Anger Against the Government

[jackc]

Ideology and partisan politics are interesting, but irrelevant and divisive, thus counterproductive, and in any case the future is the best focus.

Really wan't intending to interject ideology or partisan politics (though as an aside, its seems perfectly fine here when it comes from the other direction...)

I do very much mean to assert that in an unregulated setting, capitalism is a very predatory system that will lead to the aggregation of wealth by those most capable of doing that. There is no notion of the public good in a pure capitalist system. There must be a notion of the public good for a society to have long-term viability. I said before in another thread that there are alot of lessons that our country learned a long time ago - remember the robber barrons, the birth of anti-trust laws, etc - that seem to have been discarded along the way. And I bet the current state of affairs would come as no surprise to our forefathers who were dealing with those issues then.

And I do need to comment on the blame being shot at the CRA as the ulitmate culprit in the financial meltdown. I whole-heartedly reject the notion that the poor little innocent bankers were just doing what the government told them to do when they knowingly created a system to market, package, rate, and sell-off junk loans - while everyone who touched them along the way was pocketing obscene amounts of money. The top of our financial system is rotten to the core and it is critical to our future that meaningful controls be implemented.

[Cadillac Jim]

Pointing a finger at capitalism isn't very meaningful to me because the world as a whole is a very predatory place that will lead to the aggregation of wealth etc., and unfettered capitalism hasn't been around anywhere for over 100 years now.

its seems perfectly fine here

Yes, any topics are allowed in the 19th hole, and that isn't what I was saying.

PARTISAN POST ALERT

1) I don't take partisan positions and I usually don't respond to them, from either side, because I do believe that everyone is entitled to their opinions and that nobody deserves argumentative BS thrown at them for expressing them, particularly at The 19th Hole. A tolerant, gentlemanly atmosphere devoid of baiting such as "You don't suppose unrestrained capitalism had anything to do with it, do you?" followed up by blog-driven ready-made cases strike me as pressure against open discussion by suppression of opposing viewpoints through abusive posts.

Examples which show strong partisan polarization:

when it comes from the other direction...

And I do need to comment on the blame being shot at the CRA as the ulitmate culprit in the financial meltdown. I whole-heartedly reject the notion that the poor little innocent bankers...

Please click the links I gave and browse each of them for a few seconds. You will find that neither of them is partisan, and that although the CRA was a major player in the bubble(s) it wasn't the only thing, and it was IMHO an artifact of the cultural context of the times and other manifestations were also evident. But, do research the CRA -- you will find that the very sources that lay out the points you are making are the same sources that repeatedly and strongly opposed regulation of Freddie Mac and Fannie Mae while there was still time.

[BodybyFisher]

We want to blame banks because they did what the government said.....

This reminds me of a story

I have a neighbor down the block, that collects scrap, aluminum, copper, etc. He makes his living doing it, not well I might add

His place is an eyesore

Supposedly aluminum is valuable in the scrap yard

He has a pile of aluminum on his lawn unprotected and every once in a while another scrap rat comes buy and takes all of his aluminum.

He screams bloody hell, calls the police, who in his words are useless, he complains to all the neighbors, etc etc etc

One day he has all of the neighbors together and they feel bad for him. The last loss was about $600 worth

I walked over and said, STOP BEING A VICTIM!!! You leave VALUABLE stuff on your lawn and you are UPSET, when someone takes it..

That is like ME, leaving a FLAT SCREEN monitor worth $600 on my lawn and being upset when someone takes it..... Protect your stuff, put it behind a fence, you are a target for other scrappers, I have no pity for you, I told you this the LAST TIME, stop being a victim!

Banks are going to do with they do, make money. REGULATIONS!!!!, are what stop them from being STUPID. The SEC investigates and regulates, the state and FED audits to STOP poor lending practices, etc.

To me, this is a regulation problem PLAIN AND SIMPLE, a lack of oversite, poor lending guidelines, a lessening of credit WITHOUT considering the consequences, sweetheart LOAN deals to members of congress.... No one wanted to kill the golden goose.. The DEMS were giving money to their constituents and the REPUBs were afraid to look like they didnt care about minorities, the REPUBS were betweeen a rock and a hard place..

This was congress's and the regulators FAULT totally. SOMEONE has to guard (REGULATE) the hen house! THE banking system needed to WORK, not be used for POLITICAL purposes

[Cadillac Jim]

Yeah, I have gotten rid of stuff I don't want by putting it on the front lawn. We have a Bulk Trash day once a month in our town, and the flea markets show up at dawn to pick over the stuff at the curb, like they do at garage sales. We got rid of a Laser Jet III with a burnt-out fuser heater that way; my wife and I laughed until we cried when that thing disappeared.

The usual safeguards in our economic controls failed in the Crisis of 2008 because of several factors:

• Any economy is inherently unstable. This becomes unequivocally apparent when even the simplest economic equations are analyzed and represented with a set of recursive or differential equations. The purpose of Fed inputs is to stabilize these equations.
• There is an inherent delay in the information that goes into the economic "situation awareness" models. Thus the Fed's information is basically a prediction made from data that was applicable days, weeks, or months ago. And, the knowledge of the state and direction of the economy is inherently noisy because of the limits on accuracy and the incompleteness of the available information.
• Actions by the Fed take time to have effect, and when these effects do appear they have their own momentum. The economy has enormous mass and inertia and thus momentum. This is a big problem because the use of Fed inputs such as discount rate and M1/M2 supply are quite small.
• There are nonlinearities in the model such as tripwire conditions that cause sudden and dramatic reversals of trends, such as a drop in homebuying results in a drop in prices, which reduces effective equities, which means that many home loans are unsecured, etc. These things often have visible domino effects, and then, there is the Law of Unintended Consequences.
• The validity of any of these models depends on game theory, which here is the probabilistic modeling of transactions on the open market through continuous and unpredictable search for better options by others. If you forget to put game theory in the model of a market segment, you may find that it is there in the real world but not in your model and you can get nasty surprises that way.

Trying to stabilize the economy is a high-priority governmental function that has a lot of support behind it. But, you can think of it as similar, conceptually, to balancing an upright stick with the bottom end in your palm. With monkeys climbing on it. In high, gusty winds. And with one leg hobbled to a stake in the ground. The stick will wobble quite a bit occasionally, and once in a long while it may even fall.

We can learn from the past and improve things by innovation and refinement of the regulatory forces that limit or bias excursions in the game theory agents. Like, adding bananas at the top of the pole raises the center-of-gravity and makes the pole slower to fall.

[jackc]

Pointing a finger at capitalism isn't very meaningful to me because the world as a whole is a very predatory place that will lead to the aggregation of wealth etc., and unfettered capitalism hasn't been around anywhere for over 100 years now.

its seems perfectly fine here

Yes, any topics are allowed in the 19th hole, and that isn't what I was saying.

PARTISAN POST ALERT

1) I don't take partisan positions and I usually don't respond to them, from either side, because I do believe that everyone is entitled to their opinions and that nobody deserves argumentative BS thrown at them for expressing them, particularly at The 19th Hole. A tolerant, gentlemanly atmosphere devoid of baiting such as "You don't suppose unrestrained capitalism had anything to do with it, do you?" followed up by blog-driven ready-made cases strike me as pressure against open discussion by suppression of opposing viewpoints through abusive posts.

Examples which show strong partisan polarization:

when it comes from the other direction...

And I do need to comment on the blame being shot at the CRA as the ulitmate culprit in the financial meltdown. I whole-heartedly reject the notion that the poor little innocent bankers...

Please click the links I gave and browse each of them for a few seconds. You will find that neither of them is partisan, and that although the CRA was a major player in the bubble(s) it wasn't the only thing, and it was IMHO an artifact of the cultural context of the times and other manifestations were also evident. But, do research the CRA -- you will find that the very sources that lay out the points you are making are the same sources that repeatedly and strongly opposed regulation of Freddie Mac and Fannie Mae while there was still time.

Jim - I've thought alot today about your comments, and all I can say is that your reaction to my statements seems to be quite out of proportion to the thoughts I was trying to convey. Having followed the discussions here over the past year, I did not expect that my views would be popular and I fully expected to be challenged on them. What I did not anticipate was being charged with baiting, strong partisan polarization, and suppression of opposing viewpoint through abusive posts. If anything, I would say that your response to me comes a lot closer to an attempt to suppress than anything I said. Is it possible that you had some pent-up resentment toward me from a post I made the other day in another topic? That would make more sense to me than anything from today's discussion.

I'm sorry that you seem to think I'm just parroting partisan rhetoric from blogs. Nothing could be further from the truth. My opinions are my own, and have been arrived at after thoughtful consideration of large amounts of often contradictory information that I've accumulated from a wide variety of sources, and in the course of my day-to-day life, over the past year. And they're a lot deeper and more complex than anything I could begin to express in a one or two paragraph post. I honestly couldn't tell you right now if I'm a democrat or republican. I know I was a Reagan-Bush republican back in the day, but things have changed along the way. Does that make me an Obama liberal? No, I don't think so. I think it just makes me a guy who's trying hard to be thoughtful and to understand how we've gotten ourselves so messed-up.

Its unfortunate that we won't be able to engage each other in further discussions that might have mutually benefitted our understandings and positions - but right now, I'm not at all inclined to share anymore of my beliefs in this setting.

I'll close wishing you the best.

Jack

[BodybyFisher]

Ideology and partisan politics are interesting, but irrelevant and divisive, thus counterproductive, and in any case the future is the best focus.

Really wan't intending to interject ideology or partisan politics (though as an aside, its seems perfectly fine here when it comes from the other direction...)

I do very much mean to assert that in an unregulated setting, capitalism is a very predatory system that will lead to the aggregation of wealth by those most capable of doing that. There is no notion of the public good in a pure capitalist system. There must be a notion of the public good for a society to have long-term viability. I said before in another thread that there are alot of lessons that our country learned a long time ago - remember the robber barrons, the birth of anti-trust laws, etc - that seem to have been discarded along the way. And I bet the current state of affairs would come as no surprise to our forefathers who were dealing with those issues then.

And I do need to comment on the blame being shot at the CRA as the ulitmate culprit in the financial meltdown. I whole-heartedly reject the notion that the poor little innocent bankers were just doing what the government told them to do when they knowingly created a system to market, package, rate, and sell-off junk loans - while everyone who touched them along the way was pocketing obscene amounts of money. The top of our financial system is rotten to the core and it is critical to our future that meaningful controls be implemented.

This is the 19th hole, partisan politics is fine if you support your points.

[WarrenJ]

You don't suppose unrestrained capitalism had anything to do with it, do you?

You could try to attempt to make that case, but I think your efforts would be hobbled.

To paraphrase Churchill. "It's the worst system except for the one that successfully exists, works, and succeeds."

That would be Capitalism.

Regards,

Warren

[BodybyFisher]

You know, a lot has been said about profit and how scurrilous entrepreneurs are for wanting or needing it. The IDEA of PROFIT has been deamonized by the Obama Administration and Obama during his campaign. Recall how incensed the discussions became when fuel prices skyrocked and congress was looking at oil companies with contempt. Funny however, I dont recall congress HIGHLIGHTING the increased PROFIT THEY received at the same time from taxes, did I miss that?

READ THIS LINE CAREFULLY

All capitalist profit in Marxist-Leninist theory is based on exploitation (the business owners extract surplus value from the workers).

Profit is needed for investors to be compensated for the risks involved in a venture. Investors can invest in anything, for that matter they can be risk adverse (safe) and just put their money in their mattress or a safe deposit box (to remove the RISK of a mattress fire or theft). But when they risk their capital, they need to be compensated for the risks. When we used to deposit our money into a day of deposit day of withdrawal bank savings accounts when we were kids, we would be given a low interest rate or return/profit because the funds were 'risk free' as they were backed by the government and returnable on demand. However, as an investor risks his capital in riskier and riskier ventures, his RETURN/PROFIT needs to increase to compensate.

For instance, if I invest my capital into a real estate deal, I would expect a higher risk return than a savings account to account for the risks involved, ie, illiquidity, management, market fluctuations, tenant rollover, maintenence, etc.

If there is no profit, investor funds will not go into risky ventures, businesses, etc., so as a result, the economy will suffer and dry up

Lets try to keep our eyes open. We are moving toward more government control, call it Marxism, Socialism whatever. We need to be alert of this demogague, he is changing our economic dynamics. Everything is being rushed. These is no bill to read. The majority does not want it.

This administration demonizes everything, talks down America, is changing our traditional economics, they thrive on bad news, they have radicals in their administatation. Thank God for Glenn Beck, Mark Levin, Rush Limbaugh and Bill O'Reilly, American Thinker, Hot Air and the Heritage Foundation they are the last firewall of hope for America.

[Cadillac Jim]

The interesting thing is that "capitalism" is a Marxist term for a system in which a few, the capitalists, own all industry, which is staffed by a wholly disenfranchised proletariat which is employed and paid at the pleasure of the capitalists. I don't recall who the middle managers were in this theory but "trusty" proles is probably good. The system we have is actually free enterprise with 100% literacy, and our economy is driven by small business, with several core industries. It's a caricature of the mid 19th Century Industrial Revolution as Marx observed it in England. Marx began The Communist Manifesto, published in 1848, with “The history of all hitherto existing society is the history of class struggles,” setting a context by demonizing England's urbanization and industrialization as an extension of the feudal system, with its lords and serfs.

I do find it interesting that Marx advocated "dialectics," which is redefining words to change public perceptions, and now we have redefined "capitalism" as the free enterprise system when Marx coined it to represent a feudal system that owned all "means of production."

[jackc]

To me, this is a regulation problem PLAIN AND SIMPLE, a lack of oversite, poor lending guidelines, a lessening of credit WITHOUT considering the consequences, sweetheart LOAN deals to members of congress.... No one wanted to kill the golden goose.. The DEMS were giving money to their constituents and the REPUBs were afraid to look like they didnt care about minorities, the REPUBS were betweeen a rock and a hard place..

This was congress's and the regulators FAULT totally. SOMEONE has to guard (REGULATE) the hen house! THE banking system needed to WORK, not be used for POLITICAL purposes

Mike, you and I are in complete agreement on this point.

But I would add that the consolidation of wealth that has occurred in our country over the last 20 years is also a significant problem that threatens the long-term viability of the American society. Opportunities are drying up for those of us who are not master aggregators of wealth. Small businesses are failing right and left, with their former roles in society being assumed by ever-larger conglomerates in which the leaders are ever-more distanced from the daily plight of those they employ. Projected out to its logical conslusion, the implications of this are frightening.

I agree completely that someone needs to guard the hen house. But not just for the sake of assuring that the economic value to the commodity (hens) is preserved. Hens deserve quality of life and opportunity too, don't they?

I've had the good fortune of working for some exceptional gentlemen who were small business owners. They have since passed on. And in their wake have come not more exceptional gentlemen, but rather a new conglomerative generation that does not share their respect for employees or their belief in the need to reinvest in the enterprise, while limiting what they must take for themselves.

I wish I knew what the answer to all of this is. I think a good starting point would be to find some exceptional gentlemen and put them in charge of things. What's in the way of that? Probably campaign finance reform, for starters.

[WarrenJ]

I agree completely that someone needs to guard the hen house. But not just for the sake of assuring that the economic value to the commodity (hens) is preserved. Hens deserve quality of life and opportunity too, don't they?

Hens should be served on a plate before me, in my favorite restaurant.

Several Congressional and Senatorial hens come to mind.

What sort of dressing strikes you as best?

Regards,

Warren

[Texas Jim]

I agree completely that someone needs to guard the hen house. But not just for the sake of assuring that the economic value to the commodity (hens) is preserved. Hens deserve quality of life and opportunity too, don't they?

Hens should be served on a plate before me, in my favorite restaurant.

Several Congressional and Senatorial hens come to mind.

What sort of dressing strikes you as best?

Regards,

Warren

Maybe a good dressing down with a cat-o-nine tails?

[WarrenJ]

I agree completely that someone needs to guard the hen house. But not just for the sake of assuring that the economic value to the commodity (hens) is preserved. Hens deserve quality of life and opportunity too, don't they?

Hens should be served on a plate before me, in my favorite restaurant.

Several Congressional and Senatorial hens come to mind.

What sort of dressing strikes you as best?

Regards,

Warren

Maybe a good dressing down with a cat-o-nine tails?

That would be a good start.

Regards,

Warren

[Ranger]

What sort of dressing strikes you as best?

How about tar & feathers.

[JimD]

But I would add that the consolidation of wealth that has occurred in our country over the last 20 years is also a significant problem that threatens the long-term viability of the American society.

The long term viabilty of American society is at risk only from socialistic government interference in our free-market capitalistic republic.

If the federal government (somehow) decreed tomorrow there was to be a one-time redistribution of wealth - to totally and absolutely legislate that the net "wealth" of this nation was to be redistributed equally on a per-capita basis, 98+% percent of our population would overnight become "rich".

Within five years, and certainly less than ten years, the very same "consolidation of wealth" you moan today would begin to emerge again. Guaranteed.

[WarrenJ]

What sort of dressing strikes you as best?

How about tar & feathers.

Better still.

Our current president is reported to have said he doesn't care if he becomes a one term leader as long as his policies are instituted. He's publicly remarked the Constitution is an impediment to his ideals.

Along with just about half of our country, I'm not prepared to surrender the Declaration of Independence or the Constitution to this person's "ideals."

I'm worried about the other half of the country.

Are you?

Regards,

Warren

IMPORTANT: U.S. (OBAMA!) Cedes Independence:

http://www.youtube.com/watch?v=xbTCmSdHvrk

[WarrenJ]

Within five years, and certainly less than ten years, the very same "consolidation of wealth" you moan today would begin to emerge again. Guaranteed.

Yep.

[WarrenJ]

Then it got weird. Really weird.

But, could these guys be serious? Are there really people out there like that? In numbers???

I hope not. But I do have fears.

Regards,

Warren