Thursday, January 22, 2009

"This Will End In Tears"

This will end in tears. The hysteria is not merely embarrassing to witness, it is itself contributory to the scale of the disaster that is coming. What we are experiencing, in the deepening days of a global depression, is the desperate suspension of disbelief.

It is frightening to think there is a real possibility that the entire world economy could go into complete meltdown and famine kill millions. Yet Western—and British—commentators are cocooned in a warm comfort zone of infatuation with America's answer to Neil Kinnock.

It is questionable whether the present political system can survive the coming crisis. Whatever the solution, teenage swooning sentimentality over a celebrity cult has no part in it. The most powerful nation on earth is confronting its worst economic crisis under the leadership of its most extreme Leftist politician, who has virtually no experience of federal politics. That is not an opportunity but a catastrophe.

These are frank, even ungracious, words: they have the one merit that, unlike almost everything else written today about [the new American leader], they will not require to be eaten in the future.

London Telegraph
20 January 2009


  1. Everyone says the sky is falling and I just don't believe it. History is full of economic corrections and collapses that hurt people for a time, but don't come close to destroying western civilization in the fashion being discussed. Information technologies assure that those who can spot irrationalities will be able to spot them and profit by their correction. The biggest problem that I see is the rejection of basic rational thought as demonstrated by these two issues: we can vaccinate people and wipe out certain diseases that kill many, but we allow people, out of supposed highmindedness to not get vaccinated solely because they are irrationally afraid of the side effects of the vaccination--this type of decision should not even be in play; or, we have billions of gallons of a valuable fluid that we can extract from beneath the ground for little cost and we don't do it because we have some notion that a few square miles of temporary harm are not worth billions of dollars.

    These are the types of things that concern me. How can such easy calls go the wrong way? It's true that each involves tradeoffs, but the notion that people can't see that one greatly outweighs the other speaks to a weakness of practical thought.

  2. Alas, I am quite gloomy.

    The Bush administration, tired, beaten-down, and inept in so many ways, totally mishandled the so-called economic crisis, and allowed it to mushroom into what probably will become a genuine economic crisis in this country. It may not yet be a genuine economic crisis in the United States, but it is awfully close to becoming one—and it is already a genuine economic crisis in Western Europe, where governments are destined to fall.

    Inefficiencies of information are not the key to success on Wall Street at the moment, if for no other reason than the information is bad, or unreliable, or keeps changing, or is subject to the day-to-day whims of government policy-makers. As proof, I offer all the whipsaw developments at Citibank and Bank Of America over the course of the last year, not to speak of Wachovia (supposedly healthy at 4:00 p.m. on Thursday, and definitely still solvent at 4:00 p.m. on Friday, but nonetheless closed by the Feds at 9:30 p.m. on Friday night).

    I see no evidence that the incoming administration is prepared to address this situation in an effective or serious manner, and the quality of its appointments, across the board, has been acutely bad. On the other hand, I see evidence everywhere that the private sector has lost all confidence in the incoming administration—perhaps to the point that the new administration’s failure is pre-ordained, already a fait accompli.

    Moreover, economic depressions are largely psychological, and near-impossible to cure.

    We may be operating in a perfect storm.

  3. Did you see that the government of Iceland fell this weekend? There was rioting in Iceland over the financial meltdown, something I would never have believed possible. ICELAND!

    I think the government of Luxembourg is next in line.

    And still, Gordon Brown hangs on by a thread. Everyone is waiting for a no-confidence maneuver, and it will come from the Labour benches, mark my words.

  4. Yes, Calvin, I read about Iceland.

    I am very surprised that Brown has held on as long as he has.