Streeters made their billions – selling endless debt which they now tell us is our fault and our problem!

When Warren Buffett publicly denounces credit derivatives as “financial weapons of mass destruction” – then later spreads his money among congress to ensure these weapons continue to exist and proliferate – he is playing the American public in the same manner as the Robber Barons once did.

When Warren Buffett publicly proclaims that the super-rich should pay taxes also, while his company is in arrears for billions of unpaid taxes, he is playing the American public in the same manner as the Robber Barons once did.

Perhaps the time has finally arrived that the people are tired of being played for fools?

Tue, 10/18/2011 - 22:41 | Link to Comment rocker
rocker's picture

 Their are other halves of truths.

 Their is No Demand.

 And Banks do not want to loan at rates where as they can't rape the other side of the loan.

 Besides, they would rather use their trading desk to rape Americans.

 If only 10% of the OWS crowd knew that JPMorgan has a owns tanker of Oil sitting offshore.

 Holding it until the price goes up and they can rape their customers using depositor's money.

 This is what it has come down to. We now buy our oil and food from the middlemen called Banksters. 

Wed, 10/19/2011 - 00:50 | Link to Comment Seer
Seer's picture

BINGO!

It's the SYSTEM!

They have to feed their shareholders- that's the corporate LAW!  Nothing else gives any returns because everything is falling, except commodities.  We're finally starting to see reality surface.  REAL STUFF IS WORTH REAL MONEY!  Yes, it's hurtful, but this reality was going to happen no matter what!  What sucks is that people just don't understand it; whether this is intentional or not I do not know; look at all the shitty logic that passes for information and it should be pretty clear that there's no way we're going to mass-educate ourselves (nature runs on deception, and it looks like we've been true to nature).

Tue, 10/18/2011 - 23:30 | Link to Comment MFL8240
MFL8240's picture

Very well written

Tue, 10/18/2011 - 22:23 | Link to Comment bob_dabolina
bob_dabolina's picture

This is what occupywallstreet doesn't understand. 

Occupywallstreet is anticapitalist. They desire socialism. Do they not realize that it is the very act of socialism/pseudocommunism that was the Wall Street bailout? The government allowed the banks to retain profit while distributing (socializing) the losses to the public. In a true capitalistic regime there would have been NO bailout...that's what capitalism is all about.

Don't you see the irony in it? The very things they are for, are the very things they are protesting against. If they are against bailouts they should be protesting for capitalism...no?

c'est la vie

Tue, 10/18/2011 - 22:25 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I'm disillusioned too; at this rate the damn wannabe hippies will just be living in tent cities in the parks.

As I have begun to say......

You can lead a horse to water, but if that horse isn't thirsty, then it probably needs to urinate, and since you just led it to water, there goes your fresh drinking supply.

Tue, 10/18/2011 - 22:33 | Link to Comment bob_dabolina
bob_dabolina's picture

You can lead a horse to water, but if that horse isn't thirsty, then it probably needs to urinate, and since you just led it to water, there goes your fresh drinking supply.

It's axiomatically atypical to assume the horse needs to urinate. The horse could have a perfect balance of electrolytes and protein thus rendering his need to urinate in stasis.

It's dangerous to assume.

Tue, 10/18/2011 - 22:50 | Link to Comment Stax Edwards
Stax Edwards's picture

The point bobo is their is a sweeping realization among all sectors of society the playing field is not level.  OWS does not demand socialism, but they are all well aware in all their different hemispheres of thought that they are not as equal as the elites, and that my friend is the point.  Get over the labeling bob, it is disingenuous.  The fact is that people of all walks of life cannot seem to understand why when things go south, .gov thinks the solution is to make sure the elites shall not have to suffer one iota, yet assume the rest can fend for themselves. That is the point, it is growing, capital is behind it, and it is not going away.  Real change is coming my friend, bet on it.

Tue, 10/18/2011 - 22:55 | Link to Comment bob_dabolina
bob_dabolina's picture

Ok lh

So again....remind me why it's #occupywallstreet and not #occupywashingtondc?

BTW only 14% of the 1% are from the financial services sector

Tue, 10/18/2011 - 23:09 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

Well there's a reality check. I'd love to have a source for future reference.

Tue, 10/18/2011 - 23:16 | Link to Comment bob_dabolina
Tue, 10/18/2011 - 23:25 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

Thanks, bookmarked.

I'm just glancing at the chart but find it interesting that 4.3% of the top 1% are listed as "not working or deceased." I wonder how that breaks out. I presume that those who are deceased can also be counted in the non-working group.

Tue, 10/18/2011 - 23:32 | Link to Comment bob_dabolina
bob_dabolina's picture

trusts and such

Tue, 10/18/2011 - 23:39 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

So like Elvis is still number 1 (percent).

Wed, 10/19/2011 - 00:23 | Link to Comment GFKjunior
GFKjunior's picture

That is not accurate. This is the 1% of earners not the 1% owners,

 


Copied from another ZH post:

 

"The chart in the article lists occupations of those in the top 1% of income, but neither the article above nor the referenced Mother Jones article indicates how income was defined in the construction of the chart. I actually downloaded and read the study on which the chart was based, and can tell you the following.


First of all the study itself uses information from a sample of tax returns from 1987-2005, and looks at comparisons of gross income. Gross income is defined in a variety of ways and, depending on what is being focused upon, may or may not include capital gains and interest/dividend income. The chart above is based on gross income excluding capital gains.

Secondly, from its sample of tax returns, the study dropped returns for which the sum of salary income and business income was less than $10,000. Anyone who didn't need to work because they made enough money from interest income, dividend income, and/or capital gains was dropped from the sample.

Lastly, the study just addressed percentages, based on occupation, of who made up the top of the heap. It didn't look at which occupations within the top one percent made the most money. Even among the top one percent, there is a huge variation in income. For 2005 (the most recent year included in the study), the minimum income required to be a one-percenter was $295,000 (measured in constant year 2007 dollars). Of these one-percenters, the mean income is $834,490 ($1.5 million if you include capital gains). Consequently, a sample containing 31% non-financial executives making between $500,000 and $1,000,000, 15% doctors making between $300,000 and $400,000, and 14% "financial professionals" making between $2.5 million and $5 million could result in the very same chart as above."

Wed, 10/19/2011 - 00:41 | Link to Comment bob_dabolina
bob_dabolina's picture

"I actually downloaded and read the study on which the chart was based"

Oh, do tell. Make sure you get his research sample. It's odd that it doesn't accompany the feedback....maybe that's normal in todays world.

Tue, 10/18/2011 - 23:13 | Link to Comment Stax Edwards
Stax Edwards's picture

First off, I too trade, and do have respect for your laying your trades out for all to see if that is in fact what you have been doing.  Kudos on the big balls.  Now stop thinking that our poorly educated populous is going to figure this out each and every one and have the consistent editied soundbite you desire.  The fact is .gov did what they had to do and were promised by the squid that everything would be ok.  Well, its not.  So people from all walks "get it" in their own way.  That is what you see, and there is nothing wrong with it.  In case you have not considered it, you are better off long term if they are better off long term.  So help them or shit on them.  They are us, we are them.  We are all in this together and I support em.  Flame on, get with it, or get out of the way!  I know you have something to add, and do not believe they are all "anti captialism".  Many are "anti informed" so pitch in bobo.

Tue, 10/18/2011 - 23:34 | Link to Comment bob_dabolina
bob_dabolina's picture

I don't support them because I don't feel like the genesis of the problem was WS. I think it is DC. The problems on WS are a symptom of the underlying problem.

If they occupiedsenate, or, occupiedcongress, or, occupiedwhitehouse I would probably be there in my own tent cooking beef strogonoff out my butane grill circa 2001 with my dreaded pubes and b.o.

Tue, 10/18/2011 - 23:41 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

WS runs the WH

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