RashyNullPlanet

Madlen Read has no idea what capitalism is:

…economic professors may well point to 2008 as the year capitalism went on life support.

The local rag links Madlen, and in the print edition, it’s under the moronic headline, “2008: The year capitalism went on life support.”

Banks took stupid risks, and went crying to mama government when those risks burned them. Unfortunately, fractional reserve banking has so infected so many economies that their fall has had repercussions almost everywhere. Even more dismal is the fact that there is almost no one left who understands that a bank, or any other company no matter how large, which habitually makes poor judgments, should fail.

Anyone who points to 2008 as a failure of capitalism, has no idea what capitalism is. Capitalism is not about capital, it’s about freedom. That includes the freedom to fail because of stupid decisions.

A former home-owner in Phoenix quits paying her mortgage and blames everyone else:

A little more than a year ago, I bought a four-bedroom tract home with a pool, in a very nice subdivision in Scottsdale, Arizona, for $570,000.

…

Suddenly, the house I bought for $570,000 is worth…$380,000?!?!

…

What this means is that I, as a responsible homeowner, am now paying a mortgage of $450,000, on a house worth $380,000…

…

I never thought I would be the type to end up in foreclosure, but last month I made the decision to stop paying my mortgage.

Alisa, you made a commitment. A promise. You signed a contract vowing you would pay what you promised.

You’re bailing out before you’ve honored your promise, and that makes you a liar and a thief, not to mention a colossal moron for imagining that a house is an investment. You allowed yourself to be consumed by tulip mania and you’re going to walk away from your obligation. Your actions prove you’re not a “responsible homeowner”. On the contrary, they prove that you can’t be trusted to keep your word.

This would have been a comment on Alisa’s blog, but she’s disabled comments on that entry.

Alisa’s bullshit via Billy.

Update: Alisa removed her original post, stating “Way too many crazy, ignorant people linking to this post from fascist sites. Not worth the gray hair”, revealing that she’s not only a liar and a thief, but a coward as well.

And, by the way, Alisa, “fascist” doesn’t mean what you imagine it means.

Chrysler, GM, and Ford want to suckle, too:

Even as lawmakers in both parties unleashed a barrage of questions about the wisdom of a government rescue for the American International Group, support seemed to be growing quickly on Capitol Hill for $25 billion in loan guarantees to assist the ailing auto industry.

Both presidential candidates, Senator John McCain of Arizona and Senator Barack Obama of Illinois, have voiced support for the loan guarantees ? an unsurprising stance given the critical importance of the main auto-producing states, Michigan and Ohio, to the electoral map this fall.

The chief executives of the three big American automakers ? General Motors, Ford and Chrysler ? met on Wednesday afternoon with House Speaker Nancy Pelosi.

When they emerged, they expressed optimism that the loan guarantees would be included as part of a budget resolution that is needed to finance government operations through the end of the year.

Chrysler, GM, and Ford?should be?careful what?they wish for. If the AIG model is followed, those car companies could easily become the US AvtoVAZ:

The Avtovaz project was promoted as a dynamic feat of collective socialist effort…

Compare that to this:

These are jobs. These are cars that we should be selling ? or manufacturing in America, not someplace else.

– Harry Reid, as quoted in the NYT article

There?is no difference between those two statements. With those loans will come?even more?destructive government oversight.?

NY Times article via?Radley Balko.

A friend sent me this Kiyosaki article earlier this week.

Kiyosaki is confused about some things. He opens with this:

Most of us are aware of the sacrificial slaughter of Bear Sterns.

Then he continues with this, in the very next sentence:

Some people call it a bailout, but I call it a handout…

This blatant contradiction doesn’t bode well for the rest of Kiyosaki’s article, which includes this Nuremberg lob:

The Fed was doing its job…

Kiyosaki comes apart with this:

The rise in the price of gold is a sign that capitalism has stumbled.

This is like saying that basic arithmetic has stumbled. Capitalism, like basic arithmetic, isn’t an active thing. It’s a concept. It can’t “stumble”. Kiyosaki’s statement is wrong. The fact is that capitalism has been demonstrated once again, by the rising price of gold, to be valid, despite Bernanke’s attempt to avoid basic concepts.

When your unit of measurement shrinks, the number of your units that you’re using to quantify other things has to get bigger.

The price of gold is rising because the unit of measure, the dollar, is getting smaller, because the Federal Reserve printed more dollars.

Karen De Coster excerpted this gem from a Marketwatch.com article:

Band continued: “We’re in a critical stage for stocks right now, what technical analysts call the ‘right shoulder’ of a head-and-shoulders bottom. The left shoulder formed on March 10, when the Standard & Poor’s 500 index touched its closing low for the year (so far) at 1273.37. The upside-down head came on March 17, when the index broke to a new low intraday but finished at 1276.60, slightly above the March 10 close. Now we’re sliding down again to complete the right shoulder of the pattern. If all goes well, the S&P should remain comfortably above the two previous closing lows. Then we can rocket higher in April.”

Predicting the future of stock markets this way strikes me as very similar to phrenology. You can dress up your prediction with fancy diagrams and laundry lists of terms, but in the end, the outcome will depend on the underlying principles. I have no doubt that the Dow will eventually hit 16k. It’s unavoidable given the fact that the unit by which it’s measured, i.e., the US dollar, is constantly shrinking.

To illustrate this, suppose I have a ruler I use to measure part of my anatomy every so often. The thing about this ruler, though, is that it’s slowly getting smaller, so every time I measure my part, I read a number that’s bigger than the last time. This makes me feel very good, even though my part hasn’t really changed since I quit growing about 20 years ago.

Yes, that analogy is a bit simplistic, since companies can and do produce and grow, however, the stick by which they’re measured is constantly shrinking. So, of course the Dow will hit 16k at some point. In fact, I’ll see Band’s 16k, and raise to 20k.