Econ 010 ~ Then & Now

(Tea Party 1 : Tea Party 2)

To the offended: You may be adamantly against the recent stimulus packages and bailouts of Big Business (as proffered by GWB and BHO), but if you are a laissez-faire capitalist or corporate libertarian, you are a porter for economic tyranny (as in T-Party) whether you admit it or not. Why? Because that is the inevitable evolution of BOTH the far-right and the far-left as diagramed at http://dejavu-times.blogspot.com/2011/05/econ-011-right-stuff-or-not.html and http://dejavu-times.blogspot.com/2009/09/are-we-there-yet-at-t-point.html . Warning voices abound everywhere.

Growth Funds

(All indented quotes are found in Devil Take the Hindmost: A History of Financial Speculation by Edward Chancellor, © 1999, A Plume Book. You should read this book if you are an investor and/or speculator, or if you are financially related to one.)

Not only was the “vast fund of stupidity”* a growth industry in the 1800’s, its companion fund, cupidity, was not a whit behind. The prior manias¹ were dimly remembered, BUT this new century was unfolding as a unique and exceptional age BECAUSE the Railroad was unlike anything before. This time—THIS TIME—with the Railroad, “it was different.”²

Except of course, when it wasn’t.

Times (24 Oct. 1845): “A mighty bubble of wealth is blown before our eyes as empty, as transient, as contradictory to the laws of solid material, as confuted by every circumstance of actual condition, as any other bubble which man or child ever blew before.” (p. 140)

Journalist (1849): “All rule and order are upset by the general epidemic [of speculation], as in the Plague of London, when all ties of blood, honour, or friendship, were cast away.” (p. 139)

Benjamin Disraeli (British statesman, literary figure, & eventual UK-PM; as quoted in 1849): “[There was] commercial distress of unprecedented severity—private credit was paralysed, trade was more than dull, it was almost dead—and there was scarcely a private individual in this kingdom, ... , who was not smarting under the circumstances of commercial distress …” (p. 143)

Nation (1873): Anyone who stood on Wall Street or in the gallery of the stock Exchange last Thursday, or Friday, and Saturday, and saw the mad terror, we might almost say, brute terror … with which great crowds of men rushed to and fro trying to get rid of their property, almost begging people to take it from them at any price, could hardly avoid feeling that a new plague had been sent among men, that there was an impalpable, invisible force in the air, robbing them of their wits, of which philosophy had not yet dreamt.” (p. 185)

Charles Francis Adams, Jr. (author, 1869) “ … probably no representative body were ever more thoroughly venal, more shamelessly corrupt, or more hopelessly beyond the reach of public opinion, than are certain of those bodies which legislate for republican America in this latter half of the nineteenth century. (p. 177n)

Alexander Dana Noyes (1938 re 1880s): “[There were massive frauds accompanied by] individual wrongdoing, of a kind and on a scale for which even the lax financial morality of those days provided no precedent.” (p. 187)

Letter to the Times (12 Jul 1845): “There is not a single dabbler in scrip who does not steadfastly believe—first, that a crash sooner or later, is inevitable; and secondly, that he himself will escape it. When the luck turns, and the crack play is sauve qui peut, or devil take the hindmost, no one fancies that the last mail train from Panic station will leave him behind. In this, as in other respects, ‘Men deem all men mortal but themselves.’” (p. 136)

Times change, but human nature does not. And so the FUNDS grow.³ And the sinking sense of déjà vu prevails. THUS, woe is the world as bubbles float on with technology-assisted rapidity and with increasingly manic attempts to catch them before they burst!

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* A quote from Cato's Letters, January 1721. See http://dejavu-times.blogspot.com/2011/03/vast-fund-of-stupidity-recycling.html

1. Reference: The Tulip Mania (1637), John Law’s Mississippi Bubble (1720), the South Sea Bubble (1720), the mining and canal crazes (1790s and beyond), and scores of lesser manias.
2. The four most expensive words in the English language are “this time it’s different.” (Attributed to Sir John Templeton and quoted in Chancellor’s book at page 191.)
3. See http://en.wikipedia.org/wiki/Economic_bubble for some of the many latter-day bubbles.

“Vast Fund of Stupidity [& Recycling Cupidity]”?!

(All indented quotes are found in Devil Take the Hindmost: A History of Financial Speculation by Edward Chancellor, © 1999, A Plume Book, pp. 59, 67, 67, 69, 76, 77, 92.)

In memory of the birth of the South Sea Company (in 1711 – 300 years ago), Deja Vu Times recycles a few comments/quotes from the “bubble-bath” of 1720. These words from the 1700s are also recycled in memory of the many bubble-baths since and in expectation of The Great Bath (TGB) to come (sooner than later), if we don’t renounce this Vast Fund (and all its fundamentalists).

Cato’s Letters, January 1721: “There must certainly be a vast Fund of Stupidity in Human Nature, else Men would not be caught as they are, a thousand times over, by the same Snare; and while they yet remember their past Misfortunes, go on to court and encourage the Causes to which they are owing, and which will again produce them.”

Anonymous Insider (circa 1720): “’Twas his [John Blunt, leading schemer’s] avow’d Maxim, a thousand time repeated, That the advancing by all means of the price of stock, was the only way to promote the good of the company. [And his second maxim:] the more confusion the better: People must not know what they do, which will make them the more eager to come into our measures: the execution of the Scheme is our business; the Eyes of all Europe are upon us.”

Sir Isaac Newton (who lost £20,000 in South Sea investment): “I can calculate the motions of the heavenly bodies, but not the madness of the people.”

Alexander Pope: “I am really piqued at the stocks, which put a stop at present, to all trade and all friendship, and I fear all honour too.” // “… [give no heed to] this miserable mercenary Period; and turn yourself, in a just Contempt of these Sons of Mammon, to the Contemplation of Books, Gardens, and Marriage.”

Edward Harley (whose brother Robert was a former British Tory minister & co-founder of the South Sea Company in 1711): “… the demon stock jobbing is the genius of this place. This fills all hearts, tongues, and thoughts, and nothing is so like bedlam as the present humour which has seized all parties … and all sects. No one is satisfied with even exorbitant gains, but everyone thirsts for more, and all this is founded upon a machine of paper credit supported only by imagination …”

Jonathan Swift: “I have enquired of some that have come from London, what is the religion there? They tell me it is South Sea stock; what is the policy of England? the answer is the same; what is the trade? South Sea still; and what is the business? nothing but South Sea.”

Adam Anderson (former cashier of the South Sea Company): “… may [1720] serve for a perpetual memento to the legislators and ministers of our own nation, never to leave it in the power of any, hereafter, to hoodwink mankind into so shameful and baneful an imposition on the credulity of the people, thereby diverted from their lawful industry.”

How many more “South Sea” tsunamis and false profits can our irrationality and folly endure?

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See also:
http://dejavu-times.blogspot.com/2009/09/panglossary.html
http://dejavu-times.blogspot.com/2009/08/how-long-till-we-get-it.html
http://dejavu-times.blogspot.com/2010/02/free-fall.html

P-Con 001 ~ Enough & To Spare (Or Not) !

(P-Con = sketch-stories exploring the déjà vu of Power, Publicity, PR, & Propoganda Concerns.)

This sketch-story was inspired while watching "Donald Trump's Golf War" documentary, aired on "The Passionate Eye" - CBC News Network, Sunday, March 20, 2011; available for ONLY a limited time at http://www.cbc.ca/documentaries/passionateeyeshowcase/2011/golfwar/

Econ 009 ~ Church of the Laissez-faire

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http://dejavu-times.blogspot.com/2009/08/ten-dictates-practicalities-of-laissez.html
http://dejavu-times.blogspot.com/2010/06/yes-we-get-it.html

ECON 008 ~ "Give & Take"

~  (Laissez-faire style) ~

Adam Smith: The interest of the dealers, however, in any particular branch of trade or manufactures, is always in some respects different from, and even opposite to, that of the public. To widen the market and to narrow the competition, is always the interest of the dealers. To widen the market may frequently be agreeable enough to the interest of the public; but to narrow the competition must always be against it, and can serve only to enable the dealers, by raising their profits above what they naturally would be, to levy, for their own benefit, an absurd tax upon the rest of their fellow-citizens. The proposal of any new law or regulation of commerce which comes from this order ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it. (The Wealth of Nations, p. 287-8—I.XI.III)

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Related posts:
Wealth Redistribution: http://dejavu-times.blogspot.com/2008/10/wealth-redistribution.html
Beyond the Mark: http://dejavu-times.blogspot.com/2009/12/beyond-mark_14.html
Who ate my cheese? http://dejavu-times.blogspot.com/2010/05/who-ate-my-cheese.html

ECON 007 ~ "Mine" Shafts

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Adam Smith: When masters combine together in order to reduce the wages of their workmen, they commonly enter into a private bond or agreement not to give more than a certain wage under a certain penalty. Were the workmen to enter into a contrary combination of the same kind, not to accept of a certain wage under a certain penalty, the law would punish them very severely; and if it dealt impartially, it would treat the masters in the same manner. (The Wealth of Nations, p. 164—I.X.I)





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Related posts: Who ate my cheese? http://dejavu-times.blogspot.com/2010/05/who-ate-my-cheese.html
Beyond the Mark: http://dejavu-times.blogspot.com/2009/12/beyond-mark_14.html
Wealth Redistribution: http://dejavu-times.blogspot.com/2008/10/wealth-redistribution.html

ECON 006 ~ Graphic Proof

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If you really want the "right" side-up of GOP deficit records, visit http://en.wikipedia.org/wiki/National_debt_by_U.S._presidential_terms and also check out the links to government and other sites. The Ten Trillion Dollar Question: Is 30 years of data not enough to prove that deficit reduction is a promise devoid of substance or intention?

ECON 005 ~ "A Person"*

(*with proxy claims for equal human rights! Goes way beyond a "board" game.)

Note: (All ECON sketches may be used pursuant to the Creative Commons License noted herein.)