Saturday, February 10, 2018

The crash of 2018


Jim Cramer formerly of Goldman Sachs has a show on MSNBC called Mad Money. As you might expect from the title of the show and the person who pretends to be crazy while touting a very financialized version of capitalism. After the stock market rout  of February 8th 2018 he took us through the exotic financial instruments that he said caused the crash that day.

In particular Cramer dipped  Into his  stockbrokers heart and said that frankly they would bet on anything. That included, he claimed,  raindrops on the window. But for him to crash was caused by several stocks that bet on  volatility on the market. He was horrified that the SEC allowed them to exist and indeed generate $billions in business that day. They have exotic names; SUXY, UVXY and indeed one – not sadly – died on Feb 3 as it encouraged bets AGAINST  volatility.

Is this the truth, or Cramer disavowing his own past in hedge funds? For example, the Shiller-Cape  index independently suggests  that the S+P and Dow should be at about half their current level;



The Shiller index in currently at 31.8 versus the historical average of 16.8.


Up to recently capitalist boom/burst Cycles were explained by entities like Kondratieff  Cycles which argued that boom bust was caused by the delay in capitalists building plant and that they would occur about once every 15 years. What is happening now is quite different particularly as automatic trading means that we have a very out of control stock market..

Moreover our economy is far more financial. After the crash of 2008 the capitalist class did two rather brilliant operations. One was to get behind Obama which meant that they had what Cornel West called “A black puppet of Wall Street” in the White House. The other was to bet the national economy on Wall Street using a degree of state control that Stalin would be ashamed of.

In particular, the Fed gave money to the banks that until recently were then forced to deposit at the Fed;


The bull market of the past year is explained in these terms as this deposit restriction being eased so the money went elsewhere, creating the very inflationary pressures that the Fed is now trying to ease with interest rate hikes.

The problem is that this has also created massive national debt and that several pundits like Rogers and Icahn believe that this would be impossible to resolve even in the very painful way we discovered since 2008; evicting millions of people before closing the legal  loophole that allowed banks evict people from houses they, the banks, had sold the mortgages on; neo-feudalism with the “gig economy”; trash like Uber, Airbnb and the new equally bad AI as tech; and so on.

Where does Ireland stand in this? As we always have been for most of our history; a colony, pushed hither and thither by these forces. When they had to pin a tail on a donkey a decade ago, we rather than Iceland (let alone larger indebted countries) became the donkey.  “Junior” debt was added to the sovereign ( a big word that means you and me)  for the first time, The resulting shambles has been viewed as tough love with robust economic growth now seen as a certainty – just as the world economy implodes, taking Ireland with it.  In fact, according to Barry Eichengreen, the ECB also forbade 50% reduction of senior unsecured debt which even the IMF wanted;



It is difficult to see how they're going to handle it in the United States. They have sacrificed another generation to immensely High property prices and created to freakish presidencies in Trump and Obama. After Hillary Clinton they can't really put a woman there and ask for sympathy on the basis that she is woman in the same way as they did for Obama being black.

Robert Nye the author of the concept of “soft power” argued that only if Trump gets reelected or Worse starts War can we decide that he is something different than freaks Like Joe McCarthy or George Wallace..
What seems to be the case for Ireland is that we need to get back to politics again rather than have the economy drive politics and the whole society

The other noticeable events today was the final demission of Gerry Adams;

http://www.nationalreview.com/article/456284/gerry-adams-retirement-northern-ireland-still-unsettled

The article misses the point that we southern republicans lost our whole country because of the 1998 deal.
Readers seeking any consistency in his life will look in vain 4 themes beyond the fact he wanted to remain head of the Republican movement. As far as he was concerned intern that involved simply dangling a nebulous United Ireland in front of his followers while he shifted from communism to neoliberalism to God knows what else in a far too long career.

One of the things of this blog and of the Society of which expression is that we are underwent a coup attempt in Ireland from 1998 to 2008. The coup was meant to be sealed by an electronic voting  initiative which was intended to prevent elections for the rest of our lives at least. Will simple Fianna Fail corruption explains an awful lot of what went on, it is also true to say that experiments were being done like the privatization of the universities, the privatization of traditional music, and a corporate structure which was a new form of fascism. Part of the funding for this initiative came from government promoted bonds which highly unusually are to be repaid in full; with CIA personnel around to ensure this but see preceding entry

What we need to do is forget about this “United Ireland”; any entity that the DUP is happy to enter will be unrecognizable as Ireland. As has been stated here, simple access to the web grants us 90% of what is currently valuable about Ireland. And yes, we c an do much better; refuse to pay back any odious debt,
stress agriculture (in case we need to be self-sufficient as globalized forces marginalize us), software, and culture. We can do this in conjunction with Scotland, another high resource and low population country (genocide will do that to a country)

Adams was actually a bureaucrat, and was nicknamed the “draft dodger”. While there is evidence that he betrayed Paddy Kelly and the others killed in the Loughall massacre, it is altogether undeniable that his entourage was full of  touts like Scappaticci, recently back from the dead as Adams resigns, Kelly and others were a la ISIS about to occupy some territory; it is arguable that Adams stopped them and  the least we owe them, Mairead Farrell, Joe McCann,  Bobby Sands et al is the assertion of a territory in which our values rule


Currently, Ireland is in a power vacuum. Referenda are proposed by an unelected “citizens assembly” and divide  the country for years; we have an “S+c” relationship between govt and oppo; bills are issued for water and then withdrawn; and as happened here in California, civil servants go berserk in the absence of government and start endangering Irish citizens. We owe it to ourselves and to the world  to create a parallel Ireland