After another month of quietly watching the markets, Fox Business News, etc, and generally trawling the internet time to throw in my 2c worth.
- You soon get to figure out who on Fox Business is a 'reporter' and who has some idea of what is going on. Very few actually know what is going on; the majority are just rabid rabble making noises. Most technical analysts are not worth ever listening to anyway, but now is the worst time. Technical analysis is mildy useful at best of times, snake oil at worst. Right now its almost completely useless, as they, like most commentators, do not understand that the entire western economic model is broken. They keep banging on based on their models of cycles from the last epoch, which is always the only basis that economic models can be devised from. What none of them realise is that global warming and resource depletion now needs to be factored into their models, and these issues will completely change the models. Current cycles are out. Remember "peak oil": last year's media buzzword. Anyone would think that it and global warming simply evaporated. They have not, and the only thing that might evaporate if we do not start thinking clearly and more broadly and globally, and modelling accordingly, is us. Also, it would be great to stop asking the same question over and over again: "Are we at the bottom yet?" They sound like the kids in the back seat the minute you leave your driveway: "Are we there yet?". "No, and we will not be for a long time yet, OK. So stop asking."
- Many people finally coming to realise that the root cause deeper than the US housing mortgage market. It lies in a fundamental issue of freedom aka "The American Dream", aka "I'm alright Jack", "Money is Power", "Greed is Good". Corruption is and has always been at the heart of the American system and to a degree the western conservative democratic system. This is a system whereby those at the top earn tens of millions p.a. while other workers earn then thousand times less, and in wanting to partake in the system that supports the billionaire, and average pleb all get into debt in sufficient volume that the whole system got put under strain. What kicked it over was an entire industry of gamblers, aka 'Investment Banks' etc, propped up by corrupt politicians who let them gamble away and bleed the system dry with dodgey financial instruments in the 'credit derivative' market: a phoney market that included "Credit Default Swaps" a fraudulent form of insurance, but so named to avoid insurance regulation.
- When the financial system collapsed in September 2008, public money was sent to the greedies whose finance houses failed, on pretexts that it is actually the public being saved! and that they the public might gain in the long run ("Thanks for your cash, sucker, it will be good for you one day, I promise."). Next other failing companies began lining up for a handout, in a domino fashion, as they had all moved over the years to a model of business via borrowings instead of business via actually owning assets and cash. "Please, " they say "we are broke. Can we have some money?" If they look viable, give them a loan, never a handout. If they are not viable, no matter who they are, let them stop. Let others replace them, and accept any short term disruption. "Survival of the fittest" is a fundamental law of nature, that we tinker with fundamental laws at our peril. In the long term, propping up failed systems will only harm us.
- This week the American car makers arrived at Congress via private jet, to beg for bailout of their hopelessly badly run companies, that persist in making last century's vehicles. The trouble was, they were so incompetent that they forgot to arrive with any good figures or a plan. How come these bums do not get fired? Because that is the way the system works, mate. It works nicely for them, mate. It keeps them flying. Plus, they can apply a blackmail argument that they are at a focal and therefore indispensible point within the economy where a large percentage of the workforce is currently dependent on their survival.
- Events move fast these days. These are the days of the internet, global communications, and millisecond response times across the planet. The trouble is that many people, particularly all those that work in institutions of any kind, cannot act with sufficient speed. Our institutions, from the UN to governments, are great places for noise and meetings. But are their systems too riddled with inertia and malaise to respond adequately to events.
