Jonathan Green » Wall-St

Lambchop bubbles

Jonathan Green — Wed, 08 Oct 2008 05:49:23 +0000

I’ve still read much that was a better take on the underlying issue than this piece from Eric Janszen in February’s Harpers.

Nowadays we barely pause between such bouts of insanity. The dot-com crash of the early 2000s should have been followed by decades of soul-searching; instead, even before the old bubble had fully deflated, a new mania began to take hold on the foundation of our long-standing American faith that the wide expansion of home ownership can produce social harmony and national economic well-being. Spurred by the actions of the Federal Reserve, financed by exotic credit derivatives and debt securitiztion, an already massive real estate sales-and-marketing program expanded to include the desperate issuance of mortgages to the poor and feckless, compounding their troubles and ours.

That the Internet and housing hyperinflations transpired within a period of ten years, each creating trillions of dollars in fake wealth, is, I believe, only the beginning. There will and must be many more such booms, for without them the economy of the United States can no longer function. The bubble cycle has replaced the business cycle.

A first-rate piece. But why of creating a stimulating multi-media environment for these earnest considerations you might also like to take in a tune:

Click here to view the embedded video.

The Dow is a root vegetable

Jonathan Green — Mon, 06 Oct 2008 21:18:08 +0000

Nothing that has happened in the last few weeks has done anything to change my mind on this … pet theory, offered only half in jest: markets should only be reported once a month. Thus: “The Dow went up and down on an almost hourly basis over the past month, the net result has been a slight decline. And now, in sport … ” And we should all walk more. Probably plant a small orchard, and certainly grow our own vegetables. Developing a touch for watercolours would be good. And there you will be, painting under a tree nibbling your own carrot. Oblivious. And never mind the markets.

Wall St, madmen and martinis

Jonathan Green — Wed, 01 Oct 2008 04:51:05 +0000

I’m trying not to think about it. About Wall St, and profligacy, and just how big $700 billion might be, and the leveraging of greed into something so consuming. It’s depressing, as is the prospect of calibrating a global response to climate shift disaster against this sort of thinking. It’s otherworldy, disconnected. This distant implosion that destroys capital while leaving structures intact. So I’m not thinking about it, certain that has as good a chance as anything else of making it all come good. Instead I’m humming the theme to Mad Men, and thinking of a dry, dry martinus. Don’t you mean martini? If I want two I’ll ask for it. Sorry.

Click here to view the embedded video.

Don’t panic, we’re well placed

Jonathan Green — Tue, 30 Sep 2008 00:56:34 +0000

With the US bailout sitting in pieces on the floor of the House, now they’re talking about the US Fed taking an equity stake in leading banks. free market capitalism? Last week’s idea already. Lets nationalise the banks. Help. Australia. Got to have the Australian angle, how else could we digest this moment? “We are well placed” some spotty Herbert in a thick f-ck you tie is saying on Sky business. Buy CSR and Cochlear. They’re talking about the fatal wounding of the world’s largest economy and we’re well placed. Whatever can that mean?

Markets, panic, idiocy and Galbraith

Jonathan Green — Thu, 18 Sep 2008 04:54:52 +0000

A wonderful thing in Ken Silverstein’s Washington Babylon at Harpers. He quotes John Kenneth Galbraith in his 1954 book The Great Crash:

In the autumn of 1929 the mightiest of Americans were, for a brief time, revealed as human beings. Like most humans, most of the time, they did some very foolish things. On the whole, the greater the earlier reputation for omniscience, the more serene the previous idiocy, the greater the foolishness now exposed. Things that in other times were concealed by a heavy façade of dignity now stood exposed, for the panic suddenly, almost obscenely, snatched this façade away. We are seldom vouchsafed a glance behind this barrier; in our society the counterpart of the Kremlin walls is the thickly stuffed shirt.

Ah Galbraith. Panic has run amok on the world’s markets just now restrained only by the donation of federal money and the intervention of various statutory agencies. It makes you wonder how it is that the market can be so free and unfettered in the uptimes, then so socialised on the way down.