Hit by the Proverbial Mack Truck, Alas it is empty
Republican: A synonym for Selfishness and Narcissism and Violence
Synonym: a word or phrase that means exactly or nearly the same as another word or phrase in the same language; a person or thing so closely associated with a particular quality or idea that the mention of their name calls it to mind.
Selfishness: the quality or condition of being selfish.
Narcissism: selfishness, involving a sense of entitlement, a lack of empathy, and a need for admiration, as characterizing a personality type.
I should also include Libertarian as a synonym for selfishness and narcissism.
Violence: the unlawful exercise of physical force or intimidation by the exhibition of such force.
Political Violence: Political violence is the deliberate use of power and force to achieve political goals (World Health Organization (WHO), 2002). As outlined by the World Health Organization (2002), political violence is characterized by both physical and psychological acts aimed at injuring or intimidating populations.
Savvy style: In politics, our journalists believe, it is better to be savvy than it is to be honest or correct on the facts. It’s better to be savvy than it is to be just, good, fair, decent, strictly lawful, civilized, sincere, thoughtful or humane. Savviness is what journalists admire in others. Savvy is what they themselves dearly wish to be. (And to be unsavvy is far worse than being wrong.)
For the past few days, there has been a meme within our national news about how violent the Republican party has become. It has been given a name by our news system: Trumpism. What goes along with this reporting is a rhetorical question of: What happened to the Republican Party? This sets up all sorts of questioning directions such as: Why are the Republican leaders not stepping up to speak out. Questions then followed by statements such as: They know this is not true. They know this is not good for the nation.
Granted, these questions and statements have been with us since Trump declared in 2015. What is different is the reality of the FBI and DOJ activity in the past week or so. Our news system has been hit by the proverbial Mack Truck. There is absolutely no way for our news system to “bothsides” the story. There is no way they can be “savvy” in their reporting of these events such that they appear untouched and not part of the story or problem. Even Fox News is showing signs of being hit by the Mack Truck as evident through some of the guests that have not lied to cover up what the actions of the FBI and DOJ mean for Trump et al.
At least I thought there was no way to bothsides this until an episode on MSNBC. It was an interview with Dana Milbank and his new book. I got to hear Reverend Al Sharpton qualifying the far right being geared toward destruction and not governing but stopping governing. Followed immediately with “…and on the left there has been the same fight but they’ve not overtaken the party.”Just wow!
Let me be clear, yes anyone can lie as to the reality of the FBI/DOJ actions and resulting effects but when Fox News is limiting the lying as a cover for what has happened it is pretty safe to say the Mack Truck broke through.
I’ve noticed that the topic of political violence has been elevated in the news. Again, the Mack Truck impact. There is no means of denying the fomenting of violent behavior and its use as a political tool. There is no means to deny the source of the fomenting of violence as a political tool. The reporting is finally broaching the harm violence as a political tool has created for the function of our social and government institutions. There is this paper from 2013: Political violence, collective functioning and health: A review of the literature.
The author notes: Findings from over 50 studies were analyzed and used to build a conceptual model demonstrating how political violence threatens three inter-related domains of functioning: individual functioning in relationship to their environment; community functioning and social fabric; and governmental functioning and delivery of services to populations.
The Mack Truck has arrived… but, it was empty. The full effect of a loaded Mack Truck hitting has not been experienced. The load that was missing: Historical perspective.
Historical perspective refers to understanding a subject in light of its earliest phases and subsequent evolution. This perspective differs from history because its object is to sharpen one’s vision of the present, not the past.
All of the discussion regarding the Republican use of political violence has been in the vacuum of the present: Trumpism. The memory and feelings we were left with from the Bush/Cheney era which lead to the “Hope” campaign and election of Obama has been wiped away through the style, the process of savvy journalism. Our “press” has been delivering the Mack truck empty.
I’m not interested in why the press has been delivering empty Mack trucks. There is plenty on the net regarding the subject. I am interested in what an empty Mack Truck looks like so that maybe the recipients of the empty truck will know what they are missing. You know, not getting the biggest bang for their buck. The M x V thing.
Funny that some operators have been trying to deliver the load. Blowing the horns, revving the diesels. I guess they just have not been driving the correct brand of truck.
To be continued…
Hanlon’s Razor: Never Attribute to Malice That Which is Adequately Explained by Stupidity
Hanlon’s razor is the adage that you should “never attribute to malice that which is adequately explained by stupidity”. Applied broadly, this principle suggests that when assessing people’s actions, you should not assume that they acted out of a desire to cause harm, as long as there is a reasonable alternative explanation.
For example, if you don’t receive a notice about an important event in your company, Hanlon’s razor means that you shouldn’t assume that this happened because the person in charge decided to avoid sending it to you since they dislike you, if it’s reasonable to assume that they simply forgot to send it.
Hanlon’s razor can be a beneficial principle to implement, in a variety of contexts. As such, in the following article you will learn more about Hanlon’s razor, and see how you can use it yourself as effectively as possible.
Understanding Hanlon’s razor
Hanlon’s razor is a philosophical razor, which means that it’s a guiding principle that helps you select the most likely—though not necessarily correct—explanation for a phenomenon. It is therefore a valuable reasoning tool, which can help you deal with various everyday issues, such as having someone miss an appointment with you or not respond to an email.
However, there are two important caveats that must be mentioned with regard to Hanlon’s razor:
Overall, this means that Hanlon’s razor is meant to serve as a rule of thumb for understanding people’s actions in some cases. This means that it’s not guaranteed to lead you to the right conclusion, but that it can nevertheless be a good starting point in many situations…
Hanlon’s razor slices cleanly through our two party system. Sure, the Democratic Party has perfected the art of unforced errors formulated via utter stupidity, but the Republican Party commits its crimes against general public interests with malice and forethought. The problem is still that outcomes do not matter less because of the good intentions of self-righteous delusions. We need to de-fund Wall Street with expansion of Social Security with higher taxes and benefits sufficient for retirement as well as improve the effectiveness of law enforcement with better laws and more capable policing. It would not hurt to put more education into public education as well. Of course for humanity to survive long enough to reap the benefits of such programs, then we need to accomplish a miracle to halt and reverse climate chaos, which is unlikely given the world at large we live in and what a stupid bunch of crooked liars that run the US corporate world and by the effect of the donor class, then US politics as well.
Before dismissing the indictment of Wall Street, then read Keynes on liquidity preference and trading securities.
John Maynard Keynes
The General Theory of Employment, Interest and Money
Chapter 12. The State of Long-Term Expectation
WE have seen in the previous chapter that the scale of investment depends on the relation between the rate of interest and the schedule of the marginal efficiency of capital corresponding to different scales of current investment, whilst the marginal efficiency of capital depends on the relation between the supply price of a capital-asset and its prospective yield. In this chapter we shall consider in more detail some of the factors which determine the prospective yield of an asset.
The considerations upon which expectations of prospective yields are based are partly existing facts which we can assume to be known more or less for certain, and partly future events which can only be forecasted with more or less confidence. Amongst the first may be mentioned the existing stock of various types of capital-assets and of capital-assets in general and the strength of the existing consumers’ demand for goods which require for their efficient production a relatively larger assistance from capital. Amongst the latter are future changes in the type and quantity of the stock of capital-assets and in the tastes of the consumer, the strength of effective demand from time to time during the life of the investment under consideration, and the changes in the wage-unit in terms of money which may occur during its life. We may sum up the state of psychological expectation which covers the latter as being the state of long-term expectation; — as distinguished from the short-term expectation upon the basis of which a producer estimates what he will get for a product when it is finished if he decides to begin producing it to-day with the existing plant, which we examined in Chapter 5.
It would be foolish, in forming our expectations, to attach great weight to matters which are very uncertain. It is reasonable, therefore, to be guided to a considerable degree by the facts about which we feel somewhat confident, even though they may be less decisively relevant to the issue than other facts about which our knowledge is vague and scanty. For this reason the facts of the existing situation enter, in a sense disproportionately, into the formation of our long-term expectations; our usual practice being to take the existing situation and to project it into the future, modified only to the extent that we have more or less definite reasons for expecting a change.
The state of long-term expectation, upon which our decisions are based, does not solely depend, therefore, on the most probable forecast we can make. It also depends on the confidence with which we make this forecast — on how highly we rate the likelihood of our best forecast turning out quite wrong. If we expect large changes but are very uncertain as to what precise form these changes will take, then our confidence will be weak.
The state of confidence, as they term it, is a matter to which practical men always pay the closest and most anxious attention. But economists have not analysed it carefully and have been content, as a rule, to discuss it in general terms. In particular it has not been made clear that its relevance to economic problems comes in through its important influence on the schedule of the marginal efficiency of capital. There are not two separate factors affecting the rate of investment, namely, the schedule of the marginal efficiency of capital and the state of confidence. The state of confidence is relevant because it is one of the major factors determining the former, which is the same thing as the investment demand-schedule.
There is, however, not much to be said about the state of confidence a priori. Our conclusions must mainly depend upon the actual observation of markets and business psychology. This is the reason why the ensuing digression is on a different level of abstraction from most of this book.
For convenience of exposition we shall assume in the following discussion of the state of confidence that there are no changes in the rate of interest; and we shall write, throughout the following sections, as if changes in the values of investments were solely due to changes in the expectation of their prospective yields and not at all to changes in the rate of interest at which these prospective yields are capitalised. The effect of changes in the rate of interest is, however, easily superimposed on the effect of changes in the state of confidence.
The outstanding fact is the extreme precariousness of the basis of knowledge on which our estimates of prospective yield have to be made. Our knowledge of the factors which will govern the yield of an investment some years hence is usually very slight and often negligible. If we speak frankly, we have to admit that our basis of knowledge for estimating the yield ten years hence of a railway, a copper mine, a textile factory, the goodwill of a patent medicine, an Atlantic liner, a building in the City of London amounts to little and sometimes to nothing; or even five years hence. In fact, those who seriously attempt to make any such estimate are often so much in the minority that their behaviour does not govern the market.
In former times, when enterprises were mainly owned by those who undertook them or by their friends and associates, investment depended on a sufficient supply of individuals of sanguine temperament and constructive impulses who embarked on business as a way of life, not really relying on a precise calculation of prospective profit. The affair was partly a lottery, though with the ultimate result largely governed by whether the abilities and character of the managers were above or below the average. Some would fail and some would succeed. But even after the event no one would know whether the average results in terms of the sums invested had exceeded, equalled or fallen short of the prevailing rate of interest; though, if we exclude the exploitation of natural resources and monopolies, it is probable that the actual average results of investments, even during periods of progress and prosperity, have disappointed the hopes which prompted them. Business men play a mixed game of skill and chance, the average results of which to the players are not known by those who take a hand. If human nature felt no temptation to take a chance, no satisfaction (profit apart) in constructing a factory, a railway, a mine or a farm, there might not be much investment merely as a result of cold calculation.
Decisions to invest in private business of the old-fashioned type were, however, decisions largely irrevocable, not only for the community as a whole, but also for the individual. With the separation between ownership and management which prevails to-day and with the development of organised investment markets, a new factor of great importance has entered in, which sometimes facilitates investment but sometimes adds greatly to the instability of the system. In the absence of security markets, there is no object in frequently attempting to revalue an investment to which we are committed. But the Stock Exchange revalues many investments every day and the revaluations give a frequent opportunity to the individual (though not to the community as a whole) to revise his commitments. It is as though a farmer, having tapped his barometer after breakfast, could decide to remove his capital from the farming business between 10 and 11 in the morning and reconsider whether he should return to it later in the week. But the daily revaluations of the Stock Exchange, though they are primarily made to facilitate transfers of old investments between one individual and another, inevitably exert a decisive influence on the rate of current investment. For there is no sense in building up a new enterprise at a cost greater than that at which a similar existing enterprise can be purchased; whilst there is an inducement to spend on a new project what may seem an extravagant sum, if it can be floated off on the Stock Exchange at an immediate profit. Thus certain classes of investment are governed by the average expectation of those who deal on the Stock Exchange as revealed in the price of shares, rather than by the genuine expectations of the professional entrepreneur. How then are these highly significant daily, even hourly, revaluations of existing investments carried out in practice?
In practice we have tacitly agreed, as a rule, to fall back on what is, in truth, a convention. The essence of this convention — though it does not, of course, work out quite so simply — lies in assuming that the existing state of affairs will continue indefinitely, except in so far as we have specific reasons to expect a change. This does not mean that we really believe that the existing state of affairs will continue indefinitely. We know from extensive experience that this is most unlikely. The actual results of an investment over a long term of years very seldom agree with the initial expectation. Nor can we rationalise our behaviour by arguing that to a man in a state of ignorance errors in either direction are equally probable, so that there remains a mean actuarial expectation based on equi-probabilities. For it can easily be shown that the assumption of arithmetically equal probabilities based on a state of ignorance leads to absurdities. We are assuming, in effect, that the existing market valuation, however arrived at, is uniquely correct in relation to our existing knowledge of the facts which will influence the yield of the investment, and that it will only change in proportion to changes in this knowledge; though, philosophically speaking it cannot be uniquely correct, since our existing knowledge does not provide a sufficient basis for a calculated mathematical expectation. In point of fact, all sorts of considerations enter into the market valuation which are in no way relevant to the prospective yield.
Nevertheless the above conventional method of calculation will be compatible with a considerable measure of continuity and stability in our affairs, so long as we can rely on the maintenance of the convention.
For if there exist organised investment markets and if we can rely on the maintenance of the convention, an investor can legitimately encourage himself with the idea that the only risk he runs is that of a genuine change in the news over the near future, as to the likelihood of which he can attempt to form his own judgment, and which is unlikely to be very large. For, assuming that the convention holds good, it is only these changes which can affect the value of his investment, and he need not lose his sleep merely because he has not any notion what his investment will be worth ten years hence. Thus investment becomes reasonably “safe” for the individual investor over short periods, and hence over a succession of short periods however many, if he can fairly rely on there being no breakdown in the convention and on his therefore having an opportunity to revise his judgment and change his investment, before there has been time for much to happen. Investments which are “fixed” for the community are thus made “liquid” for the individual.
It has been, I am sure, on the basis of some such procedure as this that our leading investment markets have been developed. But it is not surprising that a convention, in an absolute view of things so arbitrary, should have its weak points. It is its precariousness which creates no small part of our contemporary problem of securing sufficient investment.
Some of the factors which accentuate this precariousness may be briefly mentioned.
(1) As a result of the gradual increase in the proportion of the equity in the community’s aggregate capital investment which is owned by persons who do not manage and have no special knowledge of the circumstances, either actual or prospective, of the business in question, the element of real knowledge in the valuation of investments by those who own them or contemplate purchasing them has seriously declined.
(2) Day-to-day fluctuations in the profits of existing investments, which are obviously of an ephemeral and non-significant character, tend to have an altogether excessive, and even an absurd, influence on the market. It is said, for example, that the shares of American companies which manufacture ice tend to sell at a higher price in summer when their profits are seasonally high than in winter when no one wants ice. The recurrence of a bank-holiday may raise the market valuation of the British railway system by several million pounds.
(3) A conventional valuation which is established as the outcome of the mass psychology of a large number of ignorant individuals is liable to change violently as the result of a sudden fluctuation of opinion due to factors which do not really make much difference to the prospective yield; since there will be no strong roots of conviction to hold it steady. In abnormal times in particular, when the hypothesis of an indefinite continuance of the existing state of affairs is less plausible than usual even though there are no express grounds to anticipate a definite change, the market will be subject to waves of optimistic and pessimistic sentiment, which are unreasoning and yet in a sense legitimate where no solid basis exists for a reasonable calculation.
(4) But there is one feature in particular which deserves our attention. It might have been supposed that competition between expert professionals, possessing judgment and knowledge beyond that of the average private investor, would correct the vagaries of the ignorant individual left to himself. It happens, however, that the energies and skill of the professional investor and speculator are mainly occupied otherwise. For most of these persons are, in fact, largely concerned, not with making superior long-term forecasts of the probable yield of an investment over its whole life, but with foreseeing changes in the conventional basis of valuation a short time ahead of the general public. They are concerned, not with what an investment is really worth to a man who buys it “for keeps”, but with what the market will value it at, under the influence of mass psychology, three months or a year hence. Moreover, this behaviour is not the outcome of a wrong-headed propensity. It is an inevitable result of an investment market organised along the lines described. For it is not sensible to pay 25 for an investment of which you believe the prospective yield to justify a value of 30, if you also believe that the market will value it at 20 three months hence.
Thus the professional investor is forced to concern himself with the anticipation of impending changes, in the news or in the atmosphere, of the kind by which experience shows that the mass psychology of the market is most influenced. This is the inevitable result of investment markets organised with a view to so-called “liquidity”. Of the maxims of orthodox finance none, surely, is more anti-social than the fetish of liquidity, the doctrine that it is a positive virtue on the part of investment institutions to concentrate their resources upon the holding of “liquid” securities. It forgets that there is no such thing as liquidity of investment for the community as a whole. The social object of skilled investment should be to defeat the dark forces of time and ignorance which envelop our future. The actual, private object of the most skilled investment to-day is “to beat the gun”, as the Americans so well express it, to outwit the crowd, and to pass the bad, or depreciating, half-crown to the other fellow…
Down East it is said that “You can’t get thar from here,” which is sort of where we are now on politics in general and climate chaos in particular.
I took part in a halfway cogent discussion of this on EV back in 2014.
Back then on EV my handle was Darryl FKA Ron.
Also, the investors liquidity preference is the justification for rescinding the dividends tax credit first under Democratic Party congressional control in 1936 to be reinstated only three years later and then under Republican Party control in 1954 to never be reinstated again. In effect, the dividends tax credit relatively diminished the capital gains tax preference and encouraged holding of securities to collect dividends or interest rather than trading securities to take windfalls whenever available, i.e., lessened securities market churn. Economists mostly believed that churn lead to more accurate pricing and ignored the potential for quicker consolidation of firms because they believed that regulation could offset the inequities of consolidation. This is stuff that I was taught over fifty years ago or about forty years before I first read any Keynes, but rejected out of hand while formulating my own version of Keynesian economics that was confirmed rather than learned whey I finally began to read Keynes.
You could not summarize this???
If you meant summarize that Keynes GT C12 excerpt, then that would be sacrilegious for me to do. Whereas, if you meant that linked EV blog discussion then any summary I might provide would miss the whole point of Internet economics blog topic post comments discussions.
Anyone can copy and paste whole segments of a document without having to detail what it means. It does not show, you understand it.
Even Anne (Ltr) posted some terrific content in the discussion at that EV link.
Don’t give me this 3rd party crap. C&P of that length is not a discussion.
First off then my understanding of Keynes preceded my C&P of GT C12.
“…We need to de-fund Wall Street with expansion of Social Security with higher taxes and benefits sufficient for retirement…”
“…Before dismissing the indictment of Wall Street, then read Keynes on liquidity preference and trading securities…”
Well that, and my ongoing attacks against forcing workers to invest in securities to secure their own retirement, the 401K Wall Street Ponzi Scheme, as it were. Then I hunted up an old discussion of the finer points of this Wall Street con job that emerged from a discussion of inflation fears about Keynesian stimulus to offset a recession.
Add to that then my excerpt from GT C12 ended precisely with the money-ball paragraph. That was not the end of the chapter, but it was the point upon which the political division between elites and promoting of the general welfare hinges.
sigh . . .