August 25, 2010

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"To be honest, as this world goes, is to be one man picked out of ten thousand."
– Shakespeare

Is It an Elite Depression?

Wednesday, August 25, 2010 – by Staff Report

Economy Caught in Depression, Not Recession ... Positive gross domestic product readings and other mildly hopeful signs are masking an ugly truth: The US economy is in a 1930s-style Depression, Gluskin Sheff economist David Rosenberg said Tuesday. Writing in his daily briefing to investors, Rosenberg said the Great Depression also had its high points, with a series of positive GDP reports and sharp stock market gains. But then as now, those signs of recovery were unsustainable and only provided a false sense of stability, said Rosenberg. Rosenberg calls current economic conditions "a depression, and not just some garden-variety recession," and notes that any good news both during the initial 1929-33 recession and the one that began in 2008 triggered "euphoric response." – CNBC
Dominant Social Theme: All is well? Or maybe not?
Free-Market Analysis: In analyzing the memes of the Anglo-American power elite and its seemingly berserker attempts at creating global governance, we face the conundrum of whether what is going on is part of a larger plan or the crumbling of a plan. This is not just a question for the Daily Bell but for readers, feedbackers and others who see the Western world from the standpoint of elite control of financial, military and sociopolitical mechanisms.

Political Paralysis Spreads to Australia?

Wednesday, August 25, 2010 – by Staff Report

Australia's independent "kingmaker" MPs Wednesday called for detailed cost analysis of pre-election promises as they weigh up which party to put into power after polls failed to produce a winner. Tony Windsor, Bob Katter and Rob Oakeshott, suddenly in the spotlight after the closest election in decades, made the surprise demand as they prepared for talks with Prime Minister Julia Gillard and opposition leader Tony Abbott. ... Windsor warned he would not support either party if he did not see enough "goodwill", potentially sending Australia's 14 million voters back to the polls in a matter of months. "If there is no goodwill displayed by both leaders and their party members, and if we can't see a future in terms of some longevity... of the parliament itself, I won't support either of them," he said. "There's a third option (other than Labor and the coalition), and that's another poll." The Australian Electoral Commission's latest running tally gives Labor 70 seats and the coalition 71, with both short of the 76 needed for a majority and relying on the independents and lone Greens MP Adam Bandt. – AFP
Dominant Social Theme: While democracy is messy, it is the best system that the West has got and we will muddle through.
Free-Market Analysis: We have spent time in the past several years analyzing the ongoing unraveling of the power elite's "democracy" meme. This of course is a widespread perception now; in America has even caused a new political movement – the Tea Party movement. Many people in America and throughout the West are increasingly dissatisfied with their political choices. The dominant social theme of course is that one must vote for those individuals or parties that best represent one's belief system and professional and personal preferences.

Society's Rules Don't Create Wealth

Wednesday, August 25, 2010 – by Staff Report
Guest Editorial

Dr. Tibor Machan
In olden days people were forced to labor for the king and his minions in return for being allowed to live within the realm. This kind of extortion finally got tossed over and people's basic right to their lives became acknowledged – in the political philosophy of John Locke and the Declaration of Independence, for example. You don't belong to society, to other people. Your life is yours to live as you choose, although, admittedly, you could live it bad or well but not in terms set by others who claim a portion of it.
But this realization that each individual has the right to his or her life got a bit arrested when later thinkers, like Auguste Comte and Karl Marx, argued that your property does belong to everyone else, not you. (In the case of Marx this didn't quite fit his labor theory of value, but skip that for now.) Among some of today's most prominently placed intellectuals, such as Professors Cass Sunstein of the Harvard Law School and Thomas Nagel of New York University, private property rights are taken to be nothing but a myth. (As one of Nagel's co-authored book, The Myth of Ownership, announces, wealth is a collective phenomenon, never mind that some produce hardly any while others make gobs of it!)

Falsity of Creative Destruction

Tuesday, August 24, 2010 – by Staff Report

From the Ashes ... The most dynamic economies rely on creative destruction to grow. As the world continues to recover from the Great Recession, governments and businesses are focused on how to spur economic growth. But if they really want to create jobs, raise incomes, and lift living standards, they should devote more energy to figuring out how to generate economic dynamism over the long term. At times like this, governments tend to champion particular sectors like manufacturing, or industries like green technology. But true dynamism flows from continuous innovation, experimentation, adaptation, and change, all of which raise productivity over time. Those productivity gains, in turn, lift incomes and drive consumption. This fuels more innovation—and a dynamic economy thus expands in a healthy, sustainable way. Unfortunately, economic dynamism can also cause dislocation and turmoil as workers lose jobs in failing companies or in fading industries. Change in the ranking of companies has accelerated in many countries, including the United States, over the last century. The 90 names listed on Standard & Poor's index of major U.S. companies in the 1920s remained there for an average of 65 years. By 1998 a company listed on the S&P 500 could expect to stay there for an average of only 10 years. – McKinsey Institute, Newsweek
Dominant Social Theme: Capitalism constantly reinvents itself.
Free-Market Analysis: This is a very interesting article that appears in Newsweek by James Manyika, Susan Lund and Byron Auguste. Manyika is a director of the global management and consulting firm McKinsey & Co, (Newsweek tells us), and of the McKinsey Global Institute, where Lund is the director of research; while Auguste is the director of McKinsey & Co.'s social-sector office. From our point of view, the article espouses a kind of dominant social theme – that the Great Recession and the pain it is causing is part and parcel of the natural evolution of capitalism.

Muslim Bogeymen

Tuesday, August 24, 2010 – by Staff Report

Islam is the New Communism ... Paul Hsieh wrote an excellent article about America's weakness in regards to the war against terrorists. However, he claimed that the mosque is distracting us from the real issue of Iran's nuclear weapons program. I respectfully disagree. The real issue is that we are fighting a war with Islam. The mosque, rather than distracting America, has brought her full attention to it. The mosque has refocused us on the fact that we were brutally attacked on 9/11, and Americans are starting to talk about it again. Videos about 9/11 are circulating the internet and discourse is taking place about who was responsible. People are learning about Islam and decisions are being made about who is to blame. – American Thinker
Dominant Social Theme: Islam is just the worst.
Free-Market Analysis: Both in terms of feedback to the Daily Bell and in the larger Western (American) society, we see an uptick of Islamic demonization. From our point of view, as we have expressed many times, this demonization of the "other" is a kind of power-elite dominant social theme. While the American Thinker is not exactly a mainstream 'Net publication, it does represent a certain strand of thinking that partakes of this meme. It might be characterized as "Islam is a fascist and bastardized belief system that is not a religion but a state-philosophy of mayhem and murder that demeans women and keeps societies in poverty."