Tuesday, April 3, 2012

Response I: Ah, Ben!

Moral: Wherein we start a response series to Ben's (Ben, Ben, ..., yes, opinion from over a year ago - prescience?) re-look at the crisis (Lecture 1Lecture 2Lecture 3, Lecture 4) that he cast'd in the light of his own image and likeness.


Thanks to George Washington University for hosting the talks. The four talks were very instructive in that they allowed Ben to lay out his thinking for us to see.


So, it's time to begin a response sequence. The thing is that Ben has no idea from whence comes my criticism as I'm too far removed from his world. Perhaps, though, my efforts can help explain the issues in a manner that is amenable to most and in a way that is too much overlooked as the larger-than-life pursue what is more illusion than many would allow.


So, Ben, your little joke (Lecture 4) about the printing press not being used (there are moments, Ben, captured on video of you, yourself, joking about your virtual press) as if to argue that those who dislike his largess are off the wall (it wasn't amusing, Ben). You see, people, Ben does not have real money anyway. Look at your buck. It's merely a promise for the Fed, and Ben, to pay something. Of what value is that little piece of paper? Well, considering that Ben opened the flood gates for a credit deluge, it's worth a whole lot less than a few years ago.

Too, Ben waved his hands about 'unwinding' (response to a question, Lecture 4). Oh yes, he knows that he can force those with the money to comply. At what cost to the rest of us, though, is the question.


Ben, too, tells us that he'll continue the 'put' made famous by King Alan. He says that we can't overlay all of this creative finance with anything rational (beyond bastardized game theory). No, there is no chance to try to be scientific (of course, we all know how 'dismal' is economics) he seems to suggest. Ben, you need to reconsider that matter. Of course, in doing so, would you go beyond the little world of the Fed and its funny money?


There is a lot to cover, but, for starters, let's just go back to three and one-half years ago. It was before the elections. Bailouts had started. Things were strange. Yet, the writing was clear on the wall. All three of these were written during September of 2008.

  • Fraud and truth -- based upon an external view, as in, other than finance. As well, a view from the trenches, with an engineering focus. So, there was none of the mucky-muck influence. In essence, there is reason to 'hedge' (we all do it, in one form or other). Speculation, on the other hand, is grossly inequitable and is not necessary (except for the fat cats who need to continue to line their pockets, mainly so that they can farm out handling their necessities -- as in, those who sh** on the world, and its inhabitants).
  • Doers and speculators -- there is more than one way to partition this thing. The point? Somehow, the modern way with  money (whatever it is) has allowed very unhealthy, and very unsustainable, ways to develop. Actually, they have gone way too far (and for way too long), most likely due to people not knowing what was happening. Some of the rhetoric of the 'occupy' set, though, seems to suggest that there is a type of cognizance. Yet, we deal with the 'lords' (all types) and their power in these matters. The 2012 elections, with open-ended influence by the richer, are going to be telling to observe (to wit, these posts were written prior to the last election). 
  • The times -- yes, a brief list that is not so hard to understand. Nor, are these items without some means for their accomplishment. The real barriers come from those who are already entrenched in their goodies (and ways to sustain them) and their machinations to prevent what is required to come forth. 
The other day, Ben just winked, somewhat, at the idiocies that he sees. I would like to be a fly on the wall to hear his real thoughts. Ben, admit it. Alan loved the glory of the realm's guidance. I sense that you see a bunch of nitwits acting in a manner that is unconscionable. You know, you'll need to bail them out again (student loans -- sheesh, what a mess!).

Why don't you sponsor some town meetings related to why the Fed needs to change? It was nice that you talked to students. What about you talking to people who are not within those professional ranks that are responsible for the failing? Well, not talking. Discussing (quasi-academically, as we're not talking prof to prof, either -- autodidacts know as much as you guys do).


04/01/2013 -- Ben as the new Central Planner.

02/26/2013 -- What? Ben doesn't have any influence with his put?

05/11/2012 -- Then, we have Jamie.

05/05/2012 -- Related theme to explore.

04/27/2012 -- Obviously, Ben is on a roll. In his latest statement, he said that he'll continue his ways until late in 2014. That, folks, is another couple of years of savers being sacked. Again, who are savers? Mainly, those who have lived within their means, have means, use their means wisely, look to have something for a rainy day, and all of those other good things. In short, those whose efforts are needed for an economy much more than the services (ah, from him?) from the likes of Jamie. Now, how do we wake up in this new world to the fact that an age-old ideal has been trashed? Ben, give me time, and I'll explain this issue to you.

04/10/2012 -- The thing that Ben is after is the 'multiplier effect' taken to an unreasonable extreme. Let's say that fiat money allows a 'buck' to be re-used multiple times in order to provide a base for an economy. This type of thing is especially easy when the underlying framework is computationally-founded aeration. The 'shadow' (depending upon the focus) amounts to trillions (yes) of bucks founded upon a speculation-motivated game (with little accounting to map to anything of substance - you see, it's the playing that is the thing). So, we have trillions of book-based 'value' under which is mere billions of something that could be considered real.

The real sign of insanity is that Ben has to argue for those responsible to pull back from the precipice to which they push all who are more reasonable. Somehow, these supposed adults have atrophied cognition (yet, those who 'win' lounge in 'wealth' that is beyond estimation - yes, we really have no way now to assess, in these matters, what is real from not).

Yet, Ben helped the game by inflating his balance sheet with fictional credit. Ben, ever heard of the thing called hypo-critical?

04/06/2012 -- Yes, keep that debt window open. Here is a post, from Phil G' blog, that has a link to a comical video related to our current situation. Trouble is that the window was closed for the common folk, after they were heavily laden with several lifetimes of debt. In some cases, people walked away from their debt (allowed, it seems, for some types of housing finance). But, the window was cast'd open, on a broader scale, for finance types (see Ben's Lecture 4). Earlier, there were remarks about largess.

04/05/2012 --  Jamie got $23M. Savers got sacked. Yeah, Ben. His credit expansion has debt as its balance. The goal is to expand debt (and, nationally, we've hit the bell there), yet we've seen what that does to the individual. In short, it's indentured-ness, almost ad infinitum. Talk about 'clever' (as Ben called those of the finance ilk). The ultimate 'perpetual' machine that keeps peoples' noses to the grindstone and monetarily handcuff'd.

On Jamie, we may have him replacing Timmy. Scary, indeed. 

Modified: 04/01/2013