one apostate cries foul
as the cap markets roil on

his name is billy

here's his cry
“What you must really not

lose sight of in this mess

is that economists

are really working hard

to save their theology

from utter discredit and ruin.

This is not about saving the system,
this is about the priests

trying to salvage their religion.”

i council calm

“the religion is safe

just not the temple priests

the market gods are angry

they want the chosen ones
to stop passing lead calfs off as gold

Posted by js paine at 12:47 AM

like the victorian willow

producer co op ownership 

we have a new wish away the exploitation at hand

the modern trans nat titans
the pri sec profit max

liability lim

corporations

so now beyond citizen governance

are ….in actual fact

no long run problem

because

the fuckers are gonna wither away

ivy merlin :

“In the advanced economy
corporations will become less important

because more and more activities

can be delegated to independent individuals.

You may not use the big corporations,

because every activity can be done

independently and merged together with technology”

Professor Alberto Alesina
Nathaniel Ropes Professor

of Political Economy

at Harvard University.

the 6 billion crusoe islands

“every activity can be done
independently “

how ??
why thru

“technology “

“more and more activities
can be delegated to

independent individuals”

delegated ??
how compensated ???

non market mediated ???

never fear

just repeat these words :

independent individuals
independent individuals

independent individuals

independent individuals

ps maybe

some value added algorithm

worthy of jb clark ????

no doubt it'll be fairer in opportunity
more evener in outcome

but we gotta have
assured marginal va comp/price duplexing

as guiding path

plus various recycled yields

from sundry efficiency max /size and distortion min

” producers rent cisterns “

prolly in the form

of

non linear incentive bonusing

drawn from artificial self liquidating escroted

value flow back

extractions

ahh what a brave new woild

Posted by js paine at 01:25 PM

a hypothetical
natural instinct for appropriation

and possesion

is not

by any means the royal road

to today's hallowed

private property rights

ten thousand years of blood soaked history
intervene between the alpha and omega here

between free range rustles

and inviolate front lawns

not to mention
even now after all these years

the lacuna

contradictions

and

incompletenesss

nice thought

lord urgos
need not stop the morphing

if as you assume
“i me me mine “is in some dialectic

with “the great all ours to share “

tstock
has struck

down to “second nature”

social constructs

with deep pasts

and

early pervasive sustainable inculcations

mark wants us to build
better second natures

but can the job market bare that out ???

Posted by js paine at 12:58 PM

how to put out
the fire burning up values

mark t suggests
a fed auction series

which amounts to

giving freshly printed

good uncle paper

in exchange for bad soiled private paper

sort of like

buying up junkies dirty needles

good plan mark

but maybe not fast massive or generous enough

take
the well intentioned

tax payer protection

hair cut proviso

run vickrey auctions …sure

but who will sell in the first round

as the crisis deepens
with expectations of ever nearer

full bail out ….

with each successive auction
prices will rises and thus choke off seller supply

as they wait for the full bail

early sellers could prove to be suckers

since its a systemic rescue

and the insolvency runs soooo deep

and getting deeper as house lot values spiral south

to bail some of these critters
enough to keep em afloat

will require

hair restorers not buzz cut options

(talk about metaphoric punch )

i say open the window at the other end

offer to buy the underlying mortgages
at face value

want to squelch any moral hazard

try this …
after showing motion pictures

of the results

of the last big

do too little too late policy romp

ie the shakey apple stands and pythonic soup lines of the 30's

let the tax payers know exactly
how much is going on their tab

and simultaneously
give em the list of the culprits

by home address and amount swindled

pay em off
then start to arrest em

put em in protective custody

sling em in the kooler

all the fraud originators

phoney raters crap pushers etc

“its for your own protection guys “

as a spontaneous
green guards movement

hits the streets

ready to string up the purps

Posted by: paine | Link to comment | March 12, 2008 at 01:33 PM

paine says…
sgc

its too late to plan
uncle must act

waiting for the unwind ???

we're trying to prevent the unwind
its a naked bankrupt truth to grim to bare

it would be like keeping up
a full frontal assault

on a well entrenched enemy

and taking the casualties

while waiting for them to run out of ammo

Posted by: paine | Link to comment | March 12, 2008 at 01:44 PM

paine says…
“I am a little puzzled about the persisting ratings”

anne

the markets can't handle the truth

Posted by: paine | Link to comment | March 12, 2008 at 01:47 PM

paine says…
“The problem is unwinding the unregulated $500 trillion derivatives market that is partly collateralized by the mortgages.”

voodoo investment leads to utter panic

at risk 500 trill
collat 12 trill

nope not in this world

case closed on this proposition

the d words are naughty imps
not because they don't “really ” add up right

but because

people like the author

of the above hysterical line

have no idea

what in hell manner of paper beast

is right now

staring us in the face

bray of the day

“If no one understands that the situation is grave and that Self-Regulation of the industry is still the best standard, then they've had one too many for the road.”

Posted by: paine | Link to comment | March 12, 2008 at 02:00 PM

paine says…
anne

who really knows …for sure

panic abounds

those who can

will sit this out

on their pile of ready cash

till the smoke clears

the problem

by then the globes economy
may be in a near dead experience

“modern industrialized economy ..”

our's is now post modern and post industrial
so what me worry

“Ergo the term financial alchemy”

that was formulated in the 17th century
paper not base metal

can be converted into gold

proviso
use new paper each time

and new shuffles

and oh ya

pass it all b4

the underlying “real” asset

turns back into a pumpkin

sgc

dutch folks innovated the paper chase

though we think of it as a tulip

joint stock company
and fractional banking

and the ur-form of much else

we see as financial wizardry

btw
i'm no sabot stuffer

no ban the sorcery type

to wax fog horn jeg horn here

to ME
these financial products

are but prefigurations

of CLIO'S MISSION

total socialization

these security innovations
all can be socialized

since they require

partial socialization to even exist

but the privateers prosper best
if its run by carnival rules

ie

never give a sucker an even brake

house trained

so to speak

these securities will become ho hum facilitations

Posted by: paine | Link to comment | March 12, 2008 at 02:47 PM

paine says…
“Hey, I have a radical idea. Let these sons-of-bitches eat their own paper. Let them fail”

rat x samson of wall street

i need my job

so i can't share your old testament righteous wrath

“in common the objective of ensuring the flow of credit to creditworthy borrowers”

let us all
not fail to grasp the circularity

of credit worthy

loan em the money to flush off some obligations

and their credit worthy again

let em sink

and you'll likely tip a few on the edge

into the same not worthy category

never never assume crdit worthy
is an independent atomic assessment

ALL BALANCE SHEETS ARE INTERWOVEN

Posted by: paine | Link to comment | March 13, 2008 at 06:27 AM

paine says…
gordon

your united states commonwealth bank of the amerikas
needs a cyber ceo type virtual president

obviously we need

a network of algorithm's

at the top of the credit heep

here

you know

to lay out the cash pipe system

and even

settle the coin toss issues

spigot on /

spigot off wise

oughta be a vintage image here

i suggest
we by pass czar nick biddle

and even al hamilton

and

for android in chief

have john law

animatronicated

by the disney folks

lace cuffs swallow tailed coat wig and all

let your pal hayer do the voice

chalk this up to

'must be easy for you to say'

“Isn't it about time to throw out that dirty polluted bath water, even if a few babies get bruised in the process”

comment :

hey
i'm a candidate for one of those

thrown out babes here…buster brown

all wobbler jobbler holders are

Posted by js paine at 12:51 PM

mark
“movements in macroeconomic variables

that match, approximately,

movements in actual variables over time”

the obvious
difference between the usual empirics based

match up

is a simple price kinematics model

ie

one able to mimic parrot like

price movements

“more or less “

so long as real underlying conditions

embedded in the tortured data set

don't seriously change

out there on the street

ie

alls well

until a real crisis event sequence

suddenly alters those actual system kinematics

so to be safer we'd like a dynamic model
able to generate

“realoidal ”

price changes ab ovo

able to weather a simulated crsis

like the postive feedback mechanism
observed in credit markets right now

ala krugs loony toon

kinematics

as formal “analytics”

——————

not to turn to

long yarded and laff trackish

but

using actual retail food store

transaction prices

seems to be a deck stacker

there is no representative pricing system

n firms n pricing algorithms

needless to say
the list price /transaction price

dance can be quite complex

and yes often the various cross moves tend

to cancel each other

and reinforce the steady level lift trend rate

but come weird odd ball conditions …
to less simple markets like …credit securities backed by house lot values

serviced by job incomes and ….

well ..

” actual algorithms may vary “

at the b to b buy /sell stages

at least

“the this time only deals ”

obviously

do exist and can get very dispersed

and move much faster

albeit all “below “…”below”

the list price ceilings

which get lifted only at fairly predictable intervals

with lots of warning mummbling grumbling alibi ing etc

needless to say

these tend to shorten

as the speed of underlying

price change increases

of course it does ..right ??

the rational reference price interval
worth modeling

is

the decision nodes

of these b to b reference price change cycles

each vender firm is likely to have an algorithm

more or less explicit

and understood by the buyers

needless to say
vendors always blame price increases

on costs erupting

from further back down the line

from earkier stages of production

best choices

energy fuel raw materialsshocks and shortages etc

never wage demands
that would show an internal weakness

possibly avoidable by shopping elsewhere

and never vendor stage

bursts of effective demand

that “require” higher prices

(and “produce” higher rents)

simply to maintain

“orderly” and regularized

supply avalibility

hey its all about pricing decisions
right folks

that the vintage models refused to model

because they couldn't so they assumed pricing power away

and the income and wealth effects

created by groping markets

that feed back into the process

ie

nolimitless
edgeworth recontracting

ala ground hogs day

so to claim

Posted by js paine at 09:19 PM

“When prices fall beyond a certain point, they get calls from Mr. Margin, and have to sell off some of their holdings to meet those calls. The result can be a stretch of the demand curve that’s sloped the “wrong way”: falling prices actually reduce demand. So the market could look like this”

this is not simple static shift analytics
its stylized hand waving

what in hell is that snake ???

“I’ve been struck by how little analytical thinking I’ve seen about the current financial crisis”

indeed
the limits of ivy science emerge en force

its like
“come the big fire”

finding

yee ole fire hose

has a gillion gaping holes in it

hari
” Feds policy with regard to moral hazard…

is it obligated to bale out finance institutions irrespective of their stupidity or whatnot?”

my take:
yes if its necessary to keep

the national/global

production system near as possible to full output

the huge debt structure in the financial markets
built up over the recent spec cycle

is like

the cumberous fossil of earlier “bigger system morph “

enclosing its present smaller morph

old loans floated
on earlier guestimated evaluations

of collatreal values

are now weighing down

the production system

cramping its ability

to elastically “move on and move back up “

the debt burden of
these bad plays are now sunk costs

they are not guides to efficiency

and other then

the obvious horror

of

” hey u that's my security “

the whole portfolio

oughta get a serious write down

but first b4 the great write down

lets have a public rescue of private interests
a bail out

of all wanting and willing

asshole

present private debt holders

by
massive uncle sam

credit creation based

purchases

like the following…

uncle buys the entire existing portfolio
of fanny and fred mortgages

(7 trillion ??)

and allows them with the cash

to buy up

all the outstanding

private residential mortgage junk

offered to them

too much liquidty ???
nope

not so you'd worry about it now

and now is the only relevent time frame in a crisis

notice
in crisis times

liquidity has a high

spontaneous evaporation rate

as to the lesson learned from a bail
ie

the great hazard

the heels eels and seals
that actually caused this complex debacle

in the first place

hell they left plenty of finger prints

on all this soiled paper

and

can easily be identified

and with sufficient public will

barred jailed fined and otherwise

hammered into “market place ” oblivion

will this happen ???

are you shittin me

based on the two prior crises
the S and L

and the huge asian contagion

only somewhat

and prolly
too little too late

at least

to avoid a global contraction

how big ???
how long ???

ask larry summers
or

at the other extreme

warren buffet

they both got
a good gut guide

“Exactly how the Fed was supposed to manage systemic risk without data is yet another question”

a blind samson
lashed to the pillars of the temple

equity cap
solvency risk reducing

just in time

cb rescue gimmick

proved too slow too little

because other wise

it would look

too blatant too venal

too revolting

Posted by: paine | Link to comment | March 11, 2008 at 08:33 AM

paine says…
this is not a crisis of liquidity, this is a crisis of solvency. It is very simple

no its not

liquidity and solvency
are in the last analysis

too deeply interwoven

and any jaw bone of the ass type smotin'

will have such elaborate

criss cross patterns

of gains and loses ….

well that implies
either a col klink or a sargent shultz reaction

by our public guardians

Posted by: paine | Link to comment | March 11, 2008 at 08:38 AM

paine says…
shades of john law lynch mobs

“It is securitization, which has gotten us into trouble”

lets set back hi fi for 100 years

Posted by: paine | Link to comment | March 11, 2008 at 08:44 AM

paine says…
mark t

would have uncle assume the insurance role

on all these security markets

fine notion

but only likely to emerge…
after the system is in rubble

Posted by: paine | Link to comment | March 11, 2008 at 08:46 AM

paine says…
bruce wilder

fire in the eye guy

burner of the hi fi harlots

the whores of the new babylon

lets go back to the banking system of ike and harry

Posted by: paine | Link to comment | March 11, 2008 at 08:54 AM

paine says…
bw

shades of savonarola

Posted by: paine | Link to comment | March 11, 2008 at 08:55 AM

paine says…
mark feld

reminds us

moral hazard is only a retardent at best

eventually

10 years ??

the wildcats of wall street

will be everywhere again

betting with your balls
will never

become extinct

Posted by: paine | Link to comment | March 11, 2008 at 09:00 AM

paine says…

don

“the public is seeing the need to save….
Solutions that merely try to keep spending up may just postpone the necessary adjustment, and may cause it to become much worse”

what model is part 2 here based on ??

part one
is easily countered

if the “public”

wants to save more

much much more

uncle can issue

all the risk free

inflation adjusted

t bonds needed

to both sate the craving

and maintain full employment

Posted by: pain
“I prefer to change the structure of the system so that all debt collapses back to citizens “

winslow
warning to wonderful

and bold thinker

vision plus tunnels may lead to error
the notion of zero mediation

a pure horizontal credit system

is

libertarians in the finance markets

and i have more qualms about that
then

libertarians in the fresh catch fish markets

Posted by: paine | Link to comment | March 11, 2008 at 09:12 AM

paine says…
dd

“Derivatization seems the real disaster and it seems there is a concerted effort to call it a “housing” or “subprime” disaster when the real problem is unregulated CDO, CDS “

yes with innovations in security products
we need to impose new harnessing

not as we;ve done

liberate the old stallions instead

Posted by: paine | Link to comment | March 11, 2008 at 09:17 AM

paine says…
As for betting with your balls, maybe if there were a few more women in hi fi it would temper that tendency

based on my gender neutral experience

ovary bets have a hazard too

fear and fearless
shame and shameless

yin and yang spec
both exist

but
on second thought

genderization

is pseudo solemn

highly insensitive

and thus a foul brand

of metaphoring

sorry one and all

Posted by: paine | Link to comment | March 11, 2008 at 09:20 AM

paine says…
anne

“job turnover or the rate of job destruction and creation has significantly declined these last several years “

how much ??

from what to what ??

please give references

nice nice observation point

as unsure
about its implications

as its causes

Posted by: paine | Link to comment | March 11, 2008 at 09:25 AM

paine says…
“Foreign savers simply don't know how to evaluate a culture of utter contempt toward savers”

long live the great american walk away

pompous prigglers beware

you have
your little pot of piss to lose lending here

Posted by js paine at 09:14 PM