Thursday, Apr 16, 2009
Rome all over again. Can we stop it?
Martin Armstrong on scribd.com: The Decline and Fall of Western Civilization
The Decline and Fall of Western Civilization because of debt and taxes AGAIN. Can We stop it?
Posted by sold 2 rent 1 @ 10:29 AM (1302 views) Add Comment
21 Comments
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1. sold 2 rent 1 said...
We can't stop the collapse but we can move to something completely different - like a free energy paradigm.
2. inbreda said...
which I guess is like free love, but less interesting?
3. sneaker said...
So after Newsweek procalimed "we're all socialists now", let me guess - "we're all conspiracy theorists now" ??
@inbreda -- hahahahahaha I guess so!!
4. str 2007 said...
Just as a side thought, if we had free energy would that allow the sheeple to spend the extra £300 per month they used to spend on energy on a bigger mortgage and so inflate the bubble further ?
5. alan said...
Our current system is shaky and my guess is that it won't hold up inderfinitely. I've spoken to lots of others who agree. But, simply making that statement isn't good enough for many thinking folk who will cast around for theories, often plotting events in history and trying to fit them to "cycles" of some kind or another.
The danger or all of this is we could end up expecting markets to turn (with mathematical precision) on a certain day !
But thanks for the post S2R1, I will hold these theories gently in my hand.
6. mountain goat said...
Thanks S2R1 great read, I was starting to despair at the barrage of cruel sniggering at 23 year old's in negative equity that seems to be what hpc.co.uk is mainly about these days.
I agree with him that our society's waterfall collapse will be the abandonment of so-called "Keynesian Economics". This is epitomised by Nobel Prize winner Paul Krugman. In his latest article Time for bottles in coal mines he quotes Keynes to make a point that stimulus is not wasteful:
"If the Treasury were to fill old bottles with banknotes, bury them at suitable depths in disused coalmines which are then filled up to the surface with town rubbish, and leave it to private enterprise on well-tried principles of laissez-faire to dig the notes up again (the right to do so being obtained, of course, by tendering for leases of the note-bearing territory), there need be no more unemployment and, with the help of the repercussions, the real income of the community, and its capital wealth also, would probably become a good deal greater than it actually is. It would, indeed, be more sensible to build houses and the like; but if there are political and practical difficulties in the way of this, the above would be better than nothing."
He may be a bit optimistic if he thinks the US government will try to tax its people to pay back their debts. Unfortunately I fear that if foreigners try to sell their Treasury debt it will be interpreted as an act of aggression and be met by war. The US still has the biggest baseball bat after all.
7. general congreve said...
Alan @5 - Very good point. Hopefully enough people have heard about the Armstrong turning point to influence the markets negatively. I say hopefully because the pain obviously isn't over, despite all the green shoots nonsense, and the sooner we get the pain out of the way, the quicker the recovery will be.
MG @6 - Totally with you on the possibly of the US starting a war to revive their fortunes. If they can persuade the US public to back an invasion of Iraq and Afghanistan over a couple of poxy buildings being knocked over, just think of the hysteria and war mongering they could talk up when the US public finds themselves universally impoverished for the first time in living memory. Someone will be to blame, and I don't expect it to be themselves.
8. george monsoon said...
Murphy's law - Given enough research, you can support any argument, however poor.
9. quiet guy said...
That has to be the most annoying way to publish a document I've ever seen - in a scrunched up little window with demands for registration if you try to download it. How many readers actually had the patience to squint through the whole thing or did you hand over your personal details?
10. little professor said...
quiet guy - login using username and password as scribdd2
11. general congreve said...
@9 - I'm working my way through it at the moment, good paper so far. The scan of hand-typed document, which is partly responsible for the lacklustre presentation, isn't convenient, but then again, the fact the author wrote it in prison probably wasn't either.
12. drewster said...
mg @ 6,
I'm not clear - are you in favour of Krugman's money-down-coalmines plan, or opposed?
Mish hates the idea and tears apart Krugman's arguments - and I have to agree with Mish on this one!
Krugman in Need of Remedial Education
"What [the banknotes down coalmines plan] would do is promote malinvestments in digging equipment, and cheapen the dollar while doing so. The stimulus would wear off as soon as the notes were retrieved and the digging tools business would crash. Those who were lucky enough to retrieve the cash might be marginally better off, but at the overall expense of everyone else. Those who borrowed money for digging equipment only to come up empty handed would be back out of work and in worse shape than before. Those who sat on the sidelines uninvolved had to fund this mad proposal with their tax dollars or [through inflation]."
13. mountain goat said...
drewster - yes sorry I wrote that unclearly. I agree with Mish and think Krugman and the whole concept of Government stimulus is wrong. Government should leave the economy alone, apart from regulating corruption and anti-freemarket activity.
14. general congreve said...
mg @13 - Here, Here! If we had true, corruption-free, free markets we wouldn't be in this mess.
15. mountain goat said...
GC - thanks, did you read the whole article yet? What do you think of Armstrong's views on taxation? Apart from world war, if our governments ever intend to pay back what they have borrowed this will become increasingly relevant. Government spending is exploding at the moment. How can they increase taxation on a sick economy? Who do they tax? How do the rich escape being milked if tax shelters are being pressurised like Switzerland is at the moment? There are so many uncomfortable questions that a person in prison with too much time on his hands can ask. These questions are not far down the road.
The one doubt I have is that a lot of the problems we face were made many decades ago by abandoning gold standard etc. Can a solution be found to keep this debt bubble economy going for another few decades or this it, the fall of Rome?
16. general congreve said...
MG @15. Yeah, pretty much read the whole article. My opinion on the whole situation is that the west is going down. We have outsourced all the means of capital production abroad for quick corporate profits and that has broken our economies. Much of our wealth and the means of creating further wealth have been shipped over to China et al and we have been living on borrowed time/debt for the last few years. There is no way out of this mess, we either see cripling debt repayment send our countries to the poor house (relative to our previous standing in the world at least) or we find an excuse to use our (mainly the USA's) vastly superior military might (for the meantime) to smite the economic threat from the east before we are truly swamped. Everyone game on for WW3?
17. inbreda said...
Serious question - and not wanting to digress - but if the wests economies are propafugged, and global warming means that europe is about to experience another ice age - what is the best *future* location on the planet to avoid these twin stresses?
18. general congreve said...
The pub. The answer is surely in the bottom of a pint glass somewhere and the more traditional ones often have nice warm fires that are very pleasant during cold snaps.
19. quiet guy said...
@little professor
Thanks for the tip. I printed off the PDF to read it with a glass of plonk - much more civilised than squinting at my laptop :)
@sold 2 rent 1
Thanks for a very interesting and provocative article. I'm not saying that I agree with everything in it but it's a great read and I plan to study it more.
@inbreda
I'm not sure about the global warming issue but I suggest that the safest place to be in a real economic crash is a strong community - a place where people know each other and look out for each other.
20. inbreda said...
Thanks for the advice chaps. Alcohol in a warm social environment. Seems the obvious way to avoid global warming and financial armageddon now you come to mention it.
21. shipbuilder said...
I just read the article when I had time and my first impression was that it isn't really anything new. I was also surprised at the fundamental and simple error (in my opinion) he makes that I see everywhere else with this type of argument - he ignores globalisation/big business. Anyone who talks about big government being the only problem is living in the past.
The reality is that big anything is the problem - big business now as well as big government, yet like so many other right-wing capitalists, he can't see past only focusing on big-government 'Marxism' (also making the socialist=state mistake) and refuses to attack the sacred cow and elephant in the room that capitalism leads to big business.
Making the Adam Smith argument, as he does, that nations should be free to trade with one another, is ridiculous and rather quaint now when we live in a world where corporations are larger than countries and borders are invisible to them. Countries may have control of their own currency and economic policy, but their actual wealth (people's intellect and the earth's natural resources) are in the hand of corporations, therefore governments and countries are powerless - unable to get any of this wealth other than through direct tax. No wonder they run out of money, when corporations are free to move to where labour is cheapest.
The reality is that while I agree wholeheartedly with big government being a problem, capitalism leads to big business and the idea that private property includes land and resources, leads to wealth ending up in the hands of the few. Armstrong, like many others, ignores these points (or tries to blame them on government) and so presents nothing radical or new here as I see it.