And Just When You Think It Couldn't Get Any Worse
- Thread starter Steve Williams
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Never underestimate the ability of the human mind to concoct ways to gain the unfair advantage over the many. Greed,power and money is most powerful when things are "good". It is known as the "Bezzle" and happens during all bubbles. FDR understood this as well as Eisenhower.
John Kenneth Galbraith put it to pen in his excellent book on the Great Depression :
"In many ways the effect of the crash on embezzlement was more significant than on suicide. To the economist embezzlement is the most interesting of crimes. Alone among the various forms of larceny it has a time parameter. Weeks, months or years may elapse between the commission of the crime and its discovery. (This is a period, incidentally, when the embezzler has his gain and the man who has been embezzled, oddly enough, feels no loss. There is a net increase in psychic wealth.) At any given time there exists an inventory of undiscovered embezzlement in - or more precisely not in - the country's business and banks. This inventory - it should perhaps be called the bezzle - amounts at any moment to many millions of dollars. It also varies in size with the business cycle. In good times people are relaxed, trusting, and money is plentiful. But even though money is plentiful, there are always many people who need more. Under these circumstances the rate of embezzlement grows, the rate of discovery falls off, and the bezzle increases rapidly. In depression all this is reversed. Money is watched with a narrow, suspicious eye. The man who handles it is assumed to be dishonest until he proves himself otherwise. Audits are penetrating and meticulous. Commercial morality is enormously improved. The bezzle shrinks."
Well, I wouldn't consider the guys at AIG, Goldman, et. al. exactly hens. I know a bunch of them -- even they'd object to that! I think employees guarding the sharks is closer to the present situation.
I think the first two were far more at fault than #3, though the problem is more like the lack of regulation made a lot of #1 legal. There's always going to be a fluid line between what some call regulation and other's interference. To me, it's a heckuva contortion to make the recent meltdown an issue of interference. Part of the point of regulation is to temper what seems to be a basic part of human nature, and that is greed. The mammoth and growing gap between rich and poor in this country suggests whatever regulation there is ain't amounting to much.
You guys are welcome to live in Canada, and also invest in Canada. 
...We have igloos, polar bears, polar speakers, Anthem, Bryston, Paradigm Signature loudspeakers, cold beer, maple syrup, trees, water, and a whole lot more goodies, plus a bunch of very friendly & peaceful people...
...We have igloos, polar bears, polar speakers, Anthem, Bryston, Paradigm Signature loudspeakers, cold beer, maple syrup, trees, water, and a whole lot more goodies, plus a bunch of very friendly & peaceful people...
I think you mis understand what I mean by free market,it is not only the market apparatus to trade all forms of securities,it is also those securities,ie bonds,stocks,bills,agency debt,central bank instruments,USGOV insured debt and paper, and so forth. Let's not forget the wealth of the nation hangs in the balance. Banks and Investment banks were always divided because of the different risk profiles,not to mention insurance companies. Now this has all been comingled and as we all learn day by day it is almost impossible to unscramble the eggs.
The greater the return the greater the risk,that will not change. Federal Reserve policies of ZIRP has forced society to take larger risks in order to keep up the illusionary standard of living. It is a facade more or less because it has been built on leverage.
Many will seek safety and that will be gold for a period of time until either a serious deflation grips the nation or something is done to create a new currency based on probably a basket of accepted value. The ill advised QE3 program of buying treasury debt will only prolong the agony.
Bottom line is this country is in perilous times. We need leadership right now and that falls on the POTUS.
And the great Presidents understood the dangers of the GS and AIG's of this world. They do not have society in general in the best interest. They would shoot their Mothers for a nickle.
Yes and sorry. Though still not clear on who's the wolf and who's the hen
Well, I misunderstood what he meant by "free market," but I still think "employees and sharks" is much closer to the truth.
Tim
You guys are welcome to live in Canada, and also invest in Canada.
...We have igloos, polar bears, polar speakers, Anthem, Bryston, Paradigm Signature loudspeakers, cold beer, maple syrup, trees, water, and a whole lot more goodies, plus a bunch of very friendly & peaceful people...
My youngest sister and her family migrated to Toronto last year and was very impressed with the society she lives in. She also likes the educational system there but feels the standard of living there is high. She just wrote me yesterday asking me what's going on the States re the debt crisis, the S&P downgrade, etc. I told her, I'll get back to her in a few days as I'm still digesting the issues on What's Best.
My youngest sister and her family migrated to Toronto last year and was very impressed with the society she lives in. She also likes the educational system there but feels the standard of living there is high. She just wrote me yesterday asking me what's going on the States re the debt crisis, the S&P downgrade, etc. I told her, I'll get back to her in a few days as I'm still digesting the issues on What's Best.
In the past, some of my best sources of news and politics have been non-political internet discussion boards. Such discussions are dangerous and can lead to horrible fighting on the wrong boards, but on the right ones it can be the fastest conduit of different perspectives available. It needs, however, to be backed up by professional news...read, not watched...from both the right and the left. And the center if you can find it. For professional news coverage, the internet cannot be beat. I can search the stories of interest across the sources of value and very quickly have a view of this crisis, for example, not only from both sides of the political aisle and from a market point of view, but from a global perspective as well.
As rapidly as aggressive, competent investigative journalism has faded, opinion has proliferated. The proliferation of editorial itself is not a problem. The problem is our tendency to only read what we already agree with.
Tim
Free market requires some kind of arbiter... The government is the best fit ... No one would fathom something as mundane as a basketball game (any game) without an arbiter, a referee, someone to interprets and enforce the rules .. Why do we think the "Markets" will nicely auto-regulate? Highly unlikely.
Give the markets a few years of real self-regulation you'll return to the robber-barrons. Give them a hundred years and you'll return to feudalism. An unfettered free market is just another path to unfettered power, which is a path to unfettered corruption, which is a path to unfettered oppression. It has always been so. Our memories are so short.
Tim
garylkoh
WBF Technical Expert (Speakers & Audio Equipment)
The question I have, and this is because I am not familiar with leadership who want to sink the country, is what can the ordinary people do about this? The US is a nation of the people, and this is where freedom to act and to be heard is enshrined in the founding of the country.
Take the 1997 crisis in Thailand - one of the leading Buddhist monks urged his followers to donate gold and precious items to the Bank of Thailand to help bail the country out. If I remember right, some 20 tons of gold was donated. For a small country like Thailand, that's a significant drop in the bucket.
Whereas in the US, I read that the rich do not help the poor. The rich and the corporations have trillions in reserves overseas because they are waiting for another tax holiday on repatriated earnings before they will bring the money in. Wouldn't that money held overseas, and the taxes paid on those earnings be a great shot in the arm to kick-start the economy?
Here in Washington, the State tourism bureau has been shut down because of lack of funding. In previous years, the few million that the bureau cost has resulted in far more in revenue. Doesn't shutting down sources of revenue dig you further in the hole?
Take the 1997 crisis in Thailand - one of the leading Buddhist monks urged his followers to donate gold and precious items to the Bank of Thailand to help bail the country out. If I remember right, some 20 tons of gold was donated. For a small country like Thailand, that's a significant drop in the bucket.
Whereas in the US, I read that the rich do not help the poor. The rich and the corporations have trillions in reserves overseas because they are waiting for another tax holiday on repatriated earnings before they will bring the money in. Wouldn't that money held overseas, and the taxes paid on those earnings be a great shot in the arm to kick-start the economy?
Here in Washington, the State tourism bureau has been shut down because of lack of funding. In previous years, the few million that the bureau cost has resulted in far more in revenue. Doesn't shutting down sources of revenue dig you further in the hole?
Government interference of the wrong kind I speak of is manipulation of prices in the short term. This happens mainly in the gold,commodities,futures markets. I am not talking about the enforcement of regulation and code enacted by congress.
Shutting down a visible and profitable department is a tactic often employed to create a "crisis" atmosphere for the viewing public.
Lee
Any ideas what Bernanke will announce this afternoon after the Fed meets or are they just out of bullets
Hi
I still think that the emphasis on "The Market" as an indicator of economic health is incorrect.. This is after all the same "market" which invested in quasi-ponzi scheme such as the dot.coms and more recently and unfortunately in Housing and derivatives. It is IMO more of a lottery where it is expected that the rewards have to always be increasing .. This leads in all kind of manipulation toward displaying some kind of increase whatever the means used to arrive as such showings...
Call me a skeptic but I am not sold on The Market, hardly an objective indicator.
I still think that the emphasis on "The Market" as an indicator of economic health is incorrect.. This is after all the same "market" which invested in quasi-ponzi scheme such as the dot.coms and more recently and unfortunately in Housing and derivatives. It is IMO more of a lottery where it is expected that the rewards have to always be increasing .. This leads in all kind of manipulation toward displaying some kind of increase whatever the means used to arrive as such showings...
Call me a skeptic but I am not sold on The Market, hardly an objective indicator.
I don't think anyone wants to sink the country, Gary. I think every side believes what they want is for the good of the country. Obviously somebody, maybe everybody, is wrong.
Tim
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