Monday, January 18, 2010

Channeling Outrage

After smiling silently upon reading the rumble over at Barry Ritholtz' I must admit that, for my amusement, I am all for a good conspiracy theory purporting to explain the inexplicable - one that projects blame away from where it perhaps hurts most, or onto something that makes erstwhile sense out of randomness and/or seeming injustice, particularly on a canvass where The Bad Guys seems to triumph more often than Mom, Pop, Guy Little, or even the virtuous citizen. Yes, blame the Fed, it's leader(s), Goldman Sachs, it's leader(s) - present or former, the Plunge Protection Team, CIC, the NWO, vulgar Russians, fundamentalists, George Soros, Water fluoridation, The Jews (oh yeah - don't forget the Jews), Sunspots, Cronies, Old Boys, Ivy-Leaguers, Etonians, Extra-terrestrials, Economists, Hedge Funds, HFT'ers, rich folk, poor folk, Freemasons, Unions, Vaccinations, the CIA, Jews (oops I've already said that) crack-heads, [insert favorite other pet tag, famous persona, or just Timothy Geithner here], anyone and anything other than what the wise seeker of explanations, William of Ockham and his obvious razor might suggest with appropriate contemplation.

In the world of the Sordid and Nefarious Conspiracy, cabals dominate. Nothing, I repeat NOTHING, is at seems. The truth, you see, would bring tears to the eyes of Macchiavelli and Lao Tzu, not to mention Mother Teresa and the Dalai Lama. At least if they walked away from watching Glenn Beck or reading certain financial blogs more informed and rage-a-licious than before. Yet the market for intrigue, cynicism and increasingly, financial skepticism is large and expanding seemingly at a faster rate than the market for sober-minded analysis and cogent, thoughtful non-hyperventilated explanations. To be certain, flaws are prevalent in everything and everyone. Systems and rules will gamed frequently and systematically, and competitors will inevitably collude, more or less in inverse proportion to the amount of oversight, regulation, scrutiny and enforcement of said affairs. Politicians will frequently bend the truth for self-serving reasons. Good people universally will make some bad decisions (in hindsight). And bad people will make worse decisions. Heck, just ponder the plight of an altar boy in Ireland. Corruption is almost certain to be prevalent to a greater or lesser extent while honesty will perpetually be in short supply where money, power, and/or privilege is concerned. Conflicted interest is behind every door. Institutions are only as good as the people within, and the support from the polity. Culpability is in short supply in American culture. Even Clinton found it hard (no pun intended) to own up to a few moments of illicit pleasure. Yet, for all that, conspiracy theories - like religion - need to be credibly and plausibly proved to be anything other than a phantasmagoric conjuring at best, or sad excuses NOT to confront the prevailing reality with the prevailing palette of contributory causes and explanatory factors and influences, because it is contrary to one's presently anchored view.

Conspiracy theory, like demagoguery, begins with a remote kernel of seductive and at a cursory glance seeming explanatory power. A simplistic soundbyte lodging itself within, but for practical purposes, of little use in comprehending the complexity of modernity. It is precisely this complexity and the subsequent loss of individual control that has caused the bull-market in Conspiracy and Demagoguery. Reality just has too many facets and moving parts. Dumb it down. "Six-Minute Abs" applied markets or politics. It sells ad slots on late-night talk radio, and elevates the eyeball-count on websites. But sadly, it provides little more than a placebo in place prescription required.

20 comments:

robert said...

As someone who has enjoyed your blog for sometime, can I ask what you did in Tokyo, and perhaps for whom?

Matthew said...

The seeming chaos of cause and effect is less maddening in the context of a solid conspiracy.

For example, the gross subsidisation of debt financing (by the Federal government) has disproportionately benefited the financial services industry (particularly the money center banks) while acting as a destabilizing force in the broad economy.

While strong lobbying efforts manifested certain instances of debt subsidisation, the pervasiveness of debt subsidies leaves a rational thinker to conclude that debt subsidies are largely the spontaneous product of uncoordinated legislator cowardice (i.e., they wanted to be re-elected), not an orchestrated conspiracy to destablise the economy (which is not good for anyone).

A lot of alcohol and a week long stay in Key West last autumn resulted in a more collected big picture view. I think some of these conspiracy theorists should convert some of their gold into relaxy juice.

Anonymous said...

Mr Cassandra: A simplistic soundbyte lodging itself within, but for practical purposes, of little use in comprehending the complexity of modernity. It is precisely this complexity and the subsequent loss of individual control that has caused the bull-market in Conspiracy and Demagoguery.

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That is wrong. There is a bull market in conspiracy theories because Geithner/Paulson/Bernanke bailed out the bondholders of the big banks and AIG, instead of saving the businesses in chapter 11 bankruptcy.

Before and during these back-room bailouts various politicians and pundits were skeptical and demanded to see the analysis justifying these bailouts. Geithner/Paulson/Bernanke bulldozed them. Then the skeptics demanded information after the fact. Once again, Geithner/Paulson/Bernanke have refused by giving incomplete, confusin, and downright misleading disclosures.

Geithner/Paulson/Bernanke and their backers on the Hill (Frank, Dodd, etc) are to blame for the bull market in conspiracies.

Bankruptcy is as American as apple pie and motherhood. When the big banks, Geithner, etc refused to use bankruptcy to save the banks and force their stupid bondholders to take their losses, they gave the public the finger. When Obama hired Geithner/Summers, and let them continue Geithner/Bernanke/Paulson's little game of backdoor bailouts and subsidies for the bondholders of the big banks, Obama gave the finger to the public.

There is a price, and part of the price is conspiracy theories. The public is smart enough to know it was raped, but not smart enough to understand how. The conspiracy theories come about out because the public is grasping as best it can for the truth.

If Obama wants to end the conspiracy theories and the backlash against him, he ought to give full disclosure to the public. And fire Geithner and Summers, and withdraw Bernanke's nomination for Fed chief.

Anonymous said...

I don't agree with Barry Ritholz. While I have no proof of course, I think there's a reasonable possibility that the government/Fed has been interfering in the stock market.

When trying to solve a murder, police look at Ability, Opportunity, and Intent. In the case of the S&P 500, the government/Fed has all three: Ability, Opportunity, and Intent. They have certainly have been interfering in other asset markets to an astounding degree. In addition, the Fed has no misgivings about being secretive or even breaking the law (Their purchases of Fannie and Freddie MBS is clearly not authorized by law.)

And if you know anything about the black programs of the DoD, parts of the government are very good at keeping secrets... for many, many years.

Buzz said...

As fat headed and self centered as we are, It is hard to find enough consensus in all our individualism to support any conspiracy....but!.. I have to agree with Anonymous...FACTS seem to support his/her conclusion. I have sent our dear president many e-mails to that effect.

There is so much inertia!

But there are other factors that are far more powerful......witness Haiti.

I cry for them..shouldn't we raise our UNITED STATES OF AMERICA flag to half mast and be still and unproductive out of respect for a day or two?

We will not win our stupid battle with nature.

Anonymous said...

A worthy accomplishment, even in the hyper-prolix world of the blogosphere. Three bloated, turgid paragraphs that say absolutely nothing.

Anonymous said...

The Fed's corrupt actions have destroyed their own own reputation, and they have no one to blame but themselves. It's little wonder that people are getting more distrustful of the wizard behind the curtain.

tooearly said...

"But sadly, it provides little more than a placebo in place prescription required."
Contrary to your assertion, placebos are often highly therapeutic, or at least as therapeutic as the active agent with which they are being compared. But tell us, what prescription have you in mind?

And what in particular are you railing against? Conspiracy as the boogey man is rather losing its scare factor..

Demetrius said...

As one of the conspiracy of bloggers whose ambition is to reinstate The Templars, or at least their accounting systems, part of the problem is there is now a surfeit of conspirators and a lack of people who know what they are doing. Like the UK Government.

Anonymous said...

Perhaps the real problem lies in that anything is more credible than what's published by the Washington Politburo and its propaganda machine the MSM.

ArkansasAngie said...

Intent.

Being skeptical is always prudent. At the same time ... I do not believe in benevolent Dictators.

The problem is that too many people think their Ends justify their Means. There are RICO laws for a reason.

It's interesting that you really did actually mention a particular theory

Anonymous said...

And I so enjoyed checking out your thoughts in the past?! Let's see if I follow the logic. Because conspiracy theories are like ...holes, everyone has one, they should be discounted as unproductive, demagogic and ... what "dumb"? So, Johnson's Gulf of Tonkin incident, Nixon's plumbers, Hitler's Reichtag fire, Roosevelt's "Remember the Maine", the Pentagon papers, need I go on? These were not conspiracies, rather ...?

Anonymous said...

http://www.newworldorderreport.com/Articles/tabid/266/ID/980/33-Conspiracy-Theories-That-Turned-Out-To-Be-True-What-Every-Person-Should-Know.aspx

Anonymous said...

One, read more history and stop thinking that in the modern age we are necessarily that different from previous ages.

Two, read more about human nature, for the more it changes the more it stays the same.

...David3

Anonymous said...

So Why is the Fed So Desperate to Keep Maiden Lane III Details Secret?
http://www.nakedcapitalism.com/2010/01/so-why-is-the-fed-so-desperate-to-keep-maiden-lane-iii-details-secret.html

Agent Smith said...

Perhaps we should believe in the invisible hand. I don't know who it belongs to. No matter. Could the fact that I don't know lead me to believe. Hell yes!! Unless you know all the information. Knowledge is key.

Anonymous said...

Yep and with yesterdays us supreme call there will be no more confusion about whom doing who. If you have time stop by Jesse Cafe today for a little more on what C said.
jo6pac
Everything is on schedule, please move along.

Phillip said...

Agent Smith,

The iron fist owns the invisible hand if Kevin Carson is to be believed.
http://www.mutualist.org/id4.html

Also available on MP3 and on Youtube read by others.

PaxAmericana said...

So, you don't find the Pecora Commission's findings to be somewhat supporting of the idea of conspiracy?

For what it's worth, my bet is that a majority of the public in what many call the Anglo-American Empire are going to turn into what might be called conspiracy theorists within another year or two. Maybe all it takes to change the booboisie's views is a financial raping. And maybe this explains the events of the 1930's better than all those boring textbooks.

Publius said...

Shepherds of the wilderness, wretched things of shame, mere bellies, we know how to speak many false things as though they were true; but we know, when we will, to utter true things.'
============
That is the game in the nutshell.
The thin line between history and conspiracy lies in the ears of those who hear. Take AIG. One myth says the market was saved by the bailout. Another says it was not. For those who say it was not, there seem to be many true things sustaining the perspective.