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November 07, 2011

DOOM: Last fair deal gone down

DOOOOM

From the Walter Russell Meade piece Gabriel linked below:

Not a few now are unable to do anything much more remunerative than wait in line outside benefit offices; between tight economic times, social pathology, poor personal choices, and the destruction of the city’s entrepreneurial, job-creating culture, the state is the only legal and reliable source of income some have ever known.

"A sliver of madness." I always think of Heironymus Bosch's famous visions of hell whenever I read about Zucotti Park these days.

Remember what I was saying about Muni bonds? Yeah.

It's called the "man-cession" for a reason. Young men, and most particularly young black men, have been hit especially hard by this downturn, and the fear is that many of these men will be permanently disadvantaged in future years due to the setbacks they are facing this early in their working lives.

Steyn brings the DOOM.

America is seizing up before our eyes: The decrepit airports, the underwater property market, the education racket, the hyper-regulated business environment. Yet curiously the best example of this sclerosis is the alleged “revolutionary” movement itself. It’s the voice of youth, yet everything about it is cobwebbed. It’s more like an open-mike karaoke night of a revolution than the real thing.


You know things are bad in Europe when even the Communist Chinese think the Europeans are too socialist.

Looks like Papandreou’s little power-play didn’t work -- Greek Prime Minister to step down. This is after a narrow win in a confidence vote late in the week, so the message is, “We have confidence that you are a complete idiot and we would like you to leave.” Meanwhile, Greece careens towards the precipice while the rest of Europe stands by and dithers.

Confirmed: the Eurozone was flawed in its very design, not just in execution.

Wall Street banks can’t handle the truth? I think the real issue is that finance has become a monoculture in many ways, one that enforces conformity of thought, opinion, and behavior -- even the “outrageous” bankers and hedgies, the “outsiders”, the “rogues”...they’re all playing roles, really. But this is not a problem unique to the finance sector -- all businesses run into this problem once they reach a certain size. It’s human nature.

If you watch this video, you will know why Thomas Sowell is one of my heroes. In an academic field populated with mental midgets, he is a protean figure. But more than that, he is a man in full: kind, thoughtful, clear-headed, a man of great humor and great seriousness both. I wish we had a million more just like him.

What if middle-class jobs disappear?

There is a Biblical verse that is appropriate to accounting fraud. Luke 8:17 - “For nothing is secret, that shall not be made manifest; neither any thing hid, that shall not be known and come abroad.”

Never forget this: Wall Street is a Democrat stronghold, and has been for years. A lot of the anti-Wall Street rhetoric directed at Wall Street by the Democrats is nothing more than empty wind. The Donks need Wall Street far more than the GOP does.

Amity Schlaes on Christina Romer’s “Nominal GDP” proposal: it’s a bad idea. Really. A bad, bad idea.

In short, the big vulnerability of NGDP targeting is that it’s a license to inflate. It will inevitably undermine the Fed’s mandate to maintain price stability.

Public-sector pension funds investing in hedge funds in a relentless search for yield. What’s the worst that could happen?

Medicare is an even bigger Ponzi scheme than Social Security is. And let me repeat the old refrain: you don’t “pay into” medicare any more than you “pay into” Social Security. You pay a tax which is almost immediately consumed by current beneficiaries. Your own “benefit” must be funded -- or not -- by future taxpayers.

We need “super achievers” in the private sector, not the government. There's some interesting discussion on why “super achievers” tend to be males.

Rage against the machine...in public, anyhow.

Private-sector renaissance on the "space coast"? As a certified space geek and one who despairs of public-sector space exploration (NASA), this is good news. And, happily, an affirmation of free-market principles.

Freddie Mac: Brother, can you spare $6 Billion?

Greece to EU: Er, maybe that referendum was a bad idea. Remember, the Greeks elected a bunch of Socialists (PASOK) to prevent austerity measures, not to make sure they got rammed through. But the Greeks also like the first-world living standard that being in the Eurozone gives them, so they're on the horns of a dilemma. The Greeks (and the EU, for that matter) have yet to face up to the hard truth that there are no good options left: only different bad and painful ones.

Greece: The Hemlock bailout.

The Eurozone crisis seems to give rise to conflicting views on who is the most dangerous threat: Greece, Spain, Italy, or Portugal? (Probably not Ireland.) Greece was first, but it’s comparaitvely tiny -- the Eurocrats really dread the fall of Spain or Italy because those economies are simply too big to bail out. But Greece was the first crack in the dam -- it showed just how badly-thought-out the whole Euro project was. If Greece’s economy is so small and inconsequential, then how could it have so badly damaged the rest of the Eurozone if the monetary union was as robust as its backers claimed?

Welcome to the Orwellian world of the modern Left, where “diversity” applies everywhere except where it’s most important.

The death of money. Remember: “money” is not equivalent to “wealth”. More of the former does not translate directly to more of the latter. When the concept of “money” becomes decoupled from the world of real things, catastrophe usually ensues.

This used to be called “printing money”, conveying the sense that it’s a fabrication of something from nothing, which is pretty accurate. In truth, however, the Fed doesn’t even need to go to the trouble of printing it anymore. Now the money is conjured electronically: A number appears on a bank account balance sheet because the Fed puts it there.

From the same article:

There is something else going on, too, however. Courtis believes that gold and other commodities have hit a short-term peak and will stagnate in the months ahead as new fears about sluggish global growth unsettle investors. However, the “Himalayas” of debt, public and private, in the United States, Japan and Western Europe trouble him. The total debt burden in these countries ranges from 350 percent of national GDP to 500 percent. “Only people who believe in the tooth fairy should believe this will be repaid”, he jibes. One result of this unsustainable debt burden, he predicts, is that governments and central banks will try to inflate their way out of their debt problems even more than they are doing now. “We will look back and say to ourselves, ‘Why didn’t we buy gold when it was only $1,900 an ounce?’” says Courtis.

Remember this the next time Teh Bernank assures you that inflation is low.

Unleash the entrepreneurs!

The Potemkin economics of Keynesian stimulus.


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posted by Monty at 08:45 AM

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