Tuesday, November 26, 2013


Great phrase from John Hussman found here. He's talking about accounting, but I think it goes well with Sowell's comment from my previous post, regarding the manipulation of reality. Hussman writes:
In hindsight, the crisis ended - precisely - on March 16, 2009, when the Financial Accounting Standards Board abandoned FAS 157 “mark-to-market” accounting, in response to Congressional pressure from the House Committee on Financial Services on March 12, 2009. That change immediately removed the threat of widespread insolvency by making insolvency opaque. [italics mine] My impression is that much of the market’s confidence and oversensitivity to quantitative easing stems from misattribution of the initial recovery to QE. This has created a nearly self-fulfilling superstition that links the level of stock prices directly to the size of the Fed's balance sheet, despite the absence of any reliable or historically demonstrable transmission mechanism that relates the two with any precision at all. 

The FOMC certainly had a part in creating a low-interest rate environment that provoked a reach-for-yield and a gush of demand for securities backed by mortgage lending of increasingly poor credit quality (I’ll note in passing that new issuance of “covenant lite” debt has now eclipsed the pre-crisis peak largely due to the same yield-seeking). Still, it may ease the burden of power to consider the likelihood that the actions of the Federal Reserve – though clearly supportive of the mortgage market – were not responsible for the recovery. One can thank the FASB for that, provided we’re all comfortable with the reduced transparency that results from mark-to-model and mark-to-unicorn accounting.
Balzac said in the 19th century, behind every great fortune there is a crime. Today, behind every great obfuscation there is a purpose.

Friday, November 22, 2013

Omnipotent moral busybodies

“Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience.”

-- C.S. Lewis

"[Intellectuals] really have an enormous virtuosity in the use of words, and I think it's a fatal talent, because it can keep you from facing realities. You can always find some clever way to wish the reality away."

-- Thomas Sowell

The latter gem and its context can be heard here. The former can be read here. I am not a Christian apologist, for I am not a Christian, but the Lewis observation is sound on this note.

Monday, November 18, 2013


Harvard University President Emeritus Larry Summers spoke during a panel discussion on financial crises at the International Monetary Fund (IMF) Jacques Polak Annual Research Conference in Washington, Nov. 8, 2013.

We could also move to a cashless society where all money is electronic. This would make it impossible to hoard cash outside the bank."

Think about the implications here. Here's one that comes to mind: control.

Friday, November 15, 2013

Labor camp survivor tells his story

Listened to an interview with Harry Wu on PRI today. I couldn't leave my car until it was over. Powerful story, even if briefly told.

Wu expressed skepticism that the camps will actually close or that political prisoners will be released. "China is a Communist regime. As Communists, they need a repression system," said Wu. "If you disagree or are against the Community policy, you'll get sent to the labor camps."

Tuesday, November 12, 2013

Noisy negativists

SETI: Silly Effort To Investigate

"There are four basic rules for the noisy negativists:

1. What the public doesn't know, I'm not gonna tell 'em.
2. Don't bother me with the facts; my mind's made up.
3. If you can't attack the data, attack the people; it's easier.
4. Do your research by proclamation; investigation's too much trouble
and nobody'll know the difference anyway."

--Stanton Friedman, from the Cryptic Knowledge podcast on BlogTalkRadio.com

Wednesday, November 6, 2013

The last act

These lines by Francis Quarles encapsulate so much.

Epigram. Respice Finem (1635).

My soul, sit thou a patient looker-on;
Judge not the play before the play is done:
Her plot hath many changes; every day
Speaks a new scene; the last act crowns the play.
    h/t Chris Date