‘The Economy’ Is Fine

IndyMac denies that it’s close to collapse.  That’s July 1st 2008.  Ten days later IndyMac closes it’s doors.  While this closure may not yet be emblematic of most banks, the underlying fundamentals on display in this instance have been the model for the US economy for a long time now. Even with the ‘credit crisis’ in 5th gear it is not yet chic to speak the truth about ‘our economy’.  That being that our economy isn’t really ours at all but theirs.  And their economy is less than a house of cards.  A house, even if it’s made of cards, is a real thing.  You might say that the US economy has been chugging along on speculative fumes for a long time now.  But even fumes are real.  There is nothing real about the financial world of make-believe that we call ‘the economy’ here in the US.  .

Confidence Is What’s Needed Now

Ben Bernanke - Free Market High Priest

When you hear so-called analysts explain that what we are facing here is a crisis of confidence–that should raise a flag.  A real economy has nothing to do with confidence.  Though the word has become near synonymous with US, and now global, economic problems, it is really still only a gambling term.  Having drank the Kool-Aid for such a long time now, you’ll hear this word thrown around, even on serious financial news programs.  The assumption, that belief and psychology of people are as legitimate as the value of real and actual work done by people, runs deep now and suggestions to the contrary produce blank stares from most.  And from a growing minority, the suggestion creates hostility.  Like an avid lottery player waking up from a dream in which he has finally won.  Coming to, he realizes his winnings were never real.  He would rather lie back down and close his eyes.  Attempt to kickstart his dream, interrupted.  Visibly unhappy with whatever sound woke him to begin with, he ignores it initially.  If the sounds won’t go away, he becomes angry.  This sound isn’t going away anytime soon.  The pitter patter of feet into banks.  Investors realizing the dream is winding down, desperate to not be the last one to wake.  Casinos aren’t economies.  They only manufacture dreams, hope, confidence.  If the marks don’t trust the dealer, the casino folds.  The confidence is almost gone.

Bailouts-They Can’t Work

Upstanding member of his community

As investors wake up and banks fold, followed by the corporations that rely on the casinos to keep them afloat with constant loans, people that actually work will be the ones that actually get fucked with rent due, hungry mouths, empty gas tanks, cold feet and no job.  The rulers are attempting to head off the popular backlash that will come from all of this with fake nationalisation plans that won’t work.  The rich are too afraid of what will happen, even with fake nationalisation, if the government (the poor) begins to even think it controls institutions like banks instead of the market (the rich) running things.  Not that the poor control the government.  Of course not.  But it is a lot more responsive than the market.  So many banks being under government control would be bad for the rich.  But since nothing else will save them at this point, they’ve gotta be slicker than ever in how they do this. It’s the morning of Tuesday the 15th of July 2008.  Freddie Mac and Fannie Mae’s stocks are down 20% on rumor mill that they are going to be taken over, by the US gov’t.  The broader problem exemplified here is that attempts by the rich to save their own asses using gov’t welfare have them caught in a Catch-22.  Corporate welfare bailouts save the money on a specific craps table but simultaneously undermines confidence in the integrity of the casino as a whole.  They can’t get out of this one with more of the same.  Something fundamentally different is going to have to happen.  The fundamentals of the casino economy have reached their limits.  The word is out that the casino can’t really pay.  The rich criminals need to cash out so that they can skip town now before the rabble outside the building figure out what’s goin down.

  • Here is an explanation of how Freddie Mac/Fannie Mae/Farmer Mac were designed to work and what is happening to them right now.

One Response to “‘The Economy’ Is Fine”

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