Yesterday I received my copy of Vincent R. Locascio’s “Special Priviledge: How the Monetary Elite Benefit…At Your Expense“. It was published in 2001 by the Foundation for the Advancement of Monetary Education (FAME) and I hope they don’t mind my quoting vast tracts of it here.
This book predates Locascio’s “The Monetary Elite vs. Gold’s Honest Discipline” by a few years. In May 2005, a copy of this latter book arrived out-of-the-blue to my attention at the easyDNS offices. The inside cover was signed “Mark, I look forward to your feedback” and signed by the author, and there was an additional note saying “I hope you can help spread the word to your readers”. He was under the erroneous assumption that my personal blog, (where I sometimes ranted about sound money and crony crapitalism), had readers.
I’m one of those people who underlines passages in books, highlights paragraphs and makes notes in the margins. His book was one of those books that was almost completely underlined by the time I finished it.
This morning I started reading “Special Privilege”, and it looks like the same thing will happen here.
We have all heard of “moral hazard”. It is something that was said to have kept Treasury Secretary Hank Paulson awake at night when he was agonizing over how to thaw out the frozen inter-bank credit system in mid-late 2008. Moral hazard is defined as the risk that the monetary powers that be take when they create “money” out of thin air for the express purpose of bailing out banks and corporations whose failure would drag the entire economy down with them. In 2008, it loomed large in the US.
The problem is that economic “booms” and “busts” are an inherent part of any economic system where prices and interest rates are NOT set by the markets but by those in power to control them. Those in power love to take credit for the booms but they don’t want to be faced by any busts. Thus, every time that a credit-based economy “falters”, the temptation to spice the punch bowl with another dollop of credit money is irresistible. From there it becomes orthodox “policy”. And from there it becomes “politically impossible” to do otherwise. Mr Paulson couldn’t stand up against that orthodoxy. That is not surprising. Read more…
Tags: Hank Paulson, Paul Vockler, too big to fail
Some people like, to make all the rules and tell others what to do.
They make it their way, so they always win, and the others always lose.
Street gangs and madmen How they wage their private wars
In bankers clothes their hearts are froze and
Their wives hold hands with whores– Airbourne: Too Much, Too Young, Too Fast
There is a lot of “empirical data” coming out in reputable information channels (like Facebook and Twitter) that the 1% are over-represented in the corridors of power, have more than their fair share of wealth and are basically to blame to for mess the world is in right now.
I saw post from a friend on facebook: Read more…
Tags: Occupy Wall Street, OWS, The 1%
Mr Geithner wants his European counterparts to help him maintain the facade that “liquidity” equals creating “money” out of thin air through the issuance of new debt paper and that the financial markets can be kept happy by covering their bets. The financial markets have literally bet the house on the promise that what they are “investing” in is too big to fail – or even go down in price on a long-term basis. The banks want to maintain the facade that they are doing their “jobs” as long as they keep accepting “free” money from their central banks and churning it through those same too big to fail investments. And the central banks, notably the Fed, want to maintain the fiction that “monetary policy” is a permanent road to real wealth. Mr Geithner’s European counterparts are balking at ALL this.
Labour Day parade, Toronto, Canada, 2011
When I was a child, I was proud of my heritage and the fact that I counted among my distant relations none other than Otto Von Bismarck, the inventor of the modern welfare state as we know it today. As I matured and learned more about things like economics, math and the works of Charles Ponzi, I began to downplay my roots to Herr Bismarck.
Like a politician who’s largest campaign contributor was just pulled over by police, drunk and with the body of a teenage hooker in the trunk, it occurred to me that this connection wasn’t something I should be advertising. And really, he wasn’t a relative per se, it was via marriage. Barely a half-cousin at that.
Bismarck set out to create a pan-German state with progressive social ideals, groundbreaking at the time, and at first glance, would work in perpetuity (so long as the population and the real economy grew indefinitely). It created a social safety net and took a bit of the Darwinism out of life. It looked good on paper until populations realized they could vote themselves ever larger entitlements, and politics became a profession, one where it turned out you could advance your career by promising to redistribute other people’s money.
“Too little attention has been paid to the fact that electoral politics lures disorded, messianic personalities into positions of power.”
– Davidson & Rees-Mogg in The Sovereign Individual
Tags: Ayn Rand, Ben Graham, Bismarck, capitalism, Martin Armstrong, socialism, Warren Buffet
Mark was nice enough to let me post about my venture, Capitalist Collective:
I am looking to hire a senior and junior analyst for my NYC-based hedge fund, Fertilemind Capital.
I have decided to do away with the usual resume game and instead I am hosting a stock-picking contest @http://www.capitalistcollective.com. The four best stock pickers will be flown to New York in September where I will have the grand finale — Apprentice style — at an event I am hosting called The Capitalist Collective Stock Picking Festival.
So if you would like a shot at the job just submit your best stock pick at Capitalist Collective.
But everyone is also welcome to post a research brief. In the registration process you can just mark “just here for the good ideas and networking.” You’ll get great constructive criticism from the other members.
Thanks & let me know if you have any questions!
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