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I feel like I left a lot of conversations hanging this past couple of weeks, because things at work got hectic. Sorry about that. There are things I want to talk about, but I'm feeling too scattered to gather my thoughts as coherently as I feel I should. So for now, some links that you've probably already seen, but I love these things too much not to mention them:

An alternate timeline of racefail '09.
Verb Noire, a small press for work featuring PoC, and you can comment here if you're interested in volunteering, and here to donate startup costs.
The first Asian Women's Blog Carnival; the call for submissions is here and the deadline is April 3rd.

Also, some time ago [livejournal.com profile] marej asked me what I thought of the stimulus package, and I hadn't thought of it much so I told her I'd get back to her. And, I still haven't thought of it much, and have no real desire to spend time researching just what projects are in it and what the affects would be and why, because, quite honestly, in the worst case scenario that is looking increasingly likely, I don't think it's going to make much of a difference. When you're falling off a cliff a flimsy safety net at the bottom isn't going to do much good, and at times I think that's exactly what's going to happen to this economy.

The things that I am paying attention to right now - any news that comes out of China, how the treasury auctions are going, the price of gold and oil and currencies, and of course interest rate spreads. To me what's going on right now (what goes on all the time, actually, in global finance) feels like a rigged confidence game, and I'm watching to see if/when it turns. The way that the response to the failures of the American regulatory system and financial markets was a selloff in all currencies while people rushed to buy dollars and American debt when, if a third world country had been a tenth as fiscally idiotic, it would've become another Zimbabwe, all the capital would have fled and its currency gone in a perpetual free-fall making it impossible to buy the imports that it had become dependent on thanks to the WTO agreements it had (been coerced to) sign, and the majority of its people, already struggling to make ends meet, written off as necessary casualties of the capitalist system (if they were thought about at all), while the IMF forced it to gut its public sector even more to pay off the (interest on the perpetual) debt of its foreign investors (speculators).

But this didn't happen to a Brazil or South Africa or one of the so-called Asian tigers - couldn't have happened to these countries - it happened to America, and it is a Pavlovian response by now that whenever there is turmoil in the global financial markets you rush into dollars, even if the turmoil is directly connected to America. (It is of course a bit more complicated than this, the way every market these days is tied to America and is propping up America; the reason the Chinese are the biggest buyers of treasuries is because exports make up 40% of their economy and if the dollar were to plummet so would this. The other big buyers of American debt are the central banks in India, Brazil, etc, that are almost required to hold it just in case there should be a run on their currencies, because that is how the flat world works - all money comes flowing here. This system is awesome when you're at the top, no?)

So yes, big US and European banks started failing, the US financial system was exposed for the Ponzi scheme that it was... and the whole world rushed to buy the US dollars that were being used to prop up this Ponzi scheme. (Okay, again, a bit more complicated because a lot of this involved forced deleveraging in which people that had positions were stopped out of them, made to sell their holdings in return for whatever they were selling short, which was in most cases the Japanese yen and the US dollar, and that is what started the selloff in the foreign currencies, but it comes down to the same thing in the end - the whole world pays for the mistakes a few guys in Wall Street and London and Washington make.) And the real killer is that our government, given all this time and money to fix things, is instead just ignoring the problem, and throwing more money at the system and hoping that works.

And perhaps it will work, perhaps the problem isn't as big as I suspect it is and in a couple of years the American upper-class will once again emerge unscathed to make another killing (and that is what matters!). But I rather suspect that this time the geniuses in Wall Street have fucked up royally, that we've still only seen the tip of the iceberg (and even that is enough to have people running like headless chicken), and instead of fixing the problem all that the present policies have done is made it worse, and I really shouldn't be as surprised by this as I am, because at the head of the Fed we have a guy that apparently thinks the Great Depression was so great because people lost confidence (in much the same way I'm assuming that Madoff's investments were problematic because people lost confidence in them), and the Treasury was and is run by former Goldman Sachs employees that led the effort to deregulate the markets and almost single-handedly created the brave new world we find ourselves in, where our country's past and present and future wealth is tied into houses that no one can afford to buy or wants to buy and credit that few can afford to repay at leverages up to 30 to 1 (going with the most optimistic scenario), and I could go on and on here. But the point is, people who created and are indebted to a system that got us in the present mess are really bad people to trust to get us out of it. Yet those are the people still running the show.

I started writing this post a week ago, didn't get around to finishing because stuff got really crazy, and in the meantime the Fed announced that they were going to go out and buy mortgage-backed securities, and I headdesked again. In my opinion the best thing to have done, when the problems first appeared with the collapse of Bear Stearns, was to take over the banks and ibanks right there, force the stockholders and bondholders to take full losses, sell off the problematic securities when they were still worth something and fix the regulations so that things like this couldn't happen again. But of course that would have been an admission of guilt on the part of those who work at the Fed and in the government, would have required a realization that the system they'd helped create had the potential to destroy the entire economy, would have required holding people accountable that they were friends with or were indebted to or were counting on for future income/contributions/jobs. It was - it is - much easier for those in power to think that the problem is only superficial, like a doctor who witnesses his patient go into cardiac arrest because of a drug he has encouraged him to take and thinks the problem is that their patient's skin is too pale and perhaps they need a tan! That's just the way these things work, right? So instead of cutting off the financial sector our government has tied our whole economy to it, seems determined to bail it out with taxpayer money, and is waving a red herring with the AIG bonuses and look at how much they're doing to get them back! When um, the bonuses are what, less than a billion total, right? And the government is taking the other side of CDSs for hundreds of billions of dollars, some of which are essentially worthless, and this is just one of the dozens of things I could name and I haven't even been paying attention lately.

So, yeah. I feel like the sword of Damocles is hanging over the whole economy right now, and when it falls it won't be on the king, on the ones who created this mess, because they would've long since abandoned that chair. It will be those who had nothing to do with it that will end up paying the most, because that is what it means to have power these days, that you have the ability to make others pay for your mistakes, along with a sense of entitlement and delusion so vast that you think they should be grateful for the opportunity to do so. It makes it hard for me to imagine that the world could be anything else, with people going around pretending everything is okay because WE MUST NOT DESTROY CONFIDENCE (while they are frantically gobbling up taxpayer money and working to get their personal assets diversified enough so that they don't suffer), and the politicians and regulators are willing to play along. And I wonder how long this can continue, if everyone will keep on buying our debt, believing in the promise that we will make good on it? When will the trust break, what will cause the trust to break, and if it does - when it does? - will there be anything to stop the dollar freefall? It's going to take a lot to break this system, because it has been in place for so long now, and I don't know if what's happened is enough or not, but once it breaks I'm not sure how it could be put back together again. People keep talking about the Great Depression, and it did start by people paying insane amounts to buy lots of worthless crap, but they did not have a fraction of the leverage that the banks today had, operated on a fraction of the scale banks today do, and things weren't nearly as interconnected.

On a completely different note - today's the most beautiful day we've had yet this year; the light is amazing and the sun is so bright and warm and soothing. I feel like going for a run, but am still a bit too afraid to. Soon though!

.
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