The Shock Doctrine: The Rise of Disaster Capitalism
fuck
Posts: 4,069
fuck
Posts: 4,069
fuck
Posts: 4,069
Comments
gonna watch it tonight, bro.
If I opened it now would you not understand?
is this a short?
or is this a trailer?
edit:
Ouch.
Klein is pretty brutaly warping SOME of Friedmans positions.
She fails to mention that he was pretty vehmenently against the Federal Reserve.
What she is representing as "the Free Market" is NOT what Friedman advocated.
He rightly felt that the manipulation of interest rates via the Fed was a massive DISTORTION of free markets.
Friedman's vision of a United States that legalized and embraced "competing currencies" would throw a HUGE wrench in the current status quo of the Military Industrial Complex and perpetual war mongering.
Although she is right,
he did support NAFTA.
But i have my doubts that he really understood the full implications of how NAFTA was being abused.
If I opened it now would you not understand?
I'm not so sure Friedman was vehemently against the Federal Reserve. I think he wanted state-controlled fiat money, albeit with a set inflation rate. Friedman was not even a true free-marketer.
Naomi Klein is clueless.
Peace
Dan
"Every judgment teeters on the brink of error. To claim absolute knowledge is to become monstrous. Knowledge is an unending adventure at the edge of uncertainty." - Frank Herbert, Dune, 1965
As for sensationalism, the title is pretty effective
Some good Friedman quotes, to show where his head was.
The first one here i just fucking love:
If I opened it now would you not understand?
Don't tell me there isn't a little twinge of wanting to tap into some shocked doctrine action.
and reveling in it's loyalty. It's made by forming coalitions
over specific principles, goals, and policies.
http://i36.tinypic.com/66j31x.jpg
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( o.O)
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I like most of Friedman and what he said, but you have to look at some of his actions. If I'm not mistaken, withholding taxes from paychecks was Friedman's idea ( he didn't think people would like to see how much they really have to pay each year), he advocated government interference at macro levels, and he was an inflationist. If he were still alive I bet he would support the recent bailouts.
Friedman was just an economist working with in the confines of the existing economic system.
I hear what you are saying.
i don't see him as some great god of economics.
However,
i do understand that one can know what the absolute right\preferable solution is, and still work within the confines of the existing condition to TRY to make that work.
in other words,
Friedman recognized that the inflationary system was unfair to the common man, and he knew that it interfered with the markets, and that we would be better off without an unchecked central bank (competing currency would CHECK its power).
But he was also a man that took pay checks from various people throughout the years, and was tasked with answering existing problems.
Fuck, i hate the goddamn Fed, but if you came up to me and asked me, "Honestly Drifting, what do you think they should do about this whole goddamn Fannie & Freddie situation?"
I'd tell you straight up.
Well.
If you want to avoid financial armageddon,
you sure as fuck better bail those bastards out!
[Now, alternatively, i would LOVE to just watch it all come crashing to its knees. However, i'm also smart enough to know that the American people are on the whole too dumb to figure out what is going on before they got steamrolled in to the WRONG answer ... like a BIGGER and more powerful central bank!]
Thats all i see Friedman doing in some of the instances you cited.
Also, remember that he started off as a statistician, not an economist or a politician. What i'm saying is, he came from an honest background, and perhaps took him a while to shed some of that honest naivety.
?
anyhow.
ps. i'm not sure you can rightly call Friedman an "inflationist".
A lot of his work actualy went a long way towards discrediting the fundamental assumptions of Keynes' own theories on inflationary economics. If you can call Friedman an "inflationist" it is only fair in the sense that he worked (got paid) to develop "solutions" within the confines of the established economic order. Certainly the quote in reference to finding another Greenspan, "Though wouldn't it be better if we learned that we could do without one?" can not be viewed as "inflationist", can it?
If I opened it now would you not understand?
Well he wanted to develop a computer-based algorithm to control inflation at about 3 or 4 %, so clearly he wanted to inflate. He was apparently smart enough, however, to not want people controlling the inflation.
And, once again correct me if I'm wrong, but I think he wanted competing fiat currencies, which I don't think is a good solution. That's what we have today, isn't it?
Fannie and Freddie should collapse if we want real progress. The sad thing is people like Naomi Klein would blame the free market.
I'd like to give her the shocker.
His comments about the computer controlling inflation was not a serious suggestion so much as an attempt to iterate the problems that arise from appointing HUMANs to be in charge of something that ends up being an EMOTIONAL decision with such large ramification as national fiscal policy.
Friedman was pretty explicit on at least a few occasions saying that he would prefer a non-manipulated market.
And when he said competing currencies, he meant just that. COMPETING currencies.
You think he would some how exempt commodity backed currency from that equation? That just doesn't follow.
As for what we have now,
no we have an aboslute monopoly on currency.
Its called LEGAL TENDER laws.
All US citizens and US corporations are REQUIRED TO ACCEPT THE U.S FEDERAL RESERVE NOTE as payment! COMPULSION.
Further, you are REQUIRED to pay your income tax with the $US FRN.
COMPULSION.
There is nothing "competing" about that.
In fact, the Government just shut down the Liberty Dollar and RAIDED ALL THEIR GOLD.
As far as Fannie and Freddie are concerned,
i think you are being a bit naive about this frankly.
The fact of the matter is they really are "too big to fail" ... look, i'm not saying i really personaly give a fuck. Bring on armageddon. Sounds like you're in that boat too,
however the EXISTING POWER STRUCTURE will NOT allow that to happen if they can avoid it.
Those institutions are the underwriters of FOUR+TRILLION worth of debt.
YIKES!
If they fail, the value of this 4 Trillion becomes QUESTIONABLE.
The US Economy can NOT handle a "4 Trillion Dollar Question".
That is half the size of the TOTAL current national debt!
You would be talking about a MASSIVE, MASSIVE collapse, and CONTRACTION of liquidity.
If Fannie and Freddie fail,
so to will the entire US economic and political system.
And that is NOT fearmongering.
Thats the damn near truth.
Here is a mainstream article for you
FORTUNE: The Fannie and Freddie doomsday scenario
If I opened it now would you not understand?
Friedman was against commodity-based money:
“The fundamental defect of a commodity standard (read gold standard) from the point of view of the society as a whole, is that it requires the use of real resources to add to the stock of money. People must work hard to dig gold out of the ground in South Africa - in order to rebury it in Fort Knox or some similar place. The necessity of using real resources for the operation of a commodity standard establishes a strong incentive for people to find ways to achieve the same result with out em ploying these resources. If people will accept as money pieces of paper on which is printed ‘I promise to pay - units of the commodity standard,’ these pieces of paper can perform the same function as the physical pieces of gold or silver, and they require very much less in resources to produce.”
Do you think the value of that $4 trillion Fannie/Freddie is not questionable? Do you remember Jim Rogers laughing at the CNBC guy who tried to tell him it wasn't questionable?
Housing prices would plummet--to there actual market value!
Regarding competing currencies, let me try this ONE more time.
There currently is NO competing currency within the United States.
Like i said, look up the term "LEGAL TENDER LAW".
A system of international floating exchange rates has nothing to do with the idea of "competing currencies", since one is not guaranteed the use of any other currency within the United States. However, you are FORCED to use Federal Reserve Notes in ALL transactions, and especially to pay taxes.
As for Friedman's quote regarding a "commodity standard", i am not sure of the context of this statement, however there is a portion of it which makes me question what he is really saying
When he says THIS:
"I promise to pay" combined with "units of the commodity standard"
means a GOLD or SILVER NOTE.
As in, the money supply is no longer tied to a ONE to ONE exchange of paper for commodity like a "REAL" Gold Standard. Because if we functioned on that level (ZERO leverage), banking WOULD return to the days the centuries ago. Finance simply operates too quickly these days to be tied down by such an absolute and imposing standard.
Seemingly, however, what you just quoted Friedman saying is actually in SUPPORT of commodity BACKED currency. We are talking about "Silver Certificates" or something similar that read on the face "The US Treasury Promises To Pay on Demand The Bearer of This Note: 1 Dollar In Silver", but where if you cashed in every dollar all at once, there would NOT be enough commodity (gold, silver) in the vaults to pay on demand, but as long as the paper itself is accepted in trade, the "veil" (leveraging) holds up, and the currency remains "backed" by the commodity. That is what we had in America up until 1971.
FURTHERMORE,
a "gold standard" is NOT mutually exclusive with "competing currency".
It IS feasible to have a fiat currency AND a commodity backed currency operating within the same economy.
The commodity backed currency could certainly put pressure on the fiat currency to stay "honest" (reasonable inflation vs. runaway inflation). However because the commodity backed currency would take a long time to get in to circulation on a large scale (it takes a while to procure all of that gold and silver to back a currency with) there would still be an incentive in business to use the FIAT money, simply because of the issue of scarcity.
article here, read it, its good
Here is some more good Fed Bashing from Mr. Friedman:
HERE IS A HUGE PASSAGE ON COMPETING CURRENCY:
All Friedman is saying is basicaly that the USD (Federal Reserve Note, rather) has had such a long standing monopoly on the national conscience that an attempt at competition would be squashed simply by the ubiquitous nature of the current money supply.
That being said, Friedman ACKNOWLEDGED HIS SUPPORT OF THE IDEA IN PRACTICE! He just didn't think that, by itself, it was going to make a substantial difference on a national scale.
But, again, HE SUPPORTED THE IDEA:
SO MUCH FOR THE "INFLATIONIST" ARGUMENT:
Here is his PERSONALY PREFERED, and "MOST RADICAL" SOLUTION...
it is the FREEZING OF THE "HIGH-POWERE" MONEY SUPPLY! That means, STOPPING INFLATION TOTALY:
OKAY.
i woke up in the middle of the night (1:30am) ... it is now 2:45am .... and i'm going back to bed!
If I opened it now would you not understand?
No.
The short term panic and recalibration caused by a 4 trillion dollar variable like -- WHO IS GOING TO GUARANTEE 50% OF ALL MORTGAGES IN THE UNITED STATES -- is TOO GREAT for the system to withstand.
If you know anything about how the street even reacts to events as "relatively small" as changes in the interest rate (causes 200 to 500 point moves on the DOW sometimes) ... the notion of the street trying to figure out, OVERNIGHT, how to revalue FOUR TRILLION DOLLARS is going to be catastrophic.
You can't do that in a highly leveraged system like this.
You just can't.
:(
If I opened it now would you not understand?
The stuff I read about Friedman was mostly older articles, including this detailed one by Murray Rothbard: http://www.lewrockwell.com/rothbard/rothbard43.html
Rothbard is the true free marketeer.
"Finance simply operates too quickly these days to be tied down by such an absolute and imposing standard"
Can you explain this briefly? We aren't talking about carrying around bags of gold.
Rothbard is good.
So is Friedman. Hes just more misunderstood, because his stance was often more "nuanced". Rather, he didn't always stick to some theoretical\hypothetical perfect scenario\vision, but was able to work to explain ways in which the current reality could be improved slowly.
As for that quote.
I can explain that , but probably not saying anything that hasn't been said before:
The entire system moves on the premise that there is liquidity somewhere to cover any demand. Thats why we shifted to fiat money, right? Because we were told that it was the imposition of actualy having gold on hand that was the problem?
The fact is that money travels around the the country -- and indeed the globe -- at far too quick a rate for the gold to "follow it" fast enough.
In that sense you are talking about actual nuggets of gold,
because remember with a gold standard you have to be able to exchange your cash right on back in to gold at will ("on demand").
Think of all the effort\productivity that would be wasted constantly trying to get that gold from where it was deposited\mined to where it was being withdrawn from.b And don't forget the accounting function of correcting for that if say Bank A gave gold to Bank B's customer, and then had to resecure gold directly from Bank B (like clearing checks, but clearing gold instead!).
And that is just the superficial problem.
The real problem is with the LENDING.
Because with a gold standard, what is being lent by a bank is supposed to be backed by gold. In other words, if you ask me for cash, i can only give it to you provided i have gold reserves in the vaults.
That REALLY fucks with liquidity in the economy.
Of course, with a FEDERAL system this is lessened to an extend, but you still have over a dozen regional reserve banks, and countless private banks, and shuffeling around all that gold "backing" to get it to the right bank at the right time to ensure proper liquidity for normal business, and to guarantee against a catastrophic run during abnormal business, becomes a monumental task.
I'm really not telling you anything you dont know.
Here, from Ency. Britannica Online, is a surmation of the key points. Again, all of which i think you are aware, you were just thrown by my phrasing of the problem:
If I opened it now would you not understand?