Here is the new thread by Jason Soon at Catallaxy. And its not as if we haven’t gone over and over and over these subjects before:
At the ALS blog, Pommygranate has a round-up of all the latest measures to shore up the financial sector across the world including the recently announced decision to guarantee Australian savings. Pommygranate titles his post ‘Socialism is back’. The interesting question is whether such socialism or as its supporters might prefer to call it, emergency measures, are inevitable because some institutions such as those in the financial sector are simply seen as too big to fail because of the substantial transition costs of letting them fail (even if things eventually settle down in the end).
But if governments ultimately have no ability to commit to letting ‘adjustments’ happen in this sector and moral hazard cannot be avoided, then is the inevitable quid pro quo a substantial level of regulation that will never go away?”
Look Jason. If you are going to allow the special priviledge of people selling counterfeit shares over the internet….. right? Well you are either going to come clean and disallow this practice or you are going to have to regulate, protect, and priviledge the people going forth with this practice RIGHT? Yes you are. And there will be problems and distortions involved with this practice.
If you are going to allow the special priviledge of people selling gold-that-they do not own over the internet….. right? Selling ponzi-gold. Selling make-believe gold, selling counterfeit gold…..right…. Well you are either going to come clean and disallow this practice or you are going to have to regulate, protect, and priviledge the people going forth with this practice RIGHT? Yes you are. And there will be problems and distortions involved with this practice.
Now take people who buy, sell and store SILVER. Take SILVER. If you are going to allow the special priviledge of such people to sell silver-that-they do not own over the internet….. right? If you are going to allow them to sell ponzi-silver. Sell make-believe silver, sell counterfeit silver…..right…. Well you are either going to come clean and disallow this practice or you are going to have to regulate, protect, and priviledge the people going forth with this practice RIGHT? Yes you are. And there will be problems and distortions involved with this practice.
NOW ARE YOU SEEING A PATTERN FORMING HERE FELLA?
Banks store, buy and sell CASH. And if it was the free market this cash would be commodities. If you extend to them the priviledge of buying, selling, and loaning PONZI-CASH you are either going to have to come clean and make everyone equal before the law and disallow this priviledge….. or you are going to have to bail them out, regulate them, subsidize them and they are effectively in the process of socialisation.
And it is this that causes recessions and obviously so.
I don’t know what it takes for lickball court economists to click to the bloody bleeding obvious. But WHAT CAN BE MORE OBVIOUS THEN THIS?
And now we have derivatives and the absolute disaster of fractional-reserve-EVERYTHING. Which means our price system has been totally ravaged by these special priviledges and millions will die because of it.
What is all this talk of EMERGENCY socialism? The socialism was always there and it is the thing that caused the emergency. The banks always had this special priviledge. They always got to pocket the value of money-creation. They got to buy and sell and take a margin on any issuance of government debt. They had 77000 pages of regulations for any startup competitor to be bogged down by. They got to borrow off the public tit at wholesale prices.
Thats not emergency socialism. Thats socialism that must lead to a debauch of the price system and sooner or later an emergency. It was the same when the banking priviledge was through neglect rather than over-regulation. There was always these emergencies. There was always the price distortion. Medieval Florence suffered from bouts of unemployment that no-one understood, though there was not a trade union in sight. No minimum wages to speak of.
So we have just got to stop letting lickball, court-economists be dishonest, idiotic and negligent about these realities.
And we have to trash these banks. Trashing them means simply stopping to subsidize them in any way, releasing more cash, increasing the reserve asset ratio as the cash arrives, and letting all our banks fail. With plenty of cash around, in a non-priviledged environments, failing banks, would simply sell of branches to new competitors or to the general market.
Our banks would have to increase their margins, stop creating new money, learn to live as honest traders….. OR DIE.
Whats wrong with that?
There is nothing wrong with it and we would have a better investment market and price system for it. Now we are going to be in very bad shape for decades. This bank bailout is a far worse mistake then not pulling ground-troops out quickly from these wars. Its not even a mistake. It was the banks controlling both houses and gypping the President. Its the banks in charge since there never was an argument for bank subsidies.
If anyone had wanted to spend a lazy couple of trillion on something that two trillion could have spent on building nuclear reactors. We have real problems to worry about. And real problems aren’t the multi-million dollar salaries of these banking welfare queens. A lot of these real problems are in fact the banking systems doing. Like our trade deficit, and the coming energy crisis that isn’t being handled at all. And won’t be handled by the current debauched version of capitalism with its socialist money.
Consider what else this money could have been spent on. The debt retirement. And then hang your head in shame if you ever advocated subsidising the bankers.
The debt retirement I said. But remember. The court economists told us that debt doesn’t matter. Thats sophistication in lickball economists circles. So if debt doesn’t matter why bail out the banks? Why not let them deal with their own debts?