Capitalism is Inherently Unstable

Reddit

“Why capitalism fails” is the intriguing and misleading headline of an article in The Boston Globe. It is a reminder of the theories of Hyman Minsky, who pointed out the obvious: capitalism is inherently unstable…it proceeds in booms and busts…not steady, incremental growth. Of course, that is just the way it works – like nature herself. And that’s why people don’t like capitalism…they can’t control it. So, whenever a bust comes, they imagine that it has ‘failed’ or ‘broken down.’ Then, they propose ways to fix it.

“Since the global financial system started unraveling in dramatic fashion two years ago, distinguished economists have suffered a crisis of their own,” starts the article. “Ivy League professors who had trumpeted the dawn of a new era of stability have scrambled to explain how, exactly, the worst financial crisis since the Great Depression had ambushed their entire profession.

“Amid the hand-wringing and the self-flagellation, a few more cerebral commentators started to speak about the arrival of a ‘Minsky moment,’ and a growing number of insiders began to warn of a coming ‘Minsky meltdown.’

“‘Minsky’ was shorthand for Hyman Minsky, a hitherto obscure macroeconomist who died over a decade ago. Many economists had never heard of him when the crisis struck, and he remains a shadowy figure in the profession. But lately he has begun emerging as perhaps the most prescient big-picture thinker about what, exactly, we are going through.

“A contrarian amid the conformity of postwar America, an expert in the then-unfashionable subfields of finance and crisis, Minsky was one economist who saw what was coming. He predicted, decades ago, almost exactly the kind of meltdown that recently hammered the global economy.”

Economists went off their heads in the last few decades. They thought capitalism would make us all rich. And they thought capitalism automatically tended toward beneficent equilibrium.

Here at The Daily Reckoning, intuitively, we guessed the contrary. The system produces a kind of orderly chaos…in which the rich are frequently impoverished, the proud are humbled…and the goofballs who think capitalism fails inevitably make things worse.

Until next time,

Bill Bonner
for The Daily Reckoning Australia

Bill Bonner

Bill Bonner

Best-selling investment author Bill Bonner is the founder and president of Agora Publishing, one of the world's most successful consumer newsletter companies. Owner of both Fleet Street Publications and MoneyWeek magazine in the UK, he is also author of the free daily e-mail The Daily Reckoning.
Reddit

Comments

  1. Exactly its a Recurring Finiancal Social Problem fed by being given the right to climb up the social ladder by borrowing somebody elses production thrift and savings without any concern of how it was created The only concern of these lazy mindless takers of overblown self inportance– is– self and show, The accumulated trouble since the 60-70s now is that there is millions of overblown lazy lots, playing with trillions of dollars worth of overblown assets,with the simple expectation told by our out of control polititions that the social responsibility of the present is O.K because it can be passed on to some moon man out there in moonland. REALY!!!
    THE WORLDS GONE MAD
    David Lloyd

    Reply
  2. well bill, you arent gonna like what minksy proposes as a solution. he is a communist of the nth order.also,austrians have showed that capitalism is not inherently unstable as he claims (its only as stable as a ‘language’ is).it is dynamic but not prone to boom and busts of huge magnitudes UNLESS acted upon by exogenous actors like governments,central banks etc.
    i prefer liberty over communism anytime.Minksy is only describing the govt controlled/central bank policed bastardized version of cronyism we have now.

    Reply
  3. Dyslexic “I prefer liberty over communism anytime”.

    But what makes liberty – presumably another word in this context for democracy – any less unstable.

    Democracy does fail again and again for the simple reason people ALWAYS vote for the party promising each individual he or she will receive more than is taken from them and politicians always make this promise.

    Finally, as right now, the piper has to be paid but the cupboard is bare. So all of those goodies given and promised must now be taken back and for many the future will erase the plans of the past.

    Winston Churchill said that “democracy is a very bad form of government but it is the best we have invented yet”.

    Of course no one wants to live under a dictatorship or an oligarchy so the democratic process with all its faults will continue even after repeated failures until a better one is invented.

    Reply
  4. I think we do live in under an authoritarian type system…just of the Claytons kind. Democracy fools people into thinking they have power over government. All government systems have proven unstable. Maybe democracy will persist longer, the enemy of the people hidden behind a facade of lies and deceptive notions. Hard to pin down an enemy which keeps moving/changing.
    Still we’re all the same…rulers, the ruled. Give a child everything it wants it becomes wreckless and corrupt. And power corrupts those who rule…eventually, sometimes quickly.

    Lachlan Scanlan
    September 19, 2009
    Reply
  5. The enemy of the people is the people themselves. They don’t want freedom. They don’t want fair competition. They want leverage and an advantage over their competitor’s.

    Daniel Newhouse
    September 19, 2009
    Reply
  6. I can’t agree with Daniel Newhouse’s sentiments. I think people (rich and poor alike) by and large want freedom and fairness. The people are thus not the enemy of themselves, but are merely weak and foolish – they are no match for the elite (now a global elite) and while they are so much deceived they cannot begin to fight back.

    People usually don’t want others to be crushed, or bled dry, or subject to parasitism, unless they themselves are driven by a culture of greed and hatred – does that apply to you? Most people, if you talk to them, say they don’t believe in slavery, or corruption, excessive wealth, or unjust wars. They just want to be “comfortable”.

    Democracy has failed to prevent or mitigate these for the past several generations because it is a broken system and currently is about as useful as a steering wheel on a train. Revolutions and market crashes are one and the same – a way to transfer power, and neither are spontaneous events. So comes the big question. Who, then, is setting the course of society, if not the public?

    “Economists went off their heads in the last few decades. They thought capitalism would make us all rich. And they thought capitalism automatically tended toward beneficent equilibrium.”

    The big lie is that people think there are only TWO ways of doing things. They think of only capitalism (and democracy) and socialism (and communism), for example. Both are patently flawed systems of wealth disribution, so why bother espousing either? Why not think laterally?

    Reply
  7. I think we need to remove our selves from the philosophies Dan. Really what Daniel Newhouse is saying (I suggest) is part of the inherent flaw(s) of humanity. The fact is no matter how powerful a nation is they cannot rectify the health, education, transport, unemployment etc the wealthy get wealthier as a consequence of animal greed and leadership corruption and yes what you indicate, (I suggest) lack of genetic or biological will, stupidity.

    Human being are less organised than ants or bees – which require absolute biological rules. Humans are too diverse to maintain any control or rather the diversity lacks rules that work in logical sequences. Stock markets are ok provided you can control the greed. Capitalism does not mean free enterprise, it is inherently monopolistic.

    The Natural Order works on a Free Enterprise system and as far as Communism is concerned it is simply a philosophy of de tent, a single closed loop system suited to poverty systems and should only used as a base to build on. Russia spent to long with it, China has developed a hybrid and India needs it badly.

    Charles Norville
    September 19, 2009
    Reply
  8. Just briefly in response, ‘animal’ greed and leadership corruption are not dominating traits of human (or actually animal) behaviour in all situations, so it needn’t be the way you see things, Charles, although such assumptions form the basis of the atheist/materialist philosophies. But of course this isn’t the right place to debate such things. Ultimately we want to know, is the market going to go up, or down, is gold the way to go, etc? By unveiling the mystery of the markets and the world economy, we can conquer them, and all make ourselves a handsome buck, right?

    Reply
  9. But if gold takes over and becomes important the Govts will want to own it, I don’t trust certificates. Silver is 1/60+ the price of gold yet silver is 1/17 abundant in earth’s crust. Silver is an industrial metal and can’t be made too expensive ie its not 1/17 the price of gold so gold by default I suppose becomes the trader…..so is it not about purchasing power, we need silver to be a fairly stable price because of the things we purchase with it in manufacturing?

    Yes gold is good to trade with (by default maybe), but considering the gold/silver ratio maybe silver may prove a better hedge its has gone up in value almost 100% in one year. Silver can be traded in smaller denominations so you could use it as hard currency, gold is too expensive to trade for day to day goods.

    Charles Norville
    September 19, 2009
    Reply
  10. Silver seems like it is sensibly priced, given its utility (it’s not a very stable metal in that it quickly oxidizes, so as money it has to be part of an alloy – which might complicate things a bit). Gold retains a lot of speculative appeal which puts me off it a bit – there are some big questions left unanswered for me as to how the gold market really works: are the inventory figures cooked? will the central banks pull another rabbit out of the fiat-money hat? I do think that an objective currency is a critical step towards neutering some of the biggest economic abuses going on today, but it’s just one step of many.

    But silver as a currency is no more likely to win than any other precious metal (palladium, platinum, whatever you want). As a hedge though I agree, I think it’s less likely to go the wrong way, because people actually need silver, whether it shines or not.

    Reply
  11. Every human inherits an anxious, vulnerable state. We may choose to be strong, behave rational or moral (and these may be admireable) but the native condition is and remains anxious/vulnerable.
    Every human seeks therapy to mitigate against this state and we will conceal these efforts with varying degrees of success. We will control something somewhere, something small, large or intermediate… a pile of money, a relationship, a country (plural relationships), a smoking habit or maybe just a tea drinking ceremony. Our apparent control allows us some “comfort”(mitigates vulnerability/validates ego). Like the drug, the potency of these therapies decline with use. The thirst is never quenched. An irrational response continues until sometimes it can no longer be maintained. The vulnerable state is then exposed.

    Governments find comfort as their power grows, anxious when it is threatened, irrational in their efforts to maintain it and nothing Ive just said makes any difference.

    Hmmm this week coming maybe ? USDX continued decline…..gold, silver, stocks, mouse traps and anything remotely useful/exchangeable for US dollars to rise.

    Lachlan Scanlan
    September 20, 2009
    Reply
  12. An observation on precious metals: Having just visited Upper Canada Village (one of many ‘working’ historical towns we’ve toured) and spoken at some length with the tinsmith there, I was intrigued to then read the following, in a funny little tome “Achtung Schweinhund!” (Harry Pearson, 2008, p. 167): “… in terms of cost, tin lags behind only platinum, gold and silver in the table of precious metals, making it impractically expensive to use in pure form… ” Tin?!! Who’d have thunk it?!! We’ve watched Aboriginal women in the northwest of WA ‘mining’ tin by hand with goldpans, curiously concluding that it seemed a helluva lot of effort for such a small return, but maybe we were blind to the true rewards… (?) Postscript: Pearson can’t be right, can he? For a start, nickel would have to be worth more than tin, right…? Back to Kansas and the Yellow Brick Road… .

    Biker Pete, Brighton, Ont., Canada
    September 20, 2009
    Reply
  13. Luther’s once called for his army to give their swords a twist in God’s name and so came The Reformation. God’s good graces and name have been well since abused by the Judeo religious sectarian warriors and that tradition was henceforth continued in matters of secular governance.
    “Don’t call me comrade” is effectively the call to arms for those that lend support to this revolutionary political manifesto. So at base this is an anti-manifesto of sorts, one that rises from a seminal historical critique. It should be one that seeks to constrain the political narrative in order to shield the core integrity from the inevitable attempts to subvert it through political mastery and executive hegemony. Unless there is a healthy scepticism and censure of excess in political narrative, Eric Blair’s pigs will live and thrive within it. The more the narrative is bent toward the utopian illusion and evasive of human frailty, the greater the opportunity for the subversive within us.
    A genuine reformation of the body politic and systems of governance will be led by a conservative movement. It should be firmly rooted in the Jeffersonian democratic tradition and it will be a system that unashamedly begs, borrows, and steals structure like all those successful before it.
    But before we set sail, let’s just try to nail the essence of our critique. It is one that professes that our political systems have been abused to such an extent that we have reverted to a feudal system of governance. Racketeers and cronies have taken absolute control of western representative government and its institutions. The processes of subversion employed were borrowed from simple racketeering prototypes with the accompanying expended narratives borrowed from cheap penny lane tunes. But the global debt clock is now posted on The Economist and it is whizzing beyond any possibility of avoiding a catastrophic economic and political event.
    There is a push emergent in the US with GOP reformers like Ron Paul, and when we find that even the Democrat opportunist Barney Frank touching the narrative, and then the screamers like Karl Denninger really do touch wide spread main street conviction in a way that the bigoted radio shock jocks never could. One measure of the threat imposed by the reformation movement is Nancy Pelosi’s passive aggressive call that plays the race card when defending President Obama in the face of his decline in popularity. Another would be the cries of alarm from the executive in the face of the Bank of America / Merrill Lynch scandal.
    Elsewhere, we have the sense of disquiet pervading the British corridors of power with their resurgent 70’s punk rock and football hooliganism flowing back into street life as the North Sea gas fields are drained and the previously supposed everlasting flame of the foreign debt multiplier is finally extinguished on the townhouse owners in the city that have held its candle. Germany and Japan embraced a post war political refrain, in a manner that facilitated their ability to focus their efforts upon mercantilist policies and surf the wave of opportunity presented by the western imperial debtor’s consumerism. These states have achieved their economic miracle & reconstruction but this refrain also marks a dark corner of their national psyche, one where their zeitgeist is adrift and their children remain few.
    In the antipodes (barring the odd kiwi act of defiance), we have little to speak of in terms of foreign policy now other than our instinctive reactions attached to the entrails of “All the way with LBJ” as called by Harold Holt, and an unaccountable swill in our foreign policy elite that measures its dignity and worth on foreign shores and plays a game at direct odds with fundamental Australian values. The foreign policy elite’s narrative survives only on their observed elasticity of our national characters complacency and disenfranchised roots that survived our penal colony’s beginnings. But that complacency has its limit.
    Australia’s foreign policy pretence waned into that of a mercantilist brigand when reaching out to Asia, one that was cruelled by the hubris of our liberal fascist elite that eroded good faith that might have been built from our Colombo scheme and our support for those unshackling from western colonialism. It is survived now by only the warmth generated by more deprecatory Australian sustaining human contacts that ignore the bannered marches shepherded by our ruling elite.
    Globally, those responsible for the subversion of western democratic institutions must quickly be indicted and held to account within their domestic jurisdictions. There is sufficient criminality under existing law in these countries to see this through. An increasingly desperate political, business and academic elite will not be cowered otherwise, and already we see clear evidence that they are prepared to enact inflammatory short term economic policy that must inflame an already certain calamity. . And if these same remain in power for sufficient time they will inevitably feel compelled to contrive events to scapegoat “enemy aliens” and set in chain events that will lead to a global conflict more ugly than WWII.
    We must remind ourselves of the current imbalance of power in terms of military assets, and the recurrent lack of success of the global superpower and its full alliance of being able to hold ground after the invasion of relatively small countries. This suggests that any major conflict may be a stand off war of mass and indiscriminate civilian devastation and that it would likely follow a period of disrupted trade flows on vulnerable sea and air passages. Such disruption of trade in a world of globalised production could induce a madness such as that of Weimar era famine. One foisted upon those that had thought themselves born to better prospects and that would henceforth carry that resentment with a shocking level of wilfulness.
    The premise of our critique was that we had returned to feudal era means of governance and had lost representation so where better to look than to the France of today. And beyond the “French justice” being brought to writ against the world by the ICC we can look to critique its leader Sarkozy, with his nominally conservative party allegiance, and his actual socialist narrative. All Gaullist pretension is now masked within the EU’s squirreling of UN institutions. The symbolism of Sarkozy’s attendance with QEII upon gaining office was unmistakable.
    And so it is that the cronies have returned us to that feudal / regal system of governance and delivered us new sovereigns. The courtiers are running the CFR, the central banks, the merchant & comprehensive banks given charge of markets after having had their cronies in the political elite strike down Glass Steagal (and here we include Paul Keating’s handing over the Mutuals and Superannuation investment institutions to the Australian banks), the traditional military industrial complex, the subsidised agricultural barons and their CBOT cohort that now determine by storage charge and effective fumigation quality process prohibition what and when physical grain supply is brought to market in order to control futures market prices (and the effect of which in totem on both a US and global basis is the hegemony of the industrial farm and the conduct of a Stalinist pogrom of peasant and family based farming by sleight of hand), and of coarse those same merchant bankers again running high frequency trades that suck in investors and permit them to name their own NYSE index outcomes and global market making leads by selling as few as four major stocks back and forth between each other in such volume that they occupy over 40% of all NYSE market trades with less than a scrap of buy-sell transaction actually completed due to netting in advance of such required settlement.
    So what do we call this that we impeach? It is Purple Socialism for mine, an amalgam of the crony corrupted red and blue in US politics, one that morphs in colour to that of the feudal regal purple.
    The Purple Socialist’s narrative, penny lane tunes if you will, is brought to us by the liberal fascists. Their methods are no different from those honed by these same Fabian Societies, the Freemasons, and other racketeers. A centre and a force behind the movement is David Rockefeller, his CFR and the antecedent Trilateral Commission (which the Japanese have now signalled their choice in past weeks to renounce their white man club membership in deference to a resurgent Asian regional imperative and reconciliation). The face of liberal fascism is derived from HG Wells’ portrayal of the Fabians as he abandoned them after even he found their ends abhorrent.
    Rockefeller and his Purple Socialists are significant forces lurking behind the pretensions of the international jurist movement and the ICC. These being a tentacle of the western hegemony’s elite that has annexed power to impose a system of unaccountable French justice that in itself claims global executive and unseparated power.
    With their ICC precedent built upon the sullen foundations of the Nuremberg Show trial precedent (here we refer to The Economist’s 1946 piece on this for contemporary conservative acknowledgement of the words “show trial” to cleanse ourselves of the latter day legitimacy). There are now those that reach for this device to politically assassinate their indicted. Even in infancy such jurist agencies have managed to physically assassinate Milosevic and stitch up Megrahi for the Pan Am 103 / Lockerbie bombing. The ICC is an agency that by design takes selective accounts of atrocities out of the theatre of conflict from witnesses induced and extracted from the conflict zones by interested cash resourced western hegemony actors in order to threaten the political elite of foes ruling resource rich non client states. And here the adaptation of “French justice” is no better than should be conceived by the common pejorative use of the label.
    We must seek fundamental change to the UN Security Charter through force of its wider membership. The actions of the Security Council and its members must be held accountable to existing international laws and a ¾ majority vote of veto must be granted to the general assembly in respect of security issues.
    Before one decries the world government pretensions of those blue and red bloods in the CFR (Council of Foreign Relations) as a conspiracy theory of no substance, one must recognise the ambitions of its founder and patron David Rockefeller and his admitted drive to seek to implement his form of world government (as quoted and plainly stated in his authorised biography). In the CFR you will find fellow travellers and opportunists across a political polyglot of including Clinton, Rubin, Cheney, Condi Rice, and G (HW) Bush all holding the same chalice with a predominantly resource & finance industry based corporate membership. Protestant evangelicals, Zionists, and medieval crusaders are at one and bedfellows.
    The CFR’s resource industry clientele and funding base is listed on cfr.org form. You may wish to compare the core of the international membership to the weight of the pointy end troop numbers in Afghanistan. The Anglo, Dutch, French, and Canadians being primary (BP,Shell,Total etc), then the “me too” players like Norway and Australia playing small front line roles, and then finally the token complement of those under-represented and either reluctant or opposed like the Germans, Italians, Japanese and Spanish.
    And in case you think you can pin this manifesto to that likely to illicit the support of right wing radio shock jocks, then let’s look at the supposed conservatives that through moral cowardice abandoned their sensibilities and enjoined with the racketeers and then for form sake fiddled with their taunts upon the liberal fascism while at the same time nourishing it.
    It is easy to strike at the hypocrisy of the imperialist blue bloods, Bobby Kennedy’s and his hatred of the liberationist Cuban’s taking the world to a nuclear precipice with his brinkmanship and narratives such as the Norwood conspiracy. There was never any Jefferson in that lion of liberalism and “coloured people’s” freedom was just a means to an electoral ends for him, a cause found appropriate for an electoral problem, and one to get the blue vote out in places where previously it wouldn’t dare.
    But lets go straight through Nixon (for let us acknowledge Kennedy’s moon shots and LBJ’s Vietnam debt legacy) and his debt induced flight from the gold standard, and go onto Reagan’s public debt debacle pulling the US out of Volcker’s cure to stagflation with his military industrial profligacy only to leave G (HW) Bush pick up the post Soviet debt trap tab (one of the few areas where Chomsky can be regarded as lucid). And after Keating’s “banana republic” call (and his electoral demise by the hand of his own hubris but his political survival in the hands of his public service) and Clinton’s “it’s the economy stupid” election win over G (HW) Bush, and NULAB where did we go?
    After the invention of funny money for the private sector by Clinton’s team (Rubin/Paulson/Summers and young Geithner who almost succeeded in collapsing Asia and Latin America using ham-fisted misconceived IMF policy initiatives) we went to hell with those imperialist and protestant evangelist conservatives and their lazy sidekicks (NULAB had accorded Gordon Brown conservative credentials through his nominal conservative CFR resource client state membership as UK exchequer).
    The conservatives picked up on Keating’s Australian lead of private sector foreign debt binging and those of the Chicago school given their head. There can never be too much private debt said they! As many USD’s as you want to fund the current account deficit ponzi scheme in your own country and plenty to share and Bush set about doing so with his anglo mates (like the little Aussie bleeder Howard/Costello team) to fund their asset price inflation ponzi schemes. And when you had so much USD supply why not releverage it and balance and insulate your national capital account by encouraging them to buy up foreign assets at impossible valuations with your own little merchant bankers like Macquarie, Babcock and Brown, and Allco.
    These self styled financially conservative administrations of the anglo western led alliance in reality lowered the effective rates of productivity in their economies and failed to pare back the ballooning nanny state.
    Socialist treasury officials set sail with a Clinton enabled vastly accelerated foreign debt multiplier impetus and clipped the expanded services economy GDP ticket to pay the ballooning nanny state & middle class welfare expenses. In Australia such luminaries as Garnault, the Access Economics team, Fraser, MacFarlane, Henry, Stevens and their fellow traveller banking induced economists and media scribblers ran around rubbing their hubris on their little Aussie miracle narrative.
    And after all of this critique and so little of the pretence to the narrative of a manifesto, where should we go?
    Our manifesto will be one that insists upon the rule of law rooted in English common law principal for western territorial jurisdictions, and one that resists the executive’s pursuit of expediency in rote law. Western democracy must enshrine in its own constitution the territorial limit upon its own laws and mark respect for Westphalian principals and the League of Nations charter. It will not trifle with the existing sovereign’s power in Australia’s case and neither will it seek to enshrine a bill of rights where such definition is not in the nation’s tradition and constitution protected from the claws of the Fabian inspired jurists.
    Our manifesto will induce a constitutionally enabled anti racketeering and anti trust regime that reports to a panel with reserve powers. Beyond the western hegemony we would imagine such a panel democratically endorsed to be represented by Mullahs, Kings, tribal Chieftains, and patriarchal party bosses, and we wouldn’t seek to nuke a single one of them for their choice of them, or their people’s ability to design systems of representative governance that might compete with our own.
    We will ban in our own jurisdiction bi-party political funding and mark absolute limits on lobbyist expenditures, and completely ban party funding from ACORN styled organisations and industrial unions. Our manifesto will require that base political party funding will be derived from private citizens. A direct campaign contribution made by a private citizen will however be supplemented by public funding equal to a multiple of that same private citizen’s donation, and this aggregate contribution to the political party’s funding should form the dominant share. The existing rules of limitation operating in the US will apply to private citizens and no public funding multiplier will apply to any corporate donation. Criminal code penalties must be enacted to prevent parties inducing such ground level support from private citizens by financial means or promise of patronage (those party hacks that may seek to pay each citizen $2 for each $1 solicited, and requiring therefore that such expenses for marketing or solicitation be deducted or netted prior to the public funding multiple being brought to bear). In Australian politics this must force the political candidate back to the stump that the Keating era acolytes held in such disdain and managed to successfully eschew.
    We will hold to the European public service model and they should retain their place of policy review. We will however remove the policy development function from the public service and separate those party partisan officials nominated by their party political masters (not directly citizen elected) from their departments. There will be no continuous policy making or development support services provided by public service departments and the policy hacks of political parties will return to academia or industry based solely upon meritorious selection and in competition with those younger whose careers are rising from within academia or business.
    We will introduce a financial regulatory regime that places the sanctity of the worth of money at its core, one that limits by weight foreign exchange movements within bands as defined by trade and hard titular foreign capital investment to moderate hot money flows.
    We would impose a hard raw leverage limit of 10x on bankers and remove the preferential treatment for residential housing in tiered capital scorecards and seek to reduce the property collateral imperative in commercial small business lending. But we need not speak of in depth of our support for capitalism as we turn from socialism because the markets we seek are free and the “ism” is a drag upon us.
    We will enforce a meritocratic system for the academic’s personal advancement, for academic board appointment processes that can set aside the ability of a candidates to fundraise or to gain increased public patronage, and we will ban “private funding specific” research driven careerism and rebalance and reward institutions and its teachers for excellence in traditional generalist undergraduate teaching and for increasing the level of participation.
    And finally we would abandon the so-called “independent” Reserve Bank and pursue the end of such institutions globally.
    And the cuddly narrative stuff? Liberté, égalité, fraternité, is more than sufficient. But your editor needs to be as ruthless when pruning that narrative as those first charged with it became in action. The force of destructiveness of the utopians and those of the “isms” is exceeded only by the hypocrisy of those that annex such charters for more fundamental ends. And so too it is for many of the constitutions that followed that have now been brought low by the executive, the political actors, and the cronies.
    So too writ small it has been in Australia where such subversive Fabians seek out both the label and the running of so-called civil libertarian movements. We recognise the past effectiveness of the subversive efforts of the Fabians we oppose. We shall not seek to overthrow a nation’s existing bicameral parliament or its judiciary, but we will take key reform initiatives to the people in the light of day, and prosecute the cronies with the weight of existing law and seek to banish them as a best an improved system of governance shall allow.
    We will not set forth measures that seek to impose a new world order, or implement any supposed “preventative measures” (beyond those already enshrined in the League of Nations Charter) to prevent some future clash of civilisations, for to do so would inevitably give rise to the opposite in outcome.
    So we seek a conservative revolution, hardly revolutionary, yet one more radical than post modern thought may withstand.

    Reply
  14. Great rant Ross…I’m not sure about the detail – I’m old enough to need to print it out on paper to really examine it.

    The Outback Oracle
    September 20, 2009
    Reply
  15. Dan

    Maybe I have missed something. I am asking this genuinely for your opinion. I outlined a possible outcome for the next 3 to 5 years. You seem to disagree with it. Again, as I said, I am sure we are fundamentally on the same page but what do you see for the next 3 to 5 years in Aus?

    The Outback Oracle
    September 20, 2009
    Reply
  16. Rudd’s policies are timed to expire within the next couple of years, as are those of many other nations. Within 18-24 months the curtain will be lifted on a new interntional monetary order, perhaps a new world currency. People are betting it’s going to be gold based, but I have my doubts. Any way, to me it will be a sad day when it all happens, because what happened in Russia and China last century was quite terrible, and it could happen again, given how centralized global power is becoming – and how rapidly this is occurring.

    Australia, on the other hand, is placed, as it always was, as the provider of raw materials for the world’s factories. As such, there will always be the need for a population here, about the size that there currently is, and it has to be a healthy one, to ensure reliability of supply. So it’s a kind of status quo, more or less, over the next 5 years. Except that socialism is coming into effect more than before – but leaving Australia might not be so attractive, because the alternatives might well be worse by then – overpopulated countries beware!

    That’s my take, but it’s a long bow. Nobody can predict the future, so I might as well have fun making pot shot predictions :)

    Reply
  17. Yogi Berra eckoned ‘It is hard to make predictions, especially about the future’

    The Outback Oracle
    September 20, 2009
    Reply
  18. Ross, your post makes for interesting reading, and summarizes much of what is being said around the various nooks and crannies of the Internet. I wait with bated breath for the downfall of central banking and garbage money, but how will it come about, if at all? Much of what you say about the vulnerability of the US military rings true (South Ossetia was a recent, painful embarrassment), and a conflict with Iran would bring about the sort of carnage that the desperadoes in Washington are drooling for.

    The one thing that calms the nerves when thinking about this stuff is that men, no matter how powerful, can make all the evil plans they like, but in the end it can all unravel – this is quite likely to be the case for the crazies who want to dominate the planet.

    Reply
  19. ” …the narrative is bent toward the utopian illusion…” . Yes, I think that perception in your second paragraph sums it all up well, Ross.

    Biker Pete, Brighton, Ont., Canada
    September 21, 2009
    Reply
  20. If Gold renews its place, then wont the centralised Govts (that are left) control it perhaps silver to the plebs? The last depression employed lots of soldiers, Aus cannot raise an army to defend itself in the next historical chapter. Keynes was never really proven was he, WW2 was defaulting of many of the economic theories not just Keynes? We evolved so much from defaulting past.

    Political theories are not logical, laws and so on are inventions like markets. Markets needs to be naturally sustainable, when it storms the stock and banks take heed. Yet we as humans cannot stand still, we must invent and/or do something useful, otherwise we are wasting our resources – we are wasting our time on earth.

    Charles Norville
    September 22, 2009
    Reply
  21. “Yet we as humans cannot stand still, we must invent and/or do something useful, otherwise we are wasting our resources – we are wasting our time on earth.” .. how’s that for a thought for the day! Nice one Charles!

    I’m reminded of the fact that no matter what the system in place may be, it ultimately depends on people in power, their belief systems, their motivations and their subsequent world agenda. People were keenly aware of this fact during the days of Monarchy. Today the same applies, except it is more difficult to discern.

    Has this changed at all over the past few decades, or fundamentally even since WWII? Are the children of the Prescott’s of the world past any different from their parents?

    Reply

Leave a Reply

Letters will be edited for clarity, punctuation, spelling and length. Abusive or off-topic comments will not be posted. We will not post all comments.
If you would prefer to email the editor, you can do so by sending an email to letters@dailyreckoning.com.au