Passing the hat

Slightly off topic stephanie, but if we are relying on nations such as Japan and Germany to lend billions of dollars to the Imf fund isnt it about time that lesser nations, you know like the UK and France lost their permanent seats on the UN security council.

I wonder what the world would be like if the UK, discarded by the US had to make its own way in the world.

It was these 'hapless souls' that got us into the mess in the first place!...so how can we trust them to get us out of it?

The US and UK economic models have lost all credibility.

The US and UK banks (aided by their political puppets) created this catastrophe and now they are trying to get the rest of the world to share the pain. It's the same tactic they used in spreading the CDO/subprime mortgage risks. They privatised the profits during the upturn and are now just trying to socialise the losses in the downturn. The ROTW won't buy it this time.
These stimuli packages only transfer wealth from the many poor/weak to the very few rich/strong. Making the rich even wealthier won't work as far as resolving these economic problems. Even a 10y/o could work that one out.

It sounds like the Yanks are desperate...and a 'wounded animal' can be very dangerous indeed.

All we will get is bland promises and 'media opportunities' for failed and failing 'leaders'. Brown will smile and claim success and we'll just look on and think: my God what a shambles.

Until banks across the globe are prepared to declare their off balance sheet liabilities, all governments support packages should stay on hold.

This stalemate is killing the economic system as we know it.

Lets face it if anyone came along and asked to borrow a fiver, you woudl make a quick assessment on their ability to pay and what clearly would also be going through you rmind was will they come back for more.

Multiply that by the open positions the banks and Insurers have which stretch to trillions and who in theoir right mind will not ask for clarity.

The USA is far more agressive in issuing subpoena's where necessary but in Europe and elsewhere too much vacillation and delay is acommodated. As for the FSA's declaration of 'be afraid' who are they kidding.

Having seen confrimed reports that banks gave coments on investigating FSA staff, which woudl affect binus payments to them. How can we really believe they will do the right thing.

The problem is that the few good hard working staff members are outnumbered by thoise who are excellent at rhetoric but carry no industry knowledge or substance to make things happen.

Europe need some serious lessons in how the SEC operates and the FSA in particular needs to be staffed at the highest levels by those whop have been around the block in their relevant fields so much so they are ahead of the game and not always seen to be trailing years behind.

Sassoon is right wholesale changes need to occur before the FSA is taken seriously.

Last nights London Evening Standard asked should the FSA be disbanded and 84% of respondents said yes. SUrely that tells you something and not that it is doing a good job!!

Please wake up Hector and stop hectoring. You are no paid to rhetorically speak daily but lead from the front are you sure you're up to it?

Perhaps it isn't the gaps that exist between the representatives of the countries at the G20 (their political leaders, economists) that matters most.

When those delegates are personally cocooned from the severest effects of the current crisis (unlike the Versailles and Bretton Woods summits, convened in the aftermath of global conflict, which would deeply have affected the participants), should we be more concerned with the gaps that exist within those countries' economies, between the beneficiaries and the extorted?

Is there a country or its economy represented at the G20 table whose citizens and taxpayers have had any real democratic input into the decisions taken by their leaders on their behalf?

What seems good for the global elite may not be palatable to the common people.

Have our leaders demonstrated trustworthiness? By failing to learn the lesson of "privatise profits, nationalise losses" of the early nineties (witness an earlier US bail-out of banks to the tune of a mere half a trillion dollars in the early 'nineties over the Latin America bad debt crisis), have we any reason to believe that the delegates will act in the interest of the many rather than the few?

I would consider myself poles apart from the "anti-globalisation" protestors, but I certainly cannot align with the new elite, who appear to hide subterfuge behind a veneer of incompetence.

"If the global economy is tanking, you might think it obvious that governments should do as much as their budget position will allow." - Stephanie Flanders

Actually, no. But then if you read the comments, you would be wearily familiar with the position of the likes of me. Please acknowledge us with a throw-away remark one day. ;)

To me this sounds rather circular. A group of countries pooling their money to bail out themselves. We might as well ask, why don't all the insolvent insurers out there pay out for each others' losses? The answer - because they all mispriced the risk and are in the same boat. For a bailout to work, one needs a source to go with the sink. For there to be a net beneficiary, there needs to be a net loser. So which way does this cookie crumble? You hint it will be the trade surplus nations of the world who make the sacrifice. The ones which you have previously explained, are seeing their surplus destroyed by a global drop in demand. Japan for example, having just seen its exports halve. What confidence should we have that they can overlook the obvious implications of these events for their own stability, and bail out the rest of us, especially with public opinion to consider? I see none that is not misplaced.

#6 U

Oh when the Sants goes marching off...

The problem with the FSA is that it was a political creation, was perpetually held back by its creator in the interests of promoting "light touch" regulation, and - amazingly - has not been let off the leash now by the same master (even in the light of "lessons learned" - hmm, where's the evidence?).

Somewhere along the line, while saving the banks (if not the world), it looks as though someone forgot that little word "accountability", again.

The macro economic picture is a tad trying. But as your graph showed the other day Steph it is all relative. Baby boomer folly has cost us plenty but our generation has not sparked either the first or the second world war. And there certainly isn't going to be the capital surpluses to fight a third. Looking on the bright side. all this makes a third world war much more unlikely. Feeling happier anyone?

This comment was removed because the moderators found it broke the house rules. Explain.

If only we could spend ourselves richer.

Hello Stephanie,

So we use some of our new QE printed money and give it to the IMF?

One question for you. What is the opposite of QE - eg how is this initial GPB 75B going to be later removed from the economy?

Best regards

Tim

So this is the summit when globalization credentials are tested to breaking point.

Hopefully the politicians and bureaucrats realise that settling this is not a sterile statistical exercise, but affects the livelihoods of billions of people around the world.

There will be few opportunities to solve this before the real effects are felt on the ground around the world either as civil unrest or famine or energy shortages or all of the above.

What will it take for the likes of Germany and France to get real and rise above their narrow minded perception of the problem.

It's all very well speculating how much goes in to the hat and who puts it there but all that is irrelevant if the distribution takes place under a corrupt system.

The existing system is corrupt to the core and the initial bribe for anyone taking the money is that they worship the system and all the corrupt practises that go with.

That's the issue that this blog should be addressing.

www.putpeoplefirst.org.uk

#12 tonyparksrun wrote:

"What will it take for the likes of Germany and France to get real and rise above their narrow minded perception of the problem."

Do they owe the world a living?

They certainly are not in as good condition as everyone seems to believe.

This is the same problem we see on the streets of Britain today. Too many people feeling themselves entitled, and making an enemy of a world they believe owes them, when it fails to deliver. But what bargain was it supposed to uphold? Abdicating responsibility for one's own condition and blaming others for failure of absurd expectations is what causes the hostility and the problems you mention.

It's the prisoner's dilemma all over again...

There are several reasons countries can't act in their (and their citizens') rational interest. It's the G20's job to solve that somehow:
https://www.knowingandmaking.com/2009/03/rationality-and-todays-bbc-bloggers.html

Comment 13 has now been referred to the moderators for over 1 hour 15 minutes.

I'm a little at a loss Ms Flanders.

If the UK were to contribute more to the IMF, would we provide the cash through more QE, or out of a toy Monopoly box ?

I know efforts are afoot to use plastic and dispense with cash, but are we also entering a world of virtual cash produced by some accounting "legerdemain" ?

LET'S TRY IT ANOTHER WAY (WITHOUT USING THE WORD RECOVERY)

In these transparent times of Evidence Based-Practice and Quantitative Easing how is anyone supposed to be able to tell when these policies are 'working'?

"10. At 4:28pm on 12 Mar 2009, MrTweedy wrote:


If only we could spend ourselves richer."

If only our money wasn't based on debt we simply wouldn't have this problem.


"11. At 4:42pm on 12 Mar 2009, LovelyTim wrote:

One question for you. What is the opposite of QE - eg how is this initial GPB 75B going to be later removed from the economy?"

The Bank Of England sell the bonds or gilts they are currently purchasing and then destroy the money they get for them. Oh but they can make a profit...

I suspect the G20 meeting will be more about passing the buck than any hats.

They'll happily stuff their coupons with foie gras whilst the masses riot outside over the price of eggs, such seems to be their contempt for those whom elected them into power in the first place.

Cynical? Moi?

OK. Let me get this straight.

So Germans work hard, they produce goods people want to buy, they save their hard earned cash for a rainy day...

And along come the UK who have spent everything they ever had and then went trillions into debt on a huge binge and.. demand that the Germans should bail them out.......

Is it just me or are our mothers and fathers fools and teaching their children to be fools when they tell parables about ants and grasshoppers?

Comment 14 : WerringtonSilent

"Abdicating responsibility for one's own condition and blaming others for failure of absurd expectations is what causes the hostility and the problems you mention."

Interestingly, as far as expectations are concerned, one of Jeff Randall's recent DT articles quotes Churchill:-

"There is no worse mistake in public leadership than to hold out false hopes soon to be swept away. The British people can face peril or misfortune with fortitude and buoyancy, but they bitterly resent being deceived or finding that those responsible for their affairs are themselves dwelling in a fool's paradise."

The likes of Churchill would have to spend 10 years dumbing down before they'd be allowed anywhere near the high tables of the modern elite, so it's not really surprising, I suppose, that their warnings are dismissed so casually in today's world.

Interesting numbers: 700 bn - one thousandth of the 700 tn in synthetic financial instruments (money) that are sloshing about.

Can anyone provide a halfway convincing argument that suggests that 700bn is anywhere near enough?

It may be more than we can afford, but that misses the point.

FLOGGING DEAD HORSES

true-liberal (#21) "Is it just me or are our mothers and fathers fools and teaching their children to be fools when they tell parables about ants and grasshoppers?"

It's not just you. Lots of people have not grasped the implications of the low literacy/numeracy levels in the population, in the USA and here (see Leitch Review (2006) for UK.

It just doesn't sink in for some reason........;-)

Stephanie your post is confusing to us non economists. You use different phrases " fiscal stimulus" " government stimulus" "economic stimulus" " discretionary stimulus" - what do each of these mean?

From what I can see there are : government works, tax cuts, interest rate cuts, printing money,social spending, subsidized loans and debt, market support operations,devaluation etc. etc. Is this all "stimulus", or are we talking apples and pears?

You dont mention the flip side of the coin, equally if not more important ie : how do we return to sustainable debt and balance the books and what about exchange / currency values in the mix.

I've noticed everyone is getting carried away with the "funny money" bonanza!

the White House said President Barack Obama will not seek any "specific commitment" at the meeting. ..................

oh dear looks like GB's dream to lead the world is coming unstuck....the G20 like all of these summits will come out with bland platitudes and every leader will go home and do nothing

By the time Obama's administration really gets going, a lot of Europeans will wish for the good old days of Geroge Bush. I see a trade war and a diplomatic war in the offing. It's one Europe can't win.

I have noticed that the expansion of financial services occured in symmetry with the shutting down of loanatic asylums and realocation of their incomebents into the community

Therefore[just in case] all our financial leaders should recieve lie detector tests based on four questions

1 Are you Napolean Bonapart

2Are you Adolf Hitler

3Are you Ghengis Khan

4Are you Mad[OFF COURSE]

They will of course have the right to remain silent when connected to the national grid

"After all, as I've noted previously, it's in their own interest: nearly all of the countries likely to need help from the Fund in the next year or so are in Central and Eastern Europe."

And this is exactly the problem that is stopping some of the cash-rich developing from contributing more to the IMF pot !!

Much of the control of the IMF is in Western hands and they want those cash-rich nations to hand over blank cheques so they can play Santa Claus in Central and Eastern Europe while there are still more countries in Asia, Africa and Latin America that are also in as bad or worse need of more funds !!

The East Asians have already set up their own fund to help their members through their time of need and they will be loathed to let others play Santa Claus with *their* money. At the very least, they will want a much bigger say in how things were done in the IMF.

To paraphrase an old American battle cry - No lending without representation !!

#28 Reminds me of a famous tale where the doctors asked a guy why he thinks he is Napoleon and he said that it's because God told him so.

And the guy in the next bed said, "No, I did not !!"

#24 "It just doesn't sink in for some reason........;-)"

A self-fulfilling prophecy !! If they are sufficiently uneducated, then they can't understand the parable !!

#12 "What will it take for the likes of Germany and France to get real and rise above their narrow minded perception of the problem."

Soon after the Brits wake and smell the coffee and knuckle done to doing some *real* hard work are realistic wages instead of shuffling bits of paper or electrons around and expect to be paid kings' ransoms !!

Being paid multi-million quid bonuses for getting things badly wrong is the stuff of the Never-never land !! Borrowing more than you can repay in the hopes that the assets you buy will appreciate and repay your borrowings are dreams from the same pipe !!

No. 24. JadedJean wrote:
"Lots of people have not grasped the implications of the low literacy/numeracy levels in the population, in the USA and here in the UK."

Great fortunes were made by exploiting the mass market. Economies of scale drive down the unit cost of production, which brings the goods and services within reach of a larger number of consumers, which brings down the unit cost of production even further.

Unfortunately, some people got greedy, and pushed the concept too far:
(i) If everyone owns their own home, banks can expand lending and make bigger profits, estate agents and mortgage brokers also take a cut of the market. Rising house prices feel good to the mass market consumer but the consumers don't realise it's never a good thing to have expensive necessities.
(ii) Reality television is low cost entertainment with little financial risk. The broadcaster/ production company gets an audience of 5m viewers for only a relatively small financial outlay. The phone voting generates incremental revenue. Consumers are flattered that they are the stars of the show.
(iii) Pop music makes billions with little effort. The business model is well documented, and is a licence to print money. This is factory farming on a large scale.
(iv) Contemporary artists barely conceal their laughter at offloading their junk onto an "educated" and rich clientele. The art takes little effort to produce but rakes in the cash. When found out, the artist merely claims the work was an ironic piece, which satirises the liberal consumer society.
(v) Cars last for 10 years if well maintained. It is cheaper to maintain a car than to keep buying a new one every three years. But consumers like the "status" of a new number plate, and finance is cheap.
(vi) Businesses are forever being told to "innovate", which is a polite way of saying take on more risk.
(vii) Businesses are forever being told to "lever" and "gear up" to higher productivity in an attempt to reach short term profit at the expense of long term debt.
(viii) We are told to be "competitive" but this is merely a polite way of saying "selfish".
(ix) Consumers are told to invest their pensions in equities because share prices always go up over time. The "buy and hold" strategy. The more consumers invest the higher the prices climb. They forget that dividends are the real sustainable element of share prices.
(x) Designer clothes are cheap to produce but can be sold at a massive mark up. A triumph of style over substance.
(xi) Credit "takes the waiting out of wanting". No need to save up any more.

Low numeracy/ literacy makes all the above easier to exploit. Everyone's special; so no-one's special. Mass market junk culture is cheap to produce but easy to sell.

The big flaw in the model is that it's completely unsustainable in the long term, due to too much debt, too many externalities and too much depletion of the planet's resources.

Everyone's clever, everyone's an artist, everyone's a home owner, everyone's a consumer, everyone's a car owner, everyone's tolerant nowadays. Too tolerant of cheap junk culture. Unfortunately, this economic model is now proving to be very expensive.

#8. At 2:54pm on 12 Mar 2009, thatotherguy2 wrote:
"And there certainly isn't going to be the capital surpluses to fight a third. Looking on the bright side. all this makes a third world war much more unlikely. Feeling happier anyone?"

Sorry 'thatother guy2' but this does not apply to a nuclear exchange. Even after some reductions in weapons, the USA and Russia alone have sufficient nuclear weapons available to provide MAD (mutually assured destruction). In fact, the approximate amount available for 6.5 billion people is the equivalent of 10,000 tons of TNT per person on the planet.

All of these weapons already exist. The capital has been spent. They are ready for use. Even assuming 50% don't work or miss targets, that still leaves 5,000 tons for every child, woman and man on the planet. No need for planning what to do after this one. There will be nothing left after the explosions, radiation and nuclear winter.

So, I don't think it is wise to assume that:
1) the world does not have the capital for a WW3.
2) it will not happen.

Indeed, social unrest and pressure on resources are likely to get worse as the population moves up towards the 10-12 billion mark.

Still feeling happy?

#33.
Please accept my apologies for an error on my last post.

Given an approximate 15,000 nuclear weapons between the USA, Russia, UK, France, China, India and Pakistan (ignoring places like Israel, N. Korea and S. Africa).

Assume each weapon is 1 megaton as an average. This gives 15 billion tons of TNT. This of course reduces the amount of TNT per person on the planet to the significantly lower figure of 2.3 tons (assuming 6.5Bn people).

Now I'm sure that piece of news must make you feel happier! However, I would not recommend sitting on 2.3 tons of TNT when it explodes.

I'm not suggesting that the French & Germans bail us out but the Germans in particular main export market is Eastern Europe financed (as Stephanie has described in earlier blogs) by large scale debt lent to them by Austrian French German banks. This is no zero sum game that Germany pays and someone else receives, this is about the overall world economy and replacing the leverage/liquidity now removed from the system. Sadly some of this leverage is what has raised East Europe from the ravages of poverty.

Supporting the Germans as wholesome industrious savers against feckless Brits is a cheap generalisation and a travesty. Invoking cliches and simplistic homilies in the face of the current crisis doesn't do justice to the depth of the problems.

We have few enough tools to deploy to mitigate or remedy the crisis. I was just hoping that we could all recognise everyone is involved so everyone has to respond.

MrTweedy (#33) Excellent. Maybe we should have a go at drafting a PRGBconstititution? Does anyone feel up to a first re-draft? It won't be the first time it's been done.

Sadly, that Trot/(crypto-free-marketeer) Orwell will have scared most folk off.

#36 tonyparksrun:

The leverage is GONE and it is NOT coming back because the required capital and value in the collateral does not EXIST. It never DID. Nearly everyone thought otherwise, but it was FAKE. There is clear air between the leveraged and the floor, and much of the lifting out of poverty was based on an ILLUSION. There may be a sense of having been cheated, of entitlement, but it cannot be delivered upon in perpetuity. There was no way it ever could. The last decade and a half of prosperity was global inter-generational cheque kiting, it was nice while it lasted, but here is the bounce and the game is up.

"We are all in this together" is precisely why bailouts will not work. We are talking about passing money from one hat to another in a circle. We are all broke. The German banking system is levered even higher than ours, something like 50:1 vs 33:1. The main difference is their risk is largely foreign, not domestic, and their tales of woe are more difficult to connect than the journalistic field day over here. It might be an outwardly more orderly crash over there, but that is about all that can be said for it.

Insolvency, there is a tool we all have. Start coming to terms with it. This is the whole point of a depression, what it is and how it works. The starting point is recognising that behind the problems you see is not an unfortunate event, but a lie. Something you thought was possible, never was.

Sorry to channel AC on you, but the sooner people start figuring out what we are dealing with, the sooner we can all move on. Stop stalling for time, repay or default. That is what recovery comes down to.

#33

Yes it seems to me that a credit economy just results in whirlpools of feedback loops that amplify until they break, dragging all kinds of trends down with them.

-The banks issues money to the people who want and desire, and the money is given value by the threat of repossession.
-The people go off on a monthly mission to seek out this money the banks want in order to avoid repossession.
-They make money by producing things for others who pay by yet more debt.
- It doesn't matter how they produce them, or how efficient the production is. In fact, if the company can be grossly inefficient and employ yet more people to perform useless tasks, then the more the better because they can have more debt and buy more stuff.
- It doesn't matter if they import more cheap stuff from abroad than they export because the money they pay with is reinvested in domestic or US assets on the basis that there will be yet more money produced as a result to keep more Chinese labourers employed and distracted from threatening the state.
- There is no higher value to things being produced other than the ability they have to allow people to buy yet more things.
- Production is paramount, quality of life is secondary. It doesn't matter if production is the result of a feedback loop (for example, people working in increasingly wider automotive industries to pay debt on their increasingly expensive/decreasingly robust cars)

No. 37. JadedJean

Consumers forget that rules and laws are there to protect them, and not there to restrict their "freedoms". British consumers are not free, as they are easily manipulated.

Sure, a corrupt government can use unjust laws to exploit the population; but that doesn't mean all governments are corrupt and that all rules and regulations are bad.

We do need some protection.

At least a constitution would set out the people's rights and restrictions, whilst at the same time defining the state's responsibilties and limits.

Motorists think speed cameras are evil until one of their family gets knocked over by a car doing 40mph in a 30mph speed zone.

If agreement on key issues and solutions is what we need on 2nd April, the G20 looks closer to agreement than you make it appear. What's truly remarkable is that each national government's agenda is now well known in advance. So they each have time to consider how they're going to "sell" the inevitable packages of compromises to their respective electorates.

Getting those declarations about solutions at least enables their teams of officials to craft the details over following weeks. Bringing the major developing economies into bigger IMF roles where they share responsibilities will require some magnanimity from the US & EU and some big cash and trade commitments from China, Brasil and India, which will give them a success story back home. Aligning definitions of 'fiscal balance' and 'discretionary' shouldn't be too hard either, if explained to US public carefully.

So, the careful preparations look capable of bringing off a milestone agreement. What's needed is some support from people everywhere who really want a successful agreement.

No. 39. FrankSz

The increased borrowing covered up all the inefficiency. Unviable companies could keep trading by renewing their debt. Now these debt ridden companies with "big order books" but no cash think we should all feel sorry for them.


Also,
During the recent "good" times, if we can call them that, it was common to see:

(i) Household borrows GBP110,000 to buy a house valued at GBP100,000
(ii) After a year, the household falls behind with its mortgage repayments
(iii) The household goes to a broker who says your house is now worth GBP115,000, we'll arrange for you to remortgage and increase your loan from GBP110,000 to GBP115,000
(iv) The household uses this extra GBP5,000 loan to make its monthly mortgage repayments
(v) In a year's time the household finds it can't keep up the repayments, but is able to borrow more money against the rising value of the house. And so on, and so on....

All in all, the debt is never being repaid but instead keeps increasing. And they wonder why it all fell apart....

I like the idea of a new constitution, as proposed by JadedJean #37, though the proposed starting point, the CPRC strikes me as a little off beam. Didn’t Tony Benn try this approach some while back?

Fact is James Madison has mostly done the job, even including an attempt to enshrine sound money. Of course, with the benefit of hindsight we might want to be a tad firmer on the rights, if any, and role of the government and on the penalties should politicians overstep the mark. I believe the ancient Greeks had a reasonable set of sanctions in this respect.

Perhaps we should get a move on. A constitution might be a bulwark against the risk that the G20, IMF and chums seek to implement a fully global ponzi scheme.

rwolff (#43) It's hard to tell what's fact and what's propaganda. The Webbs' wrote a very sympathetic book on Soviet Communism in the 30s/40s [Unsuitable/Broken URL removed by Moderator]Sidney being behind Clause IV of the Old Labour Party, and what we know as the Welfare State). The contrast between the American and Soviet constitutions has been said to be the difference between rights vs duties, and even in the current, post USSR, Russian constitution, there's a duty of children to their parents. We seem to have erred too far in the direction of rights, to the point of rewarding/celebrating narcissistic entitlement (which comes in part from our having over-feminised our culture I suspect). If any 'hat' is to be passed round at the G20, were I to be representing the PRC I'd press for a legislative shift in the duties:rights balance as a sine qua non for any future purchase of Western debt by the PRC and her allies. Our collective behaviour needs to change.

MrTweedy

It's nice to see that the idea that a credit economy is unsound is becoming more popular.

I especially liked Bernanke's final realisation that trade imbalances were underlying the problems, despite the fact it was the US with their disengagement from gold that created these imbalances, and despite the fact that prominent thinkers have been warning of a looming credit crisis caused by trade imbalances for years.

It's a problem though if people think that by improving regulation the same old cycles can be perpetuated.

Ah, JadedJean, the old rights versus duties chestnut. It all comes around to MI (methodological and metaphysical individualism). My assessment is that government, if indeed any is called for or could conceivably be legitimised, is merely a tool for the individual. As such, it cannot have rights, only duties. Conversely, the individual can have no duties to government, at least none that are obligatory. Of course, if you wish to propose an alternative entity to the individual and to which an individual is logically subservient, it would be of interest.

I do not hold that my or any other individuals behaviour needs to change in respect of the PRC. Such debt as they hold is neither mine nor any other citizen of this country as far as I know. It is perhaps a debt incurred by HMG and certain institutions that happen to be domiciled near to me. By the way, I believe the PRC set a precedent for default on some USD 260bn when they refused to honour the obligations of the preceding regime.

No.45 Frank Sz wrote:
"It's a problem though if people think that by improving regulation the same old cycles can be perpetuated."

The idea of allowing commercial banks to borrow on the wholesale money markets was pure insanity. I hope the authorities now put a stop to it, and quickly.

We need to restrict commercial banks to lending only what they have received from their depositors. Even then, the banks should lodge a sizeable sum as reserves with the BoE.

Comsumers will still be able to buy the same houses as before, but prices will be much lower. I agree with home ownership, but the aim must be to keep house prices as affordable as possible. To me it's stating the bleedin' obvious to say that houses are a necessity and not an asset. Lending must be restricted to keep house prices low. If consumers don't have large mortgages they will have more disposable income to save or spend.

Here's to hoping......

"42. At 1:06pm on 13 Mar 2009, MrTweedy wrote:

All in all, the debt is never being repaid but instead keeps increasing. And they wonder why it all fell apart...."

Welcome to the world post August 15th 1971.

Of course, it's even better than that. The debts cannot be paid, they are simply too large, there is no intention of them ever being paid.

I recall my grandparents wondering and wondering at the cost of everything always going up. They didn't realise just how they were being robbed.

JadedJean thinks the problem is the people at the bottom. Not being smart enough. In fact the problem is that the people at the top are liars and swindlers.

Money defines society.

Pass the hat sounds about righ now that pass the pAAArcel is over ,with nothing to show for it but a messy pile of the most expencive wrAAApping paper produced in history OF WARPING PAPER AND ALL OF IT ARROUND ABSOLUTELY 0[which we can thank the Arabs for, before we give it back to them without the wraping paper.]

rwolff (#46) "My assessment is that government, if indeed any is called for or could conceivably be legitimised, is merely a tool for the individual. As such, it cannot have rights, only duties. Conversely, the individual can have no duties to government, at least none that are obligatory.

Really?

Sadly, we see that view manifest almost everywhere today. It accounts, I fear, for the mess which we've made of our culture. I try to console myself that those who preach it 'know not what they do' (It's not much of a consolation).

true-liberal (#48) "JadedJean thinks the problem is the people at the bottom. Not being smart enough. In fact the problem is that the people at the top are liars and swindlers.

I'm not sure that those at the top are as smart as they make out - one requires good iQ and consciensciousness to be a 'good' peson. That may be because any atthe top are liars and swindlers and we no longer use the appropriate tools we once did to exclude/prevent them from doing harm to others (cf. NPD and other Axis II Personality Disorders such as ASPD). These types tend to wreck lives as they're deficient in/lack empathy/conscience, which naturally constrains most of us. As this disposition also makes them ruthless, this useful in business. Not a good prognosis, alas.

"If you're listening, China, that means especially you."

The Americans and Chinese are to go it alone and control, via The IMF, who gets favoured status for the benefit of future bailouts. The UK, despite Brown's pleading, is not one them. Germany is, France still talking. Why else The NATO flirtation this week. You heard it here, first, Ma'am.
Why not The UK? Not enough eqity to bring to the game. Sad to say, our World status is dead in the water, sunk by debt.

#49

Seems some competitor is testing their first Markov Chain on the BBC Blog. stilllitterarty - did you know that half of us here are cyborgs?

et.al.

This reminds me of interviews with Germans who were complicit in the actions of the Nazi party, or the communist party STB agents and KGB agents and so on being interviewed after the fall of socialism.

People asked them, 'why did you do it?' And they try to explain how everyone was caught up in a dream, how everyone was convinced that what they were doing was right and correct. Others say that they did what they did because it was the easiest, and they had to feed their families and so on. Few seem to say that they had no choice.

I wonder how long it will be before people look back and wonder why the "Supply and Demand Doctrine" was called "Law of Supply and Demand".

#48

I don't think JadedJean is implying that the problem is the people at the bottom. As I understand it JadedJean seems to be saying that the current system is having allowing societal decay to take place or encouraging it, as evidenced by concrete measures such as IQ and etc.

It's cause and effect at the same time though. Another amplifying feedback loop. It's true and I witness first hand every day - the system has pushed morons to the top and unfortunately those morons are hiring more morons and breeding plenty more too. (If any of my upper management are reading this, yes this means you)

Anyway folks, do not fear. I have a plan. In fact two plans. I will save us all.
Plan a) Release tonnes of oxytocin into the air and drinking water. This will make everyone trusting and lend everyone money, thus getting credit turning and totally undermining the whole concept of credit at the same time.
Plan b) Finish building my intelligent machine, which will be programmed to take over the world and be a benevolent dictator to us all (especially men, by the way, as I still haven't figured out if to program the thing to treat women as a commodity or a service.)

true-liberal (#48) "In fact the problem is that the people at the top are liars and swindlers."

Are you absolutely sure that's not a fitting description of acolytes of Austrian School Anarcho-Capitalism (with the above scotoma)?

yawn, surprise, surprise, yawn
https://news.bbc.co.uk/2/hi/business/7941717.stm

Both rights and duties are optional. They smell of 'morality' and 'ethics,' neither of which have caused anything but harm.

#18. JadedJean wrote:

"LET'S TRY IT ANOTHER WAY (WITHOUT USING THE WORD RECOVERY)

In these transparent times of Evidence Based-Practice and Quantitative Easing how is anyone supposed to be able to tell when these policies are 'working'?"

Simple - when hyperinflation reached 1000 percent!

As that is the only possible outcome of these insane policies.

Or perhaps when someone with a little gumption sacks Mervyn King, the entire MPC, the management of the FSA and the Permanent Secretary of the Treasury (Nicholas Macpherson - he has been there since 2005) on the basis that no politician can possibly admit he/she is wrong and therefore it must be his/her advisers - who must go!

If there was ever a case of the deckchairs on the Titanic this must be it!

JadedJean, I really would like to hear what entity you place in supremacy over the individual and by what means you seek to legitimise such entitys claim.

The issue of duty resolves to prudent dealings with other individuals. One may legitimately assume a duty (and revoke it) but never be legitimately coerced into performing one. I repeat, government, if ever legitimate, is the mere servant of the individual and can never presume the individual has a duty to it. We have moved a long way from divine rights and such rubbish. The best the status quo merchants (e.g. Rawls) can offer is a very weak implication of some kind of theoretical/mythical quasi-contract that they seek show we would all rationally accept. None of the social contract arguments holds up too well under close scrutiny.

The debate surrounding the so-called financial crisis is beginning to crystallise. There are some who would countenance all manner of fraudulent monetary manipulation in a vain attempt to restore the status quo c.2007. These people seem to have faith that government is capable of making the right choice and, of course, define right as what is best for them irrespective of the impact on those who loose out. Opposing this view are those who, having seen through the fraud of fiat money and government interference, have lost confidence in the old ways and are seeking an alternative, albeit laissez faire.

Do you not applaud individualism and diversity? Would you rather a homogenous culture? … and a homogenous fraudulent world government ever inflating a fiat currency to impoverish and enslave the masses?

I spend...therefore I am!

FrankSz (#54) You're right in at least your first two paragraphs.

JadedJean # 55

"Are you absolutely sure that's not a fitting description of acolytes of the Austrian School Anarcho-Capitalism (with the above scotoma?)"

More Hegelian dialectic?

You are going to have to do an awful lot better than that to be more convincing.

JadedJean # 50

If individuals want to have a government and thereby legitimise an entity called the State, then its sole function or duty is to uphold and defend the pre-existing rights of its citizens.

That is the ONLY duty that needs to be discussed; nothing else!

inocom #15,

That is an interesting article you posted regarding the author's intention to analyse the rationality of decisions taken at G20 within the framework of cognitive dissonance.

Not an insubstantial task I might venture but the best of luck to the author as it is worth a go. I would be grateful if you could post the link when the author completes the review.

You mention Game Theory and this will certainly be central within discussion and negotiations.

What is rational for one economy may not be rational for other economies.

Similarly there is not much doubt that each national strategy (NS) to acheive 'recovery' may not necessarily fit within an overall 'best' recovery strategy.
Thus the individual player's Game Strategies (GS) offer plenty of scope for disagreement or trade-offs between parties.

An adjusted Nash Equilibria might emerge perhaps whereby each participant has to adopt what might be a least best, best individual strategy (NS) in the light of the other players stances.

It could be that after this and the next round, both the EU and Asiatics might dismiss the Brown and King plans of devaluation, inflation and their rejection of savers' rewards.

B and K might well finish up ploughing a lonlier and lonlier furrow of their own making in this matter.

I can envisage their return from Horsham, (metaphoriaclly) whereby they step out of the aeroplane and wave a bit of paper saying
'A total success, global recovery underway as we all agreed to have talks on talks to do a bit more on regulation.
Sometime.
Don't mention the rest'

A Wiki list of games theory, games here if anyone might be interested

https://en.wikipedia.org/wiki/List_of_games_in_game_theory

A bit of the global influence Cake Cutting game anyone ?

Sorry Mr Brown, all the cherries went with QE, only the crumbs are left for your team so you will have to tighten your belt and think up a better plan
(with the emphases on 'think' and 'better' and 'plan')

LIBERALISM IN CARICATURE (1957)

rwolff, true-liberal and LibertarianKurt: The title is a 'blast from the past', but I do think that all three of you should consider why Von Mises fled Austria, why NPD figures more in US psychopathology (DSM-IV) than European (cf. WHO ICD-10) and why we have warnings like this popping up at present.

If one prefers to see the comical side (although I really don't think it a laughing matter), think Woody Allen or more soberly, Alisa Zinov'yevna Rosenbaum.

JadedJean, you repeatedly seek to equate individualism with narscissim. They are not synonymous. Logically and rationally the individual is paramount. You have yet to postulate an alternative superior entity to the individual.

I enthusiastically followed your leads only to be disappointed by mere unsubstantiated opinion.

My understanding of why von Mises left Austria was that, as a proponent of individual freedom, his views were at odds with those of those bastions of State Planning, the Nazis. Do you have an alternative understanding?

As for complaints about narcisissm in the classroom, my view is that attendence in any classroom should be voluntary. This move alone would I believe resolve any issues. The state control of education in Britain is anything but liberal, libertarian and is certainly un-anarchic. Like everything the state touches, it causes the atrophy of personal responsibility. I think I asked elsewhere, would you prefer homogeneity over individualism?

Do you really want to see world government and a fully contrived, state controlled fiat money system to arise?

JadedJean # All

Rothbard on education:

https://mises.org/story/2226

Learn!

REINFORCEMENT OF THE 'ME FIRST' GENERATION

LibertarianKurt (#67) Observe. Rothbard was a NYC anarchist see the demographics #5. Look to what happened in the 1930s in Austria/Germany, why Von Mises fled. The hotbed of Anarchism and (madeover/entryist) Trotskyism in the early decades of the C20th was NYC, the direct consequence of mass immigration from Russia at the end of the C19th. Who, and what were they trying to subvert?

Look at the rising violent crime in our (and USA) inner cities, the disintegration of the family, and our current economic crisis. Pathological narcissism is widely regarded as being related to the nomal process of Individuation-Separation in infancy/adolescence. Narcisisists are at the centre of their universes, other people being useful sources of narcissistic supply, i.e. commodities. Empirical facts tend not to change their beliefs/behaviour as they only experience life from their own point of view, i.e. they're prone to more than methodological solipsism, they're metaphysical solipsists ('cognitivists'). It all shares the same roots if you look into it.

"..Whether you know it or not, the Austrian school entirely rejects empiricism when it is sought to be applied to economic science.

Why? Because we are human beings who, in an economic sense, think and
act purposefully. We are not "capital", objects, specimens or whatever
that can placed in a laboratory to be analysed and subjected to
experimental verification."

LibertarianKurt 12th
March 2009

INDIVIDUAL GROUP INTEREST/HEGEMONY

LibertarianKurt (#67) Thanks for the link, and whilst it will take a while to read carefully @ ~40 pages it does appear prima facie to have a predictable agenda. Whiolst yu have said tat empircal research doesn't carry much weight for you in this area (one wonders what does as reasoning without empirical facts is somewhat nefarious/empty), I ask you to consider two points:

1) cogntive ability appears to be largely genetic and Gaussian distributed.

2) groups compete: which able migrant group most resisted assimilation into the status quo both in Europe and the USA, and by what means did they go about this resistance (through lobbying, academic (economic, philosphical etc), and demographic/Civil Liberty movements as 'minorities'?

Note the paradox: individual group self-interest. promotion of individualism for the larger out-group but collectivism/nepotism for the in-group.

Family politics?

JadedJean # 68/69

"Look at the rising violent crime in our (and USA) inner cities, the disintegration of the family, and our current economic crisis."

I think we can thank the socialist/collectivist welfare state dependency culture economy for this.

"Empirical facts tend not to change their beliefs/behaviour as they only experience life from their own point of view..."

Would you care to explain how an individual could experience life from anyone else's point of view?

Empirical facts cannot tell us anything about how individuals work out the means to satisfy their ends. Both the ends and means are impossible to know for the outside observer.

I think what you and probably the behavioural scientists want to devise is some sort of programmed (collectivist/altruistic?) value scale, which can be imprinted in every individual's mind so that they can make the "correct" choices.

If I go out today and buy a newspaper for 50 pence, what does that tell you? The answer is nothing, because at the time of purchase, the newspaper was worth more to me than the 50 pence. Tomorrow, my subjective value scale may change.

In economics, empirical evidence and experimental verification (or falsification) can only enlighten us as to what has happened, not what is going to happen.

JadedJean # 68

https://www.youtube.com/watch?v=ae1gmuKeuXw

Yes, does this not convince you that state/socialistic compulsory education has been a complete failure?

What a waste of taxpayers (yours and mine) money!

LibertarianKurt (#70) "Would you care to explain how an individual could experience life from anyone else's point of view?"

This is fundamental to the training of all (scientifically based) professional practice (see actuarial vs. clinical judgement).

For a trivial (but widely ill-appreciated) example (think of those who say one has to have cancer in order to understand it, or one must have children to understand children), consider the skills of a GP diagnosing and treating patients. This is always based upon other peoples' experience, much of which can be, and is, automated (because it is extentional) in instrumentation. In fact, much of our mature, so-called individual (clinical/intuitive) judgement is, it turns out, second-rate (through limited, i.e biased, sampling, actuarial judgement.... if one looks into it carefully.

LibertarianKurt (#71) If they weren't there under the supervison of those in loco parentis paid for by the state, how would their mothers go out to work and expand the free-market economy/bubble? Many would be further increasing the crime rate (which peaks in the late the teens). Parliamentary Select Committees, Public Accounts and the NAO have been very concerned about the high rates of unauthorised (and authorised) school absence.

erratum (#72) extenSional not extenTional.

JadedJean # 72/73

"This is fundamental to the training of all (scientifically based) professional practice (see actuarial vs. clinical judgement)."

Training or indoctrination?

"For a trivial (but widely ill-appreciated) example (think of those who say one has to have cancer in order to understand it, or one must have children to understand children), consider the skills of a GP diagnosing and treating patients. This is always based upon other peoples' experience, much of which can be, and is, automated (because it is extentional) in instrumentation."

We are discussing economics involving the individual, not per se patient/doctor relationships.

"If they weren't there under the supervison of those in loco parentis paid for by the state, how would their mothers go out to work and expand the free-market economy/bubble? Many would be further increasing the crime rate (which peaks in the late the teens)."

If men and women were not taxed so much, perhaps one or the other could stay at home to care for and educate their children?

Even if both parents were inclined to work, the absence of taxation would permit more funds to be available for their children's education.

Erratum @ # 72 is acknowledged.

LibertarianKurt (75)

"Training or indoctrination?"

It's pragmatic, evidence driven. This is all we know to be rationally defensible, although I appreciate you may not agree. Where empirical evidence shows that something works better than earlier practices they are usually shared as professional skills. Meanwhile, others continue to try to improve upon those collective skills through research into contingent (empirical) relations. See above link. This is the best I know.

The example I chose was because you asked me to "..explain how an individual could experience life from anyone else's point of view?"

I did that.

I repeat, cognitive ability is Gaussian in distribution and narcissists and other Axis II Cluster B types are at the centre of their own universes. Sadly they are also of pernicious use/value in our self-centred Liberal-Democracies.

No 38 Werringtonsilent

Don't disagree with a lot of what you say.

We are dealing with an illusion and indeed insolvency is ultimately what it may come down to.

We are absent anyone actually leading us, telling it like it is. Until we reach that point where someone says enough is enough and we draw the line here, then we are into the palliative, mitigative policies being discussed at G20 to try and preserve the vestiges of civil order and morality represented by the existing world economic order.

Reworking morality & values may be a long term goal, but is not a realistic immediate option. People (individuals and as a crowd) just don't work that way!

tonyparksrun (#77) "..We are absent anyone actually leading us, telling it like it is. Until we reach that point where someone says enough is enough and we draw the line here, then we are into the palliative, mitigative policies being discussed at G20 to try and preserve the vestiges of civil order and morality represented by the existing world economic order.

Reworking morality & values may be a long term goal, but is not a realistic immediate option. People (individuals and as a crowd) just don't work that way!"

But we have successively elected anarchistic, i.e. non-governing pro free-marketeer governments since at least Thatcher. Along the way, we have been breeding more who simply do not see what is wrong (we've done this by keeping too many bright females in higher-education too long as well as the work-place with the lure of a greater disposable income. We have also been preferentially rewarding those who don't care that what they do is morally wrong (Axis II, Cluster B DSM-IV types) and we've been mass importing unskilled/uneducable/high TFR rate labour for short-term financial gain to compensate for the low birth-rate - it all means we've been in self-destruct mode for decades.

In the short-term, those doing this really don't care (see our Axis II, Cluster B tilted NYC/Hollywood culture).

#78 JadedJean said:
But we have successively elected anarchistic, i.e. non-governing pro free-marketeer governments since at least Thatcher.

Not content with merely using the term anarchic in a dismissive sense, I see you are now forced to redefine it to suit your purpose. For the record, it means absence of rulers. Government cannot ever fit this category. The plethora of legislation, including from the regime of the blessed St Margaret, runs contrary to your assertion. We have not seen true free-markets in our lifetime. Instead what we have seen is the worst excesses of state control masquerading as a free world.

The choice facing us all soon will be to accept the slavery of statism or to rebel and seize the freedom that can only come from individualism.

Which do you chose?

rwolff # 79
ditto!
Kurt ;)

RHETORIC VS REALITY

rwolff (#79) LiberarianKurt (#80) "For the record, it means absence of rulers. Government cannot ever fit this category."

Yes it can and sadly, it does.

In the real world of Parliamentary Democracy within whch we live, i.e the one in which parties have to pursue their objectives through reform rather than revolution, anarchists pass legislation which can not be effectively enforced. Note the direction which the UK Public Sector has gone over the past three decades. There may be lots of staff in the Civil Service, but they are low skilled and they do very little effectively. That's a recruitment consequence. It has been engineered. See the ethnicity quotas in the Public Sector. From inside the Public Sector this appeared to be a hatchet job.

Look at the FSA and read the advice given on regulation from Brown and Blair. Look to the management of crime, it's largely 'peception management'. Look at how the population has been changed through mas immigration and education, education, education (i.e. dysgenesic fertility).

I suggest you look to the practical realities of how politics works insterad of ideals. In the real world, hands-off government is anarchism masked by spin/theatre. Watch the ETS video, read the report, lok at Leich here, and forget about ideals. What you have been seeing is the erosion of the state. Whether this is in pursuit of a federal Europe and NUTS of ~6m, or something else (I fear it's just de-regulation to breed cash-cow consumers), I'm not sure, but loking at the trends, it is happening.

"The choice facing us all soon will be to accept the slavery of statism or to rebel and seize the freedom that can only come from individualism."

Hmmmm 'slavery' or 'freedom'...........hmmmmmmmmm that's a tough one ;-)

No. 81. JadedJean

The free market will provide pot noodles to all deserving consumers.
The pot noodles will come in all the flavours and all the colours. True freedom.

But don't worry - mass market junk culture and presentation politics couldn't happen in Britain.....

Erratum (#81)"dysgenesic fertility" = dysgenic fertility - i.e. policies (wittingly or wunwittingly it doesn't matter) leading to the tilting of the population distribution in cognitive ability and other behaviours through lowering the birth-rate (TFR) in the upper half of the distribution whilst raising it in the lower half. This appears to be an entropic process which occurs in the absence of eugenic practices (essentially, sound family planning) A falling birth-rate is essentially what Germany found itself battling after the WWI. This has, in my view, been egregiously negatively spun since, as the same issue was of concern in the UK and in other European countries. Worryingly, it appears, prima facie, to globally correlate with 'anarchistic' Liberal-Democracy). The PRC addressed this, most recently through legislation in 1995. Note that such legislation would be illegal in the EU because of the Lisbon Treaty's Article II of the FCHR.

VENALITY VS LEGALITY

rwolff & LibertarianKurt (#79, #80) For an illustration of how some aspects of this work out in detail, see Lord Myners before the Treasury Select Committee today (and see Ronnie Fox on remuneration a while back), and watch Panorama when last night's is re-broadcast.

#81 jadedjean

You seem to equate anarchy with anti-anachronistic change. I can concede that the world we live in is changing away from many of the certainties of the past, especially those in the category of unthinking subservience; the king is divine, the man from the ministry knows best etc.

However, you must, I think, concede that we have seen a massive increase in state interference over the past century or so. This has occurred at the same time as dramatic improvements in technology which have served to mask the destructive impact of the dead hand of government. The economic situation that we now face, in particular the collapse of fiat monetary manipulation and the debt based system, is set to expose the myths surrounding big government. Soon the system may no longer be able to bribe people into conformity with confetti and there will be too many people who have had their eyes opened and such wealth as they had destroyed, to coerce them all back into compliance. That is why war has historically been the preferred means of restoring the status quo. It scares the masses back into compliance.

I have followed some of your links on Personality Disorders and am concerned that the definitions appear to be determined by discredited organisations such as the WHO. It is interesting that they don’t seem too hot on classifying suck-up, subservient behaviour of the sort normally encouraged by the state and its education/propaganda arm. Perhaps you could enlighten us by posting a little on the cluster C disorders?

JadedJean # 81/84

And now for the news without all the smoke and mirrors...

https://www.lewrockwell.com/north/north683.html

Slavery or freedom? No contest really!

No. 86. LibertarianKurt

The Lew Rockwell article says the Austrian economists have been predicting the current crisis since 1912. Well, I suppose that after two world wars, one great depression, and the energy crisis of the 1970s, a big asset bubble was going to arrive eventually.

Anyway, where were the Austrians during Tulip Mania or The South Sea Bubble? It's not like history tells us the future....

Austro-Hungarian Empire = unstable political situation = a bunch of Austrian economists come up with a theory on how to cope in a situation of weak government and high political risk = free market theory.

I'm sure it wasn't really as simple as that.....

rwolff (#85) I think you should seriously consider whether it's the erosion of the state which accounts for our current economic and social woes. That's what I, and many others have seen over the past three decades - i.e. the privatisation and Balkanization of Britain.

ICD-10 (WHO) is perhaps not the best place to look for NPD, you should look to DSM-IV (i.e. the USA version) instead. There are all sorts of problems with classification systems (and those who us them), but there can be no doubt that some people have a hard time tuning into the needs of others. They are extreme individualists and they tend to wreck other people's lives in quite devastating ways. They are not easily 'helped' or managed as they tend to think they don't have a problem. It's very difficult to know what to do with them - except, perhaps, give them wide-berth, if one can.

Worryingly, many people find them charismatic.

#88 Jadedjean

There seems to be much we might agree on, for example that the system we have is not working, that education has been perverted to the point of being a problem in itself and perhaps even that debt based fiat money is no longer an acceptable way to run our economy. I also accept in general your somewhat non-pc points about genetic intelligence. Where we disagree seems to be that you have faith that an overarching state, albeit properly conducted, is the route forwards. I take a contrary stance that it is in fact the very existence of a coercive state which usurps and atrophises personal responsibility.

I admit to having been pleased to see the attempts to roll back the state through privatisation but disappointed at the implementation which has resulted in quango-isation and jobs for the boys in a state protected environment. I have considered whether I might be wrong but have failed entirely to find a shred of empirical evidence that government works or has ever worked to serve the needs of any but a select few.

As to NPD classification, I deliberately steered clear of the US version so as to avoid an overwhelming temptation to slag off Americans. Nonetheless, do you not agree that there seems to be more attention paid to slurring individualists and little to categorising/stigmatising the conformist mentality?

MrTweedy # 87

"...Austrian economists have been predicting the current crisis since 1912."

I think you may have misread the article. It said:

"Austrian School economists have been predicting this for years..."

If one has any sort of grasp of the [Austrian] Business Cycle Theory - which, by the way, even the "Great Lord Keynes" acknowledged but mistakenly thought the cause lay deep in the fabric of capitalism – then one would understand why it isn’t rocket science and why a four year-old could predict boom/bust cycles.

But then again, the government and the central “fraudsters” aren’t interested in you and me or anyone else. Therefore, let’s get back to those good old inflationary days, eh? Let’s get back to ripping the people off. Who cares that the paper tickets they are forced to use are worth less every week, month and year? Who cares about their savings, so long as “we” can spend the stuff first? Don’t listen to those pesky Austrians, what do they know?

Interesting that you offer up Tulip Mania (a mere blip compared to the Leviathan crisis now engulfing the world) and the South Sea Bubble (a government granted monopoly that went belly-up and not only involved fraudulent paper claims to non-existent assets, but also corrupt politicians of the time) as examples of why the irksome Austrians are not as clever as they think.

Please accept my apologies on behalf of Menger, Boehm-Bawerk, Mises, Hayek and Rothbard that they weren’t around before those events took place.

Oh, you may wish to look at this as well (JadedJean will like this!) courtesy of those ever so “crazy” Austrians.

https://mises.org/story/3379

rwolff (#89) "Nonetheless, do you not agree that there seems to be more attention paid to slurring individualists and little to categorising/stigmatising the conformist mentality?"

I suggest you give the US classification a little time to sink in. There are plenty of illustrative case-histories on the web. 'Conformist' is not the alternative - being able to relate to, and provide for, the needs of others may be.

Which takes us back to the state....

#91 JadedJean

I can agree with you that the US categorisation appears to be more pragmatic and less value laden than the WHO. Nonetheless, I cannot accept that psychological categorisation is in any way helpful or indeed relevant to the discussion of politics and political philosophy. There is no link between a belief in individualism in a political sense and what you tend to categorise as narcissistic behaviour save perhaps that some degree of narcissistic character may help an individual to have the confidence to break free of the nanny state.

More importantly there is no correlation between political individualism and a lack of empathy for ones fellows. Indeed I would argue the contrary, that subservience to government is detrimental to an altruistic attitude since it not only places responsibility away from the individual and onto the state, it also tends to nurture some perverted view that the individualist is to be feared amongst the conformists.

In the context of the current economic and financial situation one must wonder just how bad it needs to get before some people will accept that state control of money is a failure.

JadedJean # 91

"...being able to relate to, and provide for, the needs of others may be."

You see, this is where your altruism/ascetics gets in the way of how you think humans ought to act. Self-interest is the basis for capitalistic exchange. However, what you seem to ignore or not understand is that in order for any exchange to happen, both parties must benefit or else the exchange would never take place.

I think what you would like to happen is a society where individual self-interest/freedom is stamped out and then substituted for the collectivist, common good and rigidly enforced by the state.

This therefore takes us back to what Mises said many years ago:

"It’s either capitalism or socialism: there exists no middle way."

So, which would you prefer? And before you answer, bear in mind that what the Western World has experienced for the last 100 years or so is not true free market capitalism.

rwolff (#92) "I cannot accept that psychological categorisation is in any way helpful or indeed relevant to the discussion of politics and political philosophy."

Then you'd better stop using intensional verbs of propositinal attitude. In fact, you'd better stop using Natural Language altogeher (see below).

"There is no link between a belief in individualism in a political sense and what you tend to categorise as narcissistic behaviour save perhaps that some degree of narcissistic character may help an individual to have the confidence to break free of the nanny state."

Here's why you are probably wrong.

Here's Hare again. Narcissistis and psychopaths (a subset of ASPD) share half their (statistical) Factor Structure. DSM-IV is a behavioural checklist.

We use psychological classification all the time whether we like it or not (look into the 'logic' of the intensional verbs), denying one does so does not mean one does not do so, it just means one lacks insight into the nature of one's behaviour.

Finally, this is not about argument. In the context of Hare's account above, yesterday's Treasury Select Committee made interesting viewing. It's worth watching.

LibertarianKurt (#93) "You see, this is where your altruism/ascetics gets in the way of how you think humans ought to act."

Look into how healthy families behave. This is not about how one ought to act. It's about how most healthy, normal, people, behave vs a minority who do not. See my links posted in #94.

#94 JadedJean

I must agree with you that there are problems with natural language, particularly when multiple meanings are confused. You seem to insist on conflating individualism with a number of psychological traits yet ignore the beneficial characteristics of self-reliance and self responsibility.

Hares comments were couched in the usual language of the obscurantist, may, could etc. In any event, surely your categorisation applies to a power seeking individual much more so when the power they seek is that of state coercion of others. We are seeing this in the initiatives to regulate the banking system. Who do you think will emerge on top? What personality disorder will they need to exhibit to get there?

rwolff (#36) I suspect what you are picking up on in Hare is the caution which any good scientist shows when speaking about these matters to (presumed) non-professional, i.e. untrained audiences. All professionals have technical languages and the training of professionals requires them to learn specialist languages and other behaviours. These can not be directly translated back into Natural Language for what should be obvious reasons.

I susect you seriously underestimate the extent to which the non-truth functionality of Natural Language and disrespect for the sciences has contributed to the rise in mendacity which now blights modern life. It should be obvious that we rely upon other people for language, and that because language is a social construction it presumes a contract. As a consequence, individualism never comes into this (except through lack of awareness of what's going on between people). Group strategies in the service of group self-interest, egregiously masquerading as individualism, often seduce people into believing individualism is anthing but pathologial.

The problem with DSM-IV Axis II, Cluster B disorders is that such Personality Disorders are characterised by lack of concern for others' interests. It's as if such people have a scotoma there. This is why they are rarely helped. I suspect some ethnic groups have a higher prevalence than others, but I emphasise that this is just a matter of frequencies. It is a difficult, and sensitive issue, but one which costs others very dearly.