the F rant

Kids,

When people abuse George Bush, I shrug.

When they have a go at Palin, I smirk.

When they express fear and anger at the regressive, protectionist and quite frankly ridiculous policies of Barack Obama, I giggle.

But when they criticise the capitalist system, I get angry.

In a nutshell, I’ll say it: the capitalist system is a system of profit AND LOSS.

When you win, you win. When the likes of the “Wall Street Pirates” make trillions of dollars, I’m the first to stand and cheer. But when they lose? They LOSE!

They should lose – if they are are not being careful, if they’re not wise, if they’re not responsible – if they’re running sub-standard business. They will lose. Capitalism giveth, Capitalism taketh away. Why are we having such losses at the moment? It’s simply because people are choosing to move their money elsewhere. People are rewarding those who are currently seen as more risk averse, more responsible, more prudent. They are moving their money away from the “cowboys”.  So why the hell should taxpayers prop up bad businesses?

That’s the fundamental difference between an open-market system (like Australia), and the system the US has (which you definitely would NOT call a free market system).

The financial system in the US was built on a deck of cards, subsidised by cheap Fed money and the lack of proper regulation in some ways, overregulation in others, and shielded from analysis and criticism by the US Government, who felt that the complex financial instruments peddled by these companies were “too sensitive” to be adequately scrutinised by the public or Government.

Don’t blame capitalism. Blame the US Government. Legislators in that country are too myopic to be in charge of something as important as the financial markets.

More here: http://www.businesspundit.com/sub-prime/
and here: http://www.dailyreckoning.com.au/

UPDATE: I remembered a piece I wrote last August about this very issue… It’s not far off where we are right now: the F rant: US Dollar Woes

UPDATE 2 [3 Oct]: A great editorial from Ron Paul in The Daily Reckoning.

FREEDOM: Economics, Politics and Business

“Virals” don’t usually work. Ad agencies are trying to cling onto their business model by eschewing unpopular TV ads (that nobody watches) in favour of “doing a viral”, where they produce the same boring, expensive ad, and convincing unimaginative marketers that, by putting it online, it will “become viral”.

Most of the time, actually about 99.999% of the time, the only people who watch them are the marketers and staff of the firm. They then get sucked in by the ad agencies insights department or digital arm, who in the post campaign report, tell them that a 0.00001% click rate “exceeds industry benchmarks”.

Seth Godin, author of books like “The Ideavirus” and “Purple Cow”, describes the factors that make ideas “viral” here. Rare as these factors are, people are still convinced daily to spend hundreds of thousands out of their marketing budget on what usually amounts to a boring as hell corporate video.

That being said, this viral works. It’s for Diesel’s XXX SFW “Dirty 30″ party invite. It’s GREAT. Pass it on.

http://view.break.com/577249 – Watch more free videos

FUTURE: Digital Media, Marketing, Insights and Trends

This guy is offering tours of Schapelle Corby’s “cage”, with extra special tours including an ability to “feed” Schapelle, a la feeding an monkey. Here’s the site: Schapelle Corby Tour

I checked the ownership of the URL, it seems legit, owned by:

Hutauruk, Eddie eddie.hutauruk@hotmail.com
63 A Teuku Umar
Denpasar, — 80362
+62 36178495

For those of you who aren’t Aussies, or Aussies who have been living under a rock, Schapelle Corby is an Australian woman was convicted to 20 years prison after attempting to smuggle 4.2kg of marijuana into Indonesia in a boogie board bag.

Typically, much of the parochial and narrow minded media in Australia chose to follow the line that Schapelle was innocent, despite all of the evidence being against her – and not only the conviction of the District Court of Denpasar, but an unsuccessful appeal to the Supreme Court of Indonesia. Much of the media and many Australian maintain this assertion of innocence against all logic, mainly playing to underlying racism – that somehow, we in Australia have a superior prosecution and legal system, and that Indonesians are incapable of running a court system.

It’s a shame that someone spends 20 years in an Indonesian jail. But then again, it’s a shame that someone would be so stupid and irresponsible to import 4.2kg of marijuana. It’s a greater shame that many Australians don’t see the simplicity of the prima facie case and just acknowledge that maybe, just maybe, the Indos got it right; she did the crime, she should do the time.

Anyway, above all, I think this site is funny in the darkest way possible.

FREEDOM: Economics, Politics and Business, FUTURE: Digital Media, Marketing, Insights and Trends

I was thinking: if the Federal Reserve is putting hundreds of billions of dollars of loans out into the market to ensure liquidity (wise move), but they are running short, so have asked the US Treasury for help, what sort of help would this be?

Simply, wouldn’t the Treasury ensure supply by growing money supply?

Surely, with massive growth in money supply, wouldn’t we also see massive growth in US Dollar inflation?

With massive growth in US dollar supplies, wouldn’t we see a massive debasement of the US dollar vs higher interest rate currencies?

Wouldn’t we also see a debasement of currencies that are pegged to the US dollar:
Aruban florin
Bahamian dollar
Bahraini dinar
Barbadian dollar
Belize dollar
Belarusian ruble
Bermudian dollar
Cayman Islands dollar
Cuban convertible peso
Djiboutian franc
East Caribbean dollar
Eritrean nakfa
Hong Kong dollar (narrow band)
Jordanian dinar
Lebanese pound
Maldivian rufiyaa
Netherlands Antillean gulden
Omani rial
Qatari riyal
Saudi riyal
Salvadoran colón
United Arab Emirates dirham
(rise in costs in these countries)

Wouldn’t we then see a massive rise in the value of real assets vs the US dollar, eg: GOLD?

Wouldn’t this rise in gold be further exacerbated by risk associated with credit and financial market assets? Wouldn’t we see investors flight to safety to these assets?

Wouldn’t it be wise to buy gold if you now held US dollar assets?

Am I on the right track?

FREEDOM: Economics, Politics and Business

FOOTY: Sport in general