Consulting by RPM || Free Advice Blog

Two Movies and a Bad Pun

(1) I recently re-watched the original Austin Powers to see how good it was. Eh, I only laughed out loud in the bathroom scene with Tom Arnold (“Who does #2 work for?”). The other funny part I had forgotten was when Austin is trying to do an 84-point turn in the narrow corridor with the bad guy’s vehicle. But what was really interesting is that Dr. Evil comes back from outer space and doesn’t have a feel for money. Holding the whole world hostage, he first asks the world leaders for $1 million, and they bust a gut. But then he ups it to $100 billion, and they’re alarmed. I remember seeing that scene when the movie first came out, and thinking that yeah, $100 billion would be tough for the world governments to come up with as ransom. My oh my.

(2) Just watched Michael Clayton last night. The previews were scaring me (i.e. they weren’t movies I wanted to watch and so I wondered what the heck I had rented) but it turned out pretty sweet. I like George Clooney when his ego is in check, and it certainly is in this one. Plus, how can you not put a Sydney Pollack movie in your Netflix queue? (BTW I am not discussing plot because that’s dumb. I am merely nudging people who are on the fence about a movie. If you get burned by a few of my nudges, then you will know to not rent movies I push.)

(3) The CNBC headline above the stock ticker currently reads, “Stocks Skid as Stimulus Worries Smack Banks.” Perhaps because of my recent heroin analogy to the stimulus plan, I misinterpreted this at first.

Tim Swanson Can’t Make Up His Mind on Treasurys

I am not mocking Tim, I really can’t figure out what his thesis is in this piece. He does some sort of “I’m explaining what the Chinese official is thinking–no wait, this is Tim talking, no wait, this is Tim discussing Schiff’s views” stream of consciousness. (I didn’t get Finnegan’s Wake either.) But as always, the photos Tim puts up are worth the click-through. For example:

Greenspan Admits There Is No Fed Independence

One of the central myths of our financial system is that the Federal Reserve enjoys “independence” from the federal government. The public can trust Bernanke to create hundreds of billions of dollars out of thin air, and give them to whomever he pleases without even telling Congress the details, because the Fed chair is a pure scientist and technician, uncorrupted by politics.

Yeah right, and Greenspan admits it in this interview (HT2EPJ):

“If we tried to suppress the expansion of the subprime market, do you think that would have gone over very well with the Congress?” Mr. Greenspan said. “When it looked as though we were dealing with a major increase in home ownership, which is of unquestioned value to this society — would we have been able to do that? I doubt it.”

I loved this excuse too:

The Fed’s “easy money” policy created an excess of cash that inflated equity and asset prices, leading to both the technology bubble of the late 1990s and the housing bubble in this decade.

While Mr. Greenspan acknowledges that he could have done something to avert the housing crisis, he contends his hands were tied.
…
Mr. Greenspan said that if he had taken steps to prevent the crisis, the outcome would have been painful.

“We could have basically clamped down on the American economy, generated a 10 percent unemployment rate,” he said. “And I will guarantee we would not have had a housing boom, a stock market boom or indeed a particularly good economy either.”

Is the economy “particularly good” right now? Does Greenspan go to the dentist when he has a toothache, or does he take an aspirin and explain that those office visits are painful?

"Nationalization Is…As American as Apple Pie"

So says Paul Krugman. Here’s the context:

And the argument that our culture won’t stand for nationalization — well, our culture isn’t too friendly towards bank bailouts of any kind. Yet those bailouts are necessary; and even in America they may be more palatable if taxpayers at least get to throw the bums out.

Oh, and not a week goes by without the FDIC taking several smaller banks into receivership. Nationalization is actually as American as apple pie.

Now, here we’re on terrain that all Americans can understand. You get what Krugman is saying, but at the same time, he is totally wrong and borderline lying with this absurd claim.

Well, that’s exactly what he does with his glib pop statements about economics, only you wouldn’t be sure unless you’ve got a PhD in the subject.

Total Borrowing From Fed Collapses?

I don’t know if this is just some kind of blip, but I was checking the latest numbers and saw this:

I’m not sure what it means. How’s that for Free Advice?

Anyone? Bueller?

Someone Make It Stop: Rachel Maddow Sums Up Krugman

Sheldon Richman links to the below video, but advises his readers against watching it. But I must disagree; Rachel Maddow’s commentary is beautiful in its clarity, its confidence, and its idiocy. It’s about 8 minutes, and I know that sounds like a long time, but I urge you to just click the thing and watch it. You really need to hear the build-up, in order to see how she can so smugly utter the following climax as if it’s self-evident: Maddow explicitly says that citizens should oppose tax cuts, as opposed to the spending components of the stimulus bill, because getting tax rebates would be wasting the taxpayers’ money. Let me repeat: Maddow urges citizens to reject tax cuts in favor of politicians spending the money, on the grounds that this will prevent the waste of taxpayer funds.

Crazy, I know, but you really should watch the video to see why she is so sure she’s right.

Tom Woods Is "Fed Up" (with the Fed)

He explains the can of whoop-butt that Ron Paul opened. Incidentally, I am troubled at Tom’s growing sophistication with monetary matters. When working on my book regarding the Depression and New Deal, I justified my efforts by saying, “Well, it’s true that I’m not a historian, but these are really technical matters and you can’t have these clowns running amok who don’t know the difference between the base and M1.”

But now that I see Tom confidently making references to Bear Stearns and “non-recourse loans,” I’m almost afraid to read his new book. I can only hope that my jokes are better than his.

Gerald Celente on Glenn Beck

For some reason, this guy really struck a chord with me. (HT2LRC) Make sure you watch long enough to hear his discussion of Katrina and the World Trade Center. That’s something I have been trying to get across to people, is that it’s wrong to be arguing “stimulus” in terms of Keynesian diagrams. Do you actually trust the real-life politicians in DC to fix the economy? What could possibly give you confidence in them?