The great fueling of the US economy by Greenspan, Bush, and that external event called China
(Random thoughts about the storyline leading to today’s recession.)
I’m trying to analyze the events that led to our current economic recession.
When the tech bubble burst, both the fiscal policy side and the monetary side reacted very quickly and very sharply. The results, it seemed, were immediately palpable. Growth was sustained thanks in large part to the absence of inflation. The authorities took credit for their actions, but a larger effect on the rapid recovery came from one external factor of growing and gathering impact: China. The effect that China had on the world was known, but it wasn’t reflected through policy. Indeed, China provided a steady contribution to the US from the 1990’s onward. More pointedly, China was responsible for sweeping the US back onto it’s feet, providing cheap products to it’s consumers in return for business opportunities and a resurgence in certain sectors (notably mining, engineering).
Now these over laxive economic measures spurred and sustained consumer spending and the price of property. What went wrong with the american consumer? First, a housing bubble: price of property was ahead of itself. But this wasn’t quite as bad as some people thought: Prices of property have slowed and receded in the past years but not nearly as much as in 1992 (?). What went wrong had to do with the margin of error that buyers kept in financing their dream house. Interest rates were very low for too long. Savings levels were low throughout that period. Prices of bonds were out of wack with the normal healthy signs of an economy.
The overly
optimistic house buyer was sustained and made more dangerous with the diffusion
of debt through new financial products. In my opinion, the fault here is that risk was made an object of speculation. No matter how rational,
educated, mathematicised the decisions on creating and then trading these risk assets, the fact that now many
investors traded small parts of a huge debt that is ultimatelly redeemable only
at one major bank or another, where the investor does not have the liability of
the debt as a whole, but only for his share. This is a failure of markets. The
market ran ragged, untamed by his master.
There was one alarming stat that got mentioned but maybe should have been acting upon: savings rate. America was fuelled by it's consumer spending spending spending.
Artificially created systems of enough complexity can have unintended consequences, and the global economic system is one of the most interesting living, artificially made system to study.
Now as soon as something else came up (rising gas prices, thanks in large part to China and to structural effects in the petrol industry), or for that matter, any other thing that happened, the house buyer with no savings couldn’t keep up. Sub prime loans started to bust, affecting their lenders and the trail of debt sharers financing them. Defaults on those were then so great that it brought housing companies to their knees, and then big banks. A credit shortage in that sector created shortage for all other sectors and now liquidity is sparse and problematic everwhere. Now we are seeing falling numbers in corporate investments.
Take the following sketch.
Peaceful nations will only be succesful if other nations are peaceful. Cooperation is possible in peace. Warring nations however, by breaking the circle of confidence, can take undue advantage of other peaceful nations, as covered in games theory.
By acknowledging that any ethical theory is accessory to these types of such game theoretic political relations, we can avoid the pitfalls of idealism, such as political liberalism.
Now, you might say that it is pretty weak to justify a political personality based on the dubious application of a theory about rational choices. Well, game theoretic choices are an appropriate description of countless of choices that humans make on different levels – from the real life interrogation rooms to the strategic nuclear actions nations make. Caution! Realism is certainly not a theory of behavoir. Countless other factors affect the behavior of an individual, or a nation – sometimes contrary to rationality, or sometimes just irrelevant to whatever realism says, which is just another piece of intellectual artefact. No, Realism is an ethical choice, it is a guide to action, but it is also rooted in the belief that the adoption of its principle will advance a unit in a competitive environment. (Competitive means scarcity of different sources and endangerement to reproduction.) So in a way, there is a prediction made about the bahavior of something: the prediction is made about a population, about those who will reproduce – ie those who will exhibit the correct or optimal game theoretic answer, either by choice or by accident.
2) The nature of ethics
Ok, suppose that you still reject this argument. Then I have another one that is independent of rational choice theories. This has to do with a critique of our ethical reason, a la Kant – except I do NOT come up with the same results. His results are manifestedly wrong when you look at his treatment of lying. Out ethical sense is not rooted into anything transcendantal. You can find the error in Kant in just 2-3 paragraphs, where he commits an illegal operation. To illustrate, he first starts to question and doubt the common ethical sense and then asks where can its source be? The problem is that he asks the question only rhetorically, only as a litterary or oratory face front for his answer which he already has. This was the common method of writing and arguing in the 17th 18th c. I guess and his results suffered accordingly. The answer is that there is no answer to the question of source in ethics. If there were, ethics would be a science, which it is not. I mean we can make a science about ethics – which is kinda what I’m doing here, trying to describe the beast, but ethical choices cannot be justified by natural laws. Natural laws can inform the ethical choice – and indeed, perhaps we could push it and try to say that science is servile to our ethical sense, which would be appropriately pragmatic, but ethical guidelines cannot be elevated to the rank of natural law – ever. The two discourses are anti-thetical, and many a mistake was commited when the boundaries were trespassed.
(…)
It seems anywhere I meet a South African, he has a story to tell me about his country. This story invariably tells of how unfairly his country was treated and how his country eventually came to die (more precisely the regime). The white community of the south african nations (Zimbabwe and all) are on a sort of diaspora, having lost their homeland/regime/government/political unity.
I was reminded yesterday by an SA expat how Rodesia was supported by american troops against the black insurgency while at the same time the same US and others were villifying SA for its treatment of its black population and pushing an international agenda against them.
Or there is the following piece sent to me by an old budy from the army that illustrates the problem in greater depth.
the incompatibility of idealistic theories and intents with the actual political actions.
Quite simply, it is worth pointing that both sides in a conflict believe to be on the good side. Neither the palestinians nor the israelis commit evil, by their own say. Yet, both sees the other's actions and, perhaps especially, their intentions as less than good.
I think that world memes - memes that reach a scale such that they become universal and undisputed can be false or erroneous, or more precisely, less fit i.e. pathological.
[Diversion into world memes or their utility as a concept]
World memes don't really exist - I'm not sure if they are a good idea yet. But if they do exist, they are more procedure than word. Picture yourself culture as an organism wherein humans are just the substrate of its expression. Then culture has ways of processing information and creating a perception of the world around it, much like the description of vision or other senses in the psychology of perception.
Let's give examples.
In the discipline of history, it is fashionable in some circles to see the intellectual baggage of a community as evolving through time and becoming incompatible with itself over points in time. Great events like the French revolution in european cultures change mentalities, view of the worlds, and relations between individuals, groups and nations. Notably, what is ethicaly palatable to one community in history will not be for another community at a different location in space or time. (Witness, for example, the (appropriate) justification for the burning of the eyes of the King by so and so in 11ish century Eastern Roman Empire (covered somewhere else in this blog a long time ago)).
Now these functional abstract configuration of procedural memes (paradigms?) form our view of the world. This view, to it's beholder, will always be the correct version of the world. But he is usually if not undeniably always heavily invested and commited to it. As everybody knows, questions of ideolody commonly lead to conflict and killings. Yet they are unevitable - they are (necessary) constitutive laws of who we are as a machine and our need to represent and direct our actions.
[End of diversion]
Mandela: The legend and the Legacy Part 1
his two part article appeared on the blog of Sarah
Sarah is an Englishwoman endowed with an incisive and razor-sharp understanding
of South Africa 's recent history. Unlike so many millions of brain-washed
lemmings in the UK , she sees right through the media-contrived smoke &
mirrors, lies and myths as propounded by the MSM.
By Sarah, Maid of Albion
It is often said that one man's terrorist is another man's freedom
fighter, however, this usually means that the other man has been less than
fastidious in his choice of hero, or that the 'freedom fighter' in
question was on the crowd pleasing side.
On the 27th of June, London's Hyde Park will play host to a concert in
honour of Nelson Mandela's 90th birthday and we can be assured that it will
receive wall to wall coverage by a star struck and worshipping media, who will
continue to laud Mandela as one of the greatest, or indeed the greatest, heroes
of our time.
No doubt the beaming old man will appear on stage in one of his trademark
multi-coloured shirts and cheerily acknowledge the cheers of the adoring crowd,
most of whom have been taught to believe in his sainthood since their first days
in primary school, which, for many of them, will have occurred around the same
time their hero walked free from Robben Island.
The unquestioning belief in Mandela's universally admired saintliness will
again be displayed in the press and by the unending line of politicians and
dignitaries who will queue up to genuflect before him and sing his praises. It
is a brave politician or journalist who would dare to question the godliness of
this legend and consummate showman, and hence no such questions will be raised,
nor will his much vaunted 'achievements' be subjected to any objective
scrutiny.
No matter how many speeches are given or how many news articles are written, it
is safe to bet that the full truth about Mandela will not be told.
In fact the truth about Mandela is so hidden in mythology and misinformation
that most know nothing about him prior to Robben island, and those who do tend
to exercise a form of self censorship, designed to bolster the myth whilst
consigning uncomfortable facts into the mists of history.
For most people all they know about Mandela, prior to his release in 1990, was
that he had spent 27 years in prison and was considered by many on the left at
the time (and almost everyone now) to be a political prisoner. However, Mandela
was no Aung San Suu Kyi, he was not an innocent, democratically elected leader,
imprisoned by an authoritarian government.
Mandela was the terrorist leader of a violent terrorist organisation, the ANC
(African National Congress) which was responsible for many thousands of, mostly
black, deaths. The ANC's blood spattered history is frequently ignored, but
reminders occasionally pop up in the most embarrassing places, indeed as
recently as this month the names of Nelson Mandela and most of the ANC remained
on the US government's terrorist watch list along with al-Qaeda, Hezbollah
and the Tamil Tigers. Of course the forces of political correctness are rushing
to amend that embarrassing reminder from the past. However, Mandela's name
was not on that list by mistake, he was there because of his Murderous past.
Before I am accused of calumny, it should be noted that Mandela does not seek
to hide his past, in his autobiography 'the long walk to Freedom' he
casually admits 'signing off' the 1983 Church Street bombing carried out
by the ANC and killing 19 innocent people whilst injuring another 200.
It is true that Mandela approved that massacre and other ANC killings from his
prison cell, and there is no evidence that he personally killed anyone but the
same could be said about Stalin or Hitler, and the violent history of the ANC,
the organisation he led is not in question.
According to the Human Rights Commission it is estimated that during the
Apartheid period some 21,000 people were killed, however both the UN Crimes
against Humanity commission and South Africa's own Truth and Reconciliation
Commission are in agreement that in those 43 years the South African Security
forces killed a total of 518 people. The rest, (some 92%) were accounted for by
Africans killing Africans, many by means of the notorious and gruesome practice
of necklacing whereby a car tyre full of petrol is placed around a victim's
neck and set alight. This particularly cruel form of execution was frequently
carried out at the behest of the ANC with the enthusiastic support of
Mandela's demonic wife Winnie.
The brutal reappearance of the deadly necklace in recent weeks is something I
shall reluctantly focus upon later.
Given that so much blood was on the hands of his party, and, as such, the newly
appointed government, some may conclude that those who praised Mandela's
mercy and forgiveness, when the Truth and Reconciliation tribunal set up after
he came to power, to look into the Apartheid years, did not include a provision
for sanctions, were being deliberately naive.
Such nativity is not uncommon when it comes to the adoring reporting of Nelson
Mandela, and neither is the great leader himself rarely shy of playing up his
image of fatherly elder statesman and multi-purpose paragon. However, in truth,
the ANC's conscious decision to reject a policy of non-violence, such as
that chosen by Gandhi, in their struggle against the white government, had left
them, and by extension, their leader, with at least as much blood on their hands
as their one time oppressors, and this fact alone prevented them from enacting
the revenge which might otherwise have been the case..
As the first post Apartheid president of South Africa it would, be unfair if
not ludicrous to judge Mandela entirely on the basis of events before he came to
power, and in any event there is many a respected world leader or influential
statesman with a blood stained past so in the next part I shall examine Nelson
Mandela's achievements, and the events which have occurred in South Africa
in the 14 short years since he took power in following the post Apartheid
election in 1994.
Mandela - The Legend and the Legacy Part 2
By Sarah, Maid of Albion
In the second of two articles examining the life of Nelson Mandela, in advance
of Friday's concert in Hyde Park celebrating the living legend's 90th
birthday, I shall look at his legacy and the new South Africa which he created
after coming to power on a surge of worldwide optimism and hope in 1994, when,
following the end of Apartheid, he and his followers promised a new dawn for
what became termed the Rainbow Nation.
Today South Africa stands out as one of the most dangerous and crime ridden
nations on Earth which is not actively at War. In 2001, only seven years after
the end of Apartheid, whilst the city of Amsterdam in the Netherlands with 5,6
murders per 100,000 population was declared the 'murder capitol of
Europe', Johannesburg, with 61.2 murders per 100,00 population and remains
the world's top murder city.
In South Africa as a whole, the murder rate is seven times that of America, in
terms of rape the rate is ten times as high and includes the ugly phenomenon of
child rape, one of the few activities in which South Africa is now a world
leader. If you don't believe me, you can read what Oprah Winfrey has to say
about it here.
All other forms of violent crime are out of control, and Johannesburg is among
the top world cities for muggings and violent assault, a fact seldom mentioned
in connection with the 2010 World Cup which is scheduled to be hosted in South
Africa .
As always with black violence the primary victims are their fellow blacks,
however, the rape, murder and violent assault of whites is a daily event, and
there is more .....
As with the Matabeleland massacres, news of which the BBC, together with much
of the world media suppressed for twenty years to protect their one time hero,
Zimbabwe's Robert Mugabe, another secret genocide is being ignored by the
world media, the genocide of white Boer farmers, thousands of whom have been
horribly tortured to death in their homes since the end of Apartheid. Anyone who
clicks on this link should we warned that it includes some very gruesome images
as the savagery of these attacks belie the authorities attempts to dismiss them
as nothing more than a 'crime wave'.
Given that it is now all but illegal in South Africa to report the race of
either victim or the perpetrator of a crime (unless the perpetrator is white and
the victim black) and as modern South Africa's official crime statistics are
notoriously massaged, it is impossible to know the exact numbers of farm murders
that have taken place. Many reliable sources estimate the figure as close to
3,000, but even if we take the more conservative figure of 1,600 quoted in the
politically correct South African press (but not quoted at all in ours) this is
three times the numbers killed by the South African security forces over a
period of 43 years, and which the UN calls a crime against humanity.
To put this in perspective, the population of South Africa is 47 million, (13
million less than Britain despite its far greater land mass) of which the 4.3
million whites account for 9.1%, about 1% less than the immigrant population of
Britain . Can you imagine the outcry if 1,600 (let alone
3,000) members of a minority community in Britain were tortured to death by the
native population?.
Yet when the victims are white, there is hardly a peep in the South African
press and silence from the international media. Compare this to when a white
youth is the killer, such as in the case of Johan Nel, who shot three Africans,
a story which became instant world wide news with the predictable screams of
racism and machete wielding mobs baying for his blood.
(And they accuse us of hate?!! Don't such people nauseate themselves with
their hypocrisy?!)
Crime aside, Mandela and his ANC inherited the strongest economy in Africa,
indeed, despite economic sanctions, South Africa was still one of the richest
world nations, and indeed initially there was a brief post Apartheid boom,
resulting from the lifting of sanctions and due to the fact that until
affirmative action forced most of the whites out of their jobs to be replaced by
under qualified blacks, those who had built South Africa were still in place.
However, any optimism was to be short lived. Now, after just 14 years of rule
by Mandela and his grim successor Mbeki, corruption is rife, the country is
beset with power cuts and the infrastructure is crumbling.
The nation's great cities like Durban and Johannesburg, which could once
rival the likes of Sydney, Vancouver andSan Francisco, had descended in to
decaying crime ridden slums within a decade.
And in the last few weeks we have seen the so called Rainbow nations ultimate
humiliation, as xenophobic anti immigration violence spreads across the country.
('xenophobic' is what the media call racism when blacks do it) As
poverty and unemployment explodes and is exacerbated by the floods of immigrants
flooding in to escape the even more advanced Africanisation of the rest of the
continent, the mobs turn on those they blame for stealing their jobs, their
homes, and their women.
Thus the cycle turns, and, like watching some barbaric version of 'back to
the future', on the news we see exactly the same scenes we saw on our
televisions twenty years ago, wrecked buildings, burning vehicles, mobs
brandishing machetes, axes and knives hacking at everything and everyone which
comes within their reach. Most horrific of all, we see the return of that most
savage symbol of African brutality, the necklace where, to the cheers of a blood
thirsty crowd, some poor trembling soul, with a tire around his neck, is dragged
from his home and set alight, exactly as all those other poor souls were set
alight throughout the Apartheid years, when we were told it was all the evil
white man's fault.
As nothing else the return of the necklace exposes the failure of Mandela's
revolution, and those who fought for him should weep.
Under Apartheid, blacks and whites went to separate hospitals but they received
world class health care, whatever their colour, now the facilities are
collapsing or non-existent. Black children went to different schools than white
children, but they received an education, something which is now a privileged
luxury. When they grew up, their bosses may have been white, but they had jobs
and a living wage, as the recent violence shows us, such security is but a
memory for most South Africans.
Eighteen years after Nelson and Winnie made their historic walk towards the
cameras, and 14 years, since Mandela assumed power on a tide of optimism, a once
proud South Africa slides like a crumbling, crime ridden, wreck towards a
precipice created through greed, corruption and incompetence.
For all his gleaming smiles, grandfatherly hand gestures, and folksy sound
bites, tomorrow night, when crowd cheers the retired terrorist in the gaudy
shirt, they would do best not to focus too closely upon his much admired legacy,
as they might just find that the Xhosan Emperor has no clothes. For Nelson
Mandela's lasting achievement is that, in the face of a world wishing him
well, he, and the party he leads, have shown the world that, for all its flaws,
Apartheid was a more benign system than what replaced it, and that the average
South African was immeasurably better off under the hated white rule than they
are under the alternative which black rule has created.
