"Flirting Seriously With Anarchy"

Authored by James Howard Kunstler via Kunstler.com,

The stock market is zooming this morning on the news that only 5.7 million people in Florida will have to do without air conditioning, hot showers, and Keurig mochachinos at dawn’s early light Monday, Sept 11, 2017. I’m mindful that the news cycle right after a hurricane goes kind of blank for a day or more as dazed and confused citizens venture out to assess the damage. For now, there is very little hard information on the Web waves. Does Key West still exist? Hard to tell. We’ll know more this evening.

The one-two punch of Harvey and Irma did afford the folks-in-charge of the nation’s affairs a sly opportunity to get rid of that annoying debt ceiling problem. This is the law that established a limit on how much debt the Federal Reserve could “buy” from the national government. Some of you may be thinking: buy debt? Why would anybody want to buy somebody’s debt? Well, you see, this is securitized debt, i.e. bonds issued by the US Treasury, which pay interest, and so there is the incentive to buy it. Anyway, there used to — back in the days when the real interest rate stayed positive after deducting the percent of running inflation. This is where the situation gets interesting.

The debt ceiling law supposedly set limits on how much bonded debt the government could issue (how much it could borrow) so it wouldn’t go hog wild spending money it didn’t have. Which is exactly what happened despite the debt limit because the “ceiling” got raised about a hundred times though the 20th century into the 21st so that the accumulated debt stands around $20 trillion.

Rational people recognize this $20 trillion for the supernatural scale of obligation it represents, and understand that it will never be paid back, so, what the hell? Why not just drop the pretense, but keep on working this racket of the government borrowing as much money was it wants, and the Federal Reserve creating that money (or “money”) on its computers to infinity. Seems to work so far.

Rational people would also suspect that at some point, something might have to give. For instance, the value of the dollars that the debt is issued in. If the value of dollars goes down, then the real value of the bonds issued in dollars goes down, and as that happens the many various holders of bonds already issued — individuals, pension funds, insurance companies, sovereign wealth funds of foreign countries — will have a strong incentive to dump the bonds as fast as possible. Especially if backstage magic by the Fed and its handmaidens, the “primary dealer” banks, keeps working to suppress the interest rates of these bonds at all costs.

Would the Federal Reserve then vacuum up every bond that others are dumping on the market? They would certainly try. The Bank of Japan has been doing just that with its own government’s bonds to no apparent ill effect, though you kind of wonder what happens when a snake eating its own tail finally reaches its head. What’s left, exactly, after it eats that, too? My own guess would be three words: you go medieval. I mean literally. No more engines, electric lights, central heating….

In this land, we face a situation in which both the value of money and the cost of borrowing money would be, at last, completely detached from reality - reality being the real cost and value of all goods and services exchanged for money. Voila: a king-hell currency crisis and the disruption of trade on the most macro level imaginable. Also, surely, a massive disruption in government services, including social security and medicare, but extending way beyond that. And then we go medieval, too. The mule replaces the Ford F-150. And The New York Times finds something to write about besides Russia and trannies.

The value of money and the cost of borrowing it is about as fundamental as it gets in a so-called advanced economy. You can screw around with a lot of things running a society, but when that goes, you’re flirting seriously with anarchy. In the meantime, we’ll see how the social glue holds things together in those parts of Florida that are entering a preview of medieval attractions in the electrical blackout days ahead.

Comments

JimmyJones Creepy_Azz_Crackaah (not verified) Mon, 09/11/2017 - 13:10 Permalink

Societies are capiable of running themselves. This society however hasn't been that society for some time now.  Once the EBT/SNAP no longer keeps the un-washed masses pacified then they will get angry, when they start actually starving then they will get violent and that my friend is when ever major city ceases to be habitiable, unless of course they move all of those people to "fema" camps to be "taken care of". 

In reply to by Creepy_Azz_Crackaah (not verified)

synthetically … The Juggernaut Mon, 09/11/2017 - 15:45 Permalink

"True Anarchy is the opposite of hierarchy.  Anarchy is NOT chaos; chaos is chaos." I must be a conspiracy theorist. I have a hard time believing that the commonplace and wrongheaded use of "anarchy" when "chaos" is actually meant is anything other than the result of statist propagandists having poisoned the well of the competition. Moreover, I seriously doubt that it is any mere accident that the history books gloss over how very well an anarchistic society fared in northeastern Spain from 1936 to 1939 (before the area was overrun by Franco's Falangists near the end of the Spanish Civil War).  

In reply to by The Juggernaut

ElTerco Creepy_Azz_Crackaah (not verified) Tue, 09/12/2017 - 00:01 Permalink

"Liberals - people who emote rather than think"

Not true. The blue counties tend to be home to high tech (physics/math), strategic management, and money. The red counties are where all the bibles, country music, and lack of money tends to be dominant. I'm sure you'll jump on me for being "elitist", an emotional response, but I'm not being elitist. Facts are facts.

In reply to by Creepy_Azz_Crackaah (not verified)

GUS100CORRINA stacking12321 Mon, 09/11/2017 - 13:10 Permalink

"Flirting Seriously With Anarchy"My response: When one looks at the US Constitution, one quickly realizes that it sits in the middle between Anarchy and Dictatorial Tyranny. We have both the RULE OF LAW and the three BRANCHES of GOVERNMENT. If the US Constitution ever gets removed for whatever reason, I am very certain that all HELL would break loose. We look to be getting closer everyday.The root cause of ANARCHY and TYRANNY is found in the DOCTRINE of HUMAN DEPRAVITY which states that the human heart is deceitful above all else and desparately wicked.THE END=====Quote from American Rep Robert Charles Winthrop stated during the 1800's Men, in a word, must necessarily be controlled, either by a power within them, or by a power without them; either by the word of God, or by the strong arm of man; either by the Bible, or by the bayonet.

In reply to by stacking12321

detached.amusement GUS100CORRINA Mon, 09/11/2017 - 13:52 Permalink

Hate to break it to ya jesus freak, but the Constitution For the United States of America hasnt existed since 1871, and the god of abraham is not the creator of heaven and earth.  But keep believing they exist as you think they do - just go long ky and watch the moths fly into the bug zapper, maybe you'll figure it out after being put through the grinder a few more times.

In reply to by GUS100CORRINA

Lumberjack joego1 Mon, 09/11/2017 - 13:03 Permalink

Some were just carted off to...jail.

https://www.google.com/amp/s/www.washingtonpost.com/amphtml/news/post-n…

Police didn't have many details on the arrests. Nor did they say whether the news crew's video helped identify the suspects — six adults and three teenagers, according to WPLG's report. But, as usual, the police chief was ready with a quip for any criminals in his wind-battered city.

"Going to prison over a pair of sneakers if a fairly bad life choice," he wrote.

In reply to by joego1

UndertheDRADIS Swamidon Mon, 09/11/2017 - 13:55 Permalink

The General Principle. And yes, looters should be shot immediately. Pour encourage l'autres. I will go farther and say that states with Castle Doctrine laws should be able to set a period of time after a disaster in which a looter caught and shot would have no recourse to the courts. It strikes me that it would encourage the exact type of men who would like to shoot someone to show up and practice their marksmanship. Just think of the amusing YouTube gun camera videos.

In reply to by Swamidon

Individual Swamidon Mon, 09/11/2017 - 18:46 Permalink

Your possessions are a transference of your time. Your time is your most valuable and limited resource. Stealing FROM you is stealing YOU.

In a civilized society people help each other. This is amplified in times of need or disaster. Civilized societies should not tolerate those that use these moments to prey upon people.

Society should be able to set standards of conduct among themselves. Those that would prey upon the weakest in society in their time of need don't belong in civilized societies.

Act accordingly.

In reply to by Swamidon

stecha (not verified) Mon, 09/11/2017 - 12:58 Permalink

The END is NEAR, "Everything you ever knew about the U.S. and how things work has been a lie. By January this country will be embroiled in the worst shit we have seen since the civil war. So many of our Enimies are at play in our fields and it is to late to turn them back now. Now this country gets devided and burned by the very people whom promised to suck our proverbial cocks. good luck everyone. maybe see ya on the other side.

spastic_colon Mon, 09/11/2017 - 12:59 Permalink

OT scam of the day........11:42 AM Eastern Daylight Time Sep 11, 2017 By David Shepardson
WASHINGTON, Sept 11 (Reuters) - The family of the driver of
a Tesla Model S who was killed in a May 2016 crash while using
the car's semi-autonomous driving system said on Monday the car
was not to blame for the crash.
The statement from the family of Joshua Brown, released by a
law firm, comes a day before the National Transportation Safety
Board is set to hold a hearing in Washington and vote on the
probable cause of the crash.
"We heard numerous times that the car killed our son. That
is simply not the case," said the statement from the family,
breaking its silence on the crash. "There was a small window of
time when neither Joshua nor the Tesla features noticed the
truck making the left-hand turn in front of the car."
"People die every day in car accidents," the statement said.
"Change always comes with risks, and zero tolerance for deaths
would totally stop innovation and improvements."
A spokeswoman for Tesla Inc <TSLA.O> and a lawyer for the
family, Jack Landskroner, have declined to say if the automaker
has reached a legal settlement with the Brown family.
"Josh Brown was a friend to Tesla, and as his family
articulated so eloquently, a passionate advocate for technology.
Our thoughts are with the entire Brown family," the company said
in a statement Monday.
The fatal incident raised questions about the safety of
systems that can perform driving tasks for long stretches with
little or no human intervention, but which cannot completely
replace human drivers.
Brown was killed near Williston, Florida, when his Model S
collided with a truck while it was engaged in the
"Autopilot" mode.
In January, the National Highway Traffic Safety
Administration said it found no evidence of defects in the
crash. NHTSA said Brown did not apply the brakes and his last
action was to set the cruise control at 74 miles per hour (119
kph), less than two minutes before the crash - above the 65-mph
speed limit.
In June, the NTSB said that during a 37-minute period of his
final drive Brown had his hands on the wheel for just 25
seconds.
Tesla in September 2016 unveiled improvements in Autopilot,
putting new limits on hands-off driving and other features that
its chief executive officer said likely would have prevented the
crash death.
The family noted Tesla's continued improvements to Autopilot
and said it "takes solace and pride in the fact that our son is
making such a positive impact on future highway safety."
NTSB could make policy recommendations but cannot order
recalls or force regulatory changes.

(Reporting by David Shepardson; Editing by Joseph White and
Jonathan Oatis)
((David.Shepardson@thomsonreuters.com; 2028988324;)) 

venturen Mon, 09/11/2017 - 12:59 Permalink

enconomy is going full cicle...I plan on working as a serf on Lord Bozos farm...I get to keep 1% of what I grow and free shipping of $1000/seeds....though it is tempeting to work at Lord Zucks farm....I can get my Facebook video instructions free. Serfs it whats makeing(for) dinner

Fireman Mon, 09/11/2017 - 13:00 Permalink

Looting is as USSAN as its favorite dish of rotten apple pie hubri$. So from Washing town to the slums of Florida just keep on looting till all the "stuff" is gone. Simple really.