Monday, March 31, 2008
So here is the AngloAustrian guide to the Enemy. Know them. Resist them. And then one day we will be free from their criminal grasp.
Capo Di Tutti Capi
The Capo di Tutti Capi is the "Boss of all Bosses" and the main bandit in the woodpile. All of the contractual bonds which tie together the Gang end up held tightly as reins in the hands of this man, who defends his troops with a silver tongue allied to a quick brain and a ruthless temperament. Never underestimate this crook, because if you cross him, you will be hung, drawn, and quartered in the tax courts, though he himself will be the most nervous man in the kingdom, because everyone else wants his throne. Though he didn’t rise this high in the Gang by being nice. He always gets this position by being the most ruthless current rat in the gutter.
Capo di Capi Re
The "King Boss of Bosses" is usually a semi-retired member of the Gang, often adopting this emeritus position after a period as an earlier stint as the Capo di Tutti Capi. He is often found in a senior position on the ruling Crime Commission, usually with the grudging blessing of a successor. However, few men survive an earlier incarnation as a Capo di Tutti Capi and only do so through superior guile and matchless power broking, usually in combination with the rare skill of knowing when to give up and get out. So if you ever meet a Capo di Capi Re, count your fingers afterwards and then count your blessings if you have any left, because you will find few confidence tricksters to rival them for their breathtaking skills in rampant demagoguery and outrageous sophistry. Master criminals. Never turn your back.
The Capofamiglia (or Capo Crimini) is the archetypal "Crime Boss" most of us will be familiar with from our newspapers as Secretaries of State. Sometimes known as “The Don” or “The Godfather”, these people will usually head their own “Ministries” within the main Gang organisation, often conflicting with other rival “Ministries” ruled over by the same Crime Commission. Always with at least one eye on the main prize, they will faithfully serve their Capo di Tutti Capi, at least until they smell his blood in the water. Many of those who achieve this rank, but go no further, will be weak and lazy, but all will have done their share of past “Dirty Work”, hence their eminent position. The more talented ones will be obvious to spot, as they will appear to have boundless energy and will always be able to take up two contradictory positions at the same time and convince most reasonable men that they support both of them! Dangerously ambitious. Keep well away from impressionable children.
Completing the quadrumvirate of the top posts within the Crime Family, the Consigliere is generally situated outside the main power pyramid and will usually act as an advisor or counsellor to one of the other three posts. Lacking the ambition of the Capofamiglia, these people will generally be happy helping themselves to large portions of pelf raised on the gang’s turf, but some may possess a thwarted ambition, hence a diagonal move upwards from Capo Bastone. So before any unpleasant dealings with a Congigliere, work out whether they’re on the way down (a retired Capofamiglia), on the way up (a frustrated Capo Bastone), or more naturally going sideways. However, always watch out because they will know where the bodies are. And you don’t get to know where the bodies are without having buried a few of them yourself.
The Underboss, or Sotto Capo, is the nasty arrogant figure we usually associate with the Gang, often adopting a guise as a “Minister of State”, the Underboss typically acts as a cut-out to the Capofamiglia to ensure there is deniability at a higher level, by taking the heat and keeping their mouths shut. If they survive this apprenticeship, they can usually look forward to a future stint in a higher “Boss” role, especially if they play the game of dead men’s shoes. Sometimes a Capo Bastone can get too big for their own boots, especially if they are related directly to the Capo di Tutti Capi, but a late night bullet in the neck can usually sort out such nonsense, via the “Parliamentary reshuffle” process.
The "Regime Head" or "Group Boss" is sometimes known as the Capo, the Capodecina (“Boss of Ten”), or more simply, the Captain. As the latter name suggests, this member of the Gang is generally the workhorse officer of the ruling regime, planning and executing most of the dirty jobs that needs to be done, via a personal “Crime Crew”, which consists of even more junior Sgarristas (or Lieutenants).
This street Soldato (or Soldier) is the lowest member of the officer corps of the Gang. With many other names, including “The Made Man”, "Uomini D'onore", “Man of Honour”, or, more prosaically, “The Button”, he must have made his bones. Making your bones generally consists of telling a blatant lie on national television for the good of the Gang. These Lieutenants generally follow direct orders from the Capo, carrying out his spade work at the sharp end of the Gang’s criminal activities. If any doors need kicking down in any of the various protection rackets the Gang runs, it will be the Soldato who is on the other end of the boot. Fear these people. It is often more than their “job is worth” to disobey their orders and to cross them is to enrage them. It is simply better to avoid ever having anything to do with them. So if anyone you meet ever says something as heinous as “I work for the Ministry”, peg them for a Soldato and get out of there quickly before you catch any more of their nefarious and wealth-confiscating attention.
A more junior member of the Gang, coming in about sergeant rank, though often carrying out the dual roles of either Enforcer or Bagman. Once they have successfully “made their bones” without being caught out in a Big TV Lie by the media, they will usually progress smoothly up into the higher echelons.
Associate Members are the lowest rank in the gang, usually serving as mindless bureaucrats in the tax offices of the protection squads. Many of these scum never rise above this role and spend miserable lives whiling away endless hours in comfortable palaces all over the Gang's turf. But avoid ever feeling sorry for them. They chose this life and they can take all that comes from it, even if it’s the torpor of filling in a million endless forms in triplicate or counting out several thousand paper clips a day while the rest of us are milked to pay for their meagre slice of the action.
That completes our brief rundown of the Enemy. Remember folks, if you see any of the people above, the best thing you can do is just simply get as far out of their way as possible. The more we can isolate this Crime Gang and reveal them for what they are, the sooner we will be rid of them.
Friday, March 28, 2008
First there was the glorious and popular campaign to bar him from every pub in Britain. Then there were his pathetic plans to get traders to rat on each other, thus revealing his complete lack of understanding of the basic relationships of traders, i.e. if you have a record of ratting on people, you'll never get to trade with anyone else ever again. And then there was this quote which I read today in, of all places, the Grauniad.
"I can't allow us to get into a situation where people quite deliberately manipulate markets for personal gain and with the potential to destabilise the financial system."Just what on Earth does Alistair Darling think has been going on for the last few hundred years, with the Bank of England hoovering up all UK government bonds with money out of thin air, the abandonment of gold in the early part of this century to make this process easier, and the use of fractional reserve banking to pyramid even more debt and credit on top of all this paper? All of this criminality has been caused by the deliberate manipulation of the markets by generations of government finance ministers in return for personal gain (whether for power or money) and in the full knowledge (one hopes) that they were destabilising the long-run prospects of the financial system for the rest of us, to boost short-term gain for themselves, their friends, and their miserable political careers.
Either Alistair Darling knows this and he is an evil sophist. Or he doesn't know it and he's a stupid patsy. Either way, he deserves all that's coming to him when Gordon Brown uses him as a scapegoat to soak up all of the blame for the forthcoming recession.
Thursday, March 27, 2008
In the meantime, though it stands absolutely no chance of being enacted, there is a reasonably robust way out of this crisis, though it does entail the creation of a 100% reserve gold-backed currency. Like I said, no chance. But this life belt is out there if anybody wants it. Just ask nice Uncle George, one of the few men alive who ever had sufficient balls and brains to argue toe-to-toe with Uncle Murray. Which means that Uncle George is a Colossus and possibly the nearest thing we have to a living John Galt. If only the numskull powers-that-be had the wit to replace Bernanke or King with this man, then we would stand a fighting chance of getting out of this mess. Like I said, no chance. (At least for the moment.)
But at least Uncle George is still offering us his solutions. If things keep going the way that they are, then we may be forced sooner rather than later to take him up on them. John Galt may triumph, after all.
Bring it on.
Wednesday, March 26, 2008
Whoever would have thought that by adding about 15 pence to a £150 pounds shopping bill, so much could be achieved for so little? Well, that's the wonder of world government socialism, I suppose.
To follow this major news item, the newscaster adopted a "grave" face and regaled us with some more terrible earth-shattering news, which I only managed to record, alas, with my feeble human memory system. It went something like this:
"And in other news today, environmentalists in Antarctica have discovered that temperatures in the Weddell Sea are much warmer than this time last year."Such nerve-shredding horror! Obviously, the appalling use of shopping bags by the evil capitalists of the western world is intimately connected with the definite huge warming of the Weddell Sea area, as reported by those uninterested and neutral observers, "some environmentalists", thus linking these two huge stories together. The sheer calamity of it all is terrifying. In fact, I think we should now be taxed for breathing, simply to help stem the tide of this hideousness. Or strangled at birth if we show the slightest signs of "Global Warming Denier" heresy.
And then we had some other news, including the deaths of 30 innocent civilians in Basra, which is immaterial compared to the disastrous reported warming of the Weddell Sea.
But what I find most terrifying, of course, in this wave of evidence about how the entire world requires a world government to police climate change tax and regulation strategy, is how the BBC, despite due diligence, never seems to be able find any stories countervailing this trend; it must be that with no counter-factuals to prove the rule, the evidence is simply overwhelming. We're definitely all going to hell in a 400 degree oven.
Well, apart from the story recently reported in Australia, that the world is actually getting cooler, or at the very least that global temperatures have plateaued in the last decade (which is hardly what you would expect from a galloping greenhouse effect). It was obviously news of no significance to the BBC, or its fleet of jet-set reporters, and thus not worth reporting. Or even investigating. And certainly not worth broadcasting to the millions of licence-fee-paying proles here in England, who are privileged to fund the magnificently independent BBC. Heaven forbid, if we did see such counter-factual evidence, we stupid proles might start getting the idea that we're being lied to the rest of the time.
Mustn't frighten the horses.
Friday, March 21, 2008
Well done Jeffrey Tucker, who spotted the following story telling us that the world's oceans are apparently getting slightly cooler. Fancy that. It's probably being caused by global warming, ...err..., climate change, ...err..., Kylie Minogue's penchant for feathery head-dresses. D'oh!
Obviously, being a George Reisman style heretic on this myself, where I believe we're more likely headed towards another ice age, albeit within a volatile interglacial period, rather than headed towards a global oven, the news fails to surprise me. But neither would it if the world ocean temperatures were slightly warmer. (Though you can imagine the coverage this story would have received if this had been the case. It would have been the headline story on the BBC's Ten O'Clock News every night for a week, with updates every 15 minutes!)
So why would a temperature swing either way in the world's oceans fail to surprise me? Because we still know very little about what caused all of those ice ages over the last few million years, and which leg of the current interglacial we're living in, whether in the increasing temperature leg or the decreasing temperature leg. You would have thought, of course, with all the current hoo-hah from the ecomentalists, that there would be plenty of research into what causes ice ages, especially in the field of the volatility of solar energy output. But there's less out there on this topic than there is about the terrible life-threatening effects of plastic shopping bags.
Why is this? Well, in another fascinating article highlighted recently by Lew Rockwell, there exists the related effect of the intellectual price paid by scientists for having their work funded by the state. For if you eat from the iron rice bowl you must dance to the tune of the iron rice bowl's master, a.k.a. the state. And the state has certain Kuhnian scientific orthodoxies which must be adhered to otherwise you will suffer financial excommunication; all of these orthodoxies possess the same deterministic root, which is that any result you discover from your government-funded research must tend towards the correct answer.
The correct answer is, of course, that the glory of government needs to be granted yet more ratcheted power over the puny lives of individuals to make things better for the future of humanity. In this way, a religiously mandated list of mantras has been built up, much in the same way that the medieval catholic church built up its own series of papal bulls. Some of these are:
- Global warming is caused by humans
- AIDS is caused by a virus
- Radiation, cigarette smoke and other toxins are dangerous in proportion to their strength, no matter how small the dose
- Heart disease is caused by saturated fats
- Cancer is caused by mutations
To suggest potential research to a government grant body and its state-appointed scientists, which deviates from these orthodoxies, is to go the way of Galileo and to suffer scientific house arrest. Hence, the absolute lack of information about the ice ages, possibly because a more intense look at the Sun's energy cycles could let the global warming cat out of the bag.
Strangely, many modern scientists, such as Stephen Hawking, cite Galileo as their hero. Is it because Galileo stood up to the catholic church? Or is it because he recanted his heliocentrism and eventually toed the orthodox line of a stationary Earth given to him by his statist masters, to make his life a little easier?
Wednesday, March 19, 2008
I will believe all of this and more, if only MI5 would institute a 'D' notice on Heather McCartney and stop me from being ever able to see her face or hear her voice ever again. Please. Now. Immediately.
State censorship? I love it. Or at least I would if it would pull its finger out and take this dreadful woman out of our lives. The sooner the better.
Tuesday, March 18, 2008
Any one of the first four scenarios could undermine the dollar standard, but the final scenario, where interest rates fall very near 0%, would certainly deal it [the dollar] a fatal blow.It would appear that Chopper Man has been listening. It seems Bernanke really does want to destroy the dollar on his own watch. And with the way that sterling seems to have become entangled with the greenback, he probably wants to take the Great British pound down too. (Thanks, Ben.)
So what's the betting on a Japanese-style near-zero interest rate for the dollar in the next couple of months? Weeks? Days? Hours? Minutes? Seconds? Nanoseconds?
Stand by your roller coasters. Because nobody knows what's going to happen next. Especially Chopper Man. Well, not until his shareholders call him first to tell him what to do.
But sometimes we've got to step back and stop suffering from it all so much, at least until we can take a breath before we try to stop the American and British governments killing so many other people in their bid to extend western democracy to the rest of the world.
So I thought I might take a moment out from all of this needless slaughter to say, hey, isn't it great that this year the daffodils are out again? Flowers. They're brilliant. And I love them. Thank the Lord for the English countryside. Marvellous.
Sunday, March 16, 2008
“The Theory of Money and Credit”, by Ludwig von Mises
“Human Action”, by Ludwig von Mises
“Man, Economy, and State”, by Murray Rothbard
“The Case Against the Fed”, by Murray Rothbard
“The Dollar Crisis”, by Richard Duncan
“Economics in One Lesson”, by Henry Hazlitt
“What has the Government Done to our Money?”, by Murray Rothbard
All the information is out there, and has been for many years, for example in the remarkable “Theory of Money and Credit”, written by Ludwig von Mises nearly one hundred years ago, in 1912! It’s just that nobody wanted to read this book and its common sense ideas and preferred to follow the self-serving idiocy of Keynes, instead. But the lesson is simple. If a counterfeiter creates fiduciary media out of thin air, everybody knows it is morally wrong, and financially irresponsible. What is even better is that everybody knows why it is such a terrible thing to allow. But for some bizarre reason, when a government carries out exactly the same action, creating fiduciary media out of thin air, it has been seen as being beneficial. To believe this is so, is absolute culpable madness. We are now paying the price for believing that counterfeiting by the state was a good thing. It never was. And it never will be. The solution is to stop the central banks of the world prolonging the agony by doing any more of this. Yes, there will be immediate pain, in the same way that heroin addicts deprived of morphine feel immediate pain. But have you ever seen someone who has been living on heroin for several years? Do you really want to our economies to be like that? It is time to stop the heroin. It is time to prick all of these credit bubbles to let the market find out who the really morally hazardous and most stupid lenders have been. It is either that or the crack up boom of Ludwig von Mises. There is no other option. If we avoid the hard choice, we are looking at a western financial system where Zimbabwe will look fiscally responsible. The choice is ours. The only real solution is to stop central banks and their government masters even being tempted by this madness; we must introduce a 100% reserve gold standard. Will governments contemplate this? Of course they won’t, because they can’t print gold and they would be forced to pay for all of their expenditures out of taxation. And the taxpayers would then realise what fools governments are and then massively decrease their scope and their powers. The 100% gold reserve standard is coming. The only question is how much pain we are prepared to tolerate before it does and how many years and wars we are prepared to let the fools in central banks and government fund with fiat currency before we remove them from power of managing our money. Socialist money is dead. We ought to introduce capitalist money instead. The sooner the better.
Friday, March 14, 2008
With the fiat paper dollar collapsing in value against gold, expect Bernanke to start buying even more fleets of helicopters to drop even more cash in to his friends in Wall Street. It won't work, obviously, but expect this clot to do it anyway. With the Carlyle group hedge fund collapsing and Bear Stearns teetering on the edge, things may seem bad, but I think we have a long way to go down yet.
I must say though, even I am surprised by the speed of this. I expected gold to hit the psychological barrier of $1,000 dollars in a few weeks time, rather than now, but everyone is piling into it like lemmings, so expect the price to keep rocketing upwards before a correction downwards (which will be hailed as Bernanke's helicopter policy triumphing) before it starts upward again.
I try to avoid getting too psychologically hooked on figures such as 1,000, but there is little denying that it has acted as an important trigger to drive Bear Stearns into a wall. But what if this is much worse? What if we are finally in Mises' oft-quoted crack up boom? The printing press can be used for so long, but not indefinitely, Mises said. One day there must be a reckoning. Is this it? Is the game finally up?
That the dollar is finished is a foregone conclusion and I'm fully expecting the next fashion season in London to feature a Damien Hirst suit made entirely out of $10,000 dollar bills. But if this is a crack up boom, we are in for one heck of a roller coaster ride.
I hope you've shorted the market or have plenty of gold, property, and other decent commodities in your cupboard. Because you may need these 'real values' rather badly in the months and years ahead.
How much further north will gold go? Only God and a Monte Carlo machine can answer that. However, one thing is for certain. Paper currency is going south. And it's going to keep going south until it reaches the same desperate spot Captain Scott and Captain Oates got to, and it may then be some time before it recovers, perhaps by morphing into an older more reliable commodity-based form. (A sort of Jon Pertwee version of money.)
The 100% gold reserve currency may be closer now than we ever thought possible even one year ago. It may become a fait accompli, with gold certificates 'replacing' dollar bills as the world's international reserve trading currency, and sooner rather than later. Let us see which way the Monte Carlo dice roll...
Obviously Brown is a foul specimen of the cheapest cloth, but his glove puppet successor, Alistair Darling, is putting this low ranking to the test with his miserable portrayal of a vindictive, confused, and mealy-mouthed socialist.
For somehow, despite spending an hour on his feet delivering a polemic on the moral turpitude of plastic shopping bags, Darling forgot to mention the biggest item of this year’s budget, which will raise another £2 billion in pelf for the Treasury to waste on its non-job tax-eating supporters; it slipped Darling’s mind that millions of tax-payers would be parted from an extra £520 pounds a year in social security tax due to a large increase in the national insurance tax-grab threshold. Whoops!
This theft was felt to be unworthy of mention in the face of all that important news about what government-sponsored scientists think the average temperatures will be in Britain in a hundred years’ time (as if God himself knows), thus justifying further increases in government eco-taxation so they can give more money to state pensioners to buy coal, gas, and oil, to burn this winter. Confused yet? Welcome to the double-think world of Labour party politics.
Aside from this rotten back-handed robbery, and ill-coordinated stupidity, it was hardly a budget at all. More loot, obviously, is to be taken from anyone daring to transport themselves about the land in comfort and safety, and lots of other damnable pick-pocketing measures, plus spiteful ways to make wealth producers leave these shores to prop up the envy of socialism’s natural electorate of clods and parasites. But so far, nothing really appalling has crawled out from the woodwork.
However, it took several years for the repercussions of Brown’s advanced corporation tax grab from British pensions to become appreciated, after his first budget, which later destroyed the previously solvent British pension system. Plus, Brown’s infamous IR35 measures, which sent thousands off-shore, particularly to Ireland, were snuck out in a supplementary paper. So I shall keep a wary lookout.
In the meantime, however, I shall plan my way around the wretched 'Family Business Tax', slated for next year, which is designed to wreck those few independent small businesses left who managed to avoid the worst of IR35’s malevolent thrust. Oh what joy.
I wonder what it would be like to live in Dublin? If Irish property prices collapse much further, I may feel the green blood which runs through my veins calling me home to the land of my great-grandfathers. Ah, go on, I hear you saying. You see, it’s affecting me even now. Begorrah!
Tuesday, March 11, 2008
To offset his carbon output, and to enable him to be able to afford this car through increased taxation, here's the car Gordon Brown wants me to drive around in:
I think the phrase "what a bunch of hypocrites", is perhaps a little tame. It certainly will be by the end of tomorrow when my accountant lets me know exactly how much I have just been shafted from digging through the official papers released after the Chancellor sits down.
This is the title of an excellent book by Richard Duncan. Although the book is a couple of years old now, I only came across it a couple of weeks ago and I have found it an excellent analysis of the last forty years and an explanation of why the dollar must inevitably collapse.
I therefore heartily recommend Mr Duncan's book to readers of this esteemed blog, especially anyone who regularly has to talk to anyone who refuses to believe that we truly are in a terrible financial situation.
However, although Mr Duncan's analytical breakdown is fabulous, with more graphs than you can shake a pie chart at, his solution to the problem is taken directly from the usual statist barrel of economic misconception and ratcheted interventionism. For instance, and here I'm paraphrasing wildly, he would like a world government police to introduce minimum wage compulsion throughout the world and he would like this same world government to run a global world bank to manage our way out of this crisis.
One almost weeps for the hidden Austrian soul of Mr Duncan, which has come so close to surfacing out of the murk of monetarism and Keynesianism and a belief in the intrinsic goodness of government, which has then been dragged back down again into the dead marshes of economic orthodoxy.
"The government just isn't BIG ENOUGH yet," is the cry of many of our Austrian foes, but for this author to have so presciently seen and to have so clearly explained the nature of the beast, and to have then concluded that the solution is MORE government is to have witnessed Frodo Baggins reach the pier inside Mount Doom, after his epic journey defeating the greatest statist minds of Middle-Earth, and then to put the ring of statist power on and declare himself its master. What Mr Duncan's book needs is a Gollum to drive it over the edge. However, despite this lack of a denouement, there are occasional glimpses of such a creature lit up inside rays of Gladden Field sunshine. The first of these rays is on the first page of chapter one. For there, right in front of your eyes, sits the following remarkable quote:
"There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." – Ludwig von Mises, 1949
Unfortunately, this prelude of greatness remains unfulfilled as Duncan annoyingly keeps regurgitating his "greater government" thinking throughout the rest of the book. But his analysis is still brilliant. Plus, other occasional gems of thinking emerge, for instance those covering the collapse of gold as the world currency, as induced by World War I, and those covering the introduction of the Bretton-Woods agreement, as induced by World War II.
Another amazing ray of sunshine also emerges blinking into the light on the final page of the final chapter (prior to a two page conclusion). Duncan describes five scenarios which could overwhelm Bernankeism. These briefly are (1) A world trade war; (2) A stratospheric rise in US property prices caused by a dollar inflation bubble; (3) A meltdown of the world market in derivatives; (4) A policy freeze by the US Fed caused not knowing which way to turn; (5) A decline in US interest rates to 0%.
Personally, I reckon we've had (2) and (3), we're currently experiencing (4), we're heading towards (5), and that (1) is only a matter of time. But I digress. Here's what Duncan had to say about those five scenarios, back in 2005:
Any one of the first four scenarios could undermine the dollar standard, but the final scenario, where interest rates fall very near 0%, would certainly deal it a fatal blow. From that point, the only option left to stimulate aggregate demand would be to drop paper money from helicopters. That too would fail, however, for who would accept paper dropped from helicopters in exchange for real goods and services? Hyperinflation would quickly set in. Economic transactions would then be conducted through barter rather than via the medium of a debased script. Eventually, a gold standard would re-emerge.To come so close, and yet to remain so far out of reach is excruciating, especially the use of the dreaded "aggregate" term. The unspoken assumption is, it seems, that anything is preferable to a gold standard, ANYTHING! And we must do all that we can to avoid it. But why? It is the apocryphal elephant in the room simply begging to be seen. It is what we had before World War I, when international trade was balanced, as Duncan himself states, and it is what we will probably have afterwards, once the dollar collapses, as Duncan himself admits, if governments fail to do the "right thing" (Ha!).
But somehow there is this feeling, fed by nearly 100 years of anti-gold Keynesian sentiment driven by gold's inability to be pushed around by government tyrants, that to go back to this barbarous relic would be the end of humanity and that any measures taken to avoid it, including a world government, a world central bank, or even a world police force, are therefore to be desired.
I won't even go into the fascist horrors of what a world government would be like, without economic calculation, without migratory consequences to overbearing taxation and regulation, and without any fiscal challenge to a single world paper currency, but at least Duncan does mention the gold standard. And although he hasn't seen that the obvious solution is its re-adoption, despite his amazing breakdown of what is wrong with a fiat currency standard, many of his other non-Austrian readers may come to see this elephant in the room.
Then when the dollar collapses, as it inevitably must, as Duncan claims, and then some John Galt character comes forward suggesting a re-adoption of a worldwide gold standard to get us back on track again and out of the hands of the central bank counterfeiters, at least the idea will be out there and therefore more likely to be found acceptable.
One can only hope.
In the meantime, if you would like to know how to persuade your non-Austrian colleagues to believe in our Austrian analysis of the world currency situation, but they refuse to listen to anything except orthodox language because all Austrians are by definition mad, then look no further than Richard Duncan's The Dollar Crisis. Overall, Angloaustria gives it eight out of ten. If Mr Duncan had recommended the eventual re-adoption of the gold standard, it would have scored ten out of ten. But where would the fun be in life if everyone agreed with everyone else?
Monday, March 10, 2008
You have to say the word "Not!" in the title of this piece in the same way that Dana Carvey used to say it, as Garth, in Wayne's World. Because if Gary North is right, the two major US government providers of mortgage securitization (i.e. the buyers of dodgy sub-prime mortgages, bought using the proceeds of US government-backed bonds) are currently holding themselves up financially in the same way that Wile E. Coyote used to hold himself up once he'd run over a cliff face. That is, with an increasing lack of belief.
Via its dollar profligacy over the last few decades, fuelled by the abandonment of the last tatters of the gold standard in 1971, and by its setting up of these numerous "government sponsored enterprises" to buy votes with, the US government has ensconced itself within a terrible Stalingrad-style financial pincer. The final hand is about to be played and at stake are all of the chips on the table.
The US government must either order the Federal Reserve to print as much money as Fannie Mae and Freddie Mac need to securitize millions of appalling high-risk mortgages, thereby triggering the final humiliating collapse of the dollar (Operation Zimbabwe Mk I). Or it must cut these two GSEs off at the knees by repudiating any obligation for their bonds, thus applying a wrecking ball to the entire American housing market. This, obviously, will then scuttle the entire American economy (Operation Zimbabwe Mk II).
However, going one better than this, it would seem that from the $200 billion dollar bubble promise just made by Bernanke and the latest GSE credit spread picture, that both OpZMkI and OpZMkII are going to be exercised at one and the same time. Fancy that! The Germans are going to break out of Stalingrad and attack Moscow at the same time.
Well, what do you do now if you're in the bunker back in Berlin? You can either hope and pray, much as Ben Bernanke is doing. Or you could get Gary North in to advise you. Yes, his advice will be extremely unpalatable and almost impossible to implement in the face of the interests of Wall Street and the PC establishment, but what I imagine would be the tough medicine of doing absolutely nothing except turning off the printing presses, will foreshorten the oncoming depression by at least half, and possibly by much more.
Whichever way it works out, if you are an Austrian, and if you believe Gary North is closer to the truth than virtually any other economist alive, it is time to batten down the hatches and prepare yourself for a 1990s Japanese style economy for the next ten years. (Or run screaming into the hills - take your pick.) Because if Ben Bernanke and all the other clowns in the US government really outdo themselves, what we're really looking at is a Zimbabwean style economy across the entire face of the western world. I just hope I come out the other side with a shirt on my back.
Though personally, to avoid having to deal with this, I have decided to repudiate all of this mad Austrianism and I am now swinging full-square behind Gordon Brown, and his view of the British economy, that it is robust (whatever that means) and that it will weather the storm without any intrinsic link to the US economy causing us much harm at all.
Friday, March 07, 2008
And so, it would appear that the Good Doctor has decided that it is time for us all to wake up and come out from the depths of the magnificent dream we were all having. It was good while it lasted, I suppose. But Professor Hoppe's truths about democracy were always going to win in the end.
However, in a video reminding me somewhat of the rhetorical style of that other well-known revolutionary, Vladimir Ilyich Lenin, Ron Paul also spelled out the ongoing need for a long-term revolution based upon a cadre of hard-core believers to ensure that one day we will achieve our ends in these 'dangerous and exciting' times.
Crikey. Less homespun homily and more like David Hare's paean to Chairman Mao, the play Fanshen (based upon the book of the same name by American Marxist, William Hinton.)
Let us simply hope that we are as eventually successful in implementing our revolution as Lenin and Mao were in implementing theirs.
Wednesday, March 05, 2008
As the descendants of those who defeated Varus in the Teutoberg forest, the English have always had a history of resisting the encroachments of imperial tyranny and preserving the tender flame of liberty. The history of the English-speaking people has thus been an unrelenting one of bidding for freedom against the might of the state, whether it be the Scottish Stuart hegemony of the 17th century here in England or the British government in North America in the 18th century. Until today that is, when that fat Scottish wretch, Gordon Brown, sold England's multi-millennial history down the river for the hinted promise of two and a half years of being the Emperor of Europe, in a few year's time, when this hated man is forced from these shores to take up his rotten parasitical post in the Washington DC of the East, Brussels.
Just looking at this disgusting loathsome Marxist makes me feel putrid to the stomach. The sooner he gets back north of the border to an independent Scotland, the better. I have no doubt our Celtic cousins will know what to do with this stinking foetid offal of a human being once the brainwashed English finally throw this Quisling monarch off our throne.
Tuesday, March 04, 2008
Monday, March 03, 2008
I think all the Keynesians out there are finally beginning to get it. It has taken the death of Keynesianism many times to finally get them to see the light, including its prolonged state of rigor mortis in the 1970s, when stagflation (you would have thought) disproved this idiotic religion. However, even for Keynesians like Ambrose Evans-Pritchard, the endless Buddhist life-cycle may be drawing to an ultimate close as the Keynesian greenback turtle of fiat creation swims into the Austrian supernova of fiscal reality. Let's spell it out again, for those remaining Keynesians still out there who want to go on believing. I'll make it simple for you, fellas, with J. Maturin's Law I of the Bleedin' Obvious:
It is impossible to generate real wealth by the means of printing extra fiat money on a press, or by adding extra numbers to the columns of electronic accounts held at a central bank
Even Evans-Pritchard, in his latest article on the credit crunch, despite desperately trying to slip back into the old "there must be more aggression - i.e. even lower interest rates - by the Fed", mode, recognises the reality of this end-game:
It's typical that Austrianism is only mentioned in this deeply negative context, but still, the truth will out, boys, despite this defiant piece of spite. Only negative interest rates can save you now. Though I don't see too many takers, except at the end of a gun barrel. And it still won't work anyway. What we have here is a real full-blown depression, and only way we will reach a solution is by the world's governments getting out of the way and letting the voluntary market of human desires work its magic, over one or two year's of real pain as the market corrects this enormous cacophony of ongoing government error.
But this is not a normal downturn, subject to normal recovery. Leverage is too extreme. Bank capital is too eroded. Monetary traction eludes the Fed. An "Austrian" purge is underway.
(Or by the world's governments deliberately inducing World War III, and removing voluntary human needs by removing humans - they did it before in the 1930s. Who's to say they won't try it again?)
Idiotic actions such as the nationalisation of failed banks, as we fools in Britain let ourselves get sleepwalked into two weeks ago, are exactly the wrong kind of thing we should be doing, which will simply prolong and worsen the agony. In the meantime, let's pick over this quote by Mr Evans-Pritchard:
For the first time since this Greek tragedy began, I am now really frightened.If you want to know exactly how frightened we should all be, Ambrose, the book to get hold of is The Dollar Crisis, by Richard Duncan. The Keynesian party is finally over. But the price of 40 years of heavy drinking at the printing press saloon is going to be one heck of a hangover.
It's time to get the Nurofen in. Lots of them.
But then, just as a terrible hangover never seems to prevent people hitting the booze again on New Year's Eve, if we do manage to get through this depression without World War III being used as the cure, no doubt the Keynesians will resume hitting the Galbraithian whisky as soon as it's over.
There truly is no helping some people.
Saturday, March 01, 2008
Gordon Brown, finger-on-the-pulse man that he is, probably spotted this mood too. Hence, his bitter denunciation of the evils of shopping bags, yesterday. Poor shopping bags, I thought. After all, they are the original technology which enabled us to differentiate ourselves from other apes about five million years ago, when human beings developed the carrying angle in their arms to help them transport their newly-invented private property, around the plains of Africa. Though of course, Mother-Earth worshipping socialists are still angry about this invention, too.
But even I was dumbfounded for a moment when Brown threatened the British shopping industry with the ultimatum that if they didn't voluntarily start charging for shopping bags then he would compel them to do so.
Gordon Brown is such a cretin and so utterly stupid that he is probably incapable of understanding the revolting irony of such a threat to protect us all from the terrors of free shopping bags, but it got me to thinking Hayekian thoughts about the root problem behind socialism.
Because every single person alive, from poor Paul Gascoigne all the way through to His Majesty David Starkey, is always working, at all times, towards what they perceive is to be in their own best interests. It is what makes them human. Rocks just sit there. Bacteria just graze. And ants just follow chemical trails. However, to be human is to think. And to think is to perceive the world. And to perceive the world is to try to change it for the better. For you. And for whatever else you hold dear; even if what you hold dear is communism or national socialism and your goal is the extermination of your enemies.
Yes, we're often mistaken in what we do at a tiny personal level too (for instance, when we buy shares in a company which then immediately crashes), but this is what makes us human, this constant human action to try to improve the world for ourselves, as best we perceive, and as best we can. We help others because it makes us feel good. If it made us feel bad we wouldn't do it, unless we enjoyed feeling bad, but then of course we are once again trapped by the logical whiplash of still working towards our own perceived best interests.
But then there's the rub. Although all of us at all times are always behaving selfishly like this, we Austrians are in a tiny minority because we admire this trait. We think that this is what makes us human, and the trick of civilisation is then to try to formulate shared ways of living which make it possible for all of us to behave as much like this as possible, within the general constraint of not harming the life or property of another. We can argue about whether intellectual property is real property, or whether only scarce physical goods can count as property, but we are at least all in the same progressive ball park, trying to formulate a set of natural laws with which we can all rub along.
Whereas your typical socialist petty tyrant, such as Fat Gordon Brown, thinks that everyone else should be made to obey his whims and his wants and his wishes, because this would suit his interests. But nobody else is allowed to behave like this, because anyone else behaving so selfishly is evil. So with Austrians, we want everyone to be as free as possible, within a reasonable constraint of non-initiation of violence against the lives of others and their life-enhancing property, whereas Gordon Brown wants one man to be free, himself, no doubt because he was appointed by God, and everyone else to be his slaves. Don't they realise it's for their own good that I'm trying to make them stop behaving so selfishly?
And so, naturally, to be an Austrian is to seek a natural harmony and an eventual place where each man can be himself, within the one simple constraint of non-initiation of violence, seeking his own happiness, usually by helping others find their happiness through trade and voluntary action, and accepting that all others will constantly seek their own betterment. Whereas to be a socialist, even one as powerful as Dopey Gordon Brown, is to live in constant misery. No matter what these tyrants do, for the rest of time we will all continue to be selfish, no matter how onerous the prohibitions or punitive the taxes. Even a skeletal prisoner in a Frozen Gulag will continue to seek warmth, even if this warmth were judged by the camp commandant to be better spent on improving the heat metrics of the state, naturally with the thermometer for measuring this metric within the camp commandant's hut! It must therefore be intolerable to be a socialist. You are constantly fighting the basic pattern of human nature, at all times, in all people, including within all of your fellow socialists. And if ever you try to tamper with this, for instance by genetically engineering areas of the brain, your slaves become next-to-useless morons. Because to seek to manipulate human nature to become more properly socialist, is to try to turn us all into bums. Gott und Himmel, Donner, und Blitzen!
Whereas the single pair of twinned evil-eyes we Austrians have to fight consists of the stone age impulse to pillage the property of other tribes linked to the bitter Goddess of Envy. And yes, defeating these two malcontent impulses is difficult - witness the current entrenchment of socialism, the very embodiment of them both - but I think in the long run we will have been seen to take the easier and certainly the more civilised road.
And so it was at this point that I got out of my taxi and visited Pret a Manger for one of their delicious tuna and basil leaf sandwiches. Marvellous. Philosophising, albeit in a derived amateurish way, really can make you ravenous.
And yes, I asked for a free bag. I know. It's criminal, isn't it? I ought to be locked up. I'm sure I will be if Fat Gordon ever gets his way. I'll be the one standing by the radiator.
David Starkey may remain the Greatest Living Englishman, but this week's inaugural Englishman of the Week prize must surely go to a former heroin addict, Lord Benjamin Mancroft, the Tory peer who whispered the truth that dare not speak its name; to whit, that his local government hospital is a cesspit of filth, bad management, and poor care, drowning in a culture of irresponsibility.
I may never have been in the Bath hospital in question, but I can say from personal experience that the last two hospitals it has been my misfortune to visit, were right up there in the 'dried blood round the toilet bowl' stakes, along with the inane endless chattering at the nursing stations keeping everyone (ill people!) awake all night.
Of course, there is no solution to this gigantic expensive mess, that lies within the ambit of government control, and I bear no desperate grudge against individual health care staff. If you're going to run an organisation for sixty years without economic calculation, we're actually lucky the National Health Service is still as good as it is. Thankfully, there remains a vestigial culture of professionalism, and in life and death situations even the chippiest marxoid drone can still usually find it within themselves to do the right thing by pulling their finger out.
However, the only true solution is to privatize the whole shooting match from top to bottom, including the green field removal of all government laws 'regulating' health provision. Within five to ten years we would then have a health system which really would become the envy of the world. Is it going to happen? Not until we have removed every other plank of socialism in this benighted country first, from the BBC down to the six million non-job parasites we currently tolerate. But this nettlish option of privatising the NHS will continue to exist as the elephant in the room. Maybe one day we will actually be brave enough to notice it and then grasp it. Or maybe one day we will all be dead from multiply-resistant Novovirus infections.
Perhaps this is what the socialist econmentalists want? To empty the planet of the viroid human species polluting the biosphere, thus freeing it up for yet more noxious bacteria? Sometimes I wonder.