This story at Jams is one reason one cannot go for unfettered enterprise.
When I think of free enterprise, I think of someone like you or I starting up a little business with a loan and what we've saved up, running the risks, paying reasonable taxes and slowly building up custom - I had such a business at one time, in screen printing.
I do not think of Exxon or Trafigura in Jams' post raping the land and surrounding seas and pillaging the people. I do not think of JPM and GS bringing on the global crisis and making a killing on it or CEOs lining their pockets and giving themselves increased bonuses whilst everyone else is on the breadline.
To run in horror from these monsters , straight into the hands of the Big Statists and the command and control economics of Brown which has been so beneficial [not] is equally as bad.
So there obviously needs to be a climate in which small and medium business can flourish and yet the monsters with the big money can't take over the nation's large enterprises and turn them global. While incentive is the only way to make the economy grow and working for one's family is the best incentive known, resulting in employment and a productive atmosphere, the world of the monster capitalists needs to be eradicated.
We're between a rock and a hard place and I confess I don't know the answer to the dilemma. It's certainly not in greater governmental stringency and neither is it in letting the monsters behind the government loose on the country.
There has to be a middle way.
James, you recently asked "What connects the Dots".
ReplyDeleteThe answer is derivatives. They started the cascade last autumn, and they are still being written, The politicians are captured, and will not regulate....
Read this
And
Also this
We have not moved forward, at all. Just a few mumbles about bonuses, for gawds sake!
They are the dirty little secret, preserved by the power of finance.
THE EVIDENCE
ReplyDelete9/11, and WTC Building 7
Normal Banking, and Casino banking must be separated.
ReplyDeleteG-Steagal must be brought back.
If OTC derivatives cannot be controlled, they should be unenforceable. Taxpayers should not be on the hook.
Until banks are controlled, and clarity returned, with monstrous penalties, there can be no genuine economic recovery.
Economists can not build global models with casino banking present.
Political shits are too scared to act.
Or they see this as an inevitable step towards financial NWO, choose to let it run, and hope to exert their political control later.
I have no idea what the answer is when communism is a clear faulire and capitalism fosters the greed an callousness so amply displayed by Trafigura and also by the scum who run vulture funds.
ReplyDeletePerhaps the only way to eradicate such venality is to eradicate our species.
What do you do
ReplyDeleteWhen
Different experts tell
Different stories.
Buy physical gold???
But most of all, Jams o'D, you do not surrender!
Jams o D
ReplyDeleteCommunism ideology was set up and funded and in the beginning staffed, by capitalists, as a viable competitor, a viable enemy, to create a reason to fight, a reason to borrow, a reason to add debt, to enrich the few and impoverish the many, a common enemy to rally the sheep behind the flag of never-ending debt.
(And also as part of an ideologically motivated revenge)
Until you understand that you will flail around forever, undirected in your hatred, unable to create change.
BUT, the capitalists who created Communism were part of a cabal, with stated goals and stated methods, tightly clung to, set centuries earlier.
They were not capitalists as one would normally understand the term!
I think the real source of capitalism's ills is the disconnect that occurs when a corporation is a legal entity and not personal one. Corporations affect legislation to procure market advantage, reward CEO's lavishly, and fail to pay share-holders their just rewards for investing in said corporations.
ReplyDeleteStripping their ability to fund politicians and receive benefit from those politicians will go a long way to improving what corporations should be.
In the sense that there is a Communist ideology there is no capitalist ideology and never was. Communist ideology begins with the idea of a designed society, conceived by reason alone, and directed by master minds. Capitalism was not designed. It came not from theory but by doing, and most capitalists are innocent of its existence. That is why it is possible for many capitalist to be themselves strongly influenced by socialist ideas, and have not sufficient belief in capitalism to defend it with a clear conscience. Quite the contrary. They are easy recruits for the socialist cause.
ReplyDeleteThat middle way is exactly what got you here. I'm amazed anyone would pick up the very stick Tony Blair once beat you with.
By its very nature private capitalism limits government; the middle way by its very nature is a vehicle for government.
The shivering ghost that now inhabits free enterprise was once an unconquerable fighting spirit. That spirit did not belong to capitalism, it belonged to liberty; and to this day its association with capitalism is valid only so far as capitalism represents liberty. That is not a third way, that was the first way, but we have lost the lesson.
"We are not ready to suspect any person of being defective in selfishness. This is by no means the weaker side of human nature.
The vices are never so well employed as when combating one another. Too much capitalism does not mean too many capitalists, but too few capitalists.
Every man ought to be supposed a knave, and to have no other end, in all his actions, but private interests. By this interest we must govern him, and by the means of it, make him cooperate to the public good, notwithstanding his unsatiable avarice and ambition.
This policy of supplying, by opposite and private interests, in defect of better motives, might be traced through the whole system of human affairs, private as well as public."
That was to be the primary role of government. Now government is the primary role.
One of the great peculiarities of the American Revolution was that its leaders pinned its hope on the organization of factions against one another, rather than the default position of man–good versus bad. You will lose default positions every time.
The shivering ghost that now inhabits free enterprise was once an unconquerable fighting spirit. That spirit did not belong to capitalism, it belonged to liberty; and to this day its association with capitalism is valid only so far as capitalism represents liberty.
ReplyDeleteYes, when capitalism becomes a mechanism for the vandals to collude with government to bail themselves out [read increase profits on that which has been laundered during the crisis] while all the little firms go to the wall - then that is not capitalism based on freedom - that is based on a stacked deck.
Crapitalism becomes a mechanism for vandals in collusion with government and citizens who have abandoned first principles. Not third principles.
ReplyDeleteHow would a "True Capitalist" respond? ..... That is.....in the real world??
ReplyDeleteOne of his best?
ReplyDeleteHow would a true capitalist respond? He wouldn't. When a capitalist understands why he does what he does, and how much is involved in law and custom to provide that opportuninty, it is only because he has learned it after the fact as a hobby, and then rarely. Capitalism is a state of mind and personality.
ReplyDeleteThe formerly great systems of law and custom that support liberty, and therefore private capitalism, were in no case made by capitalist.
Take Bill Gates. Please. That innocent assumed, like all innocents, that one employed lobbyists to gain influence in government, and he needed nothing from them. How true. But that is not why a company his size will employ several hundred lobbyists. They do that so they are not eaten by the worlds biggest, baddest monopoly of power.
Since Gates employed only three servants to eat humble at Washington, Washington attacked him. It was not until the Cowboy came to power that the dogs were called off. You may remember.
Did Gates learn anything? Not at all. He has reached the philanthropical stage where billionaires put their money in places where it will do the most harm, which is with the very type of people who prosecuted him.
That's a capitalist.
This is not a story about capitalists. They are only the talent, not the production, and their understanding of politics is generally equal to an actor also.
FT on not clearing derivatives
ReplyDeleteAnd Jim Sinclair understanding of it:-
Jim Sinclair’s Commentary
For anyone that understands OTC derivatives, this was a foregone conclusion.
If the CME had spoken to me they could have saved themselves whatever they wasted on this ill fated initiative from a ten minute discussion.
We have reviewed this subject here multiple times. You can neither clear nor trade items that lack standards because all the methods of valuation are cartoons. This confirms the basis of our FASB discussion today.
Going backward it is totally impossible to trade or clear ANY OTC derivatives. Going forward some Credit Default derivatives now have standards but the money behind them is in tranches as valuation is still cumbersome.
This release was carried by newswires with total emphasis on the hope for clearing ONLY. That is MOPE.
(MOPE = Management of Perspective Economics)