"More than half of modern culture depends on what one shouldn't read"

- Oscar Wilde

Tuesday, July 27, 2010

A Financial Fiasco

Do you get the image of Bernie Madoff in an orange jump suit pulled down to his ankles (while some 6’5” junk bond white collar criminal makes sexy time with his backside without even the courtesy to give ole Bern a reach around) when you read the title to this post? The US government, in all it’s glory, made a just assessment and prosecution of Madoff to tell us that firms, but perhaps more importantly, consumers need liquid assets—something that can be used to ease transactions in general and make bartering unnecessary. It proves to us that big business needs something that allows it to pay its customers this month while having the assets to also pay them next year.

Money or short-term credit???

Unfortunately, it is short-term credit which appears to have almost dried up in the financial markets of many countries; and the injections of money into the system are an attempt to oil the gears sufficiently so that somehow the markets for short-term credit get going again. Whether it works is a big question mark that everyone seems to know the answer to, but no one will admit.

Paul Krugman, the Nobel Peace winning economist, among others, has argued for a while that the crisis we are living is not a liquidity crisis, but one about lack of capital, and if that is right (and it is) the liquidity injections will not work. He has written essay after essay about the reasons the crisis has globalized so very rapidly. He concludes that the financial markets are a whole lot more global than we have thought, or at least more global in ways we did not prepare for. They allowed the exporting of the American crisis more rapidly and efficiently (I hope you are sensing my undeniable gift for sarcasm) than many economists expected.

And then there is the sad story of the Lehman Brothers' demise—the bust investment bank that triggered one of the biggest corporate debt defaults nearly two years ago in October of 2008. Prior to the hearing, Republican members of the Oversight Committee released a report in which they concluded that deregulation is not to blame for the current trouble in the financial system.

The report went on to discuss the net-capital rule, which is a regulation limiting the amount of debt that financial institutions are allowed to take on. In the report, House Republicans argued that there should be no such rule, because bankers will just find ways around it. “Banking regulations require financial institutions to limit their asset risk per unit of capital, but writing regulations that simply mandate an appropriate level is unlikely to work for very long because it is in the interest of bankers to find ways around these requirements in pursuit of profit,” one asshole stated.

Well, don’t you think it would have at least been worth a try?

The report, which I have perused but in my ignorance of economic morals (as they are aptly called) do not fully understand, completely fails to note that financial institutions carrying huge debt-to-capital ratios contributed to the recent meltdown. I’m not smart, but this is obvious. Bush (he’s not smart either) and his genius administration, through the auspices of the Securities and Exchange Commission, actively relaxed the debt-to-capital regulation.

In 2004, the Securities and Exchange Commission loosened the rule mandating that broker dealers limit their debt-to-net capital ratio to 12:1. The five investment banks that qualified for an alternative rule—Bear Stearns, Lehman Brothers, Merrill Lynch, Goldman Sachs, and Morgan Stanley. Maybe you haven't noticed but you don’t see their commercials anymore do you? They were allowed to increase their debt-to-net capital ratios, sometimes, as in the case of Merrill Lynch, to as high as 40:1.

Investment banks lobbied for the rule change because it would unshackle billions of dollars held in reserve as a cushion against losses on their investments. However, when the mortgage bubble burst, the investment firms no longer had enough cash on hand to weather the storm.

Chairman of the Oversight Committee Representative Henry Waxman (or Ole Dirty Jew, as he’s known by right-wing extremist gang-bangers in the mean streets of L.A.), a democrat from California, said this lax regulation, “proved to be a temptation that the investment firms could not resist, but when asset values decline—as the market did—leverage rapidly consumes a company's capital and jeopardizes its survival.”

Waxman, in all seriousness, is a financial genius in many respects. He and many other sound-minded individuals understand that the SEC exemption was in large part responsible for the huge build up in financial  leverage over the past 6 years, as well as the massive current unwind.

It's always interesting that the “law-and-order” Republicans are so very unwilling to approve any laws applied to the marketplace, and that they are able justify this by saying that those “clever swindlers” would just get around them. Reminds me a bit of how George Bush told us there's no point in trying to really tax the rich because they'll just run rings around the government and take their money abroad. As a conservative, it sickens me everyday to see what he did to this country and to think about how we just watched as he metaphorically stared into an aimless abyss when making key decisions about our future.

The financial markets fiasco happened because of improper oversight and regulatory rules. The housing market was paralleled to household income for nearly a century. At some point, around the mid 80’s, you put some recessed lighting in your family room and the asking price jumps 200k…what the fuck?! We did this to ourselves, but we didn’t know any better because we’re stupid. However, we are supposed to be stupid—that’s why we’re not the ones we rely on to make these kinds of decisions. You mean to tell me that a ten thousand dollar loan to upgrade an 80k house now makes it worth 220k—well shit, sign me up! The thing is—someone eventually had to pay for the inequality. But why would they let the forewarning economists make this available to everyone when all they had to do was hold their hands out and take part in the ridiculousness of it all themselves?

This country was founded on the idea of unity and democracy. It has unfortunately turned into a plethora of individuals and greed. Will it ever be fixed? No, not completely. But we can learn from our mistakes…

...somewhere along the line we seemed to have forgotten that.


Tuesday, July 13, 2010

The Quest...

I am not afraid to die.

I am afraid of being methodically tortured and killed by another human being. The thought of torture scares me a great deal, but I’m not completely opposed to its good uses.

I am afraid of the losing loved ones because I know it will just bring complete heart break, but I think that I’ve experienced enough deaths and subsequent funerals…most of which were not the “nice” kind of funeral given to veterans of our two world wars; or men and women that led long happy lives and got to see grandchildren or perhaps great grandchildren if they were lucky.

No. The funerals that I attended were usually very sad. Young people who lapsed in judgment and caused dread, hate, and guilt amongst close nit communities. I have seen soldiers who, in one way or another, have been taken away from us by a God who allows war, yet loves all. I’ve seen children—kids—who couldn’t deal with the concept of involving themselves in life anymore, and in an attempt to come to some kind of peace within themselves, they “take the easy way out” as I’m told by less than devout Catholics. That bothered me. I didn’t understand why people with minimal knowledge, who rarely spent a Sunday morning in church, had the right to judge anyone else.

Catholicism is a great tradition in many aspects. It’s almost mysterious sometimes, but most other religions are the same. Devout Muslims—the sectors that understand worship, and want peace on Earth, and work hard, and raise their children well, and follow the passages of the Kuran that tell good stories and teach life lessons—are exactly the same as truly devout Catholics. Most of them want to live peaceful lives and have families who love and protect them, just like you and I.

And just as Catholics have had sex scandals in the church for centuries, Muslims have slaughtered an exponential amount of Jews throughout history. There are over 2 billion Muslims in this world, yet only 14 million (give or take) Jews—that is an un-fucking-believable stat. Hitler’s regime certainly didn’t help by eliminating 6 million, and destroying generations that have past and were lost. Should God have let that happen?

I am afraid of poverty and life without meaning, but not death. I am not old but I have lived long enough to know that death is a part of life. Death, when expected and accepted, must be the most peaceful feeling one could possibly imagine. It must be a truly un-explicable peace.

But the reason I am not afraid to die is because of my firm belief that there is no God, and no Allah, or Buddha, or the Mormon for that matter, who lives on a star in a different galaxy and gets to nail like 40 extremely attractive women of any type—basically Hugh Hefner, but on a star in a different galaxy…seriously?

Anti-Agnostics everywhere blindly accept things they can not prove—none of it is logical, and much of it is fairy-tale.

God and Satan were quite real to me in my childhood. I realized there was no Satan around the age of 14, but didn’t really tell anyone about it. However, God was in my life to a certain degree during high school, and young adult years. When I realized there was no devil at an early age I remember that if there is a God then there couldn’t be a Devil. Maybe a hell, but no giant red demons that lived in lava lairs and carried golden pitchforks. The whole concept was ridiculous when I really thought about it. I hated the church and what it stood for, but I remember taking walks through the woods or with the dog and praying for certain things. Most of my prayers weren’t answered—that was God’s plan I suppose. And, though my parents claimed to believe in a compassionate God, most things I learned about God made me afraid. I feared God because of his omnipotence. The sociopathic thoughts in my head were there for him to judge.

So, knowing now that there is no God and that death is merely an indescribable peace, I am not afraid to die. This conclusion has not come without doubt and effort. It has taken several years of living, contemplating, and trying to find meaning that has led to this conclusion.

I wanted the facts about our world and those who inhabit.

I’ve decided to return to college with the idea of not necessarily finding myself, but rather finding the world and, subsequently, where my puzzle pieces fit. Deciding to go back to school at 28 was the best decision I've made thus far. I am able to appreciate what I learn to a far greater degree. I study the earth, the sky, the universe, and the people and what they wrote about their pasts and our futures. I look at trees, flowers, rocks, stars, animals, and culture. I’ve read Tim Lahay, Carl Sagan, Ayn Rand, Ralph Waldo Emerson, Shakespeare, Keats, Churchill, Einstein, and Darwin just to name a few. I’ve read about the mind and the universe. And I’ve learned to appreciate the imagination as well as the science of life. I’ve read about evolutionary psychology. Violence, religion, hate, and love all intrigue me. I watch life, and I’ve been comparing these things for all these years with what I knew about God.

He didn’t fit. And if anything, he just did not make any sense. Everything else was logical—everything else had proof. Evolution and biology are proven by logic and science. People's behavior fit. Sex worked. Love and hate have been felt by humans since the beginning of man. But God doesn’t fit.

The world makes sense without him and has become nonsensical with him. How can a compassionate God create someone with inherent irreversible flaws? Why would he make humans have urges and desires that are so great and gut-wrenching, and then forbid us from satisfying them? Why do bad things happen to good people? Or what’s even more fucked up, why do good things happen to bad people?

The Bible is wrong; science, life, and human-nature have consistently proved it.

Good things don’t come to those who wait. The weak and impoverished will never inherit the Earth just because their enemies knock them down and take it from them. The evil claim the power. The selfish hold the wealth. Shouldn’t an all powerful, omnipotent, and loving God not have created a world like this one?

I’ve no doubt in my mind, there is no god. It took a long time before I had the courage to say that out loud to anyone. The first time I did I was expecting a deep regretful feeling. But I have said it many times now and I am not worse, nor better for it.

I am however grateful for my religious upbringing. The education was important because it brought me to this point. I do not fault my parents for causing me to fear or love God. Without a clear understanding of God, and my subsequent interest in other gods, I could not have proven his nonexistence to myself. And, because of that proof I do not fear death. I do not need to worry about whether or not my sins have been forgiven. Of most significant importance is that I’ve realized I do not need to worry about whether or not people who have passed before me place any blame on me for anything that happened to them in life.

I do not need to try to figure out why God allows bad things to happen in the world. I don’t need to wonder what will happen to me after I die. I hope to live a long and happy life but when it’s over I can only wish that I am met with some kind of inexplicable peace, and as the years progress the idea of peace, love, and meaning become more precious than anything else...

...but there's got to be something out there...