A Nation Of Fools

PDF Version                                                                         December 18 2019

What we have in the United Sates is a multitude of fools. What is a fool other than one who bases his life on things that are not  true because the truth is too daunting? What is meaningful to a fool? Why that would be entertainment and engaging in mindless fantasy. Politics comes down to seeking political messiahs and virtue signaling. The role of citizen in a democracy, is to take authority over government and leaders. American citizens do just the opposite.

As unpleasant as they are, here are the facts.

While republicans identify themselves as conservatives, they embrace political initiatives which are even more socialist than those suggested by the unapologetic classic socialists in the Democratic party.

What is socialism other than the replacement of price with political power for the purpose of allocating resources in an economy? In other words, who gets what in a socialist economy is determined by who does or does not have political power. Benefits all go to the top regardless of stated intentions. This is true of classic socialism. This is true of the fascist style socialism Americans are now embracing while calling it capitalism.

All the president has to do is say, “Make America Great Again” and supporters rally around the man and think of themselves as good patriotic Americans. So which period in history would we be better off returning to. Is it the 1940s and WWII? To do that we would have to have a third world war. Should we return to the 60s and be hippies again? How about the Civil War? When was this great period in history that we are going to return to? The president identifies scapegoats like immigrants and the Chinese. The scapegoats become the issue.

What about the trade war? So far, in all of history, there has never been a positive outcome for any country involved in a trade war. Does anyone want to place a bet that ordinary citizens will come out ahead with this one?

So, we have a trade war which will bolster the profits of American corporations. American corporations are in fact headquartered in the United States. The corporations are owned by stockholders who are scattered all over the globe. Foreign central banks own significant amounts of stock in these “American Corporations.”  So, Americans believe it is a good idea to put themselves in a financial hardship so that our corporations can win one for the team? Americans are trained from birth to do just that. That is not a way in which an economy works wells. It only works that way if the population is trained to promote its own poverty.  The greatest accomplishment of public education is to teach children to establish arbitrary loyalties and promote their own poverty by embracing the collective agendas of others and coming together for causes deemed in the public interest.

Employment numbers look good but are they really? Even if the numbers are not tampered with and embellished has anyone taken a close look? We now have lower wages as a new normal for workers. Perhaps we do have more people working these days. Assuming we do, most of the new hires are working for less real income than when job numbers were a lot less than stellar.

What about the stock market? Starting in spring of 2003, an asset value enhancement initiative was initiated.  With every day that has passed since then, the stock market has become more and more managed. There is no official policy stating as much, so you might wonder how that could be. Do you seriously think there is absolutely nothing in Washington that is done outside of a formal congressional setting? A better question, is. Are there any significant issues entertained in a formal congressional setting? I don’t know of any. Do you know any?

Here is why the stock market is overpriced and doesn’t fall. There is an astronomical level of organized support keeping it moving in the right direction. Imagine vendors  selling apples on a sidewalk. All but one has just a bucket of apples while while one large vendor has a huge cart of apples with far more fruit than all of the others put together. Who is going to decide what apples sell for on that street?

The goal of the asset enhancement initiative is to is to concentrate stock ownership in the hands of a few who then decide what everyone else pays for shares of stock. Is there a theory behind this process? Of course there is. The theory is that high stock prices become a new normal. Keep security prices rising and the economy will follow and so on. Has GDP responded well? GDP is officially very good but how good is it in reality? It is hard to find growing prosperity within the masses who work very hard and come home tired everyday. We do have more working and making less per hour. Government spending is counted. When GDP needs to look good, government spending can be increased in whatever amount is needed for the purpose of publishing good looking numbers.

What we have with respect to the stock market is the capture, consolidation and control of a huge portion of one of the factors of production. The Federal Reserve is managed with political power and all of government is used as a tool for personal enrichment. Stock buybacks are coordinated with Federal Reserve Policy. The public has its money parked in IRAs and puts little stock on the market as supply. Non-IRA money is concentrated in ETFs so hardly a soul is concerned with the value of one particular stock price. Where is supply going to come from?

For right now, there isn’t any to speak of but supply will emerge, although not in a way most expect. For now, any reasonable stock selloff can be offset by the elite buying outright. Foreign central banks already own a lot of American shares. They will buy more  if prices start falling, if for no better reason than to protect the value of what they already. The elite in general will do the same thing. When if ever or at all will stock prices normalize?

The bottom will fall out when the economy collapses and the damage cannot be explained away. The elite will panic in the same way everyone else normally does when their fantasy based paradigms fall apart. The elite do plan on being bailed out. Be prepare because they just might be. How? We don’t know yet. We do know that they are a lot smarter than the rest of us.

Both the economy and the stock market will collapse but the economy will be the first to fail. The economy is rotting from the bottom up and the rot is moving higher up the income ladder every day. The stellar numbers we are seeing are good for show. When the bottom of the economy falls out, the top will collapse on top of all others.

Do not expect an economic recovery. Only free market forces can fuel a recovery. Our free market system has been replaced with at least two styles of socialism.

 

 

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About Fantasy Free Economics

James Quillian independent scholar,free market economist,and teacher of natural law. Who is James Quillian? Certainly I am nobody special, Just a tireless academic and deep thinker. Besides that, I have broken the code with respect to economics and political science. Credentials? Nothing you would be impressed with. I am not a household name. It is hard to become famous writing that virtually no one in the country is genuinely not in touch with reality. But, if I did not do that, there would be no point in my broking the broken the code. If you read the blog, it is easy to see that there are just a few charts, no math and no quantitative analysis. That is not by accident. Given what I know, those items are completely useless. I do turn out to be highly adept at applying natural law. Natural law has predominance over any principles the social science comes up. By virtue of understanding natural law, I can debunk, in just a few sentences , any theory that calls for intervention by a government. My taking the time to understand the ins and outs of Keynes General Theory is about like expecting a chemistry student to completely grasp all that the alchemists of the middle ages thought they understood in efforts to turn base metals into goal. Keynesian theory clearly calls for complete objectivity. Government can only make political decisions. Keynesian techniques call for economic decisions. So, why go any further with that? Fantasy Free Economics is in a sense a lot like technical analysis. Technical analysis began with the premise that it was impossible to gain enough information studying fundamentals to gain a trading advantage. Study the behavior of investors instead. Unlike technical analysis, I don't use technical charts. What I understand are the incentives of different people and entities active in the economics arena. For example, there is no such thing as an incentive to serve with life in the aggregate. In the aggregate, only self interest applies. It is routinely assumed otherwise. That is highly unappealing. But, I am sorry. That is the way it is. I can accept that because I am genuinely in touch with reality. Step one in using Fantasy Free Economics is for me to understand just how little I really know. A highly credentialed economist may know 100 times what I do based on the standard dogma. Compare the knowledge each of us has compared to all there is to know and we both look like we know nothing at all. There is always more than we don't know than what we do know. I am humble enough to present myself on that basis. Why? That is the way it is. I am not bad at math. I have taught math. What I understand is when to use it and when to rely on something else. Math is useless in natural law so I don't use it. While others look at numbers, I am busy understanding the forces in nature that makes their numbers what they are. That gives me a clear advantage.
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[…] Although I no longer use technical analysis for trading it is easy to see that based on technical indicators, the stock market is ready to simply disintegrate. It might as well be held up with toothpicks. Without organized support, the market would have already collapsed. My position for years there has been, that there is an ongoing movement that is designed to concentrate assets into the hands of the world’s wealthiest citizens. The quote below is from a 2019 article, A Nation Of Fools. […]