From Bill Cara comes this insight on the happy talk about the market:
“Stress tests at the US banks will show that much more capital is required, so the banks would like to talk this market higher to minimize the resultant dilution. However, they will have six months to raise that capital, and a lot can happen in that amount of time….”
The Bureau of Economic Analysis released the Q1 ’09 GDP numbers.
The annual rate of decline came in at the expected 6.1% (a decline of 6.3% in real GDP).
Calculated Risk has an optimistic assessment of the Q1 numbers.
The optimistic case rests on the following:
Mish Shedlock is less optimistic. He says that the Q1 ’09 rise in PCE is either an outlier or temporary, and will be followed by another dip in 2010-11 and more trough for a few years.
Meanwhile, former Fed chairman Paul Volcker, head of Barack Obama’s economic team, thinks the economy is “leveling off,” according to this Bloomberg report.
Highlights of what Volcker is reported to have said:
Altogether, I thought Volcker’s comments were evasive, inadequate, and temporizing.
I’ve been listening unmoved to all the hysteria about swine flu, feeling skeptical about some of the reporting. There was, after all, a 1976 swine-flu epidemic that never was, according to a piece by Patrick de Justo in Salon.
There’s no clear evidence of how this thing was triggered or how bad it is, but already the government is stocking up from the drug companies. You’ve got to wonder if all the alarmism isn’t just a distraction from the financial shenanigans in DC. And if it will just provide another excuse to clamp down on the population.To wit., the Massachusetts Senate passed a bill on April 28 that would let the public health commissioner “close or evacuate buildings, enter private property for investigations, and quarantine individuals” during an emergency, as well as impose fines of up to$1000 for not complying with public health orders. [Credit to Rady Ananda for providing the link].
Someone, somewhere is making a few bucks off those vaccines – you can be sure of that.
The New Scientist doubts that this is a genetically-engineered virus that was accidentally (or, as some cynics write, purposefully) let loose in the population. Swine-flu might still be man-made, it concedes, but the culprits are more likely to be factory-farms:
(New Scientist):
“Animal vaccines might seem like the answer, but vaccines that do not provide 100% protection can actually make things worse. When there is widespread vaccination, viruses can spread without any visible disease. Ineffective vaccines also create strong selective pressure driving the evolution of new strains that can dodge the immune attack provoked by the vaccine.
Already, attention is turning to the big pig farms in Mexico, and the role they may have played in creating this new strain of swine flu.
The fact is that we still know so little about flu, and what makes it capable of spreading from human to human, means that deliberately engineering a virus of this kind would be a huge challenge. Yes, it’s possible that this virus was created by a mistake at a research laboratory or a vaccine factory.
But by far the most plausible explanation is that this monster is the long-predicted product of our farming system....”
_________________________
Update: Here’s Ron Paul, as usual right on the money, cautioning against the scare-mongering and pointing out that last time around 25 people died of the vaccine, while only 1 person died from the flu itself. And 500 people also developed Guillane Barre syndrome, a serious neurological disorder.
Update: From The Independent, UK:
“Q What defence do we have against swine flu?
A Better than we did against the last pandemics in 1957 and 1968. We have a stockpile of anti-viral drugs – Tamiflu and Relenza – which we did not have then. We also have a pandemic plan, drawn up by the Government since avian flu became a threat in 2003, which sets out what is to be done – from distributing the drugs and setting up helplines to closing schools and banning public events.
Q Has the pandemic plan ever been tested?
A Yes, in one of the biggest emergency planning exercises since the end of the Cold War that took place in 2007. It involved hundreds of health officials across the country.
Q Are there enough anti-viral drugs?
A Not according to the Tories. The Government says it has over 30 million courses of the drugs, enough for half the population. The Tories say this is not enough if family members of an infected person are to be treated prophylactically. In that case, enough drugs to cover three-quarters of the population will be necessary, they say….”
My Comment:
That’s a lot of drugs. And a lot of money for the drug manufacturers. Food for thought…
“On Anything,” Hilaire Belloc
Constable & Co., 1910
“The truth is that men pass under strong influences of time that fill them more than with wine, rather with an entirety of life. The time in which a man lives may be an exalted time or a weary one, but it fills him altogether, whether it is on fire or drowned. He can conceive, as a rule, nothing in the future different from the temper of his time, though there is all the past to teach him his folly. If he makes a picture of the future, that picture is a mere extension of his own tiny and ephemeral experience, and the more confidently certain he is of that future the more rigidly is it seen by the critical onlooker to be a puppet dressed up in the clothes of the present.
All these things Dunoyer’s careful book upon two men of the Revolutionary Tribunal, a monograph characteristic of that ceaseless and immense research which dignifies the modern French School of History, has suggested to my mind.
Now, whenever I read of the Revolution, in general or in particular, while that lesson of the folly of prophecy perpetually returns to me, yet something else rises from the page. In a certain sense, almost in a mystical sense, the periods of profound faith in a particular future were right. Not because the picture that they saw was true, but because those things outside time upon which they relied were and are true. And even to-day in the sheer anarchy and welter of the time we suffer there is a method of thought which has anchoring ground in the permanent fate of mankind. But what that method may be there is no space to discuss here.”
My Comment:
Belloc is less familiar to me than Chesterton, but it’s an ignorance I mean to remedy swiftly. I encountered him during childhood through his nonsense rhymes and modeled an early unpublished collection of light verse on them. I always meant to get around to reading more of him.
It’s one of the horrid things about governments that we have to spend so much time figuring out what new imposition they mean to levy on us that we have no time left over for things we actually enjoy. Some days I wonder if we wouldn’t be wiser to simply ignore what’s going on and live “underground,” hiding as much of our lives as we can from the powers that be.
The Belloc passage I posted expresses a conundrum that often troubles me and surfaced in an article I posted a while ago by Naomi Wolf, in which she compares the US government to the Nazis. Joey Kurtzman correctly called this historically inaccurate. I concurred with Kurtzman, but still agreed that Wolf had said something “true,” even if partially inaccurate.
This I take to be the substance of what Belloc is saying. Our predictions are always intensely colored by the particular time in which we live and thus are always suspect. But at moments of crisis – revolutionary moments – we can nonetheless correctly predict the direction of the future, not because of any perspective lent to us by the time in which we live, but because of something outside time, some truth beyond particularity. That is what seizes us and speaks through us…
PS: I corrected the title of this post, from “Hilaire Belloc on the effect of time” to “Hilaire Belloc on prophecy and time” for the sake of clarity.
Nice finale to Tom Woods’ piece at Taki Magazine, putting an end to some superstitions about labor and wealth:
“Leaving aside the odd view that only manual laborers engage in “work,” all the brawn in the world could never have produced a steam engine or a Pentium processor. Only when informed by the knowledge of inventors and supplied with the capital saved by capitalists can the average laborer produce the tiniest fraction of what he is today accustomed to producing. The central ingredient in a laborer’s physical productivity is the equipment and machinery at his disposal. There is nothing natural or inevitable about the availability of this productivity-enhancing capital equipment. It comes from the wicked capitalists’ abstention from consumption, and the allocation of the unconsumed resources in capital investment. This process is the only way the general standard of living can possibly rise. Hartmann thinks it’s just swell to tax it.
The increases in the productivity of labor that additional capital makes possible, by increasing the overall amount of output and thereby increasing the ratio of consumers’ goods to the supply of labor, make prices lower relative to wage rates and thereby raise real wages. That’s why, in order to earn the money necessary to acquire a wide range of necessities, far fewer labor hours are necessary today than in the past—say, 1950 or 1900. Thanks to capital investment, which is what businesses engage in when their profits aren’t seized from them, our economy is far more physically productive than it used to be, and therefore consumer goods exist in far greater abundance and are correspondingly less dear than before……
Hartmann’s argument runs, in effect: “Citizen, you need to be looted in order to stabilize the system [a nonsensical idea Hartmann came across in the popular Keynesianism that forms the entirety of his economic knowledge]. Let us hear no more anti-social talk about your so-called rights. All hail The System! Wherever would we be without the stabilizing power of violence!”
As for the nonsense about FDR’s New Deal “stabilizing us”—and the perverse argument that our economy will never be stable unless the people are violently expropriated—check out economist Robert P. Murphy’s new book The Politically Incorrect Guide to the Great Depression and the New Deal. Its playful title notwithstanding, this book mercilessly bludgeons thoughtless clichés like this.
At least the mafia has the decency not to put such transparently phony claims over on you. They’re honest: we’re taking your money because we have power, and you don’t.
What it all boils down to is this: one side of our political spectrum favors the central planning of Iraq, while the other favors the central planning of Americans. We can only hope for the continued growth of a third side, one that rejects as unworthy of a free people all the superstitious nonsense about the magical powers of our overlords, whether that power is exercised at home or abroad.”
Rep Ron Paul, Daniel Hannan, Lew Rockwell, Jason Sorens, R.J. Harris, Cody Willard & Shelly Roche, Free State Project, Secession, Nationalization FREEDOM WATCH 2PM EST TODAY (Wed., Apr. 29th)! http://www.foxnews.com/strategyroom
An interesting exchange from The Libertarian Alliance’s website on libertarianism and scarcity, with Kevin Carson responding to Paul Marks’ critique of his work:
[Marks]
“Neither land nor capital are [sic] “artificially scarce” – they are just scarce (period). There are billions of people and only a certain amount of land and machinery? .[T]he idea that land and capital are only scarce [emphasis mine] compared to the billions of people on Earth because of either wicked governments or wicked employers (or both) is false.”
[Carson]
First, simply to get the second part of Mr Marks’ statement out of the way, I nowhere asserted that all scarcity of land and capital is artificial. I argued only that they were more scarce, as a result of state-enforced privilege, than they would otherwise be, and that returns on land and capital were therefore higher than their free market values. In any case, as Franz Oppenheimer observed, most of the scarcity of arable land comes not from natural appropriation, but from political appropriation. And the natural scarcity of capital, a good which is in elastic supply and which can be produced by applying human labor to the land, results entirely from the need for human labor for its creation; there is no fixed limit to the amount available.
But getting to his main point, that land and capital are not artificially scarce, I’m not sure Mr Marks is even aware of his sheer audacity. In making this assertion, he flies in the face of a remarkable amount of received libertarian wisdom, from eminences as great as Mises and Rothbard. As a contrarian myself, I take my hat off to him.
Still, I wonder if he ever made the effort to grasp the libertarian arguments, made by Rothbard et al, that he so blithely dismisses. Is he even aware of the logical difficulties entailed in repudiating them? Does he deny that state enforcement of titles to land that is both vacant and unimproved reduces the amount available for homesteading? Does he deny that the reduced availability of something relative to demand is the very definition of “scarcity,” or that the reduction of supply relative to demand leads to increased price? Or is his argument rather with Rothbard’s moral premises themselves, rather than the logical process by which he makes deductions from them? I.e., does he deny that property in unimproved and vacant land is an invalid grant of privilege by the state, and thereby repudiate Locke’s principle of just acquisition?
It seems unlikely, on the face of things, that Mr Marks would expressly repudiate Mises and Rothbard on these points. After all, elsewhere in his critique he cites Human Action and Man, Economy and State as authorities. Perhaps he just blanked out on the portions of their work that weren’t useful for his apologetic purposes.
In any case, if he does not repudiate either Rothbard’s premises or his reasoning, Mr Marks has dug himself into a deep hole. For by Rothbard’s Lockean premises, not only the state’s own property in land, but “private” titles to vacant and unimproved land, are illegitimate. Likewise, titles derived from state grants are illegitimate when they enable the spurious “owner” to collect rent from the rightful owner – the person who first mixed his labor with the land, his heirs and assigns. And the artificial scarcity of land resulting from such illegitimate property titles raises the marginal price of land relative to that of labor, and forces labor to pay an artificially high share of its wages for the rent or purchase of land….”
Peter G. Peterson, the co-chairman of the private equity firm, The Blackstone Group, is also president of the Concord Coalition , a bi-partisan group devoted to what it calls “fiscal responsibility,” which seems to be largely given to public advocacy of social security and medicare (entitlements) cuts.
I’m interested in Peterson, because of the way he keeps popping up into things.
First, as I noted in a blog post a couple of months back, he’s become the backer of the film, I.O.U.S.A., directed by Patrick Creadon, which is loosely based on the book, “Empire of Debt,” (Bonner & Wiggin, 2005). I noted at the time the difference between the libertarian arguments of the book (which critiques the Federal Reserve) and the film’s noticeable silence on the Federal Reserve. In fact, the film spends a great deal of time on some of the very people who enabled the current debt crisis, including Alan Greenspan.
Second, I notice that Peterson has been using the film to argue that entitlement spending is out of control and needs to be cut back, etc. etc., an argument that progressive economist Dean Baker correctly calls morally bankrupt, given that this administration just bailed out some of the most irresponsible gamblers in the banking industry.
Third, I notice that Tim Geithner has given BlackRock three no-bid contracts to manage the Fed’s portfolio of troubled securities, according to a NY Times piece yesterday (April 27). BlackRock has close connections to Blackstone (where it was once the asset management division) and to the NY Fed.
That prompted me to do some digging around and I came across this interesting piece on Peterson, “A Crusader in Clover,” by John Hess at FAIR (Fairness and Accuracy in Reporting).
“While he is reticent about his [Peterson’s] income, Vanity Fair put his take-home in 1992 at $7 million, not an excessive sum for an investment banker of his rank. His partner Stephen Schwartzman, who is regarded in the financial press as the sparkplug of their firm, the Blackstone Group, said that year that investors in its venture fund should expect returns of 25 to 30 percent during the 1990s—again, not unreasonable, since the Dow Jones average rose more than 26 percent last year.
Such rates of return are, again, piquant, because Peterson has described the indexation of Social Security, which lately has raised benefits by roughly 3 percent a year, as “one of the greatest fiscal tragedies of American history.” Piquant? Wait. Peterson was at President Nixon’s side as his economic adviser and secretary of commerce when that “tragedy” was enacted in 1972. (Conservatives thought making the cost-of-living adjustment automatic would deter Congress from voting more generous benefits.)
Peterson denounces the “mad, drunken bash” of the Reagan years. That would be the time when the top income-tax rate was cut from 70 percent to 28 percent, military spending went sky-high, and trillions were made (and lost) on savings and loans and takeovers financed by junk bonds. He was himself, of course, making out like a bandit, hustling for his share of the action, and contributing his bit to Republican campaign funds. He also led a chorus of corporate executives who keened about the exploding federal deficit. His contribution was a key series of articles in the New York Review of Books in 1982 (12/2/82, 12/16/82) that prepared the intellectual climate for the 1983 Social Security “rescue,” which raised payroll taxes and lowered benefits.
The series purported to prove with mathematical certainty that the entitlements of the elderly were snatching food from babies and driving the nation toward bankruptcy. George Will called it “the most important journalism of 1982.” (Washington Post, 12/19/82). Its charts persuaded such liberals as Tom Wicker and Anthony Lewis. Leslie Stahl of ABC said Peterson “really began to educate me.” (She has since repaid the favor with appearances by her mentor on 60 Minutes.)
All the journalists he met seemed impressed by his expertise, and by his generosity in offering to surrender his own entitlements. It does not seem to have occurred to any of his interviewers that a rise of 1 percentage point in his income tax rate would cost him perhaps twice as much as his Social Security and Medicare benefits combined. Nor have any observed how policies he has supported have transferred the tax burden from the wealthy to the wage earner.
Indeed, in Facing Up, Peterson remarks with pleased surprise that nobody had clamored for a cut in the Social Security payroll tax to match cuts in benefits….”
Ivan Eland of the Independent Institute has a piece at The San Francisco Chronicle on how presidents are evaluated….and how they should be evaluated:
“Surprisingly, Democrats Jimmy Carter and Bill Clinton actually reduced government spending as a fraction of GDP. Dwight Eisenhower, the best of the modern Republican presidents on this score, held spending roughly constant as a portion of GDP. Carter also deregulated four major industries – financial services, energy, communications and transportation – and eventually appointed a Federal Reserve chairman who set a precedent for a tight monetary policy, which ultimately led to national prosperity during the Reagan and Clinton years. Reagan continued Carter’s deregulation but weakened it.
Bias Toward Activism
The fact is: Most presidential scholars have a bias toward activism rather than outcomes.
A president who creates new government programs to deal with societal problems generally will be rated as a better president than one who deals more cautiously – and cost-effectively – with problems. This is true even if the activist president’s programs do little good or even exacerbate the problems they were intended to solve.
Thus, Johnson and Roosevelt receive high ratings from most historians, though many of Roosevelt’s economic-recovery programs were wasteful and ineffective, and many of Johnson’s Great Society programs increased government dependency and made poverty more intractable. Bush added a Medicare drug benefit – the first new entitlement program since the Great Society – to a system more insolvent than Social Security. And while Reagan is remembered by historians as an advocate of small government, he expanded government substantially.
Presidents should be judged on results. And results should be measured not by the number of new laws passed, the size of a stimulus bill or the number of jobs added or saved during the president’s term.
Results should be measured by the degree to which his actions, or his deliberate inaction, contribute to peace, prosperity and liberty.”
My Comment:
This is a very thoughtful piece and it highlights one of the worst traits of democracy – the incessant pressure from voters to act, to show results.
Interestingly, that’s also one of the underlying reasons behind the increasing volatility of markets today. Firms and analysts are more and more driven by quarterly performances, which results in all-kinds of short-term juggling of balance-sheets. In turn, that contributes to overall market volatility.
In politics, the relentless pressure to act– to take charge – is equally dangerous, because it feeds the delusion that the economy can be made to do what you want in some direct, hands-on fashion.
Well, what about leadership, you might ask? Isn’t there something a leader can do?
This again depends on what you think of the notion of leadership. I’ll reserve my thoughts on that for a separate post, but for now I’ll say that what seems to be required today is an appearance and demeanor acceptable to the masses of voters. That’s what “charisma” amounts to.
In practice, this means how well a person can read a teleprompter, how personable they are on TV, how personable their family is, how decisive their utterances seem, and so on.
Now, since that varies with the moods of the voters, it follows that opinion-testing (polls, focus groups) becomes very central to this notion of leadership.
And, opinion-testing is often nothing more than opinion-forming. The leader molds the crowd, and the crowd in turn molds the leader.
This two-way dynamic is also influenced by expert opinion. You would normally suppose that that would exert a moderating influence on the activism of a president. Experts, you’d think, would provide some of the ballast, the weighting to hold back the crowd – along the lines of the role originally conceived for the Senate, for instance.
But the expert class – and I’ve discussed this at length in The Language of Empire – also has an inbuilt bias toward activism.
Ergo, everything tends to make presidents more activist than it’s wise for them to be.
Thanks to a reader for sending this in:
The Surgery Center of Oklahoma
Check out the costs of different procedures below. They are far below standard costs.
I hope the information helps someone in need of inexpensive alternatives.
Please note that I am not a medical expert of any kind and have not checked this facility. I know nothing about the quality and posted it here simply to show readers that there are alternatives. It’s up to each person to check, do their research, and ask questions. I take no responsibility for anyone who uses this facility and is dissatisfied, injured, or hurt in any way.
From the website:
“It is no secret to anyone that the pricing of surgical services is at the top of the list of problems in our dysfunctional healthcare system. Bureaucracy at the insurance and hospital levels, cost shifting and the absence of free market principles are among the culprits for what has caused surgical care in the United States to be cost prohibitive. As more and more patients find themselves paying more and more out of pocket, it is clear that something must change. We believe that a very different approach is necessary, one involving transparent and direct pricing.
Transparent, direct, package pricing means the patient knows exactly what the cost of the service will be upfront. Fees for the surgeon, anesthesiologist and facility are all included in one low price. There are no hidden costs, charges or surprises.
The pricing outlined on this website is not a teaser, nor is it a bait-and-switch ploy. It is the actual price you will pay. We can offer these prices because we are completely physician-owned and managed. We control every aspect of the facility from real estate costs, to the most efficient use of staff, to the elimination of wasteful operating room practices that non-profit hospitals have no incentive to curb. We are truly committed to providing the best quality care at the lowest possible price.”