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Weekend reflections

May 14th, 2010

It’s time again for weekend reflections, which makes space for longer than usual comments on any topic. Civilised discussion and no coarse language please.

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  1. Ernestine Gross
    May 17th, 2010 at 17:28 | #1

    “Fear wipes $40b off the market ” (ASX market)

    http://www.smh.com.au/business/markets/fear-wipes-40b-off-the-market-20100517-v6q3.html?autostart=1

    Is it “fear” or is it another one of the financial land mines go off. How many more?

  2. Freelander
    May 17th, 2010 at 17:45 | #2

    Fear might stand for ‘fundamentalist economists’ arcane rigor (mortis)’.

  3. Ernestine Gross
    May 17th, 2010 at 19:22 | #3

    N.e.a.t.

  4. Chris Warren
    May 17th, 2010 at 22:18 | #4

    Ernestine Gross :
    @Chris Warren
    May I ask for a reference for reasonable precise theoretical model of “capitalism”? (Not Karl Marx, das Kapital). During the past 20 to 30 years, institutional changes have been introduced under the heading ‘market economics’. IMHO, ‘capitalism’ is not the same thing as market economics. But I may be wrong.

    Quite a Gen-Y dilemma here, – what is a reasonable, precise, theoretical model of capitalism but not Marx’s Capital (?!).

    You cannot provide a reasonable precise theoretical model of capitalism outside Marx – you just end up with a sociological mess (Weber, Habermas etc).

    Most economists refuse to provide a model of capitalism, instead we get ‘market economy’, ‘private enterprise’, ‘investment’ and supposedly ‘competition’. But these all exist under market socialism.

    But capitalism is based on two different types of “profit” – [1] the profit someone obtains from their own labour and [2] the profit obtained by accumulating the produce of others.

    Naturally this existed under fuedalism and colonialism. Under capitalism this general mode of accumulating profit [2] is driven by capitalists using Capital in particular.

    If there is no accumulating other peoples produce, as a function of capital, there is no capitalism.

    As G D H Cole said – Marx’s Capital is not an easy book to read. Poor ‘ol Keynes found it ‘dreary, out-of-date’ etc. and according to Joan Robinson he never managed to read Marx.

    For those who have read and understood Marx’s “Capital”, a key point is that Capital is not productive – it only produces a competitive advantage thereby accumulating the produce of others (until equilibrium).

    Capitalism is based on the belief that capital is productive in itself. This is the camouflaged capitalist presentation of its accumulating of others produce (as in mode [2] above)

    .

  5. Alice
    May 17th, 2010 at 22:34 | #5

    @Ernestine Gross
    F.e.a.r…..n.e.a.t….you two are a pair of cards!

  6. Alice
    May 17th, 2010 at 22:38 | #6

    @Chris Warren
    Which brings me to an interesting thought Chris…that “capitalism” may perhaps have been thus named after Marx’s book and that perhaps he was the only economist to model capitalism, instead of only parts of markets that got added and bundled eg as micro and macro??

  7. Donald Oats
    May 17th, 2010 at 22:55 | #7

    Just saw the news story about yet another Catholic priest covering up paedophilia. Aside from the awfulness of it, what is surprising is that the priests doing the covering up are implicitly admitting that they do not personally believe in their own faith. If they did believe in it, they would be only too certain that covering up paedophilia by other Catholic priests means a one way trip to Hell, or at the minimum no ticket to Heaven. They should be shaking in their robes at the thought of God punishing their continuing transgressions.

    So far several – an understatement – Catholic priests have been discovered to have covered up ongoing sexual abuse, or the knowledge of past abuse. I don’t think hiding behind confession is a possibility for a Catholic priest in this situation. They are damned by their own hand – if they actually believe in the Catholic Christianity. If they don’t, then covering up a crime is a matter of judgement concerning the cost to them for dobbing in another Catholic priest, versus the benefits of covering it up. A career priest may well feel that a cover up is good for the Church and therefore good for them.

    Summary version: Catholic priests who cover up the criminal transgressions of other Catholic priests are complicit in crime, but more importantly, are exposing the fact that they don’t believe that God would punish them for such a crime, and that in turn makes one suspect that these priests don’t believe in what they are selling. If they don’t believe in their own Catholic Christianity, then why an outsider (eg member of public who attends Mass) would believe in it is beyond me.

  8. Alice
    May 17th, 2010 at 23:01 | #8

    @Ernestine Gross
    Ernestine..there is more to come. It isnt over and it wont be over until the hot air is ripped out of the major financial institutions one way or another. Id rather see 40 bill taken off Goldman and friends to be honest until they start acting like responsible bankers and not swindlers (in fact Id rather see Goldman Sachs wiped off the planet for good).

    The trouble is the correction needed will punish a lot of innocent people…so tell me why Goldman should survive? The governments dont have the money for a second bail anyway. Im sure it will come to this. The bailouts were a drop in the ocean against this ugly receding king tide caused by unfettered free market Wall Street. Thankyou Mr Greenspan, thankyou Milton Friedman and thankyou the conservatives in the United States (dont forget that idiot black sheep son of the Bush family) and elsewhere with their self destructive free markets worship.

    Market fundamentalism gave business elites the chance to absolutely corrupt whats left of governments in many industrialised nations. I dont know how we can recover. It wont be easy. According to Citicgroups chief economists “correcting fiscal deficits will be a drag on growth for years to come”…well if it helps sink Citigroups profits…fine..let it drag.

    http://dealbook.blogs.nytimes.com/2010/05/17/fears-intensify-that-euro-crisis-could-snowball/

  9. Alice
    May 17th, 2010 at 23:17 | #9

    http://www.theglobeandmail.com/report-on-business/economy/the-latest-developments-in-the-european-debt-crisis/article1569837/

    Scroll down and read the second comment…apparently, to the Argentinians…Greece looks all too familiar.

  10. John H.
    May 17th, 2010 at 23:32 | #10

    @Alice

    Alice,

    You might be interested in Supercapitalism by Richard Reich. He outlines how modern business practices are overwhelming democracy.

    http://robertreich.org/

  11. Donald Oats
    May 18th, 2010 at 00:11 | #11

    Did anyone see the complete interview of Tony Abbott on the 7:30 Report tonight (ie 2010-05-17)? I only caught a few sentences but it looked like Kerry O’Brien knocked Abbott of his perch by questioning him over his about-face on select issues, and Abbott’s responses became weaker and weaker and less credible by the second. Talk about digging a hole for yourself…

  12. Freelander
    May 18th, 2010 at 02:51 | #12

    @Donald Oats

    “See no evil”

  13. Fran Barlow
    May 18th, 2010 at 08:59 | #13

    @Donald Oats

    Indeed … and even his specification of the statements he would have us rely on, those carefully scripted statements, sounds less than “truthy”.

    If Abbott, as he acknowledges, reserves the right to be “less than accurate” and to “over-extend” in the heat of poltical argument (and here we might recall his claim that the RSPT was “Rudd’s attempt to kill the mining boom stone-dead”) then it is easy to see the carefully scripted statement as simply a different means to inadequate candour. In this context, scripted statements are simply the flipside of the coin to reckless commentary, with the one attempting to hide the sentiment lurking behind the other.

    What was fascianting about Kerry O’Brien was that almost for the first time, a journalist attempted something like a deconstruction of Tony Abbott’s modus operandi. In the case of some people, there is more to them than meets the eye, but in Abbott’s case, O’Brien showed that there was a good deal less.

    Behind the carefully scripted Abbott image of a passionate man who is a straight shooter, lies an indolent and vacuous dissembler, who is a plaything of interests he scarcely understands, let alone is in a position to control.

  14. Alice
    May 18th, 2010 at 09:37 | #14

    @Donald Oats
    Abbotts skill lies in stabbing other liberals in the back. Im sure John Howard, Nick Minchin, John Brogden, Brendan Nelson and Malcolm Turnbull would all agree for different reasons.. but when he is not part of a plot he hasnt actually got much to offer…good 2IC?

  15. Alice
    May 18th, 2010 at 10:07 | #15

    @John H.
    John H. We know all this..which brings me back to the idea (Ernestine’s of a spin tax).
    We know we get bombarded with ads that want us to think “BP is green”, the “government is good”, “new health care reforms will help us” “the state govt has a new transport plan”…when the reality is so much uglier and the bed closures and staff cuts continue ubabated, and the roads compress us into a gridlock because they have not changed in thirty years, and and the trains are unreliable and packed, while the population grows.

    We know already that neither government here, nor large corporate entities are what they say, or do what they promise when we vote for them (and often permit the unthinkable and the destructive to play out under our noses)….and this all reflects, globally, in the financial markets that arent what they appear either.

    Of interest is the abuse being directed towards the Greeks by the media now. They are “shameless” ” have been living like profligate children..decadent..corrupt…and now they get their “just retribution in austerity measures”…but a comment that really caught my eye in one paper was this….

    “they have not been wanting to pay theier taxes”

    Well pardon me but I can think of whole tribes of corporations and individuals and political groups in many western industrialised nations that have been arguing they dont want to pay their taxes either…

    Are they all decadent and corrupt too??

    Maybe not wanting to pay your taxes is irresponsible. So how does that sit with the “lower my income taxes crowds”. Are they leading us down the path to a similar fate as Greece? I must confess, the way I feel about modern governments, and their friends, is that I dont want to pay mine either. Everyone at the top is cheating tax and getting clean away with it.

    So lets start with the supercapitals paying their tax, and they can set an example to the middle classes and the lower classes in Greece before they caste the first stone at the decadence of the “Greeks”.

    Governments could end the decadence if they werent so busy partying with, consulting, getting “advice from” and helping the truly decadent in this world.

  16. Fran Barlow
    May 18th, 2010 at 10:08 | #16

    I found this amusing:

    First muslim wins Miss USA

    Not a burqa in sight …

    Personally, I’m not a fan of beauty contests, but I might well give this a pass on an up yours to religious fundies basis.

  17. Salient Green
    May 18th, 2010 at 11:18 | #17

    Alice @ #17 great post and let’s hope our latex-spined Labor Government makes the mining Supercapitals pay their fair share of tax.

  18. Freelander
    May 18th, 2010 at 11:52 | #18

    Anthony Alphonse Abbott is a remarkable individual. As a young man, he considered he had the natural moral leadership qualities, first to be a priest, while at the same time considering he didn’t have the moral qualities to be a father to his pregnant girlfriend’s child (better just to have the kid be given away, or why not aborted?, and as it was, much later Tony finds out he was cuckolded), and following that, considers his moral leadership qualities instead call him to be a politician, and then prime minister. With his christian sense of morality, not for him the mere mortal constrains of needing to tell the truth. Hell, he didn’t mean that. He had his fingers crossed behind his back. Beside his god is a frequent forgiver of sins, and Tony always has his eye on accumulating a few more frequent flyer points. Just a few more and he’ll be able to walk on water. He already can convert water into wine, and he does love a good drop.

  19. Ernestine Gross
    May 18th, 2010 at 11:54 | #19

    @Chris Warren

    Thank you for your considerate reply. If you wish, I’d like to respond by interpreting some of the information and terminology in terms of theoretical developments since the 1950s with the aim of comparing notes rather than to debate (I find ping-pong debates not helpful nor do I find ‘schools of thought’ helpful to address practical problems).

  20. Ernestine Gross
    May 18th, 2010 at 11:58 | #20

    A.A.A. labels (ratings) have been known to be misleading.

  21. Freelander
    May 18th, 2010 at 12:05 | #21

    Yes. It is amazing how you can package a sub-prime politician with a Credibility Default Swap.

  22. Freelander
    May 18th, 2010 at 12:08 | #22

    Credibility Default Swap = I tell lies but I have a ‘get out of jail free card’.

  23. Freelander
    May 18th, 2010 at 12:09 | #23

    Default = it ain’t my fault, de fault is someone else’s.

  24. Ernestine Gross
    May 18th, 2010 at 12:41 | #24

    A CDS popped and, I understand, the smh decided to its own (unscientific) survey on the rating implications.

  25. Ernestine Gross
    May 18th, 2010 at 12:43 | #25

    “to its” should read to do its. Sorry

  26. Alice
    May 18th, 2010 at 12:55 | #26

    @Freelander
    LOl – oh thats funny…all of that string of posts Freehumour….!!

  27. Chris Warren
    May 18th, 2010 at 14:45 | #27

    @Ernestine Gross

    OK, but I think you will find the literature since the 1950′s very convoluted, and confusing, as the artificial economic circumstances in the West (now unravelling), led to artificial discourse in Western economic and Marxist arenas.

    The theoretical developments since the 1950′s have not been useful as they have been tainted by Western motives infused by post-war global economic reorganisation.

    Although, outside the West, Edvard Kardelj’s work needs greater recognition.

  28. Michael of Summer Hill
    May 18th, 2010 at 21:19 | #28

    Update, Update, Update, Opposition leader Tony Abbott lashes out at his opponents for telling the gospel truth about him telling porkies. But Abbott can only blame himself for misleading the Australian public and is not fit to lead the Opposition let alone becoming Prime Minister and should resign immediately.

  29. Alice
    May 18th, 2010 at 21:43 | #29

    @Michael of Summer Hill
    I knew it Moshie. AAA rated Anthony Alphonse Abbott just isnt any good without his….knife… (to be used against his dissenters in the liberal party). It would be anyone’s fault but his. He is a bit like John Ibrahim only his cross is worn by other ex liberals.

  30. Michael of Summer Hill
    May 18th, 2010 at 21:56 | #30

    Alice, Abbott is finished for he has no credibility and should have known better than deliberately mislead the Australian public.

  31. Freelander
    May 18th, 2010 at 22:54 | #31

    Let’s hope young Tony holds on ’till the election. But knowing the liberal party they may well roll the dice again before November. Either way, it is starting to look increasingly like they will be rolling the dice post-November.

  32. Michael of Summer Hill
    May 19th, 2010 at 02:46 | #32

    Update, Update, Update, after reading Turnbull’s speech at the NSW Bar Association seminar in Sydney yesterday, I am of the opinion that the Liberal’s made the wrong decision in ousting Turnbull from the leadership. Furthermore, many are wondering as to why I keep siding with the man. Well the answer is simple, the Liberal’s need strong leadership and someone who knows what he/she is talking about and not some gibberish bulldust.

  33. Alice
    May 19th, 2010 at 20:13 | #33

    @Michael of Summer Hill
    Im backing a Turnbull comeback myself Moshie….it wouldnt surprise me at all…but first they have to roll the embarrassingly incompetent “Mack the Knife.”

  34. Alice
    May 19th, 2010 at 20:17 | #34
  35. Michael of Summer Hill
    May 19th, 2010 at 22:44 | #35

    Alice, last week Tony Abbott promised Joe Hockey’s reply to the Budget would outline the promised savings in his speech to the National Press Club but today the bear could only promise $46 billion savings without providing any details. What a fiasco.

  36. Michael of Summer Hill
    May 19th, 2010 at 23:52 | #36

    Alice, it seems today Joe Hockey dug his own grave for in his reply to last week’s Budget he not only failed to provide any specifics but no costings as well and is not fit to be Shadow Treasurer. And to top it off he is just as incompetent as Tony Abbott. What a fiasco.

  37. Michael of Summer Hill
    May 20th, 2010 at 07:33 | #37

    Update, Update, Update, it seems the temperature is rising and the climate is changing within the Coalition as they descend into chaos for yesterday not only was Joe Hockey dodging the media, but as Phillip Coorey says Andrew Robb released 42 ‘dodgy accounting’ measures in Coalition’s $46.7 billion fantasy ”savings” Budget reply. What a fiasco.

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