[underdose]

I think Bill Maher put it better when he said that “the lesser of two evils is better than the greater of two evils.” This plan of not voting only works if everyone goes along with it. But, sadly, a frighteningly large percentage of the population are uninformed and fervently in favor of the status quo (or worse extremes) and will get out and vote. Not voting means abdicating to the unsophisticated masses. By voting, you at least have a fighting chance of participating in one of the key functions of the constitution, “checks and balances”. So I disagree with the author of that piece. What he suggests I would characterize as “surrender”.

[underdose]

I think Bill Maher put it better when he said that “the lesser of two evils is better than the greater of two evils.” This plan of not voting only works if everyone goes along with it. But, sadly, a frighteningly large percentage of the population are uninformed and fervently in favor of the status quo (or worse extremes) and will get out and vote. Not voting means abdicating to the unsophisticated masses. By voting, you at least have a fighting chance of participating in one of the key functions of the constitution, “checks and balances”. So I disagree with the author of that piece. What he suggests I would characterize as “surrender”.

[underdose]

I think Bill Maher put it better when he said that “the lesser of two evils is better than the greater of two evils.” This plan of not voting only works if everyone goes along with it. But, sadly, a frighteningly large percentage of the population are uninformed and fervently in favor of the status quo (or worse extremes) and will get out and vote. Not voting means abdicating to the unsophisticated masses. By voting, you at least have a fighting chance of participating in one of the key functions of the constitution, “checks and balances”. So I disagree with the author of that piece. What he suggests I would characterize as “surrender”.

[underdose]

I think Bill Maher put it better when he said that “the lesser of two evils is better than the greater of two evils.” This plan of not voting only works if everyone goes along with it. But, sadly, a frighteningly large percentage of the population are uninformed and fervently in favor of the status quo (or worse extremes) and will get out and vote. Not voting means abdicating to the unsophisticated masses. By voting, you at least have a fighting chance of participating in one of the key functions of the constitution, “checks and balances”. So I disagree with the author of that piece. What he suggests I would characterize as “surrender”.

[underdose]

I think Bill Maher put it better when he said that “the lesser of two evils is better than the greater of two evils.” This plan of not voting only works if everyone goes along with it. But, sadly, a frighteningly large percentage of the population are uninformed and fervently in favor of the status quo (or worse extremes) and will get out and vote. Not voting means abdicating to the unsophisticated masses. By voting, you at least have a fighting chance of participating in one of the key functions of the constitution, “checks and balances”. So I disagree with the author of that piece. What he suggests I would characterize as “surrender”.

[underdose]

“Can it really be the case that so many *intelligent*, *skilled* and experienced professionals in our government did not see the tsunami that was brewing in the unregulated world of derivatives and mortgage backed securities?”

I’m never quite sure. I seriously doubt that very many of them are in fact intelligent and skilled. I’ve talked to a lot of investment “professionals” lately and, frankly, none of them have a clue what is happening. I explain to them that this is the unavoidable consequences of the loose monetary policy and housing bubble of the first half of this decade, and they still can’t even grasp it in hindsight!

I read a study once that found that only 25% of people ever achieve the formal operational stage of cognitive reasoning, or the ability to think in abstractions and connect the dots. This sounds harsh, but anecdotally it seems reasonable. We often talk about people “drinking the Koolaid” when the masses act irrationally. Clearly the vast majority of participants in the financial markets honestly believed that real estate was a can’t-lose road to permanent prosperity. Only a few understood what was happening. How many of that few had any ambition for a government post? Fewer still. Maybe none. They mostly run blogs like this, or actively invest against the Koolaid drinkers, like George Soros, Peter Schiff, Jim Rogers, etc. So it is entirely possible that Ben Bernanke and Hank Paulson are in fact that dumb and unskilled that they really don’t understand what is happening. I’m going to go out on a limb and venture that George W. Bush did not plan all of this, and doesn’t comprehend why this is all happening.

On the other hand, I’ve read Allen Greenspan’s essays when he was affiliated with Ayn Rand. He gets it. His actions in the past 10 – 15 years is a spectacular about face from what he used to write. I think he knew damn well what he was doing….

[underdose]

“Can it really be the case that so many *intelligent*, *skilled* and experienced professionals in our government did not see the tsunami that was brewing in the unregulated world of derivatives and mortgage backed securities?”

I’m never quite sure. I seriously doubt that very many of them are in fact intelligent and skilled. I’ve talked to a lot of investment “professionals” lately and, frankly, none of them have a clue what is happening. I explain to them that this is the unavoidable consequences of the loose monetary policy and housing bubble of the first half of this decade, and they still can’t even grasp it in hindsight!

I read a study once that found that only 25% of people ever achieve the formal operational stage of cognitive reasoning, or the ability to think in abstractions and connect the dots. This sounds harsh, but anecdotally it seems reasonable. We often talk about people “drinking the Koolaid” when the masses act irrationally. Clearly the vast majority of participants in the financial markets honestly believed that real estate was a can’t-lose road to permanent prosperity. Only a few understood what was happening. How many of that few had any ambition for a government post? Fewer still. Maybe none. They mostly run blogs like this, or actively invest against the Koolaid drinkers, like George Soros, Peter Schiff, Jim Rogers, etc. So it is entirely possible that Ben Bernanke and Hank Paulson are in fact that dumb and unskilled that they really don’t understand what is happening. I’m going to go out on a limb and venture that George W. Bush did not plan all of this, and doesn’t comprehend why this is all happening.

On the other hand, I’ve read Allen Greenspan’s essays when he was affiliated with Ayn Rand. He gets it. His actions in the past 10 – 15 years is a spectacular about face from what he used to write. I think he knew damn well what he was doing….

[underdose]

“Can it really be the case that so many *intelligent*, *skilled* and experienced professionals in our government did not see the tsunami that was brewing in the unregulated world of derivatives and mortgage backed securities?”

I’m never quite sure. I seriously doubt that very many of them are in fact intelligent and skilled. I’ve talked to a lot of investment “professionals” lately and, frankly, none of them have a clue what is happening. I explain to them that this is the unavoidable consequences of the loose monetary policy and housing bubble of the first half of this decade, and they still can’t even grasp it in hindsight!

I read a study once that found that only 25% of people ever achieve the formal operational stage of cognitive reasoning, or the ability to think in abstractions and connect the dots. This sounds harsh, but anecdotally it seems reasonable. We often talk about people “drinking the Koolaid” when the masses act irrationally. Clearly the vast majority of participants in the financial markets honestly believed that real estate was a can’t-lose road to permanent prosperity. Only a few understood what was happening. How many of that few had any ambition for a government post? Fewer still. Maybe none. They mostly run blogs like this, or actively invest against the Koolaid drinkers, like George Soros, Peter Schiff, Jim Rogers, etc. So it is entirely possible that Ben Bernanke and Hank Paulson are in fact that dumb and unskilled that they really don’t understand what is happening. I’m going to go out on a limb and venture that George W. Bush did not plan all of this, and doesn’t comprehend why this is all happening.

On the other hand, I’ve read Allen Greenspan’s essays when he was affiliated with Ayn Rand. He gets it. His actions in the past 10 – 15 years is a spectacular about face from what he used to write. I think he knew damn well what he was doing….

[underdose]

“Can it really be the case that so many *intelligent*, *skilled* and experienced professionals in our government did not see the tsunami that was brewing in the unregulated world of derivatives and mortgage backed securities?”

I’m never quite sure. I seriously doubt that very many of them are in fact intelligent and skilled. I’ve talked to a lot of investment “professionals” lately and, frankly, none of them have a clue what is happening. I explain to them that this is the unavoidable consequences of the loose monetary policy and housing bubble of the first half of this decade, and they still can’t even grasp it in hindsight!

I read a study once that found that only 25% of people ever achieve the formal operational stage of cognitive reasoning, or the ability to think in abstractions and connect the dots. This sounds harsh, but anecdotally it seems reasonable. We often talk about people “drinking the Koolaid” when the masses act irrationally. Clearly the vast majority of participants in the financial markets honestly believed that real estate was a can’t-lose road to permanent prosperity. Only a few understood what was happening. How many of that few had any ambition for a government post? Fewer still. Maybe none. They mostly run blogs like this, or actively invest against the Koolaid drinkers, like George Soros, Peter Schiff, Jim Rogers, etc. So it is entirely possible that Ben Bernanke and Hank Paulson are in fact that dumb and unskilled that they really don’t understand what is happening. I’m going to go out on a limb and venture that George W. Bush did not plan all of this, and doesn’t comprehend why this is all happening.

On the other hand, I’ve read Allen Greenspan’s essays when he was affiliated with Ayn Rand. He gets it. His actions in the past 10 – 15 years is a spectacular about face from what he used to write. I think he knew damn well what he was doing….

[underdose]

“Can it really be the case that so many *intelligent*, *skilled* and experienced professionals in our government did not see the tsunami that was brewing in the unregulated world of derivatives and mortgage backed securities?”

I’m never quite sure. I seriously doubt that very many of them are in fact intelligent and skilled. I’ve talked to a lot of investment “professionals” lately and, frankly, none of them have a clue what is happening. I explain to them that this is the unavoidable consequences of the loose monetary policy and housing bubble of the first half of this decade, and they still can’t even grasp it in hindsight!

I read a study once that found that only 25% of people ever achieve the formal operational stage of cognitive reasoning, or the ability to think in abstractions and connect the dots. This sounds harsh, but anecdotally it seems reasonable. We often talk about people “drinking the Koolaid” when the masses act irrationally. Clearly the vast majority of participants in the financial markets honestly believed that real estate was a can’t-lose road to permanent prosperity. Only a few understood what was happening. How many of that few had any ambition for a government post? Fewer still. Maybe none. They mostly run blogs like this, or actively invest against the Koolaid drinkers, like George Soros, Peter Schiff, Jim Rogers, etc. So it is entirely possible that Ben Bernanke and Hank Paulson are in fact that dumb and unskilled that they really don’t understand what is happening. I’m going to go out on a limb and venture that George W. Bush did not plan all of this, and doesn’t comprehend why this is all happening.

On the other hand, I’ve read Allen Greenspan’s essays when he was affiliated with Ayn Rand. He gets it. His actions in the past 10 – 15 years is a spectacular about face from what he used to write. I think he knew damn well what he was doing….

[underdose]

partypup, thank you for the link to the story about China calling for a new reserve currency. That little tidbit of course didn’t show up in the usual US news channels. It strikes me as about the most relevent piece of news out there. I have long thought that China was just waiting until after the Olympics. They took 50% of the cars off the road in Beijing to try to cut down on the smog. Now that the camera crews are gone, back to business as usual with their need for oil (and other commodities) back on the upswing. And it served to play the nice guy politically while taking lots of money from tourists attending the games. Now, they can give us the big middle finger if they want.

stockstradr, your scenario of an orderly transition from the dollar as reserve currency is certainly possible. But it is also possible that it would happen very suddenly, without all involved parties holding hands. People do not coordinate their withdrawls from a bank when there is a run on that bank. It’s panic behavior. Likewise, there could be a “run” on the dollar, with all holders of dollars panicking to exchange them for something else before they become worthless. A simple, and likely catalyst might be China unpegging its currency. Since commodities are currently priced in dollars, China could swiftly move to buy all the oil, steel, copper, etc. that they might want to continue expanding their industrialization, divesting themselves of their dollar reserves to let their own currency float freely. All other holders of dollars would see commodity prices spiking, and commodity supplies running out, and would run for the exits as well. Such a scenario could force the adoption of another currency almost overnight. It would also trigger hyper-inflation here in the US. Although this doomsday scenario is not a complete certainty, and trying to guess the timing would involving reading the minds of the Chinese officials, it is definitely plausible, and at any moment, tomorrow or 5 years from now.

I hope for an orderly unwinding of this situation, but it would be silly to ignore the possibility that it will be sudden and violent.

[underdose]

partypup, thank you for the link to the story about China calling for a new reserve currency. That little tidbit of course didn’t show up in the usual US news channels. It strikes me as about the most relevent piece of news out there. I have long thought that China was just waiting until after the Olympics. They took 50% of the cars off the road in Beijing to try to cut down on the smog. Now that the camera crews are gone, back to business as usual with their need for oil (and other commodities) back on the upswing. And it served to play the nice guy politically while taking lots of money from tourists attending the games. Now, they can give us the big middle finger if they want.

stockstradr, your scenario of an orderly transition from the dollar as reserve currency is certainly possible. But it is also possible that it would happen very suddenly, without all involved parties holding hands. People do not coordinate their withdrawls from a bank when there is a run on that bank. It’s panic behavior. Likewise, there could be a “run” on the dollar, with all holders of dollars panicking to exchange them for something else before they become worthless. A simple, and likely catalyst might be China unpegging its currency. Since commodities are currently priced in dollars, China could swiftly move to buy all the oil, steel, copper, etc. that they might want to continue expanding their industrialization, divesting themselves of their dollar reserves to let their own currency float freely. All other holders of dollars would see commodity prices spiking, and commodity supplies running out, and would run for the exits as well. Such a scenario could force the adoption of another currency almost overnight. It would also trigger hyper-inflation here in the US. Although this doomsday scenario is not a complete certainty, and trying to guess the timing would involving reading the minds of the Chinese officials, it is definitely plausible, and at any moment, tomorrow or 5 years from now.

I hope for an orderly unwinding of this situation, but it would be silly to ignore the possibility that it will be sudden and violent.

[underdose]

partypup, thank you for the link to the story about China calling for a new reserve currency. That little tidbit of course didn’t show up in the usual US news channels. It strikes me as about the most relevent piece of news out there. I have long thought that China was just waiting until after the Olympics. They took 50% of the cars off the road in Beijing to try to cut down on the smog. Now that the camera crews are gone, back to business as usual with their need for oil (and other commodities) back on the upswing. And it served to play the nice guy politically while taking lots of money from tourists attending the games. Now, they can give us the big middle finger if they want.

stockstradr, your scenario of an orderly transition from the dollar as reserve currency is certainly possible. But it is also possible that it would happen very suddenly, without all involved parties holding hands. People do not coordinate their withdrawls from a bank when there is a run on that bank. It’s panic behavior. Likewise, there could be a “run” on the dollar, with all holders of dollars panicking to exchange them for something else before they become worthless. A simple, and likely catalyst might be China unpegging its currency. Since commodities are currently priced in dollars, China could swiftly move to buy all the oil, steel, copper, etc. that they might want to continue expanding their industrialization, divesting themselves of their dollar reserves to let their own currency float freely. All other holders of dollars would see commodity prices spiking, and commodity supplies running out, and would run for the exits as well. Such a scenario could force the adoption of another currency almost overnight. It would also trigger hyper-inflation here in the US. Although this doomsday scenario is not a complete certainty, and trying to guess the timing would involving reading the minds of the Chinese officials, it is definitely plausible, and at any moment, tomorrow or 5 years from now.

I hope for an orderly unwinding of this situation, but it would be silly to ignore the possibility that it will be sudden and violent.

[underdose]

partypup, thank you for the link to the story about China calling for a new reserve currency. That little tidbit of course didn’t show up in the usual US news channels. It strikes me as about the most relevent piece of news out there. I have long thought that China was just waiting until after the Olympics. They took 50% of the cars off the road in Beijing to try to cut down on the smog. Now that the camera crews are gone, back to business as usual with their need for oil (and other commodities) back on the upswing. And it served to play the nice guy politically while taking lots of money from tourists attending the games. Now, they can give us the big middle finger if they want.

stockstradr, your scenario of an orderly transition from the dollar as reserve currency is certainly possible. But it is also possible that it would happen very suddenly, without all involved parties holding hands. People do not coordinate their withdrawls from a bank when there is a run on that bank. It’s panic behavior. Likewise, there could be a “run” on the dollar, with all holders of dollars panicking to exchange them for something else before they become worthless. A simple, and likely catalyst might be China unpegging its currency. Since commodities are currently priced in dollars, China could swiftly move to buy all the oil, steel, copper, etc. that they might want to continue expanding their industrialization, divesting themselves of their dollar reserves to let their own currency float freely. All other holders of dollars would see commodity prices spiking, and commodity supplies running out, and would run for the exits as well. Such a scenario could force the adoption of another currency almost overnight. It would also trigger hyper-inflation here in the US. Although this doomsday scenario is not a complete certainty, and trying to guess the timing would involving reading the minds of the Chinese officials, it is definitely plausible, and at any moment, tomorrow or 5 years from now.

I hope for an orderly unwinding of this situation, but it would be silly to ignore the possibility that it will be sudden and violent.

[underdose]

partypup, thank you for the link to the story about China calling for a new reserve currency. That little tidbit of course didn’t show up in the usual US news channels. It strikes me as about the most relevent piece of news out there. I have long thought that China was just waiting until after the Olympics. They took 50% of the cars off the road in Beijing to try to cut down on the smog. Now that the camera crews are gone, back to business as usual with their need for oil (and other commodities) back on the upswing. And it served to play the nice guy politically while taking lots of money from tourists attending the games. Now, they can give us the big middle finger if they want.

stockstradr, your scenario of an orderly transition from the dollar as reserve currency is certainly possible. But it is also possible that it would happen very suddenly, without all involved parties holding hands. People do not coordinate their withdrawls from a bank when there is a run on that bank. It’s panic behavior. Likewise, there could be a “run” on the dollar, with all holders of dollars panicking to exchange them for something else before they become worthless. A simple, and likely catalyst might be China unpegging its currency. Since commodities are currently priced in dollars, China could swiftly move to buy all the oil, steel, copper, etc. that they might want to continue expanding their industrialization, divesting themselves of their dollar reserves to let their own currency float freely. All other holders of dollars would see commodity prices spiking, and commodity supplies running out, and would run for the exits as well. Such a scenario could force the adoption of another currency almost overnight. It would also trigger hyper-inflation here in the US. Although this doomsday scenario is not a complete certainty, and trying to guess the timing would involving reading the minds of the Chinese officials, it is definitely plausible, and at any moment, tomorrow or 5 years from now.

I hope for an orderly unwinding of this situation, but it would be silly to ignore the possibility that it will be sudden and violent.

[Author]

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