"The Wasteland" - How Central Planning Broke All Markets... And What We Can Do To Fix Them

Tyler Durden's picture

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MCZH's picture

cant say I agree with any of this.

damage's picture

A central planner in our midst?

Cheesy Bastard's picture

Tell me, MCZH, do they pay well at the ministry of propaganda?

Michael's picture

We don't need a change in Washington DC, we need to completely restructure the Federal governing model. The US government is what's broken.

cranky-old-geezer's picture

The federal government does what every government does, extend its power and control as much as possible.

It's not the structure at fault. It's the people at fault. Those government mentalities.

When someone goes to work in government, any government, at any level, their thinking changes. They start thinking they're in control now. They feel the euphoria of being in control over people.

That feeling of control gradually morphs into predation. They become a predator. Uncaring. Spiteful. Even hating the people they're governing. Yes, deep down many in government hate the people they're governing, viewing them as second-class, even sub-human.

The seething hatred among government people for the public would shock you if you knew how bad it is. Government people despise the rest of us. Thy hate us with a passion.

That's what happens in the average human mind when you give someone control over other people. It progresses from not caring to outright resentment to seething hatred.

America's leaders can barely conceal their seething hatred of the American people. It's why they have no problem looting and plundering the American people. They'd like to kill us all off, but it would take away their fun looting and plundering.

So they settle for looting and plundering. They want to steal everything we have, leaving us in poverty.

If they can't do it via taxes, they do it via inflation, printing currency and spending it or giving it to their government friends.

That's exactly what we've been seeing since '08. Printing mountains of currency and spending it or giving it to their government friends.

And no, it's not going to stop. It's going to get worse.

Koffieshop's picture

Some structures are easier exploited the others.

For example, if you would allow one of the Houses to be elected based on percentage of votes instead of a winner-takes-all type of deal, you will find yourself having more then just 2 political parties (If he Green Party collects 10% of the votes, they take 10% of the seats, etc..) This will make it a lot harder to buy/corrupt all house members.


I'm not claiming I have all the answers,  but there is no doubt in my mind that you can fight corruption by ajusting the rules of the system. The trouble ofc. is that no one in the established system wants changes that undermine their own position.



New_Meat's picture

Coffie guy: Please elucidate on your political system theories. <and ya gotta' get back to them English books and figure our basic gramma, don't cha' know>.

a) extra credit: where, in history, have your alternative views proven themselves over a period of <n> years/decades?

b) which frosh poly science section did you learn about alternative voting schemes?  I'm  even betting that you don't  know why RAH had proposed similar schemes.

c) compare-and-contrast the German/French/EU view of political partiez in "coallition governments" vs. U.S. republic/executive model.  Demonstrate effectiveness and ineffectiveness situations of each.

Don't worry, i'll be an honest and straightforward evaluator/critic/responder.  That is, I'll back up my assertions with data and contracict your comments with facts.  Or not--I might be wrong and, since I'm trying to slim down, that would be a way to avoid i) a fat chance, and ii) Ol' Rusty's smoker.  But, well, I never know.

But, well, I agree with you that in Chi-town, Boston, SF, <list goes on> your assessment that the corruption is embedded.

And don't do the stupid thing about "I'm not claiming I have all the answers" again.  Makes u look jejune to any adult who is watching.  fwiw

- Ned

Koffieshop's picture

English is not my first language and the Chrome spell checker seems broken on this site.

Anyway, the system I am most familiar with is the Dutch one and I have seen events unfold there that would be impossible in the US election model.
The electorate occasionally 'revolts' and massively votes for a newcomer with views incompatible with the established parties. The 'revolutionary views' get absorbed into the mainstream thinking and balance is gradually restored.
This happened with Pim Fortuyn and Geert Wilders recently.

The door for this kind of process seems shut in the US. A candidate is either acceptable within the 2-party-system, or has very little chance of getting anywhere.
If the US had the Dutch election system then Ron Paul would have no problem running under his own flag instead of getting approved by the Republican Party first.

Now, you can demand I produce some essay, make fun of me for not using the right nomenclature..... or you could just explain where you think my reasoning goes wrong.

wilburpup's picture

And if they can't do it by any of the means above, they--49 states-- resort to lotteries to exploit the statistical ignorance of the poor and the stupid with the unbelievably cynical justification that it's all for "education."  It's a positive feedback loop---the more "education", the more people to exploit!  Now we are to be treated to state-sponsored internet gambling.  It's the next best thing to taxing Amazon transactions.

AmCockerSpaniel's picture

"It's the people at fault."   You can stop there! No enterprise is any better than it's people. They deceive us, but only after they deceive them selves.

European American's picture

Government is an innocent reflection of the collective quality of the people.

Michael's picture

Very well said, cranky-old-geezer. See what we started?

That's exactly what we've been seeing since '08. I'd also add, since NAFTA.

miguel991's picture

US and the rest of the world. Great series here: http://www.youtube.com/watch?v=JLW-ltMr49s


DormRoom's picture

Most hedge fund strategies depend on the Black-Scholes model, or a variant, which itself assumes a constant volatility coefficient.  There are entities (institutional, and otherwise) gaming the system by 'injecting volatility' into the markets via algorithms (fractal, and otherwise) to distort the option pricing mehanisms, and profiting from various arbitrage strategies.


The problem is that once you inject volatiity, using your algorithms, computerized hedge fund strategies must adjust by dumping/buying equities.  This is why we are witnessing greater than two sigma movements.


If you can game the mathematical model, which all computerized trading is based on, you can make obscene amounts of alpha.

spiral_eyes's picture

more good news!

pentagon plans for war with china!

bullish for everything!

military keynesianism, bitchez!


Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Unless the U. S. has a nucleur war in mind which would kill billons worldwide, China is holding most of the cards here.  All China has to do is pull the plug on the U. S. Treasury Bond market and the U. S. mighty war machine grinds to a halt almost overnight!                Tuco

DormRoom's picture

When was the last time a nation went to war with its largest trading partner? It would ruin both economies, and lead to a global depression.


New cold war by 2025

DormRoom's picture

yeah?  Did that war turned out well for the colonial powers?  The British pound ceased to be the world's reserve currency.  And an upstart nation, America, became the manufacturing floor of the world, for the colonial powers.


cranky-old-geezer's picture

Actually it would hurt America much more than China.

China is developing trade relations with the rest of the world.  America is a shrinking part of China's worldwide market.

On the military side China is developing an Asian nuclear alliance. Russia is in.  Pakistan is in. Soon India and Iran will be in.

At that point it will far outclass America's nuclear capability, land troop capability, and naval capability.   But nuclear capability is all that really counts, and the alliance will take things to the nuclear level right out of the gate, telling America get out of the middle east of face nuclear attack from all directions.   America will quietly leave, saying "we won" all the way home.

No, America won't attack China.  No way. Because it's China-Russiia-Pakistan right now.  Soon it will be India and Iran also, and America wouldn't even dream of going up against that.

trav7777's picture

even if every single nation on earth banded together, they would still not be at parity with our naval capability.

We're literally that far ahead.

India is not joining any alliance Pakistan is in anyhow

New_Meat's picture

trav- ya, gotta kill the USN is a fact/policy, will come on in various forms, including killing sailor ethos, subz "manning" etc.

U might wish to watch TPMB, who is really far out, I met him at Newport, quite clear thinker, although he's rather unconventional in his thinking.


and stuff.  Especially, the comments that a U.S. frigate dominated all vessels in the harbor in India.

- Ned

{Dang, I was hoping to draw u into a food fight this afternoon, my bad ;-)}

well, perhaps not ;-)

DormRoom's picture

You do realize the US is a debt ceiling away from not being able to pay its military.  If China ever stopped buying US Treasuries, the US would likely not be able to meet it's fiscal commitments, and may in time, stop paying the military.


And a unpaid military force is quite fickle.  Ask the Romans.  Most of her legions disbanded when they discovered their gold wages were tungsten.

Kobe Beef's picture

We can only hope those betrayed US servicemen would have the wherewithal to return home & clean out the "domestic enemies" infesting DC. Then they could do Detroit.

cranky-old-geezer's picture

Our naval capability won't matter going forward.  Things are moving to the nuclear level very soon, and we'll be way outclassed by the ANA.

Russia ...a firm member of that alliance... has the biggest nuclear weapon ever created, the 57 megaton Tsar bomb. It would take out an area the size of Ohio.   And they've likely figured out how to boost the yield to 75 megaton by now.

That alliance won't have our pseudo-religious wishy-washy weak-kneed limp-wristed gutless lack of will to push the nuclear launch buttons, and our gutless politicians know it.

That's why America will tuck tail and back out of the middle east when the nuclear ultimatum is communicated to them.  And yes they'll say "we won" trying to save face. 

Our naval capability will be meaningless going forward in another way. In this new age of hypersonic anti-ship missles, which we have NO defense against, our carriers are sitting ducks out there.

Perhaps China will just take out a couple to prove the point.

GeneH3's picture

Destructive nuclear war is obsolete. A few well-placed EMP weapons and it's over for the U.S. as we know it.  Our technological society, which stands udefended, will disintegrate into chaos. Rather than focus on our Defense, our arrogant political "leaders" squandered our resources on Offense.

optimator's picture

"Rather than focus on defense".  Like a Maginot Line we can relax behind?  Compare China's nuclear deterrent to ours.  There is only one thing worse than a nuclear war and that is losing a nuclear war.

New_Meat's picture

Child, GeneH3<must be the stupid, no, the clueless, gene>:  This Gives You AN OPPORUNITY TO IMPROVE Your worthless life:

"Destructive nuclear war is obsolete.",

Wow, whe knew, Kennan and the gang had that whole thingie wrapped up in like the early 1950z.  Why, even Ronnie knew this, that's how he killed the Soviets (with absolute contribution from Maggie and THE Pope), and destroyed their political system.  No Saul involved, either.

Evidently, you don't know much about how thingz happen in the real world.

But the night is eventuating and  I'd doubt u could figure out any other commentz:

= Ned

Kobe Beef's picture

Evidently you dont know how the real world works either.

Please tell us your conviction that St. Ronnie the Senile Avenger who, along with his British PM & papal figurehead, slayed the Soviet Dragon (without the help of the Mystical Saul, no less) is only Sarcasm.

Until then, stay on whatever drugs you're on & stay off the message boards. Thanks for coming out.

New_Meat's picture

extra credit: RAH on war is obsolete--go figure

In Fed We Trust's picture

And that will probabley be the time the AMERO is introduced. Of course the Chiense will be blamed along with people holding gold.

reader2010's picture

There won't any wars with China as long as CCP keeps playing their assigned role. 

New_Meat's picture

"There won't any wars with China as long as..." they own trillionz of FRN debt.

That is called "reason to negotiate."

- Ned

sun tzu's picture

Hey dummy, the pentagon "plans" for wars with every country in the world. 

What proof is there that the US is mobilizing in Asia? I have heard of no increase in the number of US forces in the Pacific.

jm's picture

So big players selling vol (suppressing its price) and thus the price of other varibales in models-- namely price (via dumping/buying equities)-- adjusts to vol rather than the other way around. 

Not sure what you mean by "gaming" this pathology as opposed to just act independently of it.

ToNYC's picture


True, according to your paradigm of course, however things change, to fill the need away from you.   HFTs are only lucky for now the un- regulators allow them to steal in the face of so many documenting witnesses. They might as well be banks as speculators in liquidity games that they comtrol.

CrashisOptimistic's picture

Nor should you agree.

You can't fix geology.  Oil scarcity is at the core of all the problems.  Not manufactured money or manufactured anything.

Central plan all you want.  Or don't central plan all you want.  It's not going to matter.

You feed 7 billion or you don't.  Last time there was no oil, there was 1 billion people.  Good luck with feeding the 7 billion, regardless of central planning.

trav7777's picture

so these were 6-8 sigma market moves eh?  Is there anyone who doesn't see these things never happening again?

Something has always been completely wrong with the risk model assumptions out there

mkkby's picture

It takes an economics professor to be dumb enough to assume normal distributions for crowd behavior.  Funny how those 6 sigma events happen every 2 years or so.

ToNYC's picture


One could imagine more people seeing that Proof in the Pudding that no one wants to eat.

CrashisOptimistic's picture

Modeling is how you justify an economics staff, without being too explicit about stating that you have one just to reassure clients (not because they have any value).

They come to work each day and the cubicle guys take the big picture concept the Chief Economist gives them and they spend the day polishing coefficients of variables.  

Then they complete their "project" and plug in the latest statistics and make their call of prediction of this or that.

The next day a ship carrying lots of important parts sinks, disrupts this or that and someone goes bankrupt because of it, shoots himself and his family, upsets his father-in-law who happens to be a legislator, who introduces legislation that passes two weeks later and smashes all results from the model.

Then they hand out paychecks to the economics staff and the Chief Economist sends down modifications to the big picture and the staff gets started on their important coefficient work again.


Dollar Bill Hiccup's picture

Gold to SPX ratio on 252 data points, 5.7 sigma on Wednesday or roughly 1 in 100 million odds.

On a mean reversion principle, short barbaric freedom and long fascist brave new worlds.

damage's picture

Peak oil is bullshit cooked up by the oil companies so they can charge more for the stuff they've already found without searching for more.

LawsofPhysics's picture

Do you work for an oil company?  Are you an engineer?  No?  Well, let me educate you a bit since I consult for Cheveron (who is investing heavily in biodiesel from algae) and my brother has been in oil and gas for 20+ years.

We will stop using oil with a lot of it in the ground.  Why?  Simple, cost recovery.  It simply is costing more and more to get the stuff out of the ground (both in capital and resources).  In most of the productive oil fields we have been pumping seawater into the field in order maintain good presure for recovery.  We have been doing this for over 40 years (yeah, these fields are massive).  One problem I work on is trying to inhibit the sulfate reducing organisms that are found in the oil.  These organisms are asleep until they come into contact with the seawater.  Seawater has a lot of sulfate in it.  These organisms oxidize the fats in the oil (oil is essentially fat idiot) and reduce the sulfate to hydrogen sulfide (an explosive and corrosive gas - hello BP disaster).  For reference, all humans oxidize sugars to carbon dioxide and reduce oxygen to water.

Educate yourself retard before spouting bullshit.  The planet has finite resources, and oil is one that is becoming more and more expensive to obtain, period.  My guess is that you also consider yourself a "conservative".  Well guess what, so am I. As a conservative I will not invest capital if the return on that investment is negative.  Guess what?  The oil companies won't invest capital either, if the return is negative.  You want to make a difference, go work for an engineering degree and then work for a solution instead of spouting bullshit.  Fucking hypocrit. 

TheTmfreak's picture

My fiance just finished an internship with them 2 days ago. Looks like we'll be moving to Houston or Louisana come next year...

I love when people bring up big oil "they charge so much money." 3 dollars and 50 cents of clownbux for a gallon is hardly "that expensive." Considering if one did the math of how much money that is in say... 1960 silver dimes, one finds out how NOT expensive oil is. (just how worthless the dollar is).

Also oil companies make what... cents per gallon? Governments make what... dollars per gallon? Oil companies are they only fucking reason globalization was ever able to move forward. The only possible moral "gotcha" that might be able to be said about big oil is the pure exploitation of unstable country resources. However while it may not necessarily benefit the local populace (who was going to do nothing with the resources to begin with...) it sure as hell made alot of other people live significantly "better" lives. 

snowball777's picture

Governments make at most 66 cents per gallon (in CA) and $0.48 average nationwide. So take that off the top and consider the $3/gallon...$2.37 of which is cost of goods, $0.16 of which is admin and selling, and $0.39 of which is "other operating expenses" (wonder what that is).

It's all well and good to claim low profits, but if the reason is that execs at Exxon are taking home $6000/hr and $400M golden parachutes, then they should be laughed at when they "cry poverty".