Archive for February 9th, 2016

Quote note (#219)

This notorious Andrew Mellon quote — disastrously ignored by Herbert Hoover — might be the XS most favored recommendation of all time (in the realm of political economy, at least):

Liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate. It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up from less competent people.

Anyone who has conniptions about it (which is almost everyone) is part of the problem. Mellon still understands entropy dissipation. No one in a position of political authority has since.

NRx (Outside in version) is the obstreperous alternative history in which Mellon was listened to.

February 9, 2016admin 103 Comments »
FILED UNDER :Political economy

Quote note (#218)

Libertarian in genesis, but strategically sound:

“… those who consider themselves modern American revolutionaries often envision manning barricades and mass revolt as the undoing of the government. That attacks the government at its greatest strength — its capacity to use force and violence. The US government has at its disposal the most potent military and surveillance capabilities ever assembled. … […] The idea that some sort of mass movement will rise and by force of its inferior arms throw off the yoke of oppression is the stuff of weak novels, not a real life strategy that has a chance of success. Those who buy into it and attempt implementation commit the biggest strategic failure: they have fooled themselves. Consequently, their enemy — the government — profits. It uses their failure to justify further tyranny and repression.

There is surprisingly little written about attacking the government at its weakest point: its financial dependence … An offensive would require a mass movement far less massive than that required for armed revolt, and its tactics would be legal. A few million simultaneous phone calls and requests via websites for the withdrawal of balances from banks, money market funds, and stock and bond mutual funds would precipitate a financial panic. None of those institutions keep enough cash on hand to meet a tsunami of redemption and withdrawal requests. They’d have to sell their assets to raise cash. The prices of those assets would drop, begetting further selling; negative crowd psychology and wealth effects would kick in as markets crash, and debt and economic activity would contract.

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February 9, 2016admin 40 Comments »