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The Market Mystique
On Monday, Lawrence Summers, the head of the National Economic Council, responded to criticisms of the Obama administration's plan to subsidize private purchases of toxic assets. "I don't know of any economist," he declared, "who doesn't believe that better functioning capital markets in which assets can be traded are a good idea."
Leave aside for a moment the question of whether a market in which buyers have to be bribed to participate can really be described as "better functioning." Even so, Mr. Summers needs to get out more. Quite a few economists have reconsidered their favorable opinion of capital markets and asset trading in the light of the current crisis.
But it has become increasingly clear over the past few days that top officials in the Obama administration are still in the grip of the market mystique. They still believe in the magic of the financial marketplace and in the prowess of the wizards who perform that magic.
The market mystique didn't always rule financial policy. America emerged from the Great Depression with a tightly regulated banking system, which made finance a staid, even boring business. Banks attracted depositors by providing convenient branch locations and maybe a free toaster or two; they used the money thus attracted to make loans, and that was that.
And the financial system wasn't just boring. It was also, by today's standards, small. Even during the "go-go years," the bull market of the 1960s, finance and insurance together accounted for less than 4 percent of G.D.P. The relative unimportance of finance was reflected in the list of stocks making up the Dow Jones Industrial Average, which until 1982 contained not a single financial company.
It all sounds primitive by today's standards. Yet that boring, primitive financial system serviced an economy that doubled living standards over the course of a generation.
After 1980, of course, a very different financial system emerged. In the deregulation-minded Reagan era, old-fashioned banking was increasingly replaced by wheeling and dealing on a grand scale. The new system was much bigger than the old regime: On the eve of the current crisis, finance and insurance accounted for 8 percent of G.D.P., more than twice their share in the 1960s. By early last year, the Dow contained five financial companies - giants like A.I.G., Citigroup and Bank of America.
And finance became anything but boring. It attracted many of our sharpest minds and made a select few immensely rich.
Underlying the glamorous new world of finance was the process of securitization. Loans no longer stayed with the lender. Instead, they were sold on to others, who sliced, diced and puréed individual debts to synthesize new assets. Subprime mortgages, credit card debts, car loans - all went into the financial system's juicer. Out the other end, supposedly, came sweet-tasting AAA investments. And financial wizards were lavishly rewarded for overseeing the process.
But the wizards were frauds, whether they knew it or not, and their magic turned out to be no more than a collection of cheap stage tricks. Above all, the key promise of securitization - that it would make the financial system more robust by spreading risk more widely - turned out to be a lie. Banks used securitization to increase their risk, not reduce it, and in the process they made the economy more, not less, vulnerable to financial disruption.
Sooner or later, things were bound to go wrong, and eventually they did. Bear Stearns failed; Lehman failed; but most of all, securitization failed.
Which brings us back to the Obama administration's approach to the financial crisis.
Much discussion of the toxic-asset plan has focused on the details and the arithmetic, and rightly so. Beyond that, however, what's striking is the vision expressed both in the content of the financial plan and in statements by administration officials. In essence, the administration seems to believe that once investors calm down, securitization - and the business of finance - can resume where it left off a year or two ago.
To be fair, officials are calling for more regulation. Indeed, on Thursday Tim Geithner, the Treasury secretary, laid out plans for enhanced regulation that would have been considered radical not long ago.
But the underlying vision remains that of a financial system more or less the same as it was two years ago, albeit somewhat tamed by new rules.
As you can guess, I don't share that vision. I don't think this is just a financial panic; I believe that it represents the failure of a whole model of banking, of an overgrown financial sector that did more harm than good. I don't think the Obama administration can bring securitization back to life, and I don't believe it should try.
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Show AllIt would have to be wondered how the arithmetic could be justified given that there is as yet no scientific discipline of economics, merely an ideology of alchemy governed by complex adjustments like the epicycles of Ptolemaic astronomy. For a primer on the principles of scientific economy, consider the following references:
All Production is Joint Production: A Thermodynamic Analysis
Introduction: Joint Production and Ecological Economics
International Society for Ecological Economics: Joint Production
Conference for Economic De-Growth, Paris, April, 2008
"there is as yet no scientific discipline of economics"
Economics is a "Social Science", like anthropology, psychology, etc.
"For a primer on the principles of scientific economy, consider the following references:"
If any of those references involve studying how we might predict humans would behave in different economic circumstances, they too are *merely* Social Science economics.
To consider economics as a social science is to concede the underlying issue of a “market” actually existing. It is the same intellectual error as assigning the epicycle a real momentum in planetary motion. Economics is where social organizations of any sort must comport themselves within the confines of the real world. It is the real world that compels social organizations and the individual delusions that underlie them to meet its challenge; the societies pass or fail according to their abilities to model the challenges posed in creation of the means of survival.
"To consider economics as a social science is to concede the underlying issue of a “market” actually existing."
You are saying "markets do not exist"? Please explain or clarify what you mean.
The status of economics as a social science is pretty well established, your statement above does little to upset that fact.
"Economics is where social organizations of any sort must comport themselves within the confines of the real world. It is the real world that compels social organizations and the individual delusions that underlie them to meet its challenge;"
At issue in economics is the behaviour of individuals, delusional or not, and the aggregate effects of that behaviour. "Compulsion" is a property of these individuals, not of the environment which you will find by contrast to be quite indifferent. That there are physical considerations of the world we live in does not change the problems with trying to predict behaviour. The "Real World" you refer to is largely individual humans.
"societies pass or fail"
Pass or fail by what criteria?
"according to their abilities to model the challenges posed in creation of the means of survival."
Gobbledeegook.
“Markets” are a social construct by which goods and services are distributed. The criteria which inform them are of a social science interest, but only where the goods and services are not actually being distributed by such delusions. That headhunters or cannibals consider themselves to be obtaining spiritual powers by their practices is of interest, but belief in the practice does not confer any independently existing thing, nor does it create a moral legitimation for those practices.
Societies fail by collapsing or returning to the jungle.
Gobbledeegook is circular definition that averts the issues raised in the question. Economics is governed by production, not by mental projection; production is governed by the laws of thermodynamics, not by agreed upon definitions; the second law of thermodynamics prohibits the concept of returns greater than inputs, hence that which is called profit by agreement is more correctly characterized as victimization in fact. Likewise, that which might be called spiritual power by headhunters or cannibals might be more correctly identified as superstitious ritual murder by those who obtain spiritual powers by other means.
"“Markets” are a social construct by which goods and services are distributed."
Agreed. That they exist in this sense lends weight to the idea of economics as a social science.
"Societies fail by collapsing or returning to the jungle."
There is economics associated with "jungle" societies, and economics informs us about historic societies that have "collapsed".
"Gobbledeegook is circular definition"
Yes it is so I will explain my use here: You deny that economics is a social science against centuries of thought on the subject, and fail to effectively state why.
"Economics is governed by production, not by mental projection"
Nonsense. Production is *only one* governing factor. Consumption, supply, demand, are just a few of many others. "Mental projection" figures into the demand for goods, vis a vis how future conditions may effect the supply of those goods as just one example.
"the second law of thermodynamics prohibits the concept of returns greater than inputs, hence that which is called profit by agreement is more correctly characterized as victimization in fact. "
Utter nonsense. Profit is not dependent on creating matter or energy where there are none. Profit can depend merely on how two different people *value* something. If you have ten apples and I have ten oranges, and we would each prefer to have a fifty fifty mix, we each gain value or "profit" by swapping five of one for the other. There is profit in that arrangement without creation of any physical wealth and no victims. That our thoughts on the value of the fruit are within our individual minds and that we can make this trade demonstrate that economics is a social science.
That markets exist in such a sense does not indicate that they are the best instruments for accomplishing such purposes.
Rome collapsed; cities in jungle societies were abandoned and its people scattered.
Some demands are never met because it would be unprofitable to do so. Consumption and supply are both dependent upon production, which is governed by thermodynamics. This equivocates on the concept of markets; see the first sentence.
Profit does require surplus value. "Swapping" is distribution; see the first sentence. Apples grow in England, but oranges will not, hence the swapping with France where oranges will grow. This interpretation equivocates "benefits" with "profits."
Profit does require surplus value. "Swapping" is distribution; see the first sentence. Apples grow in England, but oranges will not, hence the swapping with France where oranges will grow. This interpretation equivocates "benefits" with "profits."
Hmmm, Jake's point was about value. How do you define "profit" and "benefit?"
Benefit is an aspect of value, and is largely a matter of perception and judgement of an individual. The problem with "profit" is the tendency to express it in terms of currency, but there are other ways where we can see profit where it would not be easy to express it in terms of dollars.
It comes to mind that, "one person's trash is another person's treasure." Substitute treasure for profit and there you go.
Unfortunately, we're stuck with legal tender laws that keep us largely using paper dollars in the marketplace, with no explicit backing in tangible commodities behind this fiat money, and so the concept of profit is significantly warped by this government interventionism.
"It comes to mind that, "one person's trash is another person's treasure." Substitute treasure for profit and there you go."
Yep. It's a pretty fascinating idea to me anyway. I go to yard sales all the time. :-)
"...there are other ways where we can see profit where it would not be easy to express it in terms of dollars"
Ah, but no one ever does that.
"That markets exist in such a sense does not indicate that they are the best instruments for accomplishing such purposes."
I agree but that is quite besides the point. And of course "best" is a value judgement and people are likely to disagree as to what is "best". We look to economics to tell us why people behave in the marketplace the way they do. "Supply and Demand" explains that much better than thermodynamics.
"Rome collapsed; cities in jungle societies were abandoned and its people scattered."
The social science of Economics is very helpful in explaining why.
"Some demands are never met because it would be unprofitable to do so."
Some production never occurs in the first place because there is no demand, or if it does occur, the product rots in the feild.
"Consumption and supply are both dependent upon production"
The various factors we are discussing are *interdependent*. It would be misleading to say the least to claim that production is the sole basis of the other factors, and you haven't made the case that it is.
"which is governed by thermodynamics."
"Profit does require surplus value."
Value is not matter or energy. Value is *perception* within the mind of a reasoning individual, and nowhere else. Thermodynamics therefore does not apply to the concept of value as a human perception. Supply and demand does to a much greater degree.
""Swapping" is distribution;"
The costs of distribution are just one of various transactional costs. The willing participants (not "victims") in trade factor transactional costs into the overall profitability of the trade. Without the individual perceptions of value concerning goods and services there would be no trade to begin with. In any case, thermodynamics tell us very little about these aspects of economics.
"Apples grow in England, but oranges will not, hence the swapping with France where oranges will grow. "
BTW, had I use "pears" instead of "oranges", you would never have been able to write something like this, and my point would still be made just as well. In anycase, the given was that we each "have" the fruit, we have not yet made the swap. That oranges might have been imported a long distance ahead of one of us having them is besides the point.
"the second law of thermodynamics prohibits the concept of returns greater than inputs, hence that which is called profit by agreement is more correctly characterized as victimization in fact."
What?! The second law says that a closed system evolves to a macrostate corresponding to the highest number of energy eigenstates. I don't think this has anything to do with production input/output(whose metric is some sort of time-averaged market rate--which is unrelated to the energy eigenstates of the item).
I like you man...but you're crazy!
There is a "market" which represents conventional controlled wisdom reinforcing a great illusion, and there is a Black Market where anything goes.
michael jordan
http://sites.google.com/site/apolloguide/
Please clarify: Do you also agree that economics is not a social science? If so, on what wisdom, controlled or otherwise, do you base this idea?
ClassAct,
Just reading through this subthread, you have some good concepts. However, your arguments display:
- a variation of the argument by authority fallacy e.g. "second law of P says X, and we *must* follow second law of P."
- fallacious transfer of models - same example as the above
- conflating the map with the territory e.g. "the market does not exist (paraphrased)." The market is an abstraction of real phenomena, there are many maps/abstractions that one can generate to explain the same.
- a "true Scotsman" fallacy, e.g. "as yet no scientific discipline of economics" Even though there is considerable work in the field of economics whose results reflect the use of the scientific process, the phrase implies that the aforementioned work is not "true science."
It would be better to simply argue the merits of the models you reference relative to other (more popular?) models.
More correctly the second law of thermodynamics states that intepretations of transactions which produce more output than input cannot be correct. Exactly how the second law is stated depends significantly upon what exactly is being investigated.
Shorthand statements are inevitable in this format. My point is that because thermodynamic theory does not govern the conventions of economy, its mathematics are number games not bound by the physical necessities of production. The threads above are amplifying this point with their observations regarding the growth of financing within the economy to the detriment of production.
I cannot claim to know what a “true Scotsman” would be (even as a Scots-Irish myself), but it can be known what a “true Scotsman” could not be given a model to which such a thing must comport. Economy that considers production value without considering the much larger expense of waste must be invalid.
Much work in alchemy parallels what we know as chemistry, but chemistry is a true science, alchemy was the search to turn other materials into gold. Today economics purports to turn paper into gold.
Keynesian economics is bad economics. Take a look into Keynes' ideas about "animal spirits" controlling the market -- that's much closer to creationism than science. The mathematical models that others, like Krugman, developed from Keynesian thought are largely founded on flawed premises.
http://www.economist.com/research/Economics
/alphabetic.cfm?letter=A#animalspirits
I have a degree in economics. The crap they teach at school, what most call "free market" economics, is garbage. It has no relation to the real world (I was working on my undergraduate shortly after the East Asian Financial Crisis, where everything that CAUSED the crisis was accepted as the unquestioned truth), has never worked and usually benefits a small minority (the teachers teaching it are usually part of that minority). I'm really interested, name your, say, top five economists and do a short explanation as to why they are in your top five, why their ideas should be adopted. 99% of the "free market" economists never mention the assumptions that are needed for their ideas to work. Usually they'll show how much more efficient and logical the "free market" is, they just don't mention the ASSUMPTIONS that need to be in place for their ideas to work. Assuming full employment (basically never), assuming no "involuntary" unemployment (never), assuming "perfect information" (never), assuming a market at equilibrium (never), assuming all information is in the pricing mechanism (never), amongst other things...yadda yadda. Crap, garbage, nonsense, and the crooks on Wall Street, the “free market” think tanks and in government can't get enough of it. If you ask me, they're digging their own graves.
I continue to read Austrian economists to the exclusion of most other schools. Thomas E. Woods Jr. and Walter Block catch my attention the most lately.
I don't know what they taught at your school, but it sounds like the free market perspective was delivered in a Keynesian fashion. And it seems we're both in agreement that Keynes' work was garbage. After all, he opposed free markets, instead preferring central planning and government interventionism.
Here's a good book to check out from Thomas E. Woods Jr.:
http://www.cbsnews.com/stories/2009/03/19/
politics/otherpeoplesmoney/main4875433.shtml
I'm not trying to be rude, honeslty not, but if you read a branch of economics that is the most utopian of all utopian philosophies, whose ideas never have or will be put into practice, whose comments on economics and economic history tend to be ahistoric and whose assumptions are unrealistic to begin with, you won't really have a good understanding of the real world. I'm sure you could explain all the little known Austrian Theories, all the critiques of Keynes (and I'm betting you've never read the man or read critiques of Keynes from a leftist perspective), yet because the Austrian school is a branch of economics without a history what do you have to say about current economic issues? As I said, anything approaching your ideas have failed and a fully "libertarian" economy will never be put into practice. Given that, what information could you forward about real world issues? What real world sollutions could you offer, especially if it required you questioning some of the basic precepts of your philosophy (which all honest, logical people do)? If you're interested in economists who have a passing interest in something beyond theory alone, Robin Hahnel, Joan Robinson, Karl Polanyi and Herman Daly might be worthy of a look. Every one of them shred the "free market" myth to a million little pieces. What the heck does it mean that the "free market school was delivered in a Keynesian fashion"? How would you know this and, more importantly, what does it mean? No, they taught that the market could take care of itself, that all information was in prices, they taught us theories based on unrealistic assumptions and never seemed to be effected by the failure of their ideas in practice. I don't think Keynes' work is garbage, saying it doesn't make it so, explain how and show that you've read him yourself. I think that Keynes hinted at some of the fundamental problems of your philosophy and instead of allowing his logic to undermine the capitalist system he focused on simply make it work much better by taking it away from the crooks who were digging their own graves within capitalism. Read his "The end of laissez faire", written when he was still in more of an orthodox phaze. He lemented the utter failure of your ideas in practice and wished they did work. He got more radical as time went on because he took his head out of theory alone, took a look around the world a bit and began to be honest with himself.
Tell me anyway, of the 100 biggest economic entities in the world, the majority are corporations, the rest are countries. Are giant, multi-national corporations, with millions of employees, plants in multiple countries, dealing with different laws and customs around the world, not an example of central planning anyway? If "central planning" is so bad, and markets so wonderful, how do you explain the more effecient and cheaper healthcare systems in other developed countries vs. ours? Why do almost 90% Chileans and Argentinians, two countries with current privatized pension systems, want the state to control their systems? Forget them being statists, or any other insult you could throw at them. Why has your ideas bean so bad that even those in support of the "free market" want the state to control the system? Why has the pension systems in Mexico and the UK been so horribly bad?
I hate to partially repeat my statement below, but I am just dumbfounded by this idea that there is a mapping from thermodynamics to economics that is precise enough to make claims like "Economy that considers production value without considering the much larger expense of waste MUST be invalid." I am reminded of Rhonda Byrne trying to relate quantum mechanics to the power of positive thinking.
What does value (whether it be exchange value or some other abstract notion) have to do with the entropy of the commodity under consideration?
"More correctly the second law of thermodynamics states that interpretations of transactions which produce more output than input cannot be correct."
Well, only if the entropy of the output is lower than the input.
"Exactly how the second law is stated depends significantly upon what exactly is being investigated."
The veracity of the second law also greatly depends on how it is stated. In the sense that you are stating it, it is not true (unless you can demonstrate why there is a correspondence between value and entropy--which is the log of the number of energy eigenstates corresponding to the macroscopic description).
O.K. Thought Shaman,
A. It is not "argument by authority." It is "appeals to a questionable or faulty Authority." Your example does not support this fallacy. Your example indicates a hybrid of a"Post-Hoc" fallacy and a false analogy fallacy(wrongly implies that because two things share some characteristics, they are therefore alike in all respects. This could apply to your further belief patterning of what you erroneously believe are the formal logical fallacies in the rest of your "red herring" argument.
You completely digressed from the issue being discussed and inserted a highly unlikely descriptor of 'logic.'
There seems to be a typo in Mr. Krugman's column. Where he says "wizards" I'm certain that he meant "lizards".
Lol! that was funny.
Yes, so pathetically true ( and hilarious too )
The dinosaur brained -- cold blooded -- own baby eating
____ L I Z A R D S ____
of _ Wall__EYED__Street
Krugman's chosen cutoff date at 1980 of the post Great Depression banking bliss is telling as it completely ignores the stagflation of the 1970s. This is not to blame the problem on Carter instead of Reagan; instead, Nixon should probably take a lot of the fall for yanking the US off the gold standard in 1971 and thus defaulting on obligations to pay back foreigners in gold for their paper dollars. The move completely unhinged the currency and moved it into the realm of pure fiat, backed only by the force of the US government.
Ignoring this bit of economic history is easy for Krugman because none of his ideas are viable without the printing press and legal tender laws. The vulgar Keynesian is a central bank apologist promoting increased inflation (growth) of the money supply and increased consumer debt as the solution to the problems of the current economic crisis.
Thank you for posting some facts Dave. There are many people who forget that Nixon had little choice in the matter.
I agree, it goes back further, but my point remains that Krugman's assault on Reagan's deregulation is less important than the rise of the regulator's dream of the elastic fiat dollar, of which Nixon was a critical component. It is precisely because the government maintained monopoly control over the money supply and banking insurance systems that any "deregulation" not addressing these regulations rings hollow. Always ready with the printing press to bailout the banksters' and governments' decisions, the Fed acts as the most violent central planner and regulator of the economy ever created in this country, injecting itself quietly into every global transaction denominated in dollars.
I agree with the general direction of the thesis. The earlier post emphasized the gold standard which obscured the point you were trying to make.
It is precisely because the government maintained monopoly control over the money supply and banking insurance systems...
Err, more accurately - the Fed controls money supply, the government influences this process via deficit spending and paying the Fed interest. The Fed really needs to go.
See you there then :)
04.25.09
http://EndTheFed.us
Rally at Every Fed Bank and Office
"Audit the Fed! Repeal The Fed!"
Support HR 1207 and HR 833
The defenders of the Wall Street model of economics are starting to sound as credible as the "creation scientists"--that is how little connection their ideas have with observable reality. The only way to stimulate the economy is to fire Wall Street and institute a tax on excessive wealth levels. We are not going to stimulate the economy by throwing more debt at all the bad debt that already exists.
Briggs Seekins
briggsseekins.wordpress.com
From the article: "But the wizards were frauds, whether they knew it or not..."
Some of them surely did (Greenspan and Paulson come to mind), and the rest were complicit by their silence.
"All professions are conspiracies against the laity."
---Mark Twain
The myth of the market (the "magic of the free market" with its "invisible hand" corollary) is every bit as preposterous and childish as the religious myths that preceded it. Investors basically believe in magic, as their money is expected to grow without any effort from them (of course it might grow, but not through magic, but rather through exploitation of those with little bargaining position but great needs, as in labor). And I am afraid that the market myth is proving to be every bit as deadly as the religious myths, and possibly even more so, as the entire species could quite possibly go extinct as a result of it.
The entire financial system is designed to redistribute resources to make something out of nothing for the investors and bankers who are properly positioned, socially and economically. So every attempt to prevent the financial services industry from making unjustifiable gain will run into serious opposition, not only by members of the industry but by members of government who have been "captured" by the industry, as all of its gain is unjustifiable. Also, because the financial industry has so much money from its predations, it can always afford to hire armies of clever people to figure out ways to circumvent and avoid regulation.
Any society with a political/legal system that has so recently legalized and authorized tremendous redistributions of resources so that a few can accumulate extreme wealth at the expense of the many, including those who are forced to continue without adequate medical care, educational opportunities, or even housing and sufficient nutrition, and that has legalized and authorized the torture and murder of great numbers of foreigners who resist domination and plunder, is so fundamentally depraved that small steps and ordinary reforms appear unlikely to make much difference.
Thanks to the centralization of more and more power in the government in Mordor, DC, it is one stop shopping for the lobbyists. Plus, the politicians granted themselves printing press power to create the money to pay for whatever they and their cronies want.
I think the authors of the Constitution tried to warn us of what happens when power is not sufficiently separated. And I thought Obama taught college law students about that document, but maybe he now takes the Bush position that it is just a piece of paper.
Kivals, while we agree on failures of the current system, there is the fact that we have never had a free market on a signficant scale. The myth is that the "market can be free" in the context of the human condition.
I found it easier to talk to people about religion compared to food (ref. veggie, vegan movement). The current notion of the not-so-free market is harder than talking about religion too.
People are too wrapped in "hierarchies of dominance" to even understand the dangers such models and myths pose to the individual. So I have to point out that
I am afraid that the market myth is proving to be every bit as deadly as the religious myths,... is insufficient - the reality is likely much worse.
I agree that we "never had a free market on a significant scale" because a free market is like some exotic human-made metal which can only exist for a moment, as it is completely inconsistent with natural forces. The participants in a market never start off in equal position, and, even if they did, soon one or some, by chance or ability or some combination, would achieve a superior position, and then, in the pursuit of self interest, they would alter (some might say warp) the rules and the market environment to suit their own interests. And if some government were formed to intervene to enforce rules that were more fair and more consistent with a "free market," the powerful participants would immediately set out to capture the government, or at least enough of it, so that the rules and environment would still favor them. And to the extent the rules did not favor them, they would have the resources to hire clever people to circumvent the rules to maintain their advantage.
As for the danger of the market myth exceeding the dangers of religious myths, I believe we already are pretty much in agreement. I did state that the market myth was "possibly" more dangerous, though I implied that it was potentially far more dangerous by adding that it could lead to human extinction.
"and then, in the pursuit of self interest, they would alter (some might say warp) the rules and the market environment to suit their own interests"
That is the point at which the free market becomes a rigged market, and the resulting loss of freedom, and the lack of attention to it the public discourse, create constriction and confusion.
Imagine a simplified market where there is only one commodity and one person achieves a monopoly over production. This may technically remain a free market if the monopolist plays by the rules which require the market to serve the better interests of the people. The monopolist would maximize efficiencies and keep just enough surplus to earn a living, and heed the people's demands in the market. This market is free in the sense that the people are free to demand and get what serves their better interests.
The flaws in this example are that most people cannot perform as benevolent monopolists, and many of the others need to own a piece of the production. But it does illustrate that regulations alone don't make sense because the people need to act out of free will when possible. So the answer is both education and regulation. Today we have neither. Today we have confusion and collusion, plunder and oppression.
Lesson 12, 13, 14 - the IEE is fundamentally sound
What we mean when we say the economy is fundamentally sound is that the Incorporated Estates of Earth is fundamentally sound. What we mean when we say the IEE is fundamentally sound is that this is the best system ever. Ever was, ever is, ever will be. History has ended, nature has decreed, the universe declares: capitalism is vassalism wrought real, and vassalism is perfect. As perfect as can be. As close to perfect as one can possibly imagine.
This is a top down society, not bottom up. Imagine what would happen if a pyramid were turned upside down. The tip would be crushed!
Not only that but then it would all collapse and crumble leaving the whole mess at more or less the same level. Equality of condition! Total destruction.
Thankfully our system gets the design just right, preserving the tip, elevating it, providing the most sun, the best view, the commanding position with the freshest freest air. And the most cash. Oh, to be King. Hail to the Chief. O! say can you see!
Banks even allow vassals to use bank money the same as any lord. That is, a vassal’s dollar is the exact equal of a lord’s dollar. A vassal and a lord may actually touch and distribute the same bill at transcendent points in time. Of course lords inevitably possess far more dollars than vassals but that is not the point. The point is that lords and vassals use the same money, and they both may use it for any legal purpose they wish, including to buy up freedom and justice and whatever else they can afford. Can a more fair and enlightened system be conceived?
To hell with credit unions and their pretensions of democracy in action. A grand bank, like an incorporated estate, is a sovereign domain, a land really, a dominion, a country unto itself, fully able to conquer and resist being conquered. As such, banks sovereign and inherent rights are not to be tampered with, let alone trammeled. Any invasive treasonous moves against banks will continue to be met with supreme hostility from the lords of finance, from the banks themselves, the rightful owners of all money and earth.
No finer institutions than banks exist. What hell-on-earth this world would be without banks is difficult to imagine. Yet instructive. An earth with no banks would be like a military with no guns, or a world with no wars. Who would profit? Think about it. Where is the profit in no banks? No banks? That would be sacrilege.
Make no mistake, vassals, the banks have got your backs and the shirts upon them. The banks are here for you and they embrace what is theirs. For these many reasons vassals one and all may count their blessings in praise of banks.
And lead thou not into temptation, but deliver thine self from evil: For banks are the kingdom, and the power, and the glory, for ever. Amen.
apracticalpolicy.org/the-vassals-handbook/
Wonderful. Thanks for that.
Thanks - this is a nice attempt at associating the Feudal imagery with the current situation.
Thank you O Lords, I'm bowing down, forehead on the ground, ass in the air and I promise no stench from it will emit toward thou.
Toward thee, please. Thou is the nominative.
"Markets are really just a subset of an economy...they shouldn't BE the economy..just as ancient people had an economy regardless of the 'marketplace' where they traded the excess of their products...but the TRUE Wealth of Nations is PEOPLE...their health, their happiness, their certainty of being able to share what they have, what they do with others out of the JOY of doing what they do best..without the fear of destitution..the Market Economy can never provide this..Without People there is no Economy..hence: DOLLAR HEGEMONY EQUALS IMPERIALISM"..
HENRY CK LIU: from "THE HISTORY OF BANKING, MONETARY POLICY and IMPERIALISM"...
Asiatimesonline.com
"Americans have little understanding that the only reason we are living the lifestyles we have is because it is PART of a VERY VERY VICIOUS empire that ENSLAVES and MISUSES people everywhere"......
John Perkins...former CIA "economic hitman"...author of "CONFESSIONS of an ECONOMIC HITMAN".
re teddy March 27th, 2009 12:40 pm:
"...the TRUE Wealth of Nations is PEOPLE...their health, their happiness, their certainty of being able to share what they have, what they do with others out of the JOY of doing what they do best.."
Good quote, thanks. There's the perfect riposte for those who argue that nobody would become a (doctor, lawyer, broker, whatever) if they couldn't make scads of money at it.
Nobody gets paid for doing crossword puzzles, right? But people do them just the same, because they enjoy the doing of them in and of itself.
So far, most of the coverage of Obamanomics makes it sound as if Obama has been hypnotized by some kind of snake charmer. If only he could shake off the spell. This is total and complete rubbish. Obama has very quickly proven himself to be Daddy Warbucks. Those egg sucking snakes from Wall Street are his Heroes, as they are for nearly the entire corrupt leadership of the Democratic party. He is no FDR. He is the worthy successor to Bill Clinton and his sharkskin Republicanism. I have never been so quickly disillusioned by anything in my life. And so it goes.