A Country in Denial

Watch Bernanke’s ‘Little’ Inflation Capsize U.S.

By Amity Shlaes

A little is all right. That’s the message Federal Reserve Chairman Ben S. Bernanke has been giving out recently when asked about the evidence of inflation in the U.S. recovery.

Sometimes Bernanke doesn’t even go that far. He simply says he doesn’t see inflation. The Fed chairman recently described the prospects for price increases across the board as“subdued.”

 “Sudden” is more like it. The thing about inflation is that it comes out of nowhere and hits you. Monetary policy is like sailing. You’re gliding along, passing the peninsula, and you come about. Nothing. Then the wind fills the sail so fast it knocks you into the sea. Right now, the U.S. is a sailboat that has just made open water, and has already come about. That wind is coming. The sailor just doesn’t know it.

The right way to make money

If you focus on making money, you end up making a lot of bad decisions 

by RUSS ROBERTS 

People are making fun of this piece by Greg Smith where he talks about his disillusionment with the culture at Goldman Sachs. Smith claims the only focus at GS is making money and people openly disdain the customer. He’s being mocked for thinking it could possibly be otherwise.

But I was reminded of this 1950 quote from George Merck who was president of the pharmaceutical company:

"We try never to forget that medicine is for the people.  It is not for the profits.  The profits follow, and if we have remembered that, they have never failed to appear."

If you focus on making money, you end up making a lot of bad decisions. Paradoxically, if your goal is to make money, it’s better to think about making a great product, making the customer happy and so on with the constraints of making money along the way. The best corporate cultures encourage excellence, not the bottom line. The bottom line matters of course, but if that’s your focus your long-run results may be quite poor. No corporation that I know of has as its motto: make as much money as possible! And I don’t think it’s just public relations. A great corporation with great profits gets its workers to focus on the consumer and uses other mechanisms to make sure the employees don’t bankrupt the company by being too generous with prices or quality.

The Making of an Adolescent Elite

Privilege: Top of the Class

By Austin Bramwell 

Status has always been hereditary. A warlord establishes a dynasty; a merchant buys a title; a politician gets his son elected to office. The desire to pass power, rank, and wealth down to one’s descendants is a universal that human institutions have always flexed to accommodate. Even communist dictators have consolidated rule within their families.

Americans have a rich, if forgotten, history of aristocracy. Royalist cavaliers flourished in Virginia; the Dutch granted patroonships in New York; armigerous families reproduced the feudal system in Maryland. The last manorial estate in the United States did not break up until 1840s.

Could we choose another future other than collapse?

We Have No Other Choice

America is just going through the motions because we have no other choice--or so we believe. 

by Charles Smith

I have long thought that America Is Just Going Through the Motions--of caring about the deficit, of financial "reform," and everything else:

Let's be honest, shall we? There never was any fire for real reform of the financial sector. It was all rote, a foul, stupid play-act, a passionless pantomime of "caring" and fake-"progressiveness" displayed for propaganda purposes.

I now think we're just going through the motions because we have no other choice than to "extend and pretend" the Status Quo. Choice is of course a matter of perception, a situation where perception defines what is "possible" and what is "impossible."

Interestingly enough, the "possible" is what we think we can manage, while the "impossible" is what happens to us whether we thought it possible or not.

Consider the Federal Reserve. Liberal media mainstay The Atlantic published a fawning puff-piece lauding Ben Bernanke as the man who "saved the economy": The Villain: The left hates him. The right hates him even more. But Ben Bernanke saved the economy— and has navigated masterfully through the most trying of times.

We all know what Ben "saved," and it wasn't the economy--it was the fraud-based crony-capitalist financial sector. In case you missed the primer that explains the fundamental frauds at the heart of our economy:

They are doing Mankind a favour

Safe nuclear does exist, and China is leading the way with thorium

A few weeks before the tsunami struck Fukushima’s uranium reactors and shattered public faith in nuclear power, China revealed that it was launching a rival technology to build a safer, cleaner, and ultimately cheaper network of reactors based on thorium.

By Ambrose Evans-Pritchard

This passed unnoticed –except by a small of band of thorium enthusiasts – but it may mark the passage of strategic leadership in energy policy from an inert and status-quo West to a rising technological power willing to break the mould.

If China’s dash for thorium power succeeds, it will vastly alter the global energy landscape and may avert a calamitous conflict over resources as Asia’s industrial revolutions clash head-on with the West’s entrenched consumption.

China’s Academy of Sciences said it had chosen a “thorium-based molten salt reactor system”. The liquid fuel idea was pioneered by US physicists at Oak Ridge National Lab in the 1960s, but the US has long since dropped the ball. Further evidence of Barack `Obama’s “Sputnik moment”, you could say.

The Physics of Gluttony

To lose weight, eat less, or breathe more.

By Richard A. Muller

Physics can sometimes cut through the mess of complex problems with a simple conservation law. A year ago, in my column "The Physics Diet," I applied conservation of energy to the problem of obesity. I argued that exercise burns so few calories that it cannot be a major way of losing weight.

The Math of Khan

Not just a YouTube phenomenon, but a model for educational transformation

By Laura Vanderkam
Watching videos online usually means goofing off. But over the past few years, millions of decidedly enterprising people have turned on their computers to watch, of all things, math and science lectures. At KhanAcademy.org, Salman Khan, a former hedge-fund analyst, narrates more than 2,700 free lessons, each about ten minutes long, on everything from polynomials to valence electrons. In video after video, Khan’s disembodied voice explains concepts as his pen swiftly draws illustrations on a digital board. Students can also work math problem sets, proceeding through a sequence that stretches from arithmetic to calculus.

Khan began making these videos around 2004. Seven years later, they and his problem sets have become a pedagogical phenomenon, attracting fame, controversy, and, beginning last year, funding from Microsoft founder and philanthropist Bill Gates. What makes Khan’s videos so appealing? Has he invented a teaching tool that works? And what do his discoveries mean for the broader goal of improving education?

Big Time Crooks

For Greece, it's Deja Vu All Over Again

                             The only lesson of history is that it doesn't teach us anything

by CrownThomas

In 1865, four European countries decided to form a monetary union. France, Belgium, Italy, and Switzerland formed what is known as the Latin Monetary Union.

This union was to be a bimetallic monetary system. Although it had no common currency, the French Franc was the international store of value, and the Banc of France was the lender of last resort. All national silver & gold coins were allowed in settling domestic transactions. Incidentally, the fixed parity of silver to gold was 1:15.5. 

Declaring War on Newborns

The disgrace of medical ethics

 

By Andrew Ferguson

On the list of the world’s most unnecessary occupations—aromatherapist, golf pro, journalism professor, vice president of the United States​—​that of medical ethicist ranks very high. They are happily employed by pharmaceutical companies, hospitals, and other outposts of the vast medical-industrial combine, where their job is to advise the boss to go ahead and do what he was going to do anyway (“Put it on the market!” “Pull the plug on the geezer!”). They also attend conferences where they take turns sitting on panels talking with one another and then sitting in the audience watching panels of other medical ethicists talking with one another. Their professional specialty is the “thought experiment,” which is the best kind of experiment because you don’t have to buy test tubes or leave the office. And sometimes they get jobs at universities, teaching other people to become ethicists. It is a cozy, happy world they live in. 

Zombie Banks and Vampire Governments

The game of kick the can will continue

by Gary North

The term "zombie banks" refers to banks that refuse to lend to the private sector. They are run by fearful bankers who do not trust other bankers. They do not trust many potential borrowers. According to legend, zombies survive by eating the brains of their victims. It seems to me that zombie bankers must be limiting their diet to brains of other bankers and investment fund managers.

Governments are ready borrowers of money lent by zombie banks. Zombie bankers think that their banks' money is safer with sovereign nations' IOUs than with other forms of IOUs. The governments siphon off the money that could have been lent to the private sector.

Nanny Government Treats Its Citizens Like Children

Americans, unlike those of yesteryear, have become timid and, as such, come to accept all manner of intrusive governmental acts

By WALTER E. WILLIAMS
Last month, at a Raeford, N.C., elementary school, a teacher confiscated the lunch of a 5-year-old girl because it didn't meet U.S. Department of Agriculture guidelines and therefore was deemed non-nutritious. She replaced it with school cafeteria chicken nuggets.

The girl's home-prepared lunch was nutritious; it consisted of a turkey and cheese sandwich, potato chips, a banana and apple juice.

But whether her lunch was nutritious or not is not the issue. The issue is governmental usurpation of parental authority.

In a number of states, pregnant teenage girls may be given abortions without the notification or the permission of parents. The issue is neither abortion nor whether a pregnant teenager should get one. The issue is: What gives government the authority to usurp parental authority?

Falling Behind

Germany Fails To Meet Its Own Austerity Goals

European countries are expected to implement tough austerity measures amid the debt crisis. But Germany isn't setting a very good example. SPIEGEL has learned that Berlin failed to reach its own austerity goals in 2011. And despite pressuring its neighbors to save, Germany is behind this year too.

By SPIEGEL ONLINE

As she travels from one European Union summit to the next, Angela Merkel's constant mantra in recent months has been austerity, austerity, austerity. But apparently the German chancellor hasn't been quite as strict when it comes to her own country's budget.

SPIEGEL reports this week that the German government didn't reach even half of its planned savings in the federal budget. Only 42 percent of the spending cuts named by Merkel's coalition government, comprised of the conservative Christian Democrats and the business-friendly Free Democratic Party, were actually implemented.

Land of the Setting Sun

It is happening right now

By Patrick J. Buchanan   

Sunday was the first anniversary of the 9.0 earthquake off the east coast of Japan that produced the 45-foot-high tidal wave that hit Fukushima Prefecture.

Twenty thousand perished. Hundreds of thousands were driven from their homes when a nuclear plant swept by the tsunami exploded, spewing radiation for miles.

The Rain in Spain ...

Things That Make You Go Hmmm...

By Grant Williams

"... the Spain which emerged around 1960, beginning with its economic miracle, created by the invasion of tourists, can no longer result in impassioned dedication on the part of its intellectuals, and even less on the part of foreign intellectuals."

– JUAN GOYTISOLO

"In order to fully realise our aspirations, we must create in the masses of the people the sense of sacrifice and responsibility that has been the characteristic of the anarchist movement throughout its historic development in Spain."

– FREDERICA MONTSENY

"It is we the workers who built these palaces and cities here in Spain and in America and everywhere. We, the workers, can build others to take their place. And better ones! We are not in the least afraid of ruins."

– BUENAVENTURA DURRUTI

So Let's begin with Spain.

Spain is a problem. A real problem. Greece today triggered the biggest sovereign default of all time as it reneged on its commitments to pay back investors the €210 billion it had promised them some 2,400 years after 10 Greek municipalities became the first sovereign entities to default when they stiffed the temple of Delos, birthplace of Apollo.

How Goldman Sachs Fleeced Greece

Goldman Secret Greece Loan Shows Two Sinners as Client Unravels

By Nicholas Dunbar and Elisa Martinuzzi 

Greece’s secret loan from Goldman Sachs Group Inc. (GS) was a costly mistake from the start.

On the day the 2001 deal was struck, the government owed the bank about 600 million euros ($793 million) more than the 2.8 billion euros it borrowed, said Spyros Papanicolaou, who took over the country’s debt-management agency in 2005. By then, the price of the transaction, a derivative that disguised the loan and that Goldman Sachs persuaded Greece not to test with competitors, had almost doubled to 5.1 billion euros, he said.

Rotting from the Head Down

Marking out a territory and intimidating others

 A member of Britain’s intellectual elite celebrates his nation’s social collapse.

by THEODORE DALRYMPLE

In his article on London in last Sunday’s New York Times Magazine, titled “Oh, London, You Drama Queen,” novelist China Miéville writes: 

“The aftermath [of the recent riots] was one of panicked reaction. Courts became runnels for judicial cruelty, dispensing sentences vastly more severe than anything usual for similar crimes.”

This is the statement of a typical intellectual whose indifference to the actual lives of the urban poor masquerades as compassion for them. Miéville fails to mention that most of the sentences handed down were for people with criminal records, no doubt in many cases long ones. The real judicial cruelty—not to the criminals but to their victims—was the leniency before the riots that gave the rioters a hitherto justified sense of impunity.

Economic disaster in the works

Stockman On The Economy

By Bernard Condon

He was an architect of one of the biggest tax cuts in U.S. history. He spent much of his career after politics using borrowed money to take over companies. He targeted the riskiest ones that most investors shunned — car-parts makers, textile mills.

That is one image of David Stockman, the former White House budget director under Ronald Reagan who, after resigning in protest over deficit spending, made a fortune in corporate buyouts.

But spend time with him and you discover this former wunderkind of the Reagan revolution is many other things now — an advocate for higher taxes, a critic of the work that made him rich and a scared investor who doesn't own a single stock for fear of another financial crisis.

Stockman suggests you'd be a fool to hold anything but cash now, and maybe a few bars of gold. He thinks the Federal Reserve's efforts to ease the pain from the collapse of our "national leveraged buyout" — his term for decades of reckless, debt-fueled spending by government, families and companies — is pumping stock and bond markets to dangerous heights.

Germany's Strategy

Searching for a New Entente

By George Friedman

The idea of Germany having an independent national strategy runs counter to everything that Germany has wanted to be since World War II and everything the world has wanted from Germany. In a way, the entire structure of modern Europe was created to take advantage of Germany's economic dynamism while avoiding the threat of German domination. In writing about German strategy, I am raising the possibility that the basic structure of Western Europe since World War II and of Europe as a whole since 1991 is coming to a close.

If so, then the question is whether historical patterns of German strategy will emerge or something new is coming. It is, of course, always possible that the old post-war model can be preserved. Whichever it is, the future of German strategy is certainly the most important question in Europe and quite possibly in the world.

Nassim Taleb on curing economic cancer

Fragility and Strength

Can the president kill you?

Elimination of al-Awlaki was more Stalinesque than Jeffersonian

By Andrew P. Napolitano

Can the president kill an American simply because that person is dangerous and his arrest would be impractical? Can the president be judge, jury and executioner of an American in a foreign country because he thinks that would keep America safe? Can Congress authorize the president to do that?

Earlier this week, Attorney General Eric H. Holder Jr. attempted to justify presidential killing in a speech at Northwestern University law school. In it, he recognized the requirement of the Fifth Amendment for due process. He argued that the president may substitute the traditionally understood due process - a public jury trial - with the president's own novel version of it; that would be a secret deliberation about killing. Without mentioning the name of the American the president recently ordered killed, Mr. Holder suggested that the president's careful consideration of the case of New Mexico-born Anwar al-Awlaki constituted a form of due process.