Satyajit Das on the Botox Economy

As much as I like Satyajit Das’ books (his new offering, Extreme Money, is just out and was reviewed favorably in the Financial Times), I wish he’d get on TV more often. His being in Sydney puts him at a bit of a disadvantage.

This clip is amusing. It ran on a morning show with 1 million viewers (remember, Australia has a population of only 20 million, so this is a big deal) right after a story on how a 51 year old married a 16 year old (it also included their flame haired dog, presumably to make it seem more wholesome). And yes, most Australian accents are nowhere near as pronounced as those of the newscasters.

Print Friendly, PDF & Email


  1. Ray Duray


    Here’s an important Bloomberg News article I haven’t seen you listing yet:

    The WSWS covers the Bloomberg article here:

    And the referenced Bloomberg item is here:

    The headline reads:

    Wall Street Aristocracy Got $1.2 Trillion From Fed

    The editor writes that:

    “The US Federal Reserve Board secretly handed out trillions of dollars in virtually free loans to major American and European banks at the height of the financial crisis between 2007 and 2010, according to an article posted Sunday by Bloomberg News. The article, based on an independent investigation carried out by Bloomberg of previously sealed Federal Reserve documents, is headlined “Wall Street Aristocracy Got $1.2 Trillion in Loans from Fed.”

    The amount cited in the headline is somewhat misleading, as it refers only to the highest single-day amount of loans provided by the US central bank under seven emergency programs it launched to cover the bad debts of the Wall Street elite. The $1.2 trillion figure is undoubtedly lower than the total amount in Fed loans disbursed over the course of the programs’ existence, including loans to banks that came to the Fed for money multiple times.

    The amounts involved were far greater than the cash injections provided the banks under the US Treasury’s $700 billion Troubled Asset Relief Program (TARP)…

  2. skippy

    Not one word of ***FRAUD*** with intent, until he addresses this one glaring fact, it all BS.

    Skippy…sorry Yves, along as its descriptive gaming, to off set reconciliation, I’m not on board.

    1. okie farmer

      I’m with skippy here.
      This is a bullshit piece. All the money that
      went into the system’ to ‘save the system’ went to the wrong people, the fraudsters. I think he got on the airwaves because he had this cute, but ultimately meaningless metaphor. Botox this!!!, Das.

  3. Kevin Smith

    Good talk, good observations, but BOTOX® is a very poor analogy, and his complete lack of understanding of what BOTOX® is and what BOTOX® does detracts and distracts from the excellent economic analysis Satya Das is trying to present.

    For the interest of your readers, BOTOX® [and other formulations of BTX-A like Dysport® and XEOMIN®] are medicines made from a highly purified, naturally occurring protein.

    BOTOX Cosmetic® works by relaxing muscles which are causing unwanted or excessive expressions. One of the things that makes BOTOX® so safe is that it does start wear off, usually after 3-4 months.

    BOTOX® is also used for therapeutic purposes, helping to control about 140 different medical conditions, including excessive sweating [hyperhidrosis] and several forms of headache.

    BOTOX® has been used around the world for over 20 years, and around 20 million treatment sessions have been done during that time. I have performed about 13,000 treatment sessions in the past ten years, and have at various times worked with Allergan, Ipsen and Merz [the makers of BOTOX®, Dysport® and XEOMIN®.]

    1. Webster

      I recall reading an article in the Wall Street Journal back in the 1990’s about Jayhawk (?) Finance Corporation,
      an outfit that financed cosmetic surgery
      “operations”. They were very profitable because
      as the founder said “We can charge a high rate of
      interest because you can’t repossess a facelift…”

    2. rps

      Botox is derived from a bacteria, Botulinum toxin better known as Botulism (food poisoning). A poisonous bacterium that is a fatal and powerful neurotoxin to humans. As Botox is a derivative of this neurotoxin, in my opinion is apropos to the Feds and Treasury’s injection to the banks, investment houses, auto, and insurance companies, etc… It may have temporarily subdued the surface spasms mimicking stability, yet the economy has been paralyzed. The government ignored its obligations to address the underlying causes and apply the law and enforce regulations onto the renegade financiers, institutions, and derivatives games. Unfortunately the botox “effect” has worn off and congress will inject another dose into the corpse. Self-policing of the renegade financial institutions and the patriot act for the rest of us.

      1. Kevin Smith

        BOTOX® is derived from fermentation of a very specific type of bacterium, and BOTOX® is a very precise medicine, used under highly controlled conditions.

        It might be apt for Das to compare government intervention with botulism or some other infection, but it is just attention seeking and sensationalistic for him to compare government intervention with BOTOX® [and to wave around a syringe of “BOTOX®” in the studio]. Most likely what Das was waving around was FauxTox. That kind of a performance belongs on Kramer.

        1. Praedor

          Botox IS botulinum toxin (hence, “bo” (botulinum) “tox” (toxin)). Botox is Botulinum Toxin Type A. It can be collected from Clostridium botulinum or potentially expressed in another bug via molecular biology manipulation (E. coli).

          And please cut it out with the BOTOX(r) crap. Are you a sales rep for big pharma?

          It has perfectly good and real healthcare uses (treatment for dystonia for instance) but it also has a vacuous, rich person’s use in ego feeding. It is the vacuous and shallow use that people know it from and it is apt to use it in this context. Wall Street is nothing but vacuous, shallow, disgusting, egotistical, self-worshipping scum, every one of them believing in their vile bones that they deserved bailing out. They robbed the taxpaying WORKING public but they’re worth it…they are “special”. They are royalty.

  4. brian t

    Das is good as always, but what’s up with that interviewer’s face? It looks like her makeup was applied with a cricket bat. The perils of early-morning TV, I guess.

  5. Linus Huber

    SCARE 20.12.2012
    (Stop Corruption and Repression Effective 20.12.2012)

    Banks were given a very important privilege to create more in the form of extending credit. This function requires diligence and careful consideration in regard to individual credit risks as well as to overall credit levels in the system. The financial crisis revealed that the banks were operating at too high a leverage and with too much risk. They were used to be saved by the Central Banks and certain that in times of difficulties the Central Banks were there to save them. They were like trained dogs and their master Greenspan or Bernanke would always be there to rescue them when unforeseen difficulties arose.
    That may be true but that does not absolve them from their obligation to monitor overall debt levels in the system as well as being diligent in evaluating the debtors ability to not only service a debt but to be able to repay it over time. The banks clearly failed in this function that is the core function of banking but focused mainly on their compensation packages. The way these bankers enriched themselves in the process of driving the financial system into a wall was appalling and the average income earner was never able to comprehend their schemes but preferred to simply ignore them. Of course, the bankers explained their outrages income levels with free market principles of supply and demand, where the best simply could be hired with those kinds of benefits only. In hindsight those superior managers seem to have missed their mark considerably. The most interesting aspect of all of this is the fact that, after we have been more than 3 years in this financial crisis, the bankers continue to loot the system as if nothing ever happened.
    True to form the Central Banks “saved” the financial system by saving those great financial institutions without whom the system would have collapsed, as was argued. Hardly were we out of the danger of collapse, the banks immediately went back to their old ways and were certain that this was a problem that would occur just once in a lifetime and now all was clear again. The real problem, however, had not been addressed but had simply been muddied.
    In actuality, the losses produced of extending unsustainable levels of credit by the banks have been transferred to the public. Different ways were chosen to achieve this task in the form of free money for the banks, injection of government funds into some institutions, increase of basic money supply and so on.
    The threat of system collapse would have been labelled blackmail if it would have occurred in another setting. However the bankers were able to influence the media, the legislators and regulators in their favour with all the financial resources available to them. Nobody was made to take any responsibility and no one was taken to account.
    This represents a serious violation of the spirit of the Rule of Law that is the basis of western society. It seems that now the new rule is Might is Right. This changes many parameters in the compass of the social system within the western world. No one can be sure on what level and when one will be subjected to the financial abuse of those elites. Presently, the people in charge are trying to enhance financial repression of which one form is to keep interest rates below the level of inflation which affects mainly those that lived within their means over the past many years; another clear violation of the spirit of the Rule of Law as it transfers losses from bad investments to the innocent and decent part of the population. In addition, the increased level of government debt puts in doubt all those benefits promised by governments the world over.
    It is interesting how the banks were able to confuse the public that they are unable to grasp the actual situation. But considering their great financial resources, it seems not that much of a miracle to influence the media and the legislator and having politicians do their bidding. The question is what the heck can WE, THE PEOPLE do about it.
    Usually, we could address such things on a political level as we are a democracy, right? But it seems that the system has been corrupted by all the money sloshing around and it is extremely difficult to find any electable person that will act against those powerful interests. In addition, it will take many years until sufficient numbers of persons with the new thinking and with integrity not to be corrupted by those lobbying efforts will be elected to office that will implement the changes needed. So, what should we do? Start a revolution?
    Well, the blackmail used by the banks may be the only way to address the injustices that have occurred over the past few years. They showed us how to leverage one’s limited resources to achieve one’s goal. Therefore the following proposal to start the movement “SCARE 20.12.2012” should be seen in this context. The idea is that if by that time (20.12.2012) some serious injustices have been removed from the system, people start to withdraw their money from all financial institutions driving them into default. And it might work, because those who hesitate to support this threat may be left with no money as the banks will have to close down before all has been paid out.
    Now, what demands are made if that scenario is to be avoided.

    1. Bankers and past Bankers (all those working in the financial industry that earned in excess of $500k plus annually for more than 2 years during the past 15 years and this without any downside risk i.e. risk of financial losses, except the possibility of losing their job) have to be made personally accountable for their past activities and be removed from any such position that might directly or indirectly have influence on the money creation and lending aspects of the economy (this includes regulating agencies and politics) before 20.12.2012.
    2. Present and past regulators have to be made personally accountable for their past activities and be removed from any such position that might directly or indirectly have influence on the money creation and lending aspects of the economy (this includes financial institutions and politics) before 20.12.2012.
    3. Politicians that accept any financial support from institutions that are involved in the money creation and lending aspects of the economy will have to face a jail term of no less than 2 years without the possibility of parole.

    When these 3 points are implemented before 20.12.2012, we the public will not destroy the financial system but support the way to find back to the RULE OF LAW and away from the idea of MIGHT IS RIGHT.

    1. solo

      @Linus Huber: Fine recommendations, but you have what is called “the agency problem”: Given the current and prospective balance of political forces, who is going to impose, legislate and promulgate these recommendations? What political entity or entities? What political movement? –Keep in mind that yours are radical solutions indeed; your item (1), for example, is tantamount to abrogation of limited liability, therewith the corporate form of business organization. (I keep my own agency problem simple: When I find myself thinking, longingly, “If only we could treat each other decently . . .,” I mock myself for wishful thinking. Then I return to working on Acceptance, the sole route to serenity for those trapped in an insane world without respite. –“Why, this is hell, nor am I out of it,” saith Goethe’s Mephisto.)

      1. Linus Huber

        Thanks for commenting, Solo. I am actually looking for feed back and appreciate each and every comment.
        Bottom line is, some people were incompetent and others enriched themselves in the process. If they could not loot the system, they would reduce the level of risk quite naturally on their own. So the aspect of being able to enriching oneself is in my opinion the root of the problem. Once that motivation is killed, they will again increase their common sense for the good of the economy.

  6. Jim3981

    Some people think it is a conspiracy to intentionally load up governments with debt so they will collapse.

  7. rps

    We are in a straight-jacket due to an economy based upon 70+percent consumerism. Prior to the shop til’ you drop dogma, savers were rewarded with good rates in savings bonds, CD’s, bank savings & checking accounts. Debtors were frowned upon and paid high interest rates for the risk. The average Joe’s repugnance toward Wall Street investments were learned by the depression era parents/grandparents and rightfully so. Now when are punished if we choose conventional products at nil interest rates and forced into Greenspan’s nefarious rigged Wall Street congames as are the pensions, IRA’s, 401k’s and Roths. George Bush’s motto of “Go Shop” as your patriotic duty has rewarded the Average Joe’s with massive indebted servitude, foreclosed homes, high unemployment, meager SNAP benefits and the 99’ers after-effects. It’s a FUBAR economy. Libra’s scales demand balance in all aspects of living. Justice has been bound and gagged.

  8. nikhil

    I know Das knows that counter-cyclical spending by governments is not a bad thing, but he says the same canard about governments “borrowing” and “running out of money” etc. Why? Why doesn’t he explain that the type of spending is the problem and not the spending itself?

    He mentions the lack of real changes in the nature of the financial system, but I feel like he glosses over the importance of this and treats it almost as an aside. Is this simplification some kind of necessity when dealing with the time limits of morning shows?

  9. MG

    Normally I like reading Das but this was a weak analogy and useless advice. Houses do are an investment if you buy them an area when the numbers make sense and rentals have remained strong, are able to put in sweat equity yourself including most of the major work except electrical/major plumbing, and you don’t overextend yourself.

    That’s my future retirement fund.

  10. Praedor

    The money handing over to the banks should have come with a condition: they will NOT hold on to it, they WILL lend it out in the form of credit to small businesses, startups, etc. Failure to do so will mean nationalization of the bank (thus the federal loan becomes moot because it is the govt lending money to itself), liquidation of bank assets, a lien placed on banker’s PERSONAL assets, criminal investigation, arrest, trial (and GITMO!) for any and all fraud or criminal activity.

    Not a single banker should have been allowed to make a single dime on the collapse. Not a single dime.

  11. Psychoanalystus

    Such sugarcoated BS. We are so past terms like Botox, corruption, or fraud. We need to come up with new words to more accurately describe the mafia type of financial system and government we have in place right now. Personally, I prefer the way Max Keiser describes our current situation:

    The second half of the video, with guest Catherine Austin, is particularly cogent, as she describes the death threats she and others have received for exposing banksters’ crimes and shenanigans as early as the 1990s.

  12. Albert Meyer

    The botox analogy isn’t so bad but Das’s advice to save is nonsense. Without qualification (as he presented it) the advice to save means to put US dollars in the bank (or in your mattress). He can’t be ignorant of the fact that the Fed is printing money at a fantastic rate, since he mentioned it, so he is advising viewers to set out to lose money by holding rapidly devaluing US dollars.

Comments are closed.