Posted by: graemebird | October 17, 2008

Commodity Hoarding Juggernaut

Here we see why a reserve asset ratio alters the very nature of the banking industry and its influence on the rest of us. Where there is even the hint, smell, or possibility of ponzi-money creation, then private monetary systems will settle for gold and silver only. Because the public will demand value that they can see in their hand or keep in their house.

If this possibility is totally, and I mean TOTALLY eliminated, then there is absolutely no reason why the commodity hoarding juggernaut will not seek to promote the use of other monies. And we will have a really healthy economy if producer-goods more central for production are also monetized and cash balances built for them. A 100% backed banking industry will exert the influence that leads to more and more of these goods being stored.

All that is needed for this to be a reality would be for the costs of maintaining the fiat cash to be charged to the user. For fractional reserve to be eliminated in all its forms. And for enough of a tax exemption for private money provision to be in place such that the fiat-cash is steadily replaced by commodity-backed private cash. I think that storage of monetized goods and other activities associated with money-provision should be made tax-exempt.

MODIFIED FROM A COMMENT ON THIS BLOG:

Don’t be silly Mark. Its not possible for all countries to have trade surpluses. Since surpluses balance deficits.

Banks who don’t have a reserve asset ratio make ponzi-loans and then borrow as an afterthought to cover themselves. Whereas in the opposite extreme an 100%-backed bank must borrow at term first before they can lend at term.

For our banks, or for an American bank then; they only need our deposits as insurance against running short. They no longer are a broker that turns savings at term, into loans at term.

Hence when they borrow they borrow for liquidity… as insurance against a run on their cash reserves.

What this means is they borrow for liquidity, regardless of source. What this means is our banks are always lining up to borrow off overseas banks and that puts us in more or less permanent trade deficit. It also means that they no longer show up at the kids school telling them about the value of savings. Only a very few smaller banks will emphasise savings all the time.

If you are a bank and you have a high reserve asset ratio requirement…… even 40%, or especially at 100%, you are an agent attempting to convince everyone to save. Since your business doesn’t start until you have convinced someone to save. Your business begins with the saver. Without the saver you HAVE NO BUSINESS.

I remember as a kid the local savings bank would come down to the school and try and get us to save. But now as soon as they are allowed they try and sell the kids on credit cards.

Credit cards would be a disastrous marketing plan for the 100% bank. Because they have to get people to save or they have no business. And savings isn’t just a cash balance. Thats not saving. Thats the demand for cash for holding and a 100% backed bank cannot lend this stuff out. He needs to find clients that hold high cash balances and don’t therefore need to borrow but can on top of these high balances have cash that they can put at term.

Therefore at 100% backing, and particularly if its multi-commodity money, the entire banking system must set in motion a process that causes A COMMODITY SAVINGS JUGGERNAUT. This is crucial for their individual prospering and growth. Without savings they simply have nothing.

But our banks haven’t given a squat about savings for a very long time. Some of our smaller banks a little bit. But not our banking system in general. They merely make the ponzi-loan, then raise the money whenever they feel a bit edgy.

Hence they are always borrowing off foreign banks. So if our terms of trade are good we are in deficit, and if our terms of trade are bad we are in deficit. And this is not for wealth creation but for banks to insure their ponzi-loans.

Therefore it is no conincidence that the new dissavings nations tended to be the ones who practiced the ultimate in bank welfarism and got rid of any reserve asset ratio and yet implicitly ensured that the banking system got subsidised cash whenever they needed it.

So we have a problem. We are a debtor nation. It is not necessary for Dutch, Japanese, Taiwanese or Chinese policy measures to include winding up in surplus. But it is critical that Australian, bloody-marvellous Britain, and the United States policy does so…

In the old days it was possible for one gold-based nation to so expand its money supply that it suffered really critical gold shortages. These booms that went bust need not always be world-wide events if the cause of them originated in a smaller country. Although if it was the bloody-Marverllous Englanders or the US that were in the drivers seat that would touch ioff a banking crisis everywhere. But if Australia, in the 1870’s (lets say) were to do this indigenously, than before they could recover they would have had to be in surplus to stop the loss of gold and recover their cash balances.

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Responses

  1. Its good to see that people are onto things. Most of the measures recently made by Kevin Rudd are not a subsidy to us, but rather a subsidy to the banking system. Which is subsidised minute in minute out as things stand in the normal course of business.

    Here is Rod Clarke. Presumably speaking for ourselves and the Americans together.

    “RodClarke Says:
    October 17th, 2008 at 11:45 am
    Actually the liberal’s client groups.
    very very true 8 billion for RBMS a few days and 15 bill for “other securities” from the RBA.
    .
    Year after year, the ordinary citizens were told by the governments: we have no money to spend on your needs, on your communities, on your infrastructure, on your health, on your children, on your environment, on your quality of life. We can’t do those kinds of things any more…. Budgets are tight, we must balance them.
    .
    And now we know the money was there – billions and billions and billions of dollars of it, trillions of dollars of it. We can see it before our very eyes – being taken away from our public treasuries and showered upon financiers.”

    We must stop these welfare queens from stealing from us.

  2. Don’t you have a mortgage?

  3. What is your fucking argument Turkey-JohnZ you fucking moron?

    Do you have an argument you fucking moron?

    And what would have been your NON-ARGUMENT if I didn’t have a mortgage you fucking idiot.

    Fuck you are an idiot mate?

    You’ve always been an idiot. And you’re a liar. And you are a piss-weak little fag to boot.

    People I’ve met this little wimp so I’m not just assuming it.

    Now what was your argument again you piss-weak little fag?

    Because if I didn’t have a house you’d say I was just jealous on account of not having a house. So since I have a house and stand to gain from a new round of inflation what is your argument?

    So I stand to gain from continuing bad policy.

    And your argument is……….WHAT?

    You are a fucking moron mate.

    Come back when you have an argument idiot. That was exactly the same argument that the famous naked short-seller Joe Cambria made. That is to say he made no argument at all.

  4. Notice that all these deadheads who try and defend fractional reserve banking are exactly the same. Fiendishly dishonest. And never have an argument.

    The famous naked short-seller and defender of naked short-selling Joe Cambria showed up here and said exactly the same thing. But the fucking moron wouldn’t say what his argument was either.

    So we’ve got two fucking morons showing up here and saying the same thing. Both of them missing an argument.

    Notice that all of these people are the same. Like for example Jason Soon showed up here and said “Learn some neoclassical economics Graeme….”

    But the silly cunt failed to show up with an argument. Further enquiries elicited no argument. And its still a mystery what the argument was.

    Over at thoughts on freedom famous defender of naked short-selling…… Joe Cambria…….. began a thread saying “In defense of bailouts” Yet forensic examination of the entire fucking thread failed to elicit an argument in favour of the bailout.

    So its fractional reserve all around isn’t it. Fractional reserve everywhere. They write cheques and no cash in their account. They leave home without their pants on. And when they come to any blog and they leave a smarmy remark, they fucking forget that they didn’t have an argument backing that smarmy remark.

    Like leaving home without your pants on. They keep supporting positions and making insulting comments without an argument. No gold in the vaults. Cheques in the mail…….. (not). All hat and no cattle, as the Texans say.
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
    Disclaimer:

    Anyone who has sold, at the very least, American shares SHORT is inevitably a practitioner of naked short-selling through no fault of their own. Since there are currently, at least as many outstanding phony American shares as there are authentic shares with the ascribed certificate. This is the sort of shifty operation that Henry Paulson was involved in. However any lone trader, with-or-without a nod and a wink, can do this sort of thing and he cannot be held responsible in exactly the same way as me buying a mortgage am not complicit in fractional reserve banking so long as I go out of my way to oppose this system that inflates our house prices and basically eats away at the fabric of our society.

    Cambria is not a broker. And since he trades in an out of his positions, by his own admission, he cannot be held liable since he cannot be expected to wait for the American share certificates to show up before he sells these shares over the computer.

    But what pisses me off about this is that both Cambria and Regulator Reynolds do not support bringing honest share trading to the market.
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

    I may have to post this disclaimer everytime I talk about Cambria from here on in. Dude is likely to get shirty. But its true its not the short-selling he can be blamed for. Only the defense of the practice of other people watering down the stock. He may as well be defending stealing off old people and destroying or hampering promising new businesses. Because this is exactly what watering down the stock does.

    Its extremely hard to nail down any one party for the crime of naked short-selling. Since as we have seen, like every fractional reserve ponzi-scheme, it usually involves a number of parties working seperately and in theory at least, independently.

    For example, when I bought my house I was one of four principles involved with the attendant act of money creation involved. The other was the vendor, and there were probably two other banks involved.

  5. “pedro Says:
    October 18th, 2008 at 7:48 am
    Given the government guarantee, should the super funds now be putting most of the new contributions into domestic banks? At least until the share market stabilises.

    Yes pedro. Domestic banks and domestic shares. Particularly in the extraction industries. Because the markets are so poxy and in such basic violation of valid pricing that they are currently underpricing commodities.

    And another thing. We have recently devalued. So there is not much currency risk attached to our shares. As well Stephens is a bit of an inflation hawk, bless his heart, and so thats a second reason for low currency risk. Funds are just damn irresponsible parking any money in the US unless for specific stocks where the manager knows exactly what he is doing.

  6. just who are you talking to graeme?

  7. so you obviously get angry when people expose your hypocrisy …

  8. Why didn’t you practice what you preach and buy gold until you had enough to purchase your home outright?

    If ponzi money is good enough for you, why not the rest of us?

  9. looks like the Bird-Macquarie clan gets all the privileges in this country. most of us have relied on this ponzi-money far less than you Graeme. So it’s alright for you to borrow money for a house but not the rest of us.

  10. What was your argument JohnZ.

    Don’t come on here without and argument.

  11. Ponzi-money is not good enough for me. I don’t get the choice of hard money and a good house.

    This is a serious matter. The bankers have singlehandedly white-anted the Americans from within. A drop in the stock market is no problem really. But they’ve just destroyed the American economy with their ponzi-schemes. Its just a more obscurantist version of that racket that damaged the Albanians.

  12. What I meant to say was hard money and a CHEAP house. You clowns actually appear to be antagonistic to small business and entrepreneurialism. The only good time to start a business is toward the end of the recession. The rest of the time people are priced out of the market by outrageous prices on key producer goods. Like office or workshop space for example. If you think of the really terrific entrepreneurs who created magnificent businesses, most of them got going after the end of a recession. The post-Volker business creation environment was just magnificent.

  13. “Why didn’t you practice what you preach and buy gold until you had enough to purchase your home outright?”

    A damn fine investment tip at this time by JohnZ. The only creative thing I’ve seem him come up with in a very long time. However thanks to socialists and banking criminals you can’t loan out gold at interest safely whilst building up your stash. This is a very great crime that means poverty and lack of personal security the world over.

  14. Graeme,

    For fuck’s sake see the obvious. Libertarians are the most hypocritical of political activists. They do nothing, all talk. How many of them accept the Family Tax benefits etc etc.

  15. I do see the obvious. These guys aren’t libertarians. They are crony-socialists. They make me want to be sick. My wife told me that we had to get a house now. Since they wouldn’t lend to people who were all that much older than us. I think she is right. And I try to change the system, I do pretty much every damn thing I can, but I don’t create the system and have to work within it.

    Kevins bad policy seems determined to underwrite our decision and the central coast is growing. So I’ll make a gain from it. But we’d all gain a lot more if we put a stop to this ponzi-racket.

  16. To understand the stupidity and absolutism of JohnZ you just have to go to Catallaxy now and see his illogic in action on right assymetry.

    Jason is making a fundamental mistake in his critique of natural rights. A thing is what it is. It is not what it is contructed of. Since utilitarian considerations are part of the building blocks of how we construct natural rights Jason is arguing that there is no natural rights only utilitarianism. This is absolutist nonsense. Its as though he expects that you cannot have a field of study unless the answers are carved out of quartz and handed down by the godhead with a series of miracles as corroborating evidence. Natural rights and natural law is a subject more akin to horticulture. Not an exact science perhaps. But a valid science not to be undermined by this sort of absolutism. Its not like we haven’t gone over this before.

    But while SOON is persistently mistaken on this point JohnZ is borderline insane in his unreason. He reckons that if its a PRACTICAL NECESSITY to have some small level of taxation to finance the protection of our natural rights, that means, in JohnZ’s idiotic view, that we have no natural rights. This is lunacy. There is no way to deal with someone who has such a fucked up understanding of the reasoning process.

    This is why JohnZ thinks that me buying a house somehow undermines the case for sound money. Its because he’s a lunatic with a bizzare form of logical processing.

    Now about this securing of natural rights. I always liked the Hans Hoppe approach where he thinks that these natural rights could be secured by profit-making enforcement agencies. But I just didn’t think it was practical. So I figured that the only way ahead was evolution via secession. And perhaps we’d figure out how to get this thing done by that route.

    But the idea of a commodity-savings juggernaut helps square this circle. Since you see you are going to have security to protect all this largesse wherever its stored for digitization. This will take the focus of invasions away from the civilians and change the nature of war to be more purely an armed holdup. All these little territories will want serious armed forces just to protect their stash. So the whole deal of private protection evolving into defense begins to look a little bit more vaguely doable.

    But if its not a practical matter this has no bearing on whether we have rights or whether we don’t. Thats just JohnZ’s faulty absolutist illogic in operation.

  17. I thought you said gold has an interest rate built into the currency? After all, it appreciates in value each year.

    You buy the gold, watch it appreciate and buy the house outright once you can afford it. So why go crawling to the bankers for a ponzi loan?

  18. Not now it doesn’t. Its unstable because of the buggered market and because of fractional reserve fiat. It will likely double in price within the next year or two but then once the backlog of ponzi-gold clears by heightened production it can crash again.

    What you are saying happens to be pretty good investment advice if the start date was right now.

    Under monetization you would expect the SHORT-RUN interest rate to be imbedded in this way most years. But you ought to still be able to lend it out long-term at 3 per cent or something like that. But you cannot do that now. So its a real shame.

    Yeah sure. Thats not a bad way to go for the moment. Save up your gold. Buying a house was not a bad way to go awhile back either. Because stupid economists, the government and the bank guarantee your loan via inflationism.

  19. The point is that its the system that is fucked up. You cannot run away from that. Your argumentt is a non-argument. Its moronic. You are being an idiot and clearly so. There is no debating that fact. Because you are just being an idiot. Except in terms of short-run investment advice.

    You see almost all the loans made are not wealth-creating loans. Whereas the pre-banking position has very good investment allocation, the banks currently come and screw this up and allocate resources anti-capitalistically and in a wealth-destroying way. My loan didn’t improve my cash flow. At the very least it ought to have improved my cash-flow factoring out principle repayments. So from the wider societal point of view we can say that this was a malinvestment.

    And thats what these banks are doing to our resource allocation. Their legalised-criminal-behaviour is misallocating resources. Its causing daily trade deficits, ruining new business creation, buggering our manufacturing. and pointlessly getting the country into debt.

    Notice that you don’t have any counter-argument at all. You are such a fucking idiot JohnZ. A total moron. You have to fundamentally change your view of what logic means.

  20. I’ve just discovered this amusing fellow who thinks about the bailout in the same way I do. He thinks that Paulson has gone off the rails like Kurtz in heart of darkness. And that we have to send a Martin Sheen character up the river to kill him.

    Have no doubt about it. The Paulson approach is the total trashing of the US nation. Its horrifying to see this happening before our very eyes and so quickly. It seems that high monetary growth makes all human behaviour more or less insane. And monetary destruction as well. They just all go nuts. Reagan era policy was really rational. I was just glad I got to see it. Got to see the possibility that people could act in a reasonable fashion for a change.

    Anyway there is this thing called the halo effect. Where people overlook peoples faults because of something they like about him. But there is the other more pervasive problem that is more pervasive since there is no name for it. Let us call it the opposite-of-the-halo-effect. And when you listen to Max Keiser you ought not discount his understanding of matters economic because of his extreme conspiracy theory in other areas. Like he seems to think that the destruction of building 7 was an inside job.

    He’s got this gig with Iranian TV. And he knows how to please the customer. So he sort of strokes the regime while he’s doing it by portraying the US as fundametally crooked. It just so happens that this bailout is indeed totally crooked. Its just a heist. The bailout is now 2.25 trillion. Not 850 billion but 2.25 trillion. Thats about two trillion worth of pure economic vandalism and perhaps some other amount of valid monetization.

    Anyway here is Max. He’s got the right idea about the financial end of economics. Take his investment advice seriously. And don’t let some of the other stuff put you off.

    http://au.youtube.com/results?search_query=Max+Keiser&search_type=&aq=f

  21. Here is Max predicting the destruction of Icelands economy in 2007. And alluding to our current problems. Its amazing how our economists have fallen for this crazed view of economics where we don’t have to make things.

    http://au.youtube.com/watch?v=wFzUR1k3ku4

  22. You Soon and Humphreys are all welfae beneficiaries in a loose sense. In that none of you make money through production. All through government spending or in Johns case through house-flipping. In the case of all three of you you are thieving enablers. Land title is about the one thing that these guys aren’t stealing and I cannot be expected to stay young forever.

    Do you have an argument Z or are you just going to be a fucking moron. What is your argument in favour of ponzi-money. Its like being in favour of malaria. Face it. You are a fuckwit. And its a permanent condition in your case.

    What was that argument again hey fuckwit?

  23. JC what was that argument hey idiot. You see you left home without an argument again. Keiser is an American who works in Paris. So what was that argument again? Notice all you guys cannot be shaken down for an argument.

  24. Whats your argument there Mark? You have zero credibility Mark because you left home without an argument. All you guys are such fuckwits because you keep forgeting to show up with an argument.

    Mark is a moron who has argued that large trade deficits are just fine, that debt doesn’t matter and that reserve asset ratios aren’t necessary. Fractional reserve is fine in Marks view.

    These guys still insist on this as Iceland goes under and the US is to follow.

  25. I told you why I got a home loan you fuckwit. I’ve got a bank balance too. I’ve got money tied up in government bonds as well. And I have to pay taxes at a level far higher than what I consider is just on top of that. There is no way to get away from these thieves.

    You don’t have an argument Z. Fuck off. You are one of the thieves and you are just rubbing it in. Thats not an argument. Thats just gloating. Go away.

  26. I told you you have to fundamentally change your view of logic Z. We haven’t seen that change. Its as though you can only argue with the sort of intelligence of a pocket calculator.

  27. JC what is your argument. For anything. These days you just say stuff unbacked by any argument. What is your argument for the heist? You never came up with an argument for the heist. We know how to do this. You handle it like Martin Van Buren. Not like Paulson. Not like Hoover. Some monetization yes. But not stealing and giving the money to the banks.

    So we know what to do. Why not just do what we know will work? Its the case of the missing argument.

  28. Z go away. When you find an argument in favour of rampant stealing and ponzi-schemes you let me know. I will be interested. But for now fuck off. And stop gloating.

  29. He refuses to make an argument JC. If you think he’s made an argument you make his case for him.

    You are just acting like the crooked goon that you are. While you are here lets see your argument in favour of watering the shares wih fale ponzi-shares. You have come out in favour of naked short-selling. Yet you refuse to make that argument.

  30. So what is your argument in favour of watering the shares? What is your argument for the heist?

    None of you guys make valid arguments anymore. No wonder you are all CO2-bedwetters. Its that endless argument filibuster in all things.

  31. I already gave you the reasons why I thought the plan had a chance of working. The RTC worked in the early 90’s so it’s not a given it wouldn’t work now. I don’t want to get into the same old arguments we’ve hashed 3000 times before.

    Here’s the thing. The IMF believe the loan problem is around $1 to 1.4 trillion. The US banks have already written off 550 billion and have received 250 in capital. So the banks are about right, now as the rest of the problem loan are not in the banking system. Unless another freight train hits things (and the very well could) the US banking system is now safe.

    Furthermore the US taxpayer bought in at close to book value with most of these banks and historically banks trade at 2.5 times book.

  32. Look at these clowns. ALL of them are here to defend fractional reserve. But NONE of them has an argument. This is how most controversies are these days. One side bullshitting and filibustering the whole time.

  33. Stop being an ignorant shit head by calling this a ” heist”. There is no fucking heist bird. The taxpayer bought stocks:preferred stock and warrants. So it is NOT a “heist”. You’re so clueless you don’t even know the difference nowadays, would you?

  34. The banks have trillions in liabilities. Don’t hide behind the IMF. The idea of the government buying and selling to attempt to make a profit goes totally against sound monetary policy since it implies not enough monetization now and too much inflation later.

    The bailout didn’t work in the 90’s. It merely kicks the can down the road. Define what you mean by “work”. When you say it could “work”. What do you mean by this. If you steal off someone they get stolen off. So long as monetization is sufficient to stop monetary implosion 5000 banks going broke doesn’t matter to the rest of us. Thats how many banks went under with Volker.

    The bankers cannot take us down wih them if we don’t let them steal off us. Only massive inflation can bail them out now. You might call that “working” but you want to at least say what it is you mean by that.

  35. Don’t be an idiot JC. Its bad enough to see JohnZ doing it. Now you tell me what is meant by the bailout “working.”

  36. Its a heist. There is no use lying about it. Now what is it you mean by the heist “working”?

  37. Look the US is bankrupt. Now how will he heist change that? The debts of the banks are eliminated when the banks go broke. So how can the government taking over such debts change the fact of the US being bankrupt?

    Letting the banks go under was in fact the only way to get out of a lot of these liabilities without galloping inflation. The Americans with this madman Paulson have chosen a deflationary depression.

  38. An INFLATIONARY depression. I’m not the only one saying this. The thing is its almost impossible to imagine any other outcome unless there is a dramatic reversal of policy.

    Can someone tell me how this outcome may NOT come about?

  39. Look Z. If you cannot come up with an argument in favour of legalised ponzi-schemes I’m just going to wipe all your gear. So don’t waste your time.

    But check out Max Keisers 2007 lecture on the Icelanders banking craziness and see if you can find fault with it.

  40. You owe us an apology turkey. Repeat after me (copy and paste if you like).

    I, Graeme Bird, do hereby apologise to Humphreys, Soon, JC, Reynolds and JohnZ for the abuse I have heaped upon them over the years. I acknowledge that it was hypocritical of me to complain about fractional reserve while being one if its main benefactors. I acknowledge that all of these men are saving money and reducing Australia indebtedness.
    I would also like to apologise to my wife for dragging her into this mess. I alone am responsible for my financial decisions, even if they don’t always accord with my principles.

    Sincerely,
    Graeme Bird

  41. Hasenkams criticism of you Catallaxians is so good it deserves a second hearing:

    “John Hasenkam Says:
    October 19, 2008 at 5:19 am
    Graeme,

    For fuck’s sake see the obvious. Libertarians are the most hypocritical of political activists. They do nothing, all talk. How many of them accept the Family Tax benefits etc etc.”

    The only problem is that he ludicrously describes you socialist money types as libertarians.

    Here is Keiser on the Icelanders craziness.

    http://au.youtube.com/watch?v=wFzUR1k3ku4

  42. If you cannot come up with an argument in favour of legalised ponzi-schemes

    YOU obviously have an argument for them because YOU ARE THE ONLY PERSON ON THIS THREAD RELYING ON THEM TO SHELTER YOUR FAMILY.

    The rest of us either own our homes outright or are renting until we can afford to buy. So YOU explain why this ponzi scheme should persist Graeme, I’m quite happy to hold my money in gold and/or carbon nano rods.

  43. Well yes there has to be monetization. That’s the system we live under. There are problems with it in terms of being unstable, but we do grow and advance. You make it sound as though its like the soviet union.

  44. Exactly. We all deserve an apology, Bird. Please apologize.

  45. does your wife know you’re blaming her for your hypocrisy Graeme?

  46. Guys. When you don’t have an argument you are not in a position to just kick the chess board over by creating a thread of doom like the old days. Because I’ll just thin out the argument-free posts.

    Now lets see those arguments in favour of legalised ponzi-schemes and bailouts via stealing and inflation. Another good documentary from Max Keiser.

  47. I cannot see the appeal of being a house-nigger or a crony-communist. Thats the mystery of you clowns to me.

  48. “Well yes there has to be monetization. That’s the system we live under. There are problems with it in terms of being unstable, but we do grow and advance. You make it sound as though its like the soviet union.”

    It is like the Soviet Union. Its the collapse of the US as a strong economy. And its Paulson thieving like a commie thug. They won’t develop. This is a disaster.

    If you are going to have fractional reserve you have to have mass failures of the banks every so often. If not the society will die and not the banks.

    This is an historic tragedy. Paulson is white-anting the whole society. 2008 is the worst year economically since 1929 and America is in a far more adverse situation than that. They are far worse off than the Japanese were with their real estate bubble.

  49. Best one yet. Max showing how the markets are rigged. He deals with the short-selling crime. See all these other fleecing methodolgies spread once you allow fractional reserve. Since the banks become dominated by crooks.

    Meanwhile the government end of govybank regulates things that don’t need regulation as cover for these scams.

    Notice that JC has not backed off from his support of stock-watering by this method. At first he tried to throw a spanner in the works by failing to differentiate between fraudulent short-selling and legitimate short-selling.

  50. Bird:
    What exactly is fraudulent short selling? Bird you idiot, why are you assuming that shorting a stock makes money?

    For every seller there has to be a willing buyer. Please shut up with things you don’t understand as you come across even more stupid that you do now.

  51. I didn’t assume that short-selling always makes money you are a dirty filthy lying fucking fraud.

    Are you now claiming, you filthy fucking liar, that you don’t know the difference between naked short-selling and covered shorts.

    You are a fucking liar Cambria. This is exactly what you tried to do before. Pretend that you didn’t know the difference between covered and naked shorts and just basically lied your way out.

    LETS GO AGAIN.

    WHAT IS YOUR ARGUMENT IN FAVOUR OF NAKED SHORT SELLING.

    This time attempt not to lie you jerk.

  52. Cambria. Justify naked short selling. You claim its a good thing and ought to be legal. Now justify that. And justify the heist. Tell us what you mean by “work” when you claim “it could work”.

    But don’t.. fucking….. lie… and tell people……. that I don’t understand short-selling…….. you fucking lying cunt.

  53. You are lying. I already told you why I bought the house. There is to be no lying on this forum.

    Now lets have your argument in favour of ponzi-money. You are lying simultaneously on two blogs. On catallaxy you are claiming its market failure. You are a communist mate. If you cannot come up with an argument for your own position try and help that dumb cunt JC out.

    A bailout can “work”. What does he mean by that? By “work”. You steal off people and they stay stolen off?

    Can you help him out with the difference between naked and covered shorts? Because he’s lying and pretending he doesn’t know.

    Why don’t you take up some of your differences wih him? You see what we have here is a coalition of liars.

  54. Don’t waste your time Z. I’m not letting the coalition of dishonesty turn this into another no-argument thread of doom like you goons and Reynolds used to do. You get some time for people to see what you’ve said. But then the lies get ruthlessly culled.

  55. So neither Cambria nor Z has an argument. Fucking useless. Z is basically a communist. Cambria has more or less confessed his allegiance to cronyism.

    And yet neither of them can make an argument for their case.

  56. I did answer it. You are lying. Your lies will be wiped.

    “Jason Soon Says:
    October 20th, 2008 at 10:26 am
    so if there wasn’t easy credit, banks wouldn’t have stuffed up their risk management? sorry, don’t buy it.”

    You’ve just go no idea fella. There is no risk management with ponzi-schemes. There is only government cartelization regulations and bailouts. Reynolds has no useful knowledge whatsoever. The guys just an idiot. The risk management people are proven failures.

  57. You have cartelization regulations. You’ve got the interest rate subsidy. The implied government backing. The printing press backing. The implied money creation subsidy. The bailout represented by asset inflation. There is no valid risk management here. Thats why nothing can be learned in a visit to ozrisk and why these bankers are proven failures and welfare recipients.

  58. Max doesn’t work for the Iranians you moron.

    Now what was your argument again. Ahura Mazda you are an idiot mate.
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

    “There is, in the current circusmtances, enough blame to apportion to both those in the market and those who claim to govern the market.”

    So says dover having a bit of a bet each way. But we are really talking about the same counterfeiting racket. Govybank. One racket with two wings.

  59. Are the two of you eveen capable of a grown-up argument?

    Look I just noticed this guy a day ago. And its pretty clear that he’s come to similiar conclusions to me. So what was your argument again? Because its looking like Lisa Simpsons friends claiming that Lisa will grow up and marrry a carrot.

  60. Do you actually have an argument Jason? I”ve got a lot of content-free posts to wipe. You are supposed to be an economist. Can you attempt to act like an economist. What is your argument. Can you get an argument for JC?

  61. No i guess not.

  62. Well there you are then.

    Now you guys ought not be so nihilistic about it. We cannot have these bankers just basically white-anting the system all the time. The US is already ruined. Its hard to imagine that the centre will even hold and that it will stay together in its current form. Its totally bankrupt. And yet without Paulson and bailouts there was still a way out.

  63. yup exactly
    what’s the point of arguing with a communist-jihadist?

  64. Mark what is your argument in favour of fractional reserve?

    Elsewhere you claimed I was against credit contracts. You dumb bastard. You just lied. Keiser doesn’t appear to be that way at all. So you appear to be lying about that also.

    So what does your argument amount to?

    We will get there yet you dumb cunts. But its sure taking you dim bulbs awhile.

  65. Here is Z in total denial:

    “Regulations which will help here:
    – Push OTC derivatives onto exchanges to reduce the uncertainty when large financial firms go belly-up.
    – Raise reserve requirements to reduce leverage.
    – Limit consolidation of financial firms so they don’t become “too big to fail.” And don’t give me this spiel about “no bailouts”. We live in a democracy, we’re going to get the bailouts. All we can do is reduce the chance of needing one…..”

    If you don’t allow ponzi-schemes in the first place you don’t need to bail the scammers out. If natural law is such that limited liability means debt free than financial institutions will tend to be small.

  66. Do you have an argument JC?

    We see that the problem is one of utter contempt and self-satisfaction in being an unproductive insider.

    What was your argument in favour of naked short-selling? Fractional reserve? Ponzi schemes more generally?

    Islam is against interest you ignorant wog cunt. Its got nothing to say on fractional reserve.

  67. Now you are just talking nonsense. Islam is against usury. Banking as such cannot exist without interest unless one went for equity investments right up front. You’ve lost your original argument you senile old wog. No wonder Aquinas only made it to 49. God must have killed him so that no-one would see his mind fall apart within the year through wog premature senility.

    As I pointed out Islam is silent on fractional reserve and I’m not against an interest rate. You guys are just being moronic and childish.
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

    Good news in this mornings Australia. Glenn Stevens dirty on the Rudd Guarantee. At least someones doing a bit of thinking. I wonder if I haven’t picked up some hard left leadership. Phil Adams has an article blandly claiming as part of it that we are teetering on the biggest depression since the 1930’s. Well he’d be right if he was talking about the Americans specifically. But he’s blaming it all on Bush, whereas we would want more attention drawn to Paulson, who is an incredible lunatic and technically speaking, a criminal.

    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

    “How can insurance, superannuation and the other institutions of our financial system become 100% backed?”

    You have to actually learn stuff Mark. None of these guys need involve themselves in pyramiding new money into existence. And super funds particularly don’t do this. It would be better if you actually understood this stuff before spouting off at the mouth without thinking for two straight years.

  68. During a credit crunch if the central bank merely monetizes to allow for a greater demand for money for holding and the destruction of ponzi-money, then the net effect is merely a FLIGHT-TO-QUALITY which is what you want. And then these riskier banks go broke and we get to legally open their books and see what money laundering and stock watering they’ve been up to. If the central bank doesn’t produce the extra cash the money doesn’t fly-to-quality. Rather it flies up its own behind and dissapears which is not the preferred outcome.

    We see that the Austrian version of the money supply stayed basically the same between April and December. We also hear the IMF boss saying his outfit raised about 5 billion on the open market at a pretty low interest rate. Which he claims is a “flight to quality” his words not mine.

    So we see that the above vindicates the monetization side of the Feds activities but also shows that all this illegality, arbitrary power, stealing, fear tactics, the creation of new debt…… this side of the bailout is just moronic, harmful, totally unnecessary, and counter-productive.

  69. “JohnZ Says:
    October 20th, 2008 at 11:08 pm
    how, without being irrational.
    There are heaps of possibilities; stupidity, greed, overconfidence in mathematical models, agency problems etc.
    .
    If there’s one thing this crisis has convinced me of, it’s that freebanking is bat shit crazy.
    – By your own admission, banks can’t be trusted to lend money sensibly when it’s cheap
    – Ratings agencies can’t be trusted to assess the risks banks are taking accurately, in this case they got on board the gravy train.
    – Everyone ran squealing to the government when the market went south. We would have had the mother of all bank runs if the fed hadn’t stepped in when they did. How is private currency going to work without the fed and the government standing behind it?”

    And how about Cambrias replies to your observations? Totally full of shit or what. You don’t need to accept non-answers and unreason from a welfare queen. Its not as if the destruction and stealing is over. Bernanke has to come in now with a reserve asset ratio or there will be very quickly galloping inflation. Meanwhile there is very little serious investment going on of the sort that would overcome the looming energy-crisis and the trillions in liabilities can only really be handled if the consumer prices are inflated such that housing will be underpriced.

    The whole thing is ridiculous. The most wealthy bankers are doing almost nothing useful and cashing out after basically stealing from their funds. And that stealing must come out, either in their bankruptcy or their getting bailout out.

    Also notice that the system was always how I described it. And elephant balancing on its trunk. No amount of money has been spared the last 13 months to try and keep that elephant balanced on his trunk. But this has got nothing to do with the sound allocation of investment funds. And so if they have finally stopped him falling over it just means that the Americans have kicked the can down the road for a year or two.

    Fraud-banking is batshit-crazy since fractional reserve is a racket.

  70. What do you mean by that. The insurance company is only involved in pyramiding insofar as it acts like a bank.

    You would be best to find out what fractional reserve pyramiding is.

    You see when you do it you are not just relying on your own behaviour, as in the consensual model. You are pyramiding money with the aid of another bank. So it cannot be thought of as consensual behaviour between a bank and a bank customer.

  71. For fucksakes bankers are idiots. They don’t understand the most basic things about what they do for a living.

    Look at Edney. Talking about risk management. What a fucking moron. There is no science of risk management in banking. A chain letter falls apart when you run out of chain. Once price inflation took off and Bernanke had to fight it than they were doomed since the ponzi-scheme could not hold without a bailout or a subsidy.

    So look at the entirely delusional Edney:

    “SteveEdney Says:
    October 21st, 2008 at 10:18 am
    Shame I missed most of this debate.
    No, but their risk managers should have an idea of the probability of a freight train coming their way. That every bank got whacked by the same train implies that their probabilities of risks were way off – i.e. risk management failed bigtime.”

    Its a ponzi-scheme you fuckwit. So there is no risk management science. The elephant balances on his trunk. If the monetary growth stops he will fall over you know not the day or the hour. But fall over he will if the money growth stops.

    So stop fucking pretending that there is some sort of risk management science other than the recognition of what I say above. You guys are just so crooked. There is nothing you guys cannot bullshit yourselves about.

  72. Fuck you are fucking dumb mate. You must be the dumbest cunt there is.

    I ANSWERED YOU ALREADY YOU CUNT.

    The situation doesn’t arise. Because insurance companies don’t create new money unless they take deposits like a bank.

    You are just a moron mate.

    Hey I’ll you what. I’ll answer you twice in the same post:

    The situation doesn’t arise. Because insurance companies don’t create new money unless they take deposits like a bank.

    And how about this just to make sure:

    The situation doesn’t arise. Because insurance companies don’t create new money unless they take deposits like a bank.

    Well how about another time just to take into account your special dimness:

    The situation doesn’t arise. Because insurance companies don’t create new money unless they take deposits like a bank.

  73. no you arelying jc you retarded wog cunt.

    We were talking about public policy and its nothing to do with me.

    I’m only glad I’ve got my other computer back so I can wipe these relentless lies, graffiti, and stupidity.

    Look Mark. What are you waiting for? Just go and learn the monetary theory you lazy cunt. Almost three years and you still refuse to learn.

  74. Tell me what a greenslip is. It could be money depending on the institutional realities of the time.

    You’ll have to actually learn about how money is created in order to make the judgement for yourself. But nothing insurance companies do that I’ve seen would be tantamount to creating money in 2008. Though I suppose my experience with these guys is not that extensive.

    Now it seems you’ve brought this up a number of times. But you are just being a dumb cunt. Because you don’t remember what the surrender conditions were like for this sort of thing in the 1950’s. So attempt not to be an idiot.

  75. In fact you nothing about institutional arrangements for insurance companies in the 1950’s do you.

    So you don’t have a fucking clue what you are talking about do you?

    See when I asked you about this before you didn’t have a clue what you were talking about. And nothings changed has it.

    Don’t come here to be a fucking idiot mate.

    You tell me what the situation was with insurance companies in the 1950’s in America?

    You tell me?

    Why do you bring it up?

    I never said it. It was Rothbard responding to the conditions of that time to get the best metric he could.

    You tell me about ancient insurance history. But I’m wiping your post because you are being such a moron.

  76. Jay-sus
    .
    Graeme. If fractional reserve is out then bankers must have your money there for you. Every deposit must be accounted for – in the safe so to speak.
    .
    In that case whose money are they lending? Why keep ours? What’s in for them. How does it work? I’m so confused. .

  77. They lend money that you lend to them AT TERM.

    Not on-call. So supposing you are accumulating a great deal of diesel in your account. Lots and lots of diesel. More than you can use yourself in some given time period. So you lend it out for three months. Or six month. Or a year. Well they can lend it out if you specifically lend to them at term.

    That way there is no money pyramiding and no monetary disequilibrium.

    But note the bankers don’t have a business until they can get you to have high cash balances. Which means of course they have to have all this stash of commodities. So the banking system is forced to act as this giant spruiker to get you to stop spending and start accumulating these commodities.

  78. I got to save posts from thoughts on freedom. Just in case freedom lover Humphreys figures out I’m still wanting to get rid of fractional reserve:

    “However I would not call this debasement.”

    It doesn’t matter what you decide to call it Terje. Its debasement if its ponzi-gold and not real gold. Or ponzi-diesel and not real diesel. If they’ve pyramided up ontop of the gold all this fakery then thats debasement. And it means the price of gold (spending on goods) is too low (high) now but the price of gold (spending on goods) will be too high (low) later when the shit hits the fan. Its setting up a gold shortage for later on even as there is an apparent but not a real oversupply now.

    But its really worse than all that. Because when you take a deposit at term and reloan it as slightly higher interest and a slightly shorter term you are only brokering the value of these resources voluntarily. You couldn’t commandeer that value until someone came up with some goods of real value.

    But when you and other banks cook up a scam allowing you to make a ponzi-loan you are commandeering the value INVOLUNTARILY. Nobody handed that value over to you voluntarily. So it would be a racket even if it didn’t cock up price signals and capital allocation decisions. It would be inherently immoral even if it didn’t leave people in the lurch and ruin their lives.

    “There is plenty of scope within a gold standard to accomodate a declining demand for currency. In fact a gold standard entails a large degree of automaticity in dealing with this issue.”

    No what it is is this. The gold standard, once phase-in-issues are sorted, allows a great deal of flexibility in dealing with wider economic problems. But immediately you start allowing people to sell, exchange and pass around over the computers the ownership of not REAL GOLD but only make-believe gold, you are throwing the price signals into reverse. You are getting people to mine too little when they ought to be mining more. To lend too much when they ought to be lending less. To reduce their cash balances when they ought to be increasing them. You’ve just gone and thrown all the workings of the machine against itself. And when reality hits and there are gold shortages then the problems with allowing this fraud to become ubiquitous become painfully felt.

    So what is the justification for allowing this fraud?

    Reynolds is totally crooked. He now reckons that if I go to a broker and buy some shares its OK for the broker to put on the pretense that he’s helped me buy the shares. So long as he can keep the pretense going. Or not even then, but so long as he fulfills some arbitrary regulation to do with delivery.

    But then this appears to be Cambrias point of view as well. In thinking that this fraud is OK they are claiming that its OK to undermine all the pricing functions that a stock-market has and to ruin its capital-raising and pricing mechanisms.

    So its only lunatics talking. Lunatics who have come out of a group of proven failures who cocked things up spectacularly. And the best thing is to try and justify this nutty position on your own somehow if you choose to back nutty positions out of some sort of religious commitment.

    Comment by Graeme Bird | October 22, 2008

  79. Graeme,

    Please tell me all about the differences between insurers now and in the 1950s, which you claim to know so much about.

  80. No lying by omission Graeme. Explain the differences.

  81. I didn’t claim to know anything about insurers in the 1950’s. I claimed that you didn’t know anything about them. I knew this because last time you brought up this alleged putdown of Rothbard I asked you about it and you did a runner. Then you come back after a time and bring it up again.

    The institutional arrangement which would allow Rothbard to include some figure as MONEY would be if people were able to cash out of their insurance easily and without much of a penalty. I wouldn’t include it as cash in that circumstance. But its not incredible to think that we might look at that as quite a liquid asset if those were the circumstances of the time.

    Life Assurance (death insurance) was a fairly new product for a large portion of the population at the time. And it might be that they had very easy cash-out terms. Its just irrelevant. But you keep on bringing it up. The Austrians do not include this in their “True Money Supply” compilation these days.

  82. So supposing you are accumulating a great deal of diesel in your account. Lots and lots of diesel.
    .
    Alright. I usually get paid in money Graeme not fuel. I don;t drive, I’ve never bought fuel. Isn’t our society a little too complex for barter?
    .
    This is my problem: Bank, Me – right? I put, say, $100 in the bank. The bank lends it out. They lent it out so they don’t have it anymore. Someone’s borrowed it to buy diesel fuel. Now if I go back to the bank they won’t have my money. They’ll have someone else’s. If we all want our money the bank has to pay it from somewhere else.
    .
    Now if they have to back up our dollars with their’s why would they bother keeping ours. After all if they need to back up our dollars, they need to have a dollar for each one I deposit. They need to keep it in the vault right? If it’s in the vault it ain’t doing anything ‘cept losing value. So why would they do it?
    .
    Please simple real-life answers. I’m a stupid leftist remember.

  83. Well we have more than 100 currencies now. I’m thinking we could get by on six? eight?

    I think its important to have at least one which is to do with imbedded energy.
    >>>>>>>>>>>>>>>>>>>>>>>

    If we were running it with diesel 100% backing as one of the commodities, they cannot lend it out until its a term loan. In this case suppose if the diesel price went up like earlier this year. Now the gas station can come to the bank and get his supplies for free. Since he thinks the price will come down. But he must pay principle and interest IN TERMS OF DIESEL on the free diesel to his business. Like he saves on gold and silver, opens up a free source of supply when he can get a good price in terms of gold and silver. And then when the high price subsides he can pay the bank back in terms of diesel far more easily when diesel is easier to come by.

    In terms of people who have a lot of cash for holding in terms of diesel they are encouraged to use diesel for spending while the price is unnaturally high……. to sell their diesel outright……. or to lend it at high interest.

    All three of these are balancing the market out and smoothing out the short-run prices.

  84. Thanks. Much clearer now.

  85. Thanks for sharing the Max Keiser links, Graeme.
    He does a top notch job of explaining insider trading in a systematic manner. I’ll need to watch more of vids to see where he’s really coming from.
    Some questions: Is setting up regulation in the share market to stop it collapsing on it’s self against ‘free market’ ideals? What system of regulation would work the best you reckon?
    Also, with libertarians accepting welfare/benifits, would it be fair to justify it on the grounds that it is merely a process of reclaiming money they paid in tax? Or is that a cop out?

  86. Clinton. I’ve said a lot about this over at ozrisk. Its really just about clarifying property rights. But since our blokes have been corrupted in their attitude, and are looking lawyer-like for loopholes to continue the pyramiding you have to civilize them. Preferably by letting them go bankrupt first up.

    But I’ve been subjected to the thread of doom by financial market insiders so many times that its pretty clear that they are coming from the point of view of contempt for the rest of us. So you have to stop them from even THINKING ABOUT pyramiding. This is one case where passive libertarian piety means total defeat. Its not that any rules that are wanted are anything but clarification of property rights and heading off fraud. Its just that one might have to double up since Edney and others will be looking to put a wedge in some how. The bankers will be summoning their lawyers, ruining threads, telling lies, and in the States hiring hitmen no doubt.

    So check out the discussion at ozrisk and see what you think. Notice the two bankers attempting to wedge the potential for pyramiding open and using libertarian values to do so. They simply have to be brought to heel.

    http://ozrisk.net/2008/10/03/market-problems-regulatory-causes/#comment-26568

    Like there used to be a sign in the US which went like this “Don’t even THINK about parking here”. You have to cut off even the slightest leeway. Which wouldn’t be necessary if the history wasn’t there. You see its a form of fraud sure. But its an ENDEMIC form of fraud that starts pretty small and innocently enough. Yet you simply cannot allow it to even get started since it causes immense damage to the whole structure of pricing and information in capitalism, and since once it gets started its so horrifyingly difficult to unwind.

  87. “So you have to stop them from even THINKING ABOUT pyramiding.”

    I thought you loved pyramids bird?

  88. What made you think that? Is this like the argument of Lisa Simpsons friends ” Lisa’s going to marry a cabbage” Thats about the level of argument we are getting from the banking reps here.

  89. “Thanks for sharing the Max Keiser links, Graeme.
    He does a top notch job of explaining insider trading in a systematic manner. I’ll need to watch more of vids to see where he’s really coming from.”

    Beware of the anti-halo effect. Since no-one else would run his excellent little documentaries the task fell to Al Jazeera. And its inevitable that one winds up working ones audience as it were.

  90. If you had everything else sorted than insider trading wouldn’t be such a bad thing. In fact it would be extra information given to the market for yet better pricing and capital allocation. But under current conditions it comes across as being just one more rort.

  91. Think it was a carrot rather a cabbage, but none the less those arguments are mighty frustrating.

    “And its inevitable that one winds up working ones audience as it were.”
    Kinda like that TISM song, You’re Only as Good as Your Fans.
    Can’t see insider trading being of any benifit unless they are exposed to the risk of loses as the public are.

  92. Something odd is happening half my comments are disappearing. Are you censoring me you commie?

    Anyway do you think this is evidence that Explodians made it to earth.
    http://www.smh.com.au/news/news/is-this-the-human-face-of-mt-cook/2008/10/24/1224351501942.html

  93. Edney. You can say what you like. But I’m not going to let you and Mark just come on here and tell lies and use the thread-of-doom technique to confuse people. When you have a valid argument to make go right ahead. Of course you DON’T have a valid argument to make but do your best anyway.

    What you and Mark have been doing lately is just graffiti. And I get sick of Mark being a lunatic and claiming that speculators, in theory, aren’t supposed to smooth out short-term price fluctuations. I mean there is human freedom of course. But there is no economic reason for there to be speculation BUT TO smooth out short-term price fluctuations.

  94. Are you sure Max Keiser doesn’t have a point about Building 7? I think there is a case for further investigation at the very least, even if nothing comes out of it.

  95. A stockbroker I used to talk to on tigerdroppings said about building 7. He said it was the strangest thing. That it just fell so long after the attack. And they just watched it fall.

    He was Randian-Republican rather than Hoppian a pox on all your houses. He was not a conspiracy guy. No I’m not sure about anything any more. I was a conspirationist as a teenager then spent two decades viciously ridiculing any talk of conspiracy like some sort of mad William F Buckley goon gone fucking wild. I’m not exactly proud of my behaviour.

    I cannot vouch for anything now in America.

    America is likely like some sort of high-tech Pakistan. One wing doesn’t know what the other wing is up to. And this is something we might have to get used to and comforting stories implying there was never a conspiracy ever are not part of us getting along and finding our way.

  96. Well, I think all possibilities are on the table. A gang of criminals that just stole trillions of dollars from the American people is capable of anything. I’d like the authorities to at least an ATTEMPT to show how Building 7 collapsed suddenly, due to a couple of fires around the 9th floor.

  97. From where I sit at least, its all on the table. But people who are fast on their feet can throw in a maguffin that has nothing to do with the original crime that they are surfing off. So we need not attribute all the same crimes to the one mystery faction.

    But let us speak of better things. I have been looking through the various recordings of the song “Guantanamere” The one word seems to take 5 words to translate it into English. Loosely speaking: “The Babes Of Guantanimo Bay.”

    How this poor fellow ever managed to hold his own with Nana Mouskouri is anyones guess. But didn’t he do a good job? And look at the host? Doesn’t know what the fuck is going on. Just sitting there like some male model stunned by history in the making.

    http://au.youtube.com/watch?v=W96IPJd9rGY&feature=related

    A friend of mine was talking about the idea of torture in the prisons on the bay and I said I didn’t know about it. But I pointed out that in World War I torture wasn’t a substantial part of strategy or practice. I pointed out that there was not the FELT-NEED for torture on account of the strategy that we went for the jugular and never did loosen our hold so much as to get a better grip. And I must say he agreed with me.

    Let the family Saud and the clerics of Iran be in peace for now. But when the time comes again let us never let indirect measures get between us and the life of Tom Bombadil, a man of substantial powers who yet decides to spend his time gathering lillies for his Elvin lady and why not. Let indirect measures not distract us even from the appreciation of the young girls of Guantanimo bay. Nor yet even the prospect of listening to Nana Mouskouri. The better polis is inward-looking. And not something that any, but the most rash, would distract from its focus on the good life.

    Once it is known whose death it will take, to secure the peace of a sovereign territories choosing, then there will be no time for prisoners and no need for torture.

    Except for the torture of high leadership, and hopefully when their feet are twitching at the end of a rope.

  98. That’s true – it’s a logical fallacy to say A committed crime B, therefore all crimes can be attributed to A.

  99. World War I and World War II are good analogies in the sense that we fought to win, and didn’t need to use some of the dishonourable tactics that are used now. Since then, it’s all been no-win wars – such as the fade-out in Korea, where we had the Reds by the throat and then somehow let them fight to a draw, and the disaster in Vietnam where all pretenses to having an objective were cast aside – deliberate, non-declared, half-fought, drawn-out, inconclusive shemozzles. Now, they are losing in Afghanistan (again, because they refused to defeat the Taliban) while torturing goat-herders in Guantanamo.

  100. Korea was extraordinary. Since the Taiwanese were willing to operate on the mainland and yet the American navy was actively keeping them from doing so, keeping the two navies apart, and this while Americans were dying in the field. The Americans could have destroyed the Chinese ships or at least helped the Taiwanese. Hence Washington policy appeared to be pro-Chinese if you dug a little bit deeper.

    The whole thing had started because the Americans had refused to sell the heavy weaponry that the South needed to go to war against the North. Which meant there was insufficient deterrence. Washington acting like the worst thing in the world would be for an ally to start beating up on communists. And right from the start there were restrictions in fighting on enemy territory, which means of course you are fighting on your allies territory, which means of course that the pain is being absorbed by your friends. Since the North Koreans were being aided by the Chinese and Russians the idea would have been to push the fighting onto Chinese territory if you wanted to have any hope of winning the thing. Also they could have gotten people in Tibet to fight much more then they did.

    So they purposely fought not to win. When MacCarthur tried to communicate the craziness of it all in Washington he was sacked. And they still speak about it as if it were a great day for democracy. Its locked in now that Generals cannot speak to Republicans about craziness in policy. The cliche that came out of the war as to why Truman policy was so idiotic is that the fighting was meant to prevent and not start World War III, But the failure to fight to win only lead to Vietnam, since Mao found himself cocooned in a protective aura, where he knew that Washington would never go after the leadership. So there was always nothing to loose and everything to gain.


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