Geithner on Salary Caps

Fine, then don't call them salary caps if Forbes, Draper, & Co. keep squealing and whining. Call them  20x Rational Restraint Ratios that ensure all stakeholders and VALUE CREATORS participate proportionately in the returns earned by their Shared Fate labors while simultaneously Richly Rewarding innovation, investment, and market savvy.

Why are such ratios essential? Regular readers already know the answer to that question, but we'll add here that primarily, ratios -- in addition to a whole suite of interrelated policies -- help to assure that that the economic circulatory system continues to operate in a sustainable manner. Cash clots kill and economy, just as surely as blood clots kill a body. Moreover, it is also physically, mathematically, existentially impossible for any individual human's contribution to the race to be worth billions or trillions of times more than any other human being. It's empirically impossible. We each only have 24 hours in a day and none of us is AGI-Posthuman-Enhanced just yet. Even then, it will ethically impossible in the land where it continues to be asserted that All Are Created Equal, with Certain Inalienable Rights, including Liberty and Justice for All.

Let's also briefly address the entitlement issue one more time. These economic blood clots do not have a "right" to exist. Nor do pathological hoarders have a "right" to indulge their mental illness, just because it's intertwined with cash. In fact, that entanglement makes their mental illness even more damaging to society.

Compulsive hoarding is a DSM-IV illness . Maybe it is genetic, and that might partly explain why insane levels of wholly unsustainable skews of untold wealth run in genetic lines. Mental illness attached to money is still mental illness. Literally, there are just a few thousand very sick compulsively hoarding human beings acting as blood clots within the flailing American economy. Just because the object of their hoarding can be hidden away in offshore accounts, doesn't make it any less hoarding. Just because everyone understands the value of cash, that doesn't mean that the Marginal Psychological Value of cash doesn't encounter an inflection point somewhere in the $100M range.

Everyone knows that there is a point at which the slips of paper lose ALL MEANINGFUL VALUE and the game devolves into a seventh grade playground pissing contest. Even the skewed-up hoarders themselves acknowledge this: watch, listen, and learn.

So go ahead, try to explain to me a Healthy Human Psychological Profile that NEEDS more than $100M in Personal Assets while neighbors are Giving Away Their Children just to survive. Healthy human beings consider the health of the village within which they were enabled to acquire so much. Of course they OWE the community; because without the community, there would be no context within which to play out this compulsive cash hoarding illness.

This unsustainable, skewed wealth hoarding is just psychologically sick and morally revolting. We've said that this is going to get personal and as unemployment rates continue to grow, the demands to Publish The List of the top 1000 most fiscally sick and sadistic are only going to grow.

Bottom line: Ayn Rand and Aldous Huxley were both wrong. The road to postscarcity is not an avenue that Parades Satanic Sloth, escorted by a Panoptic Police State; it is a road toward the fulfillment of the penultimate Promise and Triumph of Industrial Capitalism.

So let us not lament that something is lost. Celebrate instead the success of human ingenuity and perseverance that has brought us so far. WE DID IT! Huzzah! Freedom from Want and Poverty can be ours through new ways of participation and inclusion on the human stage. No caps, no limits to the potentials for humanity.

What Would You Do for House Payments of $50?

Anything! You shout with palpitating anticipation of scoring The Deal of the Millennium.

Oh, wait; actually, we'd do anything but move there.

But, but, but ... if CAPITALISM is omnipotent and MARKETS are omniscient, that place should be overwhelmed with buyers right now. And look, look, look, we have CURVES and GRAPHS that *PROVE* that Invisible Make Believe Theoretical Real Equilibrium-Claus is just about to slide down the chimney with toys and make-busy fake jobs for all the good little wage slave boys and girls.

We'll be back to the Normal That Caused All This in no time! Just tap your heals three times and join the rest of us in the BOTTOM 90% of Americans who work two jobs for just enough money to pay rent -- just like our Share Cropper great grandparents -- and repeat:

"There's no place called home. There's no place called home. There's no place called home."

Concerto for Squealing Piggies and Harried Hoarders in “F” Major

Big man, pig man, ha ha, charade you are
You well heeled big wheel, ha ha, charade you are
And when your hand is on your heart …
You're nearly a good laugh
Almost a joker
With your head down in the pig pen
Sayin’ "keep on diggy’in"
Pig stain on your fat chin
What do you hope to find?
When you're down in the pig mine
You're nearly a laugh
You're nearly a laugh
But you're really a cry …

-- Roger Waters, on Animals

We can be confident that we’re making progress when the turrets of the Grand Old Pedantic party are reduced to loading up histrionic emotional pejoratives as their last bastion of defense:

“The assumption that the pursuit of self-interest within the rules and conventions of society will also promote the public interest may be succeeded by a mushy collectivist pseudo-altruism, in which jealousy and envy are given a free ride …”

Right. It’s jealousy and envy, not empirical observation of Unsustainable Resource Skews which are functionally equivalent to massive blood clots lodged throughout the global economic circulatory system. Note to the non-empirically minded: if you clot up 42% of your vital bodily fluids, into any 1% of your body; or, if you clot up nearly 70% of any resource into 5% of any system; that, my friend, is unsustainable unto immediate herky-jerky death.

I don’t know how that makes you feel, emotionally, but any presiding physician’s recorded Time of Death is just another cold, analytical statistic.

After all, if I might mirror an astonishingly articulate miscarriage of fact by our good friends at FT, “There is a risk that empirically dubious but emotionally attractive interpretations, which enshrine wild west, every man for himself, bar room brawl capitalism; and which call for a rapid return to the failed status quo, could gain ground.” Which is merely to say:

First they ignore us, then they laugh at us, then they attack us, then they copy us, then we win. Same as it ever was.

“Victims of your own success, unite! You have nothing to lose but your Unsustainable Resource Skews.”

Back To Normal

So you just want everything to go back to normal? Really?



Click here to view if the Seesmic Embed keeps flaking out on you.

Mad props to the one and only KDFA!

Does 13.3% U3 Unemployment Imply 30% U6 by Year End?

Sure, you can snap back with a quick and quippy Kudlow NO, but to do so without considering the data courtesy of the eponymous Big Picture thinker himself, Barry Ritholtz, might be a bit hasty, to say the least:

Bob Bronson "suggests that you bullishly extrapolate the “less worse” downtick in the Continuing Claims just reported, assuming the trend continues in a straight line without interruption, which is extremely unlikely (see the dotted arrows in chart below). He reaches an Unemployment Rate of 13.0% before yearend: 32 weeks times an average 0.15% increase (declining from 0.30% to 0.00%) added to 8.9% = 13.3%."

It's definitely time to Read More.

Oh, and Happy Mother's Day. Right.

What if 30% and Growing Unemployment is Equilibrium

In February, we asked What if 25% and Growing Real U.S. Unemployment is Equilibrium? Today, given the ongoing trend we see in today's unemployment situation report below and yesterday's comments from collaborators at the National Employment Law Project and UC-Berkeley, we have to upgrade this query to the 30% level.

We're nearly at one out of four laid-off workers has already been out of work for six months. That's Andrew Stettner at the National Employment Law Project. He and his research partners at UC-Berkeley predict the share of long-term unemployed will hit 30 percent by next year.

This, while reporters chirp this morning, "the unemployment situation IMPROVED this month," fixating on a modest Decrease in the Rate of Decrease; whereas U-6 is vastly more reflective of reality, even if it too suffers the usual statistical challenges that result in unavoidable understatement. We can only count that which presents itself for counting. All too often, these numbers are like counting the ants we can see on the surface and calling it the whole anthill. The counting itself is accurate enough, the physical reality ... um, not so much.

Debunking the Devil Formerly Known as Godless Socialism

From an extraordinarily timely NYT article:

Such things are easy for an American to ridicule; you don’t have to be a Fox News commentator to sneer at what, in the midst of a global financial crisis, seems like [OMG!] Socialism Gone Wild.

But there’s more to it.

This was one of the puzzling features of the Netherlands — the Dutch pioneered the multinational corporation and advanced the concept of shares of stock, and last year the country was the third-largest investor in U.S. businesses — and yet it has what I had been led to believe was a vast, socialistic welfare state. How can these [seemingly] polar-opposite value systems coexist?

Thank you for the referral, Georges!

Maladaptive: America's 'Financial Oligarchy'

Goldman and the privateering pirates of Wall Street "believe that this is their economy." FAIL.

Click to listen to today's Fresh Air from WHYY:

In his article "The Quiet Coup" in the May issue of The Atlantic Monthly, former (2007-2008) International Monetary Fund chief economist Simon Johnson says that U.S. suffers from "financial oligarchies."

Unless the U.S. breaks up its financial oligarchy, Johnson -- now a professor at MIT's Sloan School of Management -- warns that America could face a crisis that "could, in fact, be worse than the Great Depression -- because the world is now so much more interconnected and because the banking sector is now so big."

[ SOURCE: NPR ]