Jan Baker

Cramer's Mad Money - Wells Fargo Changes the Game (4/909)

Gee, I am sure I heard an NPR report on the Wells Fargo news that said their data was high quality, and the data was based on conservative loans!

But I've got it figured out now. It took my one son, an avid Obama supporter, to take this year's 300,000 bonus and invest it in the stockmarket last week. (Yes, I know, I think I have raised a kid who does not know which side his bread is buttered on.)

So here's what I think. Obama once was asked what he would do if one of his daughters got pregnant, and he said he'd be glad she had abortion as an option to make good her 'mistake.' At the time I reflected on that comment, because one thing statistics show us about women who abort an inconvenient fetus is this: they will be back for a second, and a third, with some exceptions, of course. Women who have the baby, on the other hand, tend not to repeat their error, again with some exceptions. And it is difficult not to conclude that the latter learned a lesson from the experience, but the former did not. Or the former so loved the lifestyle associated with the first 'mistake' that they could not give it up.

And of course that's the key to the stimulus package. It's exactly the same logic. Obama's Change package will 'fix' that 'inconvenient mistake,' exactly so the fun party can continue unrestrained. And my son is correct to invest his bonus in the stockmarket, which we may forsee as bubbling up again, and in need of another 'abortion' down the road.

Now, my son may be able to recognize the signs, and bail. The economy as a whole, however, will take another hit. There are long-term consequences to abortion, either corporeal or economic (hugely increased risk of breast cancer, for one, in a living person, and Seeking Alpha is full of articles about the consequences of the failure to learn the lesson in the economic world).

But this is clear, to me at least: Obama just wants the party to last a little longer, and Change? Forget it.

Maybe if those who wish for a real change in the US economic climate would fight it in the social world, too, and stand with pro-lifers, it would work a miracle in his economic thinking, too. Presently we are praying a million rosaries for that, before he speaks at Notre Dame. You might as well join me; you could pray that he just learns people have to learn lessons in life, not get bailed out, and let it be an open field which arena you mean.

Geithner's Financial Reform Is Doomed to Fail

Why aren't all banks cooperative, like my own? (Riverset Credit Union in Pittsburgh, formerly the Pittsburgh Teachers Credit Union--it is small compared to the one in Hillsborough County, Florida.) Does anyone know how a cooperative bank is structured, compared to the plan here? I know they didn't invest in any of the bad mortgage investments--so they told me when I moved my retirement money out of the market and into their cd's.

Steven's scheme here is such a powerful analysis of the problem. He keeps trying to get down to the structure of the problem.

Geithner's Financial Reform Is Doomed to Fail

There is a 'social justice' political party called the American Revolutionary Party (they have a website if you google it) that calls for a kind of taxation platform that penalizes businesses that grow over a certain size. I think the schedule was designed so that the hit would be gentle enough to promote sell-offs over generations, not abruptly. I believe they were speaking of all businesses, not just banks, but I offer the idea here as a way to keep banks from getting so big that they 'cannot fail.' I think this is the heart of the problem over-all.

It is a principle of distributism that ownership (as opposed to income per se) needs to be widely dispersed for healthy capitalism. 'Back in the day' they were speaking of land ownership and had programs to literally move the poor out of cities and onto small farms, but I keep musing that it could apply to anything, and waiting for someone to apply it to more intangible capital.


On Mar 27 07:06 AM Chezfrederick wrote:


>
> A cheaper solution is not to allow any one organization to become
> too big to fail

'The Change We Need' Is in Economic Direction

Proximo, you wrote, A business
> that the Congress wants to rule but not take the risks.

Isn't it the other way about? Congress will assume the risk, because there's no penalty if the bailed out bank fails again and loses the money given it by the goverment, but if the bank makes it, the stockholders get the first cut. It's not clear what the government would get. Nor how their rule would go, either. It was never finalized, for example, if they would mandate what kind of cars would be built in the new regime, was it?

Is that how the bail out goes? If it is, isn't that fascism? I mean, both are bad, but just to know.


On Jan 18 08:25 PM PROXIMO wrote:

> Your comment ought to be nominated for a Pulitzer Prize.

'The Change We Need' Is in Economic Direction

To the comment of Teutonic Knight regarding Hong Kong I'd like to add, it's disappearing. Hong Kong has the lowest birth rate of the entire world, less than one child per woman.

This is a comment to Steven: I likened economic platforms to religions already, a year ago--check out this paragraph below from a science fiction novel I'm working on. I'm sharing it to prompt Steven to take his idea further and continue to push us in the direction of seeking an entirely new model, consciously, considering the merits of various kinds of solutions, not the way this crisis is being handled.

Here's the paragraph, in a novel about a race to Alpha Centauri departing from the earth's first space colony, and it tries to touch on the economics that might prevail in space:

"As investments went in this day and age, it was a good one. There’d be no foreseeable social welfare problems, because there would be no unemployment on the colony, not in the near future, at least. The opposite, probably. Everybody worked, how not? They had a whole miniature world to set up. The first job, along with subsistence, was to provide solar energy to earth via microwaves, and until then everybody got paid just enough to maintain a minimum standard of living. There were very many perks! Women got paid time off to raise kids and had opportunities to stay trained in their specialties, for extra pay. Fathers got bonus pay. Above that, you could get extra through participation in any profitable project you could swing, even using the company resources in development. You got pizza going on the colony, made the connections for somebody with wheat and somebody with yeast and tomato sauce, you got the pizza franchise. Up to a point, anyway. Something else new, or old, that they were starting on earth, too. There was that big tax on chains over four franchises. Earth was getting serious about promoting broader ownership of business. The “Free Market” fake econoreligion had finally fizzled, along with communism. Now earth was searching for a third way, some way to save capitalism from itself. Keep it off the third rail. Some way to keep it young. "

You can't read the rest of this novel anywhere because I'm still writing it. Help me out with the economics! But can you see the possibilities, if we make it to space? We could go back to the future--borrow economic religions from earlier, less developed times.

'The Change We Need' Is in Economic Direction

Isn't it Just Money, you wrote: "I don't trust any group who has the over arching goal of "getting people to heaven" as the basis for deciding which economic model is best, although their interests may be aligned with secular interests. I also wonder about how an economic model will deal with the rather large group of people who simply can't/won't work productively. Do we let them starve?"

I hope economic policies can be evaluated on their own merits. It is true that distributism as a body of principles originated among Catholics but has been adopted by many completely secular groups as a wise platform for development. I hope you'll check it out by googling and other investigation. Some people are bringing it forward--traditionally distributism is back-to-the-land movements. But there are many ways to implement it. And the 'commandments' of distributism are respect for private property (no socialism when socialism is defined as government ownership of the means of production) and the widest possible distribution of ownership, not the monopolies of advanced capitalism.

What would you say about feeding the non-productive? European moderate socialism, which isn't socialism, provides a safety net for everyone, and I think that is wise. It needn't be a fancy safety net. But what do you think? And why?

'The Change We Need' Is in Economic Direction

To sleepless: yes, credit in the production of goods and services; but who will buy them? We have a demand problem with two legs: the system refuses to pay workers more than their sum total of skills and contributions warrent (hence the willingness to knock down auto workers in the new economy) and we have aborted fifty million new consumers in the last forty years. That scenario faces Europe to an even greater degree than the US, as we have held our growth at least at replacement levels--up to now. There are indications that that single US advantage is over now: abortions are up by thirty percent, with this latest crisis, and abortion is now legal in Mexico (as of 2008) to help from that cavalry will not be rolling over the border.

'The Change We Need' Is in Economic Direction

Steven Hanson has collected practically every problematic area in the crisis and the political responses to it, and every bullet reaps comment, so I hope this thread goes on for a while. I'd like to comment on this particular bullet:

Steve wrote: America needs the promised change – not a lot more of the same. We need a new economic vision. A vision where jobs are created and growth is not exported. A vision where credit does not fuel misdirected expansion. A vision where markets are stable and investable – and your wealth is not destroyed in a single year. A vision where inflation is not a consideration in retirement, and the government does not bankrupt its citizens to pay for its debt.

First of all, there is a conference in April that will have representatives from three distinct economic platforms, distributism, socialism, and capitalism.Thomas Storck will speak for the distributist position. Dr. Charles Clark will be the speaker on democratic socialism. Michael Novak will be the main speaker for the democratic capitalist position. I do not know what definition of democratic socialism Mr. Clark will be using, nor Storck; Novak's positions are well known as the theology of present "free market" mess (it is not a free market, thus the quotes; a free market would be operating with the wish list outlined in this post, and it does not presently exist).

Regardless of what definitions being used for distributism and democratic socialism, this conference and any others are needed to begin the kind of social discussion that could send us in a healthier direction, exactly the kind Steven describes. That this particular one is being organized by Catholics should not be an impediment. Because of the history of the Church, and because of its mission statement ("To get souls to heaven"), Catholic leadership at a world level have long discussed--prior to the birth of capitalism, even-- socially healthy economies, and have, since capitalism developed to its present chaotic death-spin, offered an alternative, simply because the present conditions are not condusive to getting people to heaven, but rather condusive to suicide, abortion, divorce, theft, and every manner of dissolution.

The alternative stresses unqualified defense of private property, saying that ownership is sacred, but that the exercise of ownership may be influenced by the state for the common good. (That's a really important distinction; go an eighth of an inch over, and you've alienated private property, and nothing the new administration has said assures one that they grasp it. It's the difference between seizing someone's assets and increasing the taxation on, say, ownership concentrated over a certain level, more than four pizza shops in a chain; more than four hardware stores in a chain; in other words, anti-Walmart taxation structures which do not seize assets but might promote their sell-off.)

A second footprint of distributism not present in some definitions of socialism and not present in advanced capitalism such as our own is the widest possible distribution of ownership--of whatever--and cooperatives are one such form of ownership, a kind of merge between the social safety net provided by socialism and the profit-making of capitalism. One group active now is the Center for Economic and Social Justice, calling interestingly for the cooperative ownership by all Americans of future new wealth. You can find their web page by googling them. There are other groups as well. There is also, of course, private ownership as well, but cooperatives in some modern form is such a fresh idea! Think of the possibilities for our impoverished population, to have alienable shares in say, the oil deposits not presently being developed, or space projects (moderated in some form or other; think of land ownership forms the Mexican government uses to protect the land distributed among their tribes, for example; they can't simply be sold, but they can be used as collateral on loans, and can be sold in some forms; I don't know if this model is a good one, but they are using a form of moderation, is the point).

I've added the space projects thing. No one ever talks about space and energy anymore, and yet there it is, full of solar that is microwaveable to earth.

In any case, I am delighted that Steven Hansen here has opened this discussion. We DO need a "new economic religion." Capitalism in its present form is stiffling that discussion. Other forms are out there.

Pius XI, in a very interesting economic/theological work called Quadragesimo Anno, said, as a caution, that the best economic model for getting souls to heaven was probably the one known as "moderate socialism," (I do not know that this term may be used interchangeably with "democratic socialism") meaning one with private ownership but a big safety net, savings-based economy as opposed to credit-based economy, etc.), but that there was one enormous problem: because the state had even more power in this form of government than under advanced capitalism, it was imperative that there be very firm social structures to guide this power through conscience as opposed to by legislation. There had to be total respect for the sanctity of the human life. There had to be total respect for the economic unit that is before all economic platforms, the natural human family. These strictures had to be as firm as those protecting private property. That ought to give us pause. It might make us consider whether we can find a new economic religion and keep the social mores of the present one, which might be characterized as a whores code in which the idea of sexual discipline makes some people literally froth at the mouth.

Let me offer an example of what can happen when this whores code is applied. One of Obama's campaign promises was to begin funding again the UNFPA, the UN Family Planning Agency. This is under no particular banner except the general "sexual freedom" clause of the whores code. The UNFPA provides abortion kits and support personnel for coerced abortion and sterilization in China and Albania, for two that are easily investigated and are probably only two among others. Bush refused to fund it. Obama will keep his promise (and forget Tuskeegee, forget how blacks were similarly ill-used). The UNFPA also provides the platform for the kind of "voluntary" abortion and sterilization where the volunteer trades the signature on the consent form for food. (If this does not raise a red-flag for you, if you think somewhere deep down, 'listen, they're only indians, they're only blacks, they HAVE to stop reproducing, it's the right thing to do for Mother Earth,' you better take a look at what kind of 'liberal' you've become. Because it's an eighth of an inch over from fascism, did you know that?)

Below is the contact form for that conference. I'll be there. (I'll be the grey-haired woman who looks cheerful, because getting souls to heaven is happy work.) It may be a bust. But we need to create a buzz for a new economic religion, Steven Hansen is on the money again, with this one.

Here's the contact info, you have to make a reservation:

Garden City, NY, USA. A conference hosted and sponsored by the Nassau Community College for Catholic Studies in Long Island, New York, is confirmed for April 4th, 2009 at the College Center Building.
Nassau Community College
Office of Life Long Learning
One Education Drive
Garden City, New York, 11530
1-516-572-7472.