meanwhile, back in reality (bank crisis round 2) - Page 2 - Tilted Forum Project Discussion Community

Cynthetiq · 09-16-2008, 09:05 AM

I believe it's the re-edit including the NYPost photo, in other words, the post went from discussion to trollish humor, in one simple edit.

Baraka_Guru · 09-16-2008, 09:10 AM

With all due respect to the reasonable criticisms of neoliberalism, this issue shouldn't have come as a surprise, but it always does.

Herd mentality and short-term memories tend to mislead people into thinking that things could always and should always improve. This sort of market movement could have very well been predicted, and some have done so. The S&P has operated at a net loss since 2000 and the Dow Jones has returned to a level it hit in 1999 and again in 2000, 2001, and 2006—and both had a good climb between 2006 and the end of 2007. Those who have this whole time expected (or at least prepared for) such things as this week's events call these past ten years a secular bear cycle.

Individual investors should get to know what this means so they can protect themselves (eg, sometimes holding a lot of cash is better than having everything in the market).

The government, Wall Street, and others more directly involved should stop being so greedy or power-hungry and understand these issues as well. A relatively unregulated economy is ludicrous when you know how the machine works. Do you know of any other elaborate machinery that has no mechanics, no operators, no "reconfigurators"?

Neoliberalism is a travesty of economic theory and practices.

loquitur · 09-16-2008, 09:26 AM

actually, RB, I'd say liberalism (in the classical sense) produced capitalism. It's not the only possible outcome of a liberal order but it is the one that historically has resulted from real life application of liberal principles. The two aren't synonymous - I agree with you there - but they do tend to go hand in hand. I don't know what "neo" adds to the equation.

As for Keynes....... been there, done that, got the bumper sticker. Remember "stagflation"? That was brought to you by John Maynard. Not intentionally, of course. But that's pretty much the logical outcome of excessively empowering planners. There are always other agendas to be served, and that leads to unintended consequences.

Go ahead, call me neoliberal. I can take it. Heck, call me neoconservative, too. It makes just as much sense.

roachboy · 09-16-2008, 09:37 AM

it's funny, loquitor, reading the press accounts of this farce and noticing the rhetoric, which is about storms and about schumpeter and about anything and everything that preserves a sense of continuity---which is in a sense about avoiding material and ideological problems by pushing them into some imaginary continuum that extends into a future just the same as the past.

neoliberalism is in serious serious trouble---but because it is the dominant ideology, and because the press speaks largely through that ideology in part because it is responsible for its dissemination and in part because in the states---and ***nowhere*** else, neoliberalism is a lingua franca on matters pertaining to the economy. that is what being a dominant ideology entails. the problem that ideological crisis generates is that it undercuts the frame of reference that shapes how this information is organized. in the soft authoritarian political context that is the american, this is an obstacle to being able to articulate the collapse of the ideology. it's a circle, and not an interesting one. intellectual monocultures run into it alot. neoliberalism is to this soft-authoritarian context what dialectical materialism was to stalinism. hard to articulate problems for the frame itself when the frame is understood as necessary.

that'll pass, i expect.
but implosion of neoliberalism probably wont pass, though.
you'll just have to figure out a different set of fables to believe in, sooner or later.

neo- generally implies redux but with alterations. i didn't make the term up.

Cynthetiq · 09-16-2008, 10:35 AM

this is an interesting interactvie graphic

A Year of Heavy Losses - Interactive Graphic - NYTimes.com

jorgelito · 09-16-2008, 02:53 PM

Quote:

Originally Posted by roachboy

it's funny, loquitor, reading the press accounts of this farce and noticing the rhetoric, which is about storms and about schumpeter and about anything and everything that preserves a sense of continuity---which is in a sense about avoiding material and ideological problems by pushing them into some imaginary continuum that extends into a future just the same as the past.

neoliberalism is in serious serious trouble---but because it is the dominant ideology, and because the press speaks largely through that ideology in part because it is responsible for its dissemination and in part because in the states---and ***nowhere*** else, neoliberalism is a lingua franca on matters pertaining to the economy. that is what being a dominant ideology entails. the problem that ideological crisis generates is that it undercuts the frame of reference that shapes how this information is organized. in the soft authoritarian political context that is the american, this is an obstacle to being able to articulate the collapse of the ideology. it's a circle, and not an interesting one. intellectual monocultures run into it alot. neoliberalism is to this soft-authoritarian context what dialectical materialism was to stalinism. hard to articulate problems for the frame itself when the frame is understood as necessary.

that'll pass, i expect.
but implosion of neoliberalism probably wont pass, though.
you'll just have to figure out a different set of fables to believe in, sooner or later.

neo- generally implies redux but with alterations. i didn't make the term up.

So naturally, if indeed "neo-liberalism", "capitalism" are on its way out, what do you (general you) think will take its place as the next economic system? Do you think it will be a collapse or a gradual change?

For those so opposed to "neo-liberalism", "capitalism" can you elaborate a little bit on why you do so? Is it the theory, practice? Do you like some elements or is it a wholesale dislike? What improvements or alternatives do you think are better or workable?

dc_dux · 09-16-2008, 02:59 PM

Quote:

Originally Posted by jorgelito

For those so opposed to "neo-liberalism", "capitalism" can you elaborate a little bit on why you do so? Is it the theory, practice? Do you like some elements or is it a wholesale dislike? What improvements or alternatives do you think are better or workable?

For me its simple...an unregulated free market leads to the greatest abuses (of workers, the environment, product safety, etc) and the greatest disparities between the "haves and have nots".

A solution....a constitutional amendment...along the lines of "a well regulated" militia....how about a "well regulated" economy?

j/k with the amendment...but de-regulation is not the answer....and it never has been.

roachboy · 09-16-2008, 03:02 PM

jorgelito--neoliberalism is not the same as capitalism in general.
protestant evangelicals who refer to themselves as christians are not the same as christianity in general.
this should be simple.
i don't understand why there's such a problem with this.

we'll see what happens with aig tomorrow....

jorgelito · 09-16-2008, 04:55 PM

Quote:

Originally Posted by dc_dux

For me its simple...an unregulated free market leads to the greatest abuses (of workers, the environment, product safety, etc) and the greatest disparities between the "haves and have nots".

A solution....a constitutional amendment...along the lines of "a well regulated" militia....how about a "well regulated" economy?

j/k with the amendment...but de-regulation is not the answer....and it never has been.

Actually, DC, I think it's a very productive start. However, I would think there needs to be some elaboration on "well-regulated". Do we mean well regulated as in a well done job of regulation, or lots and lots and lots of regulation? That I think is the tar baby here.

I will say as a person who leans towards neoliberalism, capitalism, I don't really have a problem with SOME regulation. I do see TOO MUCH regulation as being strangling and detrimental to business and the overall economy in general.
-----Added 16/9/2008 at 08 : 57 : 36-----

Quote:

Originally Posted by roachboy

jorgelito--neoliberalism is not the same as capitalism in general.
protestant evangelicals who refer to themselves as christians are not the same as christianity in general.
this should be simple.
i don't understand why there's such a problem with this.

we'll see what happens with aig tomorrow....

That's a good analogy Roach, very clear and understandable, thank you.

The problem is because the terms are used loosely and in a variety of ways causing confusion, in a similar manner as your Christian analogy.

So, what do you think of the rest of the post?
-----Added 16/9/2008 at 09 : 08 : 40-----
ADD: Well it looks like the Feds are going to "bail out" AIG with a $85 billion loan.

Charlatan · 09-16-2008, 05:12 PM

I just want to be clear that my own position is not one that calls for an end to capitalism per se. Rather, I want to see an end to the drive towards completely deregulated and laissez-fair capitalism. This particular flavour of capitalism does not sit well with my humanist sensibilities.

For further clarity, I am not looking for an answer in the great bug-a-boo of communism either. To my mind they are at either ends of the economic spectrum from each other and in their orthodoxy are essentially bankrupt.

What I seek... what I always seek... is a balance between the two poles.

History has shown us that both extremes are problematic (to say the least).

ASU2003 · 09-16-2008, 06:39 PM

There are a few things that I would say need regulated. I'll start with international trade.. It's not that it's a bad thing to grow and strengthen foreign markets, and it has stabilized the world. It isn't all bad. But it moved too fast, and it was too lop-sided. Companies wanted , and got, outsourcing of jobs and factories done in 10 years. The foreign countries grew really fast and production of raw supplies didn't. But now we have people who are just living with what they have and not buying anything new, there are plenty of people who can't get work (although it isn't too bad yet), and older people are working longer. The 20-somethings and 30-somethings don't have the money/credit to buy houses because they can't get into jobs that pay enough with the rising prices.

Speculation and short selling are two other things that need to be reigned in. There should be limits on how much any one person can do each year. And there needs to be some type of serious penalty if you foreclose on a house or can't pay back credit card loans. I'm not sure what that penalty should be, but something like 10 years of garnished wages would be good place to start.

The problem is how do you avoid bubbles? The tech bubble was justified at first, but then you had investors throwing money into it as fast as they could because they couldn't lose. The more investors, the higher the stock price. Until enough of them want to cash out, and then all of them panic and sell. Repeat with the housing bubble and the oil bubble. And it will continue into the next hot thing because the money has to go someplace, and whatever seems like a good idea to a bunch of people will catch the attention of more and then the big banks will want in and make a quick buck... And it all repeats.

And the government's deficit spending needs to be regulated as well. But that is another topic.

roachboy · 09-17-2008, 03:45 AM

overnight, it became clear that aig was too big to allow to fail.

Quote:

Federal Reserve rescues AIG
Highly unusual decision effectively nationalises insurer
Paulson insists chief executive steps down

The US government has seized control of the world's biggest insurance company, AIG, in an $85bn (£47bn) emergency rescue to avert a "disorderly" bankruptcy which threatened to wreak havoc with fragile financial markets.

After a marathon day of negotiations in New York, the Federal Reserve reluctantly agreed to lend taxpayers' money on a two-year basis in return for a 79.9% stake in AIG.

The highly unusual decision effectively nationalises AIG by transferring control to the central bank. In a sign of the level of alarm about the weakening financial system, the Bush administration set aside its usual orthodoxy of avoiding intervention in the free market.

In a statement released late last night, the Fed said it had concluded that a "disorderly failure" of AIG could "add to already significant levels of financial market fragility and lead to substantially higher borrowing costs, reduced household wealth and materially weaker economic performance".

AIG employs 106,000 people in 130 countries and sells 12m policies annually in Britain - including travel insurance and product protection under retailers' own brands such as Boots, Argos, Comet and Sainsbury's. It is shirt sponsor to Manchester United football club.

The treasury secretary, Henry Paulson, insisted that AIG's chief executive, Robert Willumstad, stepped down as a condition of the deal. He is to be replaced by Edward Liddy, a former boss of the insurance firm Allstate. AIG's board approved the rescue package at a late-night meeting.

Crippled by losses on policies insuring investors against default on exotic financial products, the firm had less than 48 hours to find sufficient cash to meet a rash of contractual obligations. It has been teetering on the brink of following Lehman Brothers into bankruptcy - a scenario which horrified financial experts who said the reverberations would be felt by policyholders, trading partners and investors around the globe.

President Bush was quick to lend his backing to the bailout. "The President supports the agreement announced this evening by the Federal Reserve," said a White House spokesman, Tony Fratto. "These steps are taken in the interest of promoting stability in financial markets and limiting damage to the broader economy."

The rescue comes a week after a decision to rescue two enormous mortgage companies, Fannie Mae and Freddie Mac. But there are likely to be questions about inconsistency in policy since no government aid was forthcoming to support Lehman Brothers when the Wall Street bank collapsed on Monday.

The Democratic chairman of the Senate banking committee, Christopher Dodd, asked: "Tell me why this situation deserves that kind of infusion of support, whereas Lehman Brothers did not."

The treasury secretary travelled to Washington last night to brief Congressional leaders. Leading Democrats lent their support, although they suggested that laissez-faire government policies had contributed to AIG's predicament.

Barney Frank, the influential chairman of the House financial services committee, told the New York Times: "This is one more affirmation that the lack of regulation has caused serious problems. That the private market screwed itself up and they need the government to come help them unscrew it."

The Fed, which engaged Morgan Stanley for advice, had shopped around unsuccessfully for a private-sector solution to AIG's problems. Leading banks such as Goldman Sachs and Morgan Stanley rebuffed appeals to provide funds, as did the world's richest man, Warren Buffett.

As rumours of a bailout leaked onto trading floors on Tuesday afternoon, a mood of relief swept the market and the Dow Jones industrial average closed up 141 points to 11,059 - clawing back some of the losses made on Monday when the market suffered its sharpest fall since September 2001. The Australian stockmarket, among the few global exchanges to be open when the bailout was confirmed, rose by 1.2%.

The terms of the bailout give sweeping powers to the Fed. The $85bn loan is collateralised by all of AIG's assets and the Fed can veto dividend payouts to the insurer's shareholders. AIG's shares, which had already collapsed by 93% since the beginning of the year, will be left with little value.

Experts said the interconnected nature of financial institutions was becoming increasingly clear - and was causing mounting alarm at the prospect of a major bankruptcy.

"It might not just bring down other financial institutions in the US. It could bring down overseas financial institutions," said Timothy Canova, a professor of international economic law at Chapman University School of Law. "If Lehman Brother's failure could help trigger AIG's going down, who knows who AIG's failure could trigger next."

Federal Reserve rescues insurer AIG with $85bn bailout | Business | guardian.co.uk

aig collapse would have put into serious jeopardy the entire neo-liberal/"globalizing capitalist" financial order, the network of flows that has long outstripped the purview of nation-states. over the past 3 days, somewhere in the area of a trillion dollars has been pumped into this system by the fed and central banks from around the world---the main system of flows, what neoliberalism is really about, autonomous capital flows operating in a spatially segregated virtual region moving independently of any coherent relation to the wider social world, motoring a new concentration of wealth and a radical reconfiguration of the geography of political and socio-economic power---while the social consequences are abandoned to the play of abstract forces---one of the consequences of neo-liberalism---here used to designate an entire ideological configuration--is an extreme extension of one of the main logics you saw fully in place under fordism--the dominant order legitimates itself through service delivery, through the fact of operative flows rather than through the location and effects of them. when the location and effects of these flows generates radicalized social inequality, the problem is talked away as being a function of the "natural" consequences of climates in the second nature of markets---but when flows themselves are seriously endangered, THEN you have a political Problem.

so you see what neoliberal structures look like, what the situation of the nation-state is really in the new order, how irrelevant populist conservative discourse is to the main project neo-liberalism is geared around---so you see the consequences of the collapse of politics onto the fact of activity, onto the fact of flows---so you can piece together the relation between neoliberal social policies in any given space--which is "let em choke, the don't matter"--because functionally, we don't matter---risk reduction, and the focus of neo-liberal attention.

you see a host of reasons why neo-liberalism is cooked, why is must and should be cooked, why some other logic has to be put into place.

ASU2003 · 09-17-2008, 04:23 AM

What I want to know is, "what are the taxpayers going to get for this $85 billion?"

roachboy · 09-17-2008, 04:24 AM

debt.

Baraka_Guru · 09-17-2008, 06:27 AM

The money can come from China, ultimately.

roachboy · 09-17-2008, 06:56 AM

hear that sound?

Quote:

US Treasury recapitalises Fed

By Francesco Guerrera in London, Aline van Duyn in New York and Krishna Guha in Washington

Published: September 16 2008 14:47 | Last updated: September 17 2008 15:36

The US Treasury on Wednesday announced that it was creating a supplemental funding programme to ensure that the Federal Reserve has the cash it needs and its ability to provide emergency liquidity support for the markets is not constrained by the size of its own balance sheet.

The move was intended to deal with fears that the US central bank’s balance sheet was overstretched following the AIG loan announced on Tuesday.

The Fed said on Tuesday it would lend AIG up to $85bn in emergency funds in return for a government stake of 79.9 per cent and effective control of the company – an extraordinary step meant to stave off a collapse of the giant insurer that plays a crucial role in the global financial system.

Under the plan, the latest dramatic intervention by the US government to combat the global credit crisis, the existing management of the company will be replaced and new executives - as yet unnamed - will be appointed. Reports on Wednesday suggested Edward Liddy, the former Allstate chief executive, will replace Robert Willumstad, the chairman bought in to replace ousted chief executive Martin Sullivan last year.

Eric Dinallo, New York Insurance Superintendent, told CNBC on Wednesday morning that AIG’s assets had already attracted strong interest but that the company might need more capital. AIG shares fell heavily in pre-market trade and were trading down 43 per cent at $2.13 shortly after the markets open.

The authorities, which will retain veto power over major decisions at the company, will receive equity giving them a 79.9 per cent stake in AIG. In return, the insurer would receive a bridge loan of $85bn to keep it afloat until it could dispose of billions of dollars in assets. The Fed said the loan was expected to be repaid by the proceeds of selling AIG operating companies. A senior Fed staffer said the most likely outcome was an orderly liquidation of AIG, though it was possible that the firm could survive as an ongoing business.

The loan is at a punitive interest rate of three-month Libor plus 850 basis points, giving AIG a strong incentive to repay it as soon as possible. It will be secured on all AIG’s assets, including those of its subsidiary companies.

The Fed said in a statement it was acting to prevent “a disorderly failure of AIG” which would “add to already significant levels of financial market fragility and lead to substantially higher borrowing costs, reduced household wealth and materially weaker economic performance”.

The issuance of the equity participation note to the government is designed to prevent existing shareholders from profiting from a rescue of the company, which has been hobbled by the losses on complex securities backed by mortgages and other assets.

President George W. Bush said the rescue was “to promote stability in the financial markets”.

The emergency moves came after earlier plans for a private sector bail-out were dashed by a further 21 per cent slump in AIG’s shares, reducing the market capitalisation of one of the biggest insurance companies in the world to just over $7.5bn (£4.2bn).

The AIG crisis fuelled another day of turmoil on global markets on Tuesday sparked by the weekend failure of Lehman Brothers and the rushed takeover of Merrill Lynch by Bank of America. Despite the turbulence, marked by brutal conditions in European money markets, the Federal Reserve kept interest rates unchanged at 2 per cent on Tuesday night.

“We are working closely with the Federal Reserve, the SEC and other regulators to enhance the stability and orderliness of our financial markets and minimise the disruption to our economy,” said Hank Paulson, Treasury secretary. “I support the steps taken by the Federal Reserve tonight to assist AIG in continuing to meet its obligations, mitigate broader disruptions and at the same time protect the taxpayers.”

But even as the plan was being being mapped out, there were already signs of political opposition. “I hope they don’t go down the road of a bailout, because where do you stop?’’ Richard Shelby, top Republican on the Senate Banking Committee, told Bloomberg Television.

Charles Schumer, the New York Democrat who chairs the congressional Joint Economic Committee, said: “The administration is approaching an unprecedented step, but unfortunately we are living in unprecedented times.

”You have to stop to catch your breath. But upon reflection, the alternatives are much worse.’’

During a day of emergency meetings at the New York Fed, the Treasury and Fed reversed initial reluctance to bail out another financial institution.

In March, the Fed helped JPMorgan Chase buy Bear Stearns by providing a $29bn credit line. Earlier This month, the Treasury seized control of troubled US mortgage giants Fannie Mae and Freddie Mac.

But at the weekend the authorities refused to back Lehman Brothers and encouraged Merrill Lynch to sell itself to a rival. Lehman filed for bankruptcy early Monday morning, rocking the financial system, while Merrill announced a $50bn takeover by Bank of America the same day.

AIG’s plans for a private sector capital infusion were dashed by a further slump in its shares on Tuesday after sharp cuts in the insurer’s credit ratings on Monday threatened to fuel a liquidity crisis and push it into bankruptcy.

Tim Geithner, president of the New York Fed, skipped the Fed’s interest-setting meeting to focus on AIG – a sign of the regulators’ heightened state of alert over the insurer’s plight.

Amid increasingly desperate lobbying for government help, David Paterson, New York governor, had said the beleaguered insurer which lost billions of dollars on derivatives and mortgage-backed securities, had “a day” to solve its problems.

AIG’s fight for survival came as Hank Greenberg, AIG’s former chief executive and the company’s biggest shareholder, announced he was considering a bid to take over all or part of the company.

Mr Greenberg has sent a letter to AIG’s board and its chief executive, Robert Willumstad, complaining about its refusal to take up his repeated offers to help the company group he ran for decades.

In a letter published in Wednesday’s Financial Times, Mr Greenberg urged the US government to step in to provide a loan if private lenders could not be found. He said AIG needed a temporary bridge loan in order to prevent further ratings cuts “which would likely prove fatal” and “pose systemic risk to the US and international financial systems”.

Copyright The Financial Times Limited 2008

FT.com / In depth - US Treasury recapitalises Fed

that's the sound of this form of capitalism cracking at it's seams.

here's a .pdf which shows something of a.i.g.'s structure, which helps explain why it was too big to allow to fail:
http://media.ft.com/cms/425ac584-841...0077b07658.pdf
(you may need to subscribe to ft.com to see it)

so what this means, i think, is that the nation-state based mechanisms available to stabilize major perturbations in the trans-national capital-flow stratum of social being (neat-o terminology, yes?) has reached it's limit.
there's been something on the order of 3 TRILLION dollars pumped into the banking system over the past 72 hours. this capital has come from most of the central banks in the metropole.
it was not enough.
the particular ineptness of the bush administration--acting in strict accord with the premises of the neo-liberal ideological substitute for the world---has resulted in a.i.g. costing so much to bail out that the fed is stretched to its absolute limit--and that, folks, means that we were on the brink of the collapse of the state itself as a regulatory mechanism *capable* in principle of managing dysfunctions at the level of these capital flows.

this is still unfolding---what do you make of this new creak in the system soundtrack?

why do you think this is still not THE story in the american media?
i think it is because, in part, the press has adopted neoliberal premises as its collective lingua franca, and that as the world commensurate with this ideology hits a wall of it's own making, description requires that one step outside the discursive frame of neoliberalism itself--you cannot deal with questions about axioms from within a proof that presupposes them--so it follows that you cannot deal with ideological crisis if your own framework presupposes the ideology that;s in crisis.

hear that sound?

Cynthetiq · 09-17-2008, 07:20 AM

so we just created more money out of thin air?

roachboy · 09-17-2008, 07:26 AM

best i can figure, cyn, the money was created from thin air by way of t-bills.
it's a little hard to say because, for example, there's not a whole lots of real estate on the dept of treasury's website devoted to actual life, particularly not when compared to the amount devoted to neo-liberal horseshit about competition, deregulation and their virtues.
but here's a link to press releases, which of course tell you very little:

U.S. Treasury - Press Releases - September 2008

Tully Mars · 09-17-2008, 07:28 AM

Quote:

Originally Posted by Cynthetiq

so we just created more money out of thin air?

Pretty much. But we'll likely borrow the cash.

Watch the dollar drop now.

Cynthetiq · 09-17-2008, 07:28 AM

well at some point in time either the shell game stops or the ponzi gets called, seems like they are still trying to pass it around.

roachboy · 09-17-2008, 07:30 AM

no choice on this one, cyn, it seems.
the scale of this is WAY beyond that...
i'm trawling about for more detailed/updated information...feel free to join me and post what you find. other on the fly analyses welcome too, of course.

this is fucked up. that is the short version.

ratbastid · 09-17-2008, 07:35 AM

Quote:

Originally Posted by Cynthetiq

so we just created more money out of thin air?

Um. What do you think money is?

Our money has been worth the value of the paper and the ink since the gold standard went away. And before that, it was worth the promise of gold, not the actual gold.

Money is a convenient fiction.

Cynthetiq · 09-17-2008, 07:37 AM

yes, i understand the idea of the fiat currency, but when the House in Vegas wants to give out more chips there has to be funds to cover them in some fashion.

Here there isn't anything but the wave of a pen, nod of a conversation, or maybe even just a press of a keyboard.

Tully Mars · 09-17-2008, 07:39 AM

Quote:

Originally Posted by Cynthetiq

well at some point in time either the shell game stops or the ponzi gets called, seems like they are still trying to pass it around.

At some point, it would seem, people (and countries) will stop buying these "bills."

And then what does the US do?

Quote:

WASHINGTON (Reuters) - The U.S. Treasury Department quickly put a new special financing facility to work on Wednesday, raising money for the Federal Reserve to use in a costly bid to rescue crumbling U.S. financial institutions.

Just minutes after unveiling the financing program, Treasury said it would sell $40 billion of cash management bills -- essentially a fresh batch of debt -- on Wednesday at the U.S. central bank's request as part of what a Treasury official called an attempt to "help them better manage their balance sheet."

Treasury selling debt to help Fed | Reuters

roachboy · 09-17-2008, 07:56 AM

what matters is continuity of movement, the continuance of flows, not what flows. the objects that move through these systems are secondary to the fact of their movement. trafficking in debt means that value is a temporal form, not a 1:1 relation--so it's not about objects, not about thinking with or through objects...it's thinking motion, systems that allow it, and relations which are structured in and through that movement. value is a convention--but it's always been convention, nothing more. the value of gold was a convention and the assumption about that convention was that scarcity (or at least limitation) of supply functioned to anchor that convention in something outside itself--but that too was a convention. and what mattered was the movement of these conventional objects--these time-forms, like sounds---through particular systems. when you extract "value" from the systems of circulation, you convert media, but the conversion of media doesn't mean that you move from a system anchored in circulation to something else--you just move from one circulatory system to another.

the entire idea of the old marxian labor theory of value was to anchor value to praxis, acting on nature, transforming nature into usable objects, as a way of making it more "material"----but even there value was located in labor power, in process, and it's object-expression---commodities---was seen as "dead labor"....

i don't know why this is surprising, that the anchors of bourgeois "reality" are basically objectifications of modes of being that are basically motion or pattern within motion (another metaphor that you could plug into the above and run the machinery).

what matters is not the relation to materiality, not the relation between process (which is temporal) to the object-oriented world that we see and live through because we see it---what matters is the equity of modes of allocation, what matters is the distribution of power. in contemporary capitalism, we--you and i---have NO power. we are spectators. this is a form of spectatorship. and it also turns out that the institutions we assumed DID have power do not have it--not really--what has power is the flowing of capital within abstract networks. that rules the world, the world that neoliberalism has enabled.

better to watch tv, i sometimes think.

loquitur · 09-17-2008, 08:38 AM

RB, on that theory, the gold standard is preferable to fiat currency because gold provides an "anchor" to something real. Except that that anchor made it very difficult to react to market shocks, which is why it was abandoned. (In effect we traded some degree of unavoidable inflation for a smoothing of the business cycle - not a bad trade, in my view).

The system isn't cracking. It'll take a few months but things will consolidate and return to normal. Unless we start rescuing every bad business in sight like the Japanese government did - that kept japan in recession for 15 years.

roachboy · 09-17-2008, 08:49 AM

when the nixon administration scrapped bretton woods and instituted floating currency, the idea was to abandon an outmoded break on capital accumulation. it never anchored anything to anything, the gold standard--rather it was a residuum of the inability of folk do deal with value as an effect of circulation, as relational, as based, in the end, on momentum, and so, by extension, no-thing.

the neoliberal order is definitely in trouble. i think the system that has taken shape is at its limit. i don't think that means capitalism will collapse---what it means is that we're entering a period of mutation in the course of which you'll get a little demonstration of what it mean when folk characterize capitalism as an autopoeitic system. changes in environment force adaptation in system logic in order to preserve system identity. neoliberalism is as outmoded as the edsel at this point, but without the lovelt design points that make the edsel still interesting--it's inability to provide either a compelling or robust description of actually existing capitalism is now obvious--that an inadequate description leads to incoherent policy is now also obvious. but this has been true for quite a long time--the only real changes are (a) the material required for becoming-visible within the bizarre little ideological bubble that is the united states are in place because (b) the dysfunctions of the system have reached the metropole. that's it.

that folk invested in precisely the ideology that is being pulverized in real time have trouble seeing what's in front of them is not surprising.
that it is so pervasive in the states is an index of the monocrop culture we live in from the political viewpoint.
it provides an idea of the consequences of soft-authoritarian rule, shows its limits.

so i find it almost funny watching the problems folk are having with getting their heads around what's in front of them.

jorgelito · 09-17-2008, 08:53 AM

Hang on to your seats, WaMu is next.

Baraka_Guru · 09-17-2008, 09:11 AM

Looking at T-bills, apparently 25% are held by foreign governments, which is double what it was in 1988. Is this going to put more of the U.S. public debt in foreign hands?

It seems to me that as time goes on, the U.S. continues to cede an increasing amount of control over its economy to foreign powers via the unabated increasing of public debt.

When will this stop?

roachboy · 09-17-2008, 09:19 AM

interesting, comrade. i was just looking at a blog that talks about this very question. i'll link it here because the original has some useful hotlinked areas. and because, well, it's a blog.

Winter (Economic & Market) Watch Financial Tar Pit Update

Baraka_Guru · 09-17-2008, 09:28 AM

Interesting indeed, roachboy.

I find it disquieting that people aren't more focused on the bigger dangers of this issue. Most people look at the bailout figures and get angry at big business. How soon they forget that such money is absorbed by the banks and the bill for it is being held by someone else, much of it quite possibly in Asia. The more foreign bills being swept up, the more control they have over American economic policy. The threat of dumping (i.e. cashing in) T-bills is enough to get someone's attention, especially when you figure that there's $1 trillion dollars' worth between Japan and China alone.

But here we're talking about foreign banking absorbing U.S. banking. Interesting. I wonder how this will play out globally as things continue to shake up.

Tully Mars · 09-17-2008, 09:49 AM

Quote:

Originally Posted by jorgelito

Hang on to your seats, WaMu is next.

Probably. Then Goldman Sachs and Morgan Stanley. Then?

roachboy · 09-17-2008, 10:02 AM

baraka--well, if things move in a straight line, it looks like the end of the american empire, engineered through idiocy and incompetence by the very people most committed to the idea of american empire.

Baraka_Guru · 09-17-2008, 10:02 AM

Quote:

Originally Posted by Tully Mars

Probably. Then Goldman Sachs and Morgan Stanley. Then?

Then back to your regular scheduled programming....

Quote:

Originally Posted by roachboy

baraka--well, if things move in a straight line, it looks like the end of the american empire, engineered through idiocy and incompetence by the very people most committed to the idea of american empire.

It's one aspect of the kind of environment that adds to my suspicion that a Puritan reformation is on its way in America. It's not as extreme as it sounds, so it's not far-fetched; what it means is that some crisis (or crises) will empower someone who will guide American interests inward in a mode of self-preservation. It might not go as far as isolationism, but it will certainly be a great shift in what we've come to know as American culture and society.

America is going for broke; someone will have to fix it.

flstf · 09-17-2008, 10:19 AM

Much of the wealth in this country seems to be obtained not by hard work and innovation but by political influence and corruption. I don't know what regulations could be put in place to avoid this with the foxes watching the hen house but what we have now is not giving capitalism a chance to work. Of course I guess it is sometimes hard work and innovative to set yourself up to get in on the corrupt action.

roachboy · 09-17-2008, 10:21 AM

well, as an aside---what matters really i suppose is whether things do or do not move in a straight line. by a straight line, i mean a bunch of things, but principal among them is the possibility of another republican administration coming into power and being responsible for dealing with the fallout of this fiasco. that would, i think, mean the end of the american empire. and that will not be pretty. i do not think obama that radical an alternative, but i do think that the international community, such as it is, probably prefers something of a variant of the status quo in terms of geopolitical and economic power simply because they know it and it generally works to their benefit--so obama might well represent a kind of "coming to their senses" on the part of the us internationally and i think that'd generate more room to manoever for the states. either way, the unipolar world of republican fever dreams is self-evidently on fire, with the ruins of neoliberalism helping it burn. because everywhere except in the us, neo-liberalism and the new and improved colonial order they call "globalizing capitalism" and american domination are synonymous more or less--even amongst more friendly political positions, the three operate in tandem. it seems to me that the americans---whom i refer to at a distance because i do not really recognize myself anywhere in a context wherein a nitwit politics like that of the us right can be taken seriously---anyway, the americans have a choice--burn with the outmoded arrangement or put the place in a position to remain a meaningful player in the mutation/reconfiguration---be the geopolitical entity the marginalization of which is amongst the central features of the mutation, or be part of reshaping it, so that the mutation would be something else.
-----Added 17/9/2008 at 03 : 12 : 16-----
an end-of-the-day wrap kinda article from the financial times.
i continue to be struck by the distance which separates the coverage in this paper from anything that has appeared in the states, and i keep thinking about why this is the case and what is going on with it.

anyway, read on.....

Quote:

Credit panic hits historic levels

By Krishna Guha in Washington, Michael Mackenzie in New York and Gillian Tett in London

Published: September 17 2008 18:23 | Last updated: September 17 2008 20:00

The panic in world credit markets reached historic intensity on Wednesday prompting a flight to safety of the kind not seen since the second world war.

The $85bn emergency Federal Reserve loan for the troubled insurance giant AIG, announced on Tuesday night, failed to curb the surge in risk aversion. Instead, markets were hit by a new wave of anxiety.

One cause for fear came when shares in a supposedly safe money market mutual fund fell below par value – or “broke the buck” – due to losses on Lehman Brothers debt. This raised the risk that retail investors in other such funds could panic and pull out their money.

All thought of profit was abandoned as traders piled in to the safety of short-term Treasuries, with the yield on three-month bills falling as low as 0.03 per cent – rates that characterised the “lost decade” in Japan. The last time they were this low was January 1941.

Shares in the two largest independent US investment banks left standing – Morgan Stanley and Goldman Sachs – fell 37 per cent and 21 per cent respectively as the cost of insuring their debt soared, threatening their ability to finance themselves in the market.

Repercussions were felt far beyond the US. There was turbulent trading in HBOS, a huge UK mortgage lender, which was forced – at the prompting of the UK government – to enter into merger talks with fellow retail bank Lloyds TSB after drastic falls in its share price.

Lending between banks in Europe and the US in effect halted. The so-called Ted spread – the difference between three-month Libor and Treasury bill rates, which measures fear over banks – moved above 3 per cent, higher than the record close after the Black Monday stock market crash of 1987.

The US authorities fired back with the Treasury announcing it would borrow money to give to the Fed to use for its emergency lending operations – in essence removing any balance sheet constraint on the size of this assistance.

The Securities and Exchange Commission announced new curbs on short selling that traders called draconian. Short sellers, who profit from share price declines, were widely blamed for the trouble at AIG. But these efforts failed to avert heavy selling, particularly of US financial stocks.

Angry traders blamed the Fed for not cutting interest rates on Tuesday amid market speculation that the US central bank could be forced into a U-turn. Many analysts also blasted the US authorities for adopting an arbitrary approach to financial rescues – saving AIG but not Lehman – that was impossible for investors to predict and therefore did nothing to boost confidence.

The S&P 500 fell 3.6 per cent, led by a 9.4 per cent slump in financials. Equity volatility was near its highest level since March. The dollar weakened slightly, while the Japanese yen rallied as risky currency funding trades were unwound.

Gold also benefited from safe-haven buying, with bullion prices heading for their largest one-day gain for 20 years, leaping 11.2 per cent to a three-week high of $864.70 a troy ounce.

Emerging markets shares dropped more than 7 per cent, according to the MSCI index.

Andrew Brenner, co-head of structured products and emerging markets at MF Global, said: “It feels like no one wants to take anyone’s credit . . . it feels like we are on a precipice.”

Copyright The Financial Times Limited 2008

FT.com / In depth - Credit panic hits historic levels

so what it looks like is that that machinery of the international trading system is jamming up, and the reason for the jamming is a kind of institutional panic that is deploying across the instruments of credit.

at this point, there's no obvious conclusion, but things are ramping in a kinda scary direction.
unless you're like me, and are mostly just watching this and trying to figure it out.

jorgelito · 09-17-2008, 12:32 PM

Quote:

Originally Posted by Baraka_Guru

Looking at T-bills, apparently 25% are held by foreign governments, which is double what it was in 1988. Is this going to put more of the U.S. public debt in foreign hands?

It seems to me that as time goes on, the U.S. continues to cede an increasing amount of control over its economy to foreign powers via the unabated increasing of public debt.

When will this stop?

Good question. I wonder if there is a threshold (theoretical or practical) in which the percentage of foreign holdings of our t-bills becomes a national security issue. There has to be some line where our economy becomes very vulnerable and beholden to a foreign interest.
-----Added 17/9/2008 at 04 : 35 : 23-----

Quote:

Originally Posted by Baraka_Guru

Interesting indeed, roachboy.

I find it disquieting that people aren't more focused on the bigger dangers of this issue. Most people look at the bailout figures and get angry at big business. How soon they forget that such money is absorbed by the banks and the bill for it is being held by someone else, much of it quite possibly in Asia. The more foreign bills being swept up, the more control they have over American economic policy. The threat of dumping (i.e. cashing in) T-bills is enough to get someone's attention, especially when you figure that there's $1 trillion dollars' worth between Japan and China alone.

But here we're talking about foreign banking absorbing U.S. banking. Interesting. I wonder how this will play out globally as things continue to shake up.

I think alot of this stuff is over the average persons head. It is complex and alot to absorb and understand. Since the media knows this they probably avoid it or just reduce to panic headlines. Heck I must admit, the few articles I've seen I have given just a perfunctory glance in favor of some other story or article until lately when it was more of a presence in general news.

So yes, people are mad, but they really don't know who or what to be mad at.
-----Added 17/9/2008 at 04 : 36 : 33-----

Quote:

Originally Posted by Tully Mars

Probably. Then Goldman Sachs and Morgan Stanley. Then?

Good lord, I don't know. Do you think Morgan Stanley and Goldman Sachs could be next?

I do think CitiCorp/Group could be next.

Hopefully it won't be an endless fall of dominoes.

roachboy · 09-17-2008, 12:36 PM

which headline comes from an american newspaper?

Dow Falls by More Than 440 Points in Jittery Trading

Panic grips credit markets

jorgelito · 09-17-2008, 12:37 PM

Quote:

Originally Posted by roachboy

baraka--well, if things move in a straight line, it looks like the end of the american empire, engineered through idiocy and incompetence by the very people most committed to the idea of american empire.

And then what? What do you think will replace it? DO you think there will be a complete paradigm shift or gradual change? Will it be a systems change?

Tully Mars · 09-17-2008, 01:06 PM

Quote:

Originally Posted by jorgelito

Good lord, I don't know. Do you think Morgan Stanley and Goldman Sachs could be next?

I do think CitiCorp/Group could be next.

Hopefully it won't be an endless fall of dominoes.

Sadly, yes I do-

Quote:

Shares of Goldman Sachs and Morgan Stanley plunged on Wednesday, a sign that investors fear they can't survive in their present form as the last two major independent investment banks.

Executives of both companies insisted a day earlier, when they were reporting profits for the most recent quarter, that they do have the financial wherewithal to go it alone.

But analysts said the question increasingly is whether continued market turmoil could force them to acquire or be acquired by commercial banks, whose deposit-taking operation would provide a stable source of funding.

Morgan Stanley shares fell as much as 44 percent Wednesday and were off about 25 percent in late afternoon trading. Goldman Sachs shares shed more than 35 points before narrowing their loss to about 14 percent.

Anxious investors also continued to bid up the price of protecting against a default of debt issued by the two investment banks. The spike in credit default swaps has fanned fear gripping Wall Street that the investment banking model is in jeopardy of extinction.

The Associated Press: Shares of Morgan Stanley and Goldman Sachs plunge

09-16-2008, 09:05 AM	#41 (permalink)
Cynthetiq Tilted Cat Head Administrator Location: Manhattan, NY	I believe it's the re-edit including the NYPost photo, in other words, the post went from discussion to trollish humor, in one simple edit. __________________ I don't care if you are black, white, purple, green, Chinese, Japanese, Korean, hippie, cop, bum, admin, user, English, Irish, French, Catholic, Protestant, Jewish, Buddhist, Muslim, indian, cowboy, tall, short, fat, skinny, emo, punk, mod, rocker, straight, gay, lesbian, jock, nerd, geek, Democrat, Republican, Libertarian, Independent, driver, pedestrian, or bicyclist, either you're an asshole or you're not. What's the best nation in the world? DO-NATION!

09-16-2008, 09:10 AM	#42 (permalink)
Baraka_Guru warrior bodhisattva Super Moderator Location: East-central Canada	With all due respect to the reasonable criticisms of neoliberalism, this issue shouldn't have come as a surprise, but it always does. Herd mentality and short-term memories tend to mislead people into thinking that things could always and should always improve. This sort of market movement could have very well been predicted, and some have done so. The S&P has operated at a net loss since 2000 and the Dow Jones has returned to a level it hit in 1999 and again in 2000, 2001, and 2006—and both had a good climb between 2006 and the end of 2007. Those who have this whole time expected (or at least prepared for) such things as this week's events call these past ten years a secular bear cycle. Individual investors should get to know what this means so they can protect themselves (eg, sometimes holding a lot of cash is better than having everything in the market). The government, Wall Street, and others more directly involved should stop being so greedy or power-hungry and understand these issues as well. A relatively unregulated economy is ludicrous when you know how the machine works. Do you know of any other elaborate machinery that has no mechanics, no operators, no "reconfigurators"? Neoliberalism is a travesty of economic theory and practices. __________________ Knowing that death is certain and that the time of death is uncertain, what's the most important thing? —Bhikkhuni Pema Chödrön Humankind cannot bear very much reality. —From "Burnt Norton," Four Quartets (1936), T. S. Eliot Last edited by Baraka_Guru; 09-16-2008 at 09:17 AM..

09-16-2008, 09:37 AM	#44 (permalink)
roachboy Super Moderator Location: essex ma	it's funny, loquitor, reading the press accounts of this farce and noticing the rhetoric, which is about storms and about schumpeter and about anything and everything that preserves a sense of continuity---which is in a sense about avoiding material and ideological problems by pushing them into some imaginary continuum that extends into a future just the same as the past. neoliberalism is in serious serious trouble---but because it is the dominant ideology, and because the press speaks largely through that ideology in part because it is responsible for its dissemination and in part because in the states---and *nowhere* else, neoliberalism is a lingua franca on matters pertaining to the economy. that is what being a dominant ideology entails. the problem that ideological crisis generates is that it undercuts the frame of reference that shapes how this information is organized. in the soft authoritarian political context that is the american, this is an obstacle to being able to articulate the collapse of the ideology. it's a circle, and not an interesting one. intellectual monocultures run into it alot. neoliberalism is to this soft-authoritarian context what dialectical materialism was to stalinism. hard to articulate problems for the frame itself when the frame is understood as necessary. that'll pass, i expect. but implosion of neoliberalism probably wont pass, though. you'll just have to figure out a different set of fables to believe in, sooner or later. neo- generally implies redux but with alterations. i didn't make the term up. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-16-2008, 10:35 AM	#45 (permalink)
Cynthetiq Tilted Cat Head Administrator Location: Manhattan, NY	this is an interesting interactvie graphic A Year of Heavy Losses - Interactive Graphic - NYTimes.com __________________ I don't care if you are black, white, purple, green, Chinese, Japanese, Korean, hippie, cop, bum, admin, user, English, Irish, French, Catholic, Protestant, Jewish, Buddhist, Muslim, indian, cowboy, tall, short, fat, skinny, emo, punk, mod, rocker, straight, gay, lesbian, jock, nerd, geek, Democrat, Republican, Libertarian, Independent, driver, pedestrian, or bicyclist, either you're an asshole or you're not. What's the best nation in the world? DO-NATION!

09-16-2008, 03:02 PM	#48 (permalink)
roachboy Super Moderator Location: essex ma	jorgelito--neoliberalism is not the same as capitalism in general. protestant evangelicals who refer to themselves as christians are not the same as christianity in general. this should be simple. i don't understand why there's such a problem with this. we'll see what happens with aig tomorrow.... __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-16-2008, 09:26 AM	#43 (permalink)
loquitur Junkie Location: NYC	actually, RB, I'd say liberalism (in the classical sense) produced capitalism. It's not the only possible outcome of a liberal order but it is the one that historically has resulted from real life application of liberal principles. The two aren't synonymous - I agree with you there - but they do tend to go hand in hand. I don't know what "neo" adds to the equation. As for Keynes....... been there, done that, got the bumper sticker. Remember "stagflation"? That was brought to you by John Maynard. Not intentionally, of course. But that's pretty much the logical outcome of excessively empowering planners. There are always other agendas to be served, and that leads to unintended consequences. Go ahead, call me neoliberal. I can take it. Heck, call me neoconservative, too. It makes just as much sense.

09-16-2008, 05:12 PM	#50 (permalink)
Charlatan Getting it. Super Moderator Location: Lion City	I just want to be clear that my own position is not one that calls for an end to capitalism per se. Rather, I want to see an end to the drive towards completely deregulated and laissez-fair capitalism. This particular flavour of capitalism does not sit well with my humanist sensibilities. For further clarity, I am not looking for an answer in the great bug-a-boo of communism either. To my mind they are at either ends of the economic spectrum from each other and in their orthodoxy are essentially bankrupt. What I seek... what I always seek... is a balance between the two poles. History has shown us that both extremes are problematic (to say the least). __________________ "My hands are on fire. Hands are on fire. Ain't got no more time for all you charlatans and liars." - Old Man Luedecke

09-16-2008, 06:39 PM	#51 (permalink)
ASU2003 immoral minority Location: Back in Ohio	There are a few things that I would say need regulated. I'll start with international trade.. It's not that it's a bad thing to grow and strengthen foreign markets, and it has stabilized the world. It isn't all bad. But it moved too fast, and it was too lop-sided. Companies wanted , and got, outsourcing of jobs and factories done in 10 years. The foreign countries grew really fast and production of raw supplies didn't. But now we have people who are just living with what they have and not buying anything new, there are plenty of people who can't get work (although it isn't too bad yet), and older people are working longer. The 20-somethings and 30-somethings don't have the money/credit to buy houses because they can't get into jobs that pay enough with the rising prices. Speculation and short selling are two other things that need to be reigned in. There should be limits on how much any one person can do each year. And there needs to be some type of serious penalty if you foreclose on a house or can't pay back credit card loans. I'm not sure what that penalty should be, but something like 10 years of garnished wages would be good place to start. The problem is how do you avoid bubbles? The tech bubble was justified at first, but then you had investors throwing money into it as fast as they could because they couldn't lose. The more investors, the higher the stock price. Until enough of them want to cash out, and then all of them panic and sell. Repeat with the housing bubble and the oil bubble. And it will continue into the next hot thing because the money has to go someplace, and whatever seems like a good idea to a bunch of people will catch the attention of more and then the big banks will want in and make a quick buck... And it all repeats. And the government's deficit spending needs to be regulated as well. But that is another topic.

09-17-2008, 04:23 AM	#53 (permalink)
ASU2003 immoral minority Location: Back in Ohio	What I want to know is, "what are the taxpayers going to get for this $85 billion?"

09-17-2008, 04:24 AM	#54 (permalink)
roachboy Super Moderator Location: essex ma	debt. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-17-2008, 06:27 AM	#55 (permalink)
Baraka_Guru warrior bodhisattva Super Moderator Location: East-central Canada	The money can come from China, ultimately. __________________ Knowing that death is certain and that the time of death is uncertain, what's the most important thing? —Bhikkhuni Pema Chödrön Humankind cannot bear very much reality. —From "Burnt Norton," Four Quartets (1936), T. S. Eliot

09-17-2008, 07:20 AM	#57 (permalink)
Cynthetiq Tilted Cat Head Administrator Location: Manhattan, NY	so we just created more money out of thin air? __________________ I don't care if you are black, white, purple, green, Chinese, Japanese, Korean, hippie, cop, bum, admin, user, English, Irish, French, Catholic, Protestant, Jewish, Buddhist, Muslim, indian, cowboy, tall, short, fat, skinny, emo, punk, mod, rocker, straight, gay, lesbian, jock, nerd, geek, Democrat, Republican, Libertarian, Independent, driver, pedestrian, or bicyclist, either you're an asshole or you're not. What's the best nation in the world? DO-NATION!

09-17-2008, 07:26 AM	#58 (permalink)
roachboy Super Moderator Location: essex ma	best i can figure, cyn, the money was created from thin air by way of t-bills. it's a little hard to say because, for example, there's not a whole lots of real estate on the dept of treasury's website devoted to actual life, particularly not when compared to the amount devoted to neo-liberal horseshit about competition, deregulation and their virtues. but here's a link to press releases, which of course tell you very little: U.S. Treasury - Press Releases - September 2008 __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-17-2008, 07:28 AM	#60 (permalink)
Cynthetiq Tilted Cat Head Administrator Location: Manhattan, NY	well at some point in time either the shell game stops or the ponzi gets called, seems like they are still trying to pass it around. __________________ I don't care if you are black, white, purple, green, Chinese, Japanese, Korean, hippie, cop, bum, admin, user, English, Irish, French, Catholic, Protestant, Jewish, Buddhist, Muslim, indian, cowboy, tall, short, fat, skinny, emo, punk, mod, rocker, straight, gay, lesbian, jock, nerd, geek, Democrat, Republican, Libertarian, Independent, driver, pedestrian, or bicyclist, either you're an asshole or you're not. What's the best nation in the world? DO-NATION! Last edited by Cynthetiq; 09-17-2008 at 07:33 AM.. Reason: NOT THEIR... BAD GRAMMAR BAD!

09-17-2008, 07:30 AM	#61 (permalink)
roachboy Super Moderator Location: essex ma	no choice on this one, cyn, it seems. the scale of this is WAY beyond that... i'm trawling about for more detailed/updated information...feel free to join me and post what you find. other on the fly analyses welcome too, of course. this is fucked up. that is the short version. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-17-2008, 07:37 AM	#63 (permalink)
Cynthetiq Tilted Cat Head Administrator Location: Manhattan, NY	yes, i understand the idea of the fiat currency, but when the House in Vegas wants to give out more chips there has to be funds to cover them in some fashion. Here there isn't anything but the wave of a pen, nod of a conversation, or maybe even just a press of a keyboard. __________________ I don't care if you are black, white, purple, green, Chinese, Japanese, Korean, hippie, cop, bum, admin, user, English, Irish, French, Catholic, Protestant, Jewish, Buddhist, Muslim, indian, cowboy, tall, short, fat, skinny, emo, punk, mod, rocker, straight, gay, lesbian, jock, nerd, geek, Democrat, Republican, Libertarian, Independent, driver, pedestrian, or bicyclist, either you're an asshole or you're not. What's the best nation in the world? DO-NATION!

09-17-2008, 07:56 AM	#65 (permalink)
roachboy Super Moderator Location: essex ma	what matters is continuity of movement, the continuance of flows, not what flows. the objects that move through these systems are secondary to the fact of their movement. trafficking in debt means that value is a temporal form, not a 1:1 relation--so it's not about objects, not about thinking with or through objects...it's thinking motion, systems that allow it, and relations which are structured in and through that movement. value is a convention--but it's always been convention, nothing more. the value of gold was a convention and the assumption about that convention was that scarcity (or at least limitation) of supply functioned to anchor that convention in something outside itself--but that too was a convention. and what mattered was the movement of these conventional objects--these time-forms, like sounds---through particular systems. when you extract "value" from the systems of circulation, you convert media, but the conversion of media doesn't mean that you move from a system anchored in circulation to something else--you just move from one circulatory system to another. the entire idea of the old marxian labor theory of value was to anchor value to praxis, acting on nature, transforming nature into usable objects, as a way of making it more "material"----but even there value was located in labor power, in process, and it's object-expression---commodities---was seen as "dead labor".... i don't know why this is surprising, that the anchors of bourgeois "reality" are basically objectifications of modes of being that are basically motion or pattern within motion (another metaphor that you could plug into the above and run the machinery). what matters is not the relation to materiality, not the relation between process (which is temporal) to the object-oriented world that we see and live through because we see it---what matters is the equity of modes of allocation, what matters is the distribution of power. in contemporary capitalism, we--you and i---have NO power. we are spectators. this is a form of spectatorship. and it also turns out that the institutions we assumed DID have power do not have it--not really--what has power is the flowing of capital within abstract networks. that rules the world, the world that neoliberalism has enabled. better to watch tv, i sometimes think. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-17-2008, 08:38 AM	#66 (permalink)
loquitur Junkie Location: NYC	RB, on that theory, the gold standard is preferable to fiat currency because gold provides an "anchor" to something real. Except that that anchor made it very difficult to react to market shocks, which is why it was abandoned. (In effect we traded some degree of unavoidable inflation for a smoothing of the business cycle - not a bad trade, in my view). The system isn't cracking. It'll take a few months but things will consolidate and return to normal. Unless we start rescuing every bad business in sight like the Japanese government did - that kept japan in recession for 15 years.

09-17-2008, 08:49 AM	#67 (permalink)
roachboy Super Moderator Location: essex ma	when the nixon administration scrapped bretton woods and instituted floating currency, the idea was to abandon an outmoded break on capital accumulation. it never anchored anything to anything, the gold standard--rather it was a residuum of the inability of folk do deal with value as an effect of circulation, as relational, as based, in the end, on momentum, and so, by extension, no-thing. the neoliberal order is definitely in trouble. i think the system that has taken shape is at its limit. i don't think that means capitalism will collapse---what it means is that we're entering a period of mutation in the course of which you'll get a little demonstration of what it mean when folk characterize capitalism as an autopoeitic system. changes in environment force adaptation in system logic in order to preserve system identity. neoliberalism is as outmoded as the edsel at this point, but without the lovelt design points that make the edsel still interesting--it's inability to provide either a compelling or robust description of actually existing capitalism is now obvious--that an inadequate description leads to incoherent policy is now also obvious. but this has been true for quite a long time--the only real changes are (a) the material required for becoming-visible within the bizarre little ideological bubble that is the united states are in place because (b) the dysfunctions of the system have reached the metropole. that's it. that folk invested in precisely the ideology that is being pulverized in real time have trouble seeing what's in front of them is not surprising. that it is so pervasive in the states is an index of the monocrop culture we live in from the political viewpoint. it provides an idea of the consequences of soft-authoritarian rule, shows its limits. so i find it almost funny watching the problems folk are having with getting their heads around what's in front of them. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-17-2008, 08:53 AM	#68 (permalink)
jorgelito All important elusive independent swing voter... Location: People's Republic of KKKalifornia	Hang on to your seats, WaMu is next. __________________ "The race is not always to the swift, nor battle to the strong, but to the one that endures to the end." "Demand more from yourself, more than anyone else could ever ask!" - My recruiter

09-17-2008, 09:11 AM	#69 (permalink)
Baraka_Guru warrior bodhisattva Super Moderator Location: East-central Canada	Looking at T-bills, apparently 25% are held by foreign governments, which is double what it was in 1988. Is this going to put more of the U.S. public debt in foreign hands? It seems to me that as time goes on, the U.S. continues to cede an increasing amount of control over its economy to foreign powers via the unabated increasing of public debt. When will this stop? __________________ Knowing that death is certain and that the time of death is uncertain, what's the most important thing? —Bhikkhuni Pema Chödrön Humankind cannot bear very much reality. —From "Burnt Norton," Four Quartets (1936), T. S. Eliot

09-17-2008, 09:19 AM	#70 (permalink)
roachboy Super Moderator Location: essex ma	interesting, comrade. i was just looking at a blog that talks about this very question. i'll link it here because the original has some useful hotlinked areas. and because, well, it's a blog. Winter (Economic & Market) Watch Financial Tar Pit Update __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-17-2008, 09:28 AM	#71 (permalink)
Baraka_Guru warrior bodhisattva Super Moderator Location: East-central Canada	Interesting indeed, roachboy. I find it disquieting that people aren't more focused on the bigger dangers of this issue. Most people look at the bailout figures and get angry at big business. How soon they forget that such money is absorbed by the banks and the bill for it is being held by someone else, much of it quite possibly in Asia. The more foreign bills being swept up, the more control they have over American economic policy. The threat of dumping (i.e. cashing in) T-bills is enough to get someone's attention, especially when you figure that there's $1 trillion dollars' worth between Japan and China alone. But here we're talking about foreign banking absorbing U.S. banking. Interesting. I wonder how this will play out globally as things continue to shake up. __________________ Knowing that death is certain and that the time of death is uncertain, what's the most important thing? —Bhikkhuni Pema Chödrön Humankind cannot bear very much reality. —From "Burnt Norton," Four Quartets (1936), T. S. Eliot Last edited by Baraka_Guru; 09-17-2008 at 09:31 AM..

09-17-2008, 10:02 AM	#73 (permalink)
roachboy Super Moderator Location: essex ma	baraka--well, if things move in a straight line, it looks like the end of the american empire, engineered through idiocy and incompetence by the very people most committed to the idea of american empire. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

09-17-2008, 10:19 AM	#75 (permalink)
flstf Easy Rider Location: Moscow on the Ohio	Much of the wealth in this country seems to be obtained not by hard work and innovation but by political influence and corruption. I don't know what regulations could be put in place to avoid this with the foxes watching the hen house but what we have now is not giving capitalism a chance to work. Of course I guess it is sometimes hard work and innovative to set yourself up to get in on the corrupt action. Last edited by flstf; 09-17-2008 at 10:35 AM..

09-17-2008, 12:36 PM	#78 (permalink)
roachboy Super Moderator Location: essex ma	which headline comes from an american newspaper? Dow Falls by More Than 440 Points in Jittery Trading Panic grips credit markets __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite