carey_jim

270 Comments

    • What Happens When Banks Are Nationalized [view article]
      I'm just saying that "capitalism" is little more than a rhetorical device. It doesn't exist except in some peoples' imagination.

       Oct 10 03:18 PM
    • Current Crisis Trading on Par with Beginning of Great Depression [view article]
      For thirty years, we've had a silent depression of homelessness, increasing income and wealth imbalance and other economic problems.

      There are many "cryto-economic problems that aren't usually thought of as economic problems but really are, such as:

      The highest rate of crime in the world (white collar crime included) and the largest prison population (white collar crime not included.)

      The worst secondary education system in the first world.

      The worst health care system in the first world which is, nevertheless, the most expense. (It's the best health care system for the rich, of course.)

      A crumbling infrastructure (roads, parks, etc.)

      Moral decay: alcohol, drugs, prostitution, pornography, adultery, multiple marriages, homosexuality .... (combined with rising religious fundamentalism :)

      Irrational transportation network and national energy system.

      Too much buying of useless things such as expensive cars, boats, private airplanes, etc. Over consumption in general.

      The very expensive war in Iraq. (Defensive?)

      More and more government intrusion into our personal and economic lives.

      These are all economic problems whether we are fully aware of it or not.

      Maybe a "Depression" (in all of its meanings) is the only way we can face our "Addictions" and other economic problems and correct them.

      Then we Americans will be able to sing happily to each other, "Prosperity is just around the corner" instead of jealously glowering at each other and predicting "The sky is falling, the sky is falling ...."       Oct 10 12:51 PM
    • What Happens When Banks Are Nationalized [view article]
      To Socialism Can't Compete! I answer that Capitalism Wont Compete.

      Alexander Hamilton, the founding father of our economic system, did NOT believe in the revolutionary ideas of Adam Smith and instead believed in good old Mercantilism or what we called protective tariffs.

      So for almost 150 after his death, and certainly all through the 19th century, America refused to compete with the rest of the world and erected protective tariffs instead. We even FORMALLY refused to recognize the patent rights of other countries, including even book copyright laws. Charles Dickens complained bitterly that he couldn't make any money in America because his books were all pirated here.

      In the twentieth and twenty first centuries, China, Japan and Korea have all done (and do) the same while America complains but buys their stuff even though they wont buy our stuff.

      And yes, I believe in free markets and no, I'm not a closet socialist.

      I'm just reporting the facts, captain: Capitalism Wont Compete (it's far too dangerous.)
       Oct 10 12:26 PM
    • History Lesson and Bear Market Advice [view article]
      You suffer from the "fish in water" problem in that you can only see our economic problems from the "far right" perspective of the Chicago school of Frank Knight as represented by his disciples (notably Milton Friedman, George Stigler and Friedrich von Hayek) whose economic ideas came to power with the Reagan presidency.

      You can be forgiven because it has been economic "reality" for thirty years.

      But there are many ways of looking at economic matters and we might be forced to look at some of them soon.

      Outside buying and selling, there are such things as politics, religion, sociology, economic classes, history and even anthropology.

      A message to academic economists: Mathematics is a lovely thing to behold but it is not all of reality.

      Jump out of your academic fish bowls and behold the world!       Oct 10 12:13 PM
    • Today's Situation: Not a Great Depression [view article]
      Your statistics are reasonable but don't tell the whole story.

      First, real unemployment is much worse than 6%
      Second, GDP growth was fine in 1929 but we don't know what it will look like in 2009 if the slow motion crash picks up speed.
      Third, exports went way down in the 1930's because protectionism became the official policy of most countries. That could return in the future also (think of China, Japan and Korea.)
      Fourth, your inflation number reflects the last few years but not the possible near future where real estate prices (and possibly) stock prices are down by 30-50% or more.

      You are looking at a fast moving picture through a snapshot taken a few months ago, I think.       Oct 10 11:35 AM
    • Candidates Are Off Course On Picks For Treasury Secretary [view article]
      Obama mentioned Buffett as a possible pick for secretary of the treasury.

      It might simply be a political lie to help get himself elected but he said it and if we don't listen to what they say anymore then the republic is in worse danger than we think.

      I like to think that Buffett would have the wisdom to reject an offer like that but I also like to think that Obama would have the wisdom not to make the offer.

       Oct 10 11:27 AM
    • A Return To Depression-Era Market Shutdowns? [view article]
      Often, shutting down a market has no effect other than to cause suffering for people who can't make the real transactions they want or need to make, such as withdrawing money needed for a medical emergency.

      When the market opens again, the same underlying problem still exists (if the patient hasn't died!) and withdrawals and sales continue where they left off but sometimes at a more rapid rate because of pent up desires and needs.

      We have to be careful not to confuse a market failure with a precipitous market fall. If people want or DON'T want something, it is the market's purpose and function to allow the purchase or sale of that something.

      As long as people believe they can withdraw as much money as they want from banks (insured by the government printing press) they will be happy enough and a bank holiday wont be necessary.

      As for stock and other markets, why shouldn't people be allowed to sell to willing buyers and buy from willing sellers?

       Oct 10 11:17 AM
    • Is the DJIA Heading Towards Zero? [view article]
      I'm just having fun David.

      As I said, I take your meaning but even in a thousand years the DOW wont fall to zero, as long as people are allowed to trade that is.

      (It might fall to one or two but not zero :)

      If you take the advice of your great namesake, John Templeton, you'll make money even if the DOW falls to fifty cents!

      And don't forget: In times of economic crisis, great fortunes are made (and lost.)       Oct 10 12:45 AM
    • Is the Great Moderation Now Over? [view article]
      The unspoken correlation seems to be the fall of communism in 1989.

      The fall of communism resulted in less money diverted into military spending and more trade with China and Russia for our mutual benefit.

      It looks like we've squandered this extraordinary opportunity for a century of peace and prosperity with the entire world working towards more social justice, freedom and economic equity and less poverty in the entire world.

      Instead we have tried to crush Russia completely, which we should have known was not only impossible but extremely dangerous.

      We've allowed ourselves to get into massive debt with our formal mortal enemy, the Chinese communists.

      And, during this period, the world has seen countless wars, revolutions and genocides which the United States has mostly been unable to prevent or have any influence over.

      And in America itself, for the last 20 years at least, we have had mindless, hedonistic consumption by the super rich and upper middle classes at the expense of the poor who have gotten much poorer and which has caused devastating destruction of the natural environment.

      "Moderation" does not seem to be the right word to describe what has happened during the last twenty years, to put it mildly.
       Oct 08 01:13 PM
    • What's Causing This Slow-Motion Market Crash? [view article]
      It's possible to reason that America has lived off its "collapse of communism" dividends for the last 20 years and that we've finally spent them.

      The DOW stood at 2000 in 1987, just before the fall of communism.

      The Russians are reigniting the cold war for obvious reasons.
      We are in deep debt to the Chinese communists.
      We are in an interminable war over oil resources in the Middle East.
      We save virtually no money for future investments.
      We spend more money on "defense" from imaginary enemies(?) than we do on education.
      We even spend more money on, cigarettes, gas guzzling cars, Viagra, cocaine (and trying to prevent the sale of cocaine), advertising, lobbying, gambling, etc., etc. than we do on cancer research, finding alternate energy solutions, crime prevention, repairing our infrastructure, laying fiber optic cables, basic scientific research, etc., etc.

      Maybe the DOW is still WAY overvalued even at 9,000?

      (How much are World Series tickets these days and how much does a hot dog and beer cost at a World Series game?)       Oct 08 12:56 PM
    • Is the DJIA Heading Towards Zero? [view article]
      I take the meaning of your post but in absolute terms, your math is wrong or else what you are saying is trivial (Whenever the DOW declines, it is always heading towards zero by definition!)

      If the DOW starts at 10,000 and declines 13% a week for 52 straight weeks it will decline to 7 by the end of the year, which is not zero.

      While I take your meaning, the DOW can only reach zero if the federal government decrees a halt to all trading, in perpetuity, and we all know THAT could never happen :)

      (Maybe the market is trying to tell us something?)

       Oct 08 12:40 PM
    • Don't Blame Deregulation For This Crisis, It's All About Lack of Regulation [view article]
      Regulation itself is subject to corruption.

      (Almost) perfect regulation ends with referees on the sports field but even referees have been known to accept bribes or have very bad days.

      Society tries to regulate crimes by threatening dire punishments (the United States penal system) but with only moderate success.

      You can try to stop men and women from selling their bodies on the streets but it is almost impossible to prevent them from selling themselves in the market place.

      Greed distorts everything, including our sense of fair play.

      Dancing around the golden calf is, apparently, irresistible, whatever Moses or anyone else has to say about it.       Oct 08 12:24 PM
    • Government Intervention and the Irony of Modern Capitalism [view article]
      It isn't helpful to call:

      The top 10% of Americans rich
      The bottom 25% of Americans poor
      The second quartile (50-75%) middle class.

      It's more compicated than that.

      For example, it's well-known that:

      The top 1% own about 33% of the wealth in America
      The bottom 80% own about 15% of the wealth

      Take a look at this well-respected website to get a feel for wealth and income distribution in the United States:

      sociology.ucsc.edu/who...       Oct 08 12:06 PM
    • Stocks Plunge, Dollar Surges [view article]
      So much for the great prognosticators of the Western world.

      When the center wont hold, the rest of the world flies apart even faster.       Oct 07 08:45 PM
    • Our Coming Depression [view article]
      By the way, I wasn't putting a ceiling over the middle class of 5 million dollars, just trying to provoke discussion.

      I'm a little pessimistic myself, thinking that human inequality is "insurmountable.&...

      It seems that one group has to have hundreds and even thousands of times more money, power, prestige, etc. than another and the lower classes, who seem to be the bottom 95% have to be, more or less, the servants of the upper 5%.

      Revolutions just change the hats on the heads of the top 5%.

      "Hello commissar, you look familiar. Nice hat you've got there, sir."       Oct 07 04:19 PM
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