Links 10/2/11

Diamond-Crusted Vertu Phone Defies Slump Bloomberg

Stuck in Bed for 19 Months, at Hospital’s Expense New York Times

You Love Your iPhone. Literally. New York Times. I am the proud owner of a stupid phone. I did love and still miss my NeXT computer. Since I really don’t like cell phones, I fancy I will be immune to iPhone romantic enslavement when I finally break down and get one.

Citigroup questions if US spectrum shortage exists Network World

Battered by Economic Crisis, Greeks Turn to Barter Networks New York Times. The black economy goes even further underground.

Currency Revulsion Ed Harrison

We’re kicking ass! Limbaugh and the talkers are running scared! Daily Kos

This economic collapse is a ‘crisis of bigness’ Guardian

With nets, spray and force, police crack down on march The Villager (hat tip Buzz Potamkin). On last weekend’s march, but provides some useful detail.

Bully for BofA: New Debit Card Fees! Adam Levitin, Credit Slips

If Millennials Do Worse Than Their Parents, It Will Be Because Bill Gates’ Kids Have All the Money Dean Baker

Why Isn’t the Unemployment Crisis a National Emergency? Mark Thoma

Personal Income Declines -0.1%, Real Consumer Spending Flatlines for August 2011 Economic Populist

Top Prosecutor Stands Out by Pushing Back New York Times

Fantastic Objects, Excited Stories and Dreadful Politics Huffington Post (hat tip Rob Parenteau)

Antidote du jour (hat tip reader James B). This is a Nicobar pigeon, which is enough to make me rethink my views on pigeons:

Print Friendly, PDF & Email


  1. Pat

    “Germany will leave the euro, says leading commentator”

    “A former economic advisor to George W. Bush during his presidential campaign, Malmgren recognises a German exit would be a radical move and would mean a sudden rise in its export prices. But she believes Germany’s industries are in a strong enough position to deal with high prices in the near future.”

    “Germany To Leave The Euro?”
    Germany is rumored to have ordered printing plates to resume printing Marks, and is intending to walk. This does make sense, although the Germans would have to find a way to shield their banks from the impact of a massive shift off the Euro and into the Mark by Germans, which would spike the Mark higher and positively trash the Euro’s value.”

    Looks like Germany may not want to spend 10-20 trillion Euros to bail out everyone else in Europe. They will eat their losses and move on. The Finns and Dutch will soon follow, leaving France in charge of the sick ward.

    1. wayne

      Germany will never leave the euro. They aren’t giving away free money; they are getting incredible bargains for their money.

      Who do you think runs the euro and benefits most by it?

    2. Jim

      If Germany leaves, so too would the northern European countries. And once that happens, I doubt that France would want to share a currency with the southern European nations.

  2. Foppe

    Simon Johnson < Horrible case of cognitive capture going on here for Johnson, who apparently either understands nothing of what was done to Mexico, or willfully denies the role the IMF played in that crime. (Seeing what nonsense he spouts about Latvia, it seems a mixture.) In any case, Johnson has identified the real problem facing the Eurozone: 'Italian imprudence.' What a tool.

    1. Jim

      The real problem with Europe is that the 17 nations should not be sharing a currency. So Simon Johnson is correct.

      Either Germany and Greece should agree to become part of the United States of Europe, a federation in which Merkel would become a governor and the German citizens would provide a permanent fiscal transfer to the southern European nations (like New York to Alabama), or each nation should go its separate way.

      This has nothing to do with Peterson. It has everything to do with a sustainable economic model.

    1. wayne

      There’s no relationship between those operating systems except for the fact that Steve Jobs was the head of the company where they were made.

        1. wayne

          I read it, and it seems like a few features and some code were ported into the Server version of OS X that fizzled in 2000. I admit I’m partially wrong, but from the end user perspective there was no progression.

          NeXT systems are still prized for a reason.

        2. Yves Smith Post author

          NeXT and OSX use (if I understand it right) pretty much the same kernel, which is a proprietary version of Unix. That’s why it’s pretty breakproof and has much better security than Windows (you can never secure Windows, they’ve lost control of the inner architecture).

          But I could leave my NeXT on for MONTHS and never need to reboot. I’d have to do things that were affirmatively stupid to crash an application.

          The GUI for OSX had to cater to old Mac users, and it was really for the worst. And I don’t know what happened to the internals, but OSX is not as robust.

          And I really liked a good greyscale monitor. Much better for the eyes. These color monitors have ruined my vision.

      1. temptingfate

        From a programmer’s perspective there have been three operating systems that require Objective C and take advantage of the unique file structures built around a complex directory structure executable that uses a .app suffix. They are NeXTSTEP (renamed to OPENSTEP slightly before cash flow closed NeXT’s doors), OS X and iOS. OS X is OPENSTEP made to act somewhat like OS 9 and in fact the early versions of prerelease OS X, called Rhapsody, actually was simply the OPENSTEP GUI running on the Motorola CPU. This as a minor task since OPENSTEP already ran on Sparcs, Intel and a few more exotic CPUs already. iOS is a stripped down, phone oriented version of OS X.

        For those waxing poetic about the good old days, NeXTSTEP had an absolutely terrible user and developer pricing structure. Had those prices been kept for OS X we would be talking about Apple and Be as companies that missed the boat for different reasons.

        Personally I liked the NeXTSTEP GUI better than OS X but putting the launch bar on the left is a way to keep a small part of it.

  3. hello

    “f Millennials Do Worse Than Their Parents, It Will Be Because Bill Gates’ Kids Have All the Money ”

    ugg, if the author is going to pick on rich kids, it should be Paris Hilton or the Waltons (40%+ owners of Walmart), not the Gates family who are literally giving away 90% of their wealth to schools in America and vaccinate kids in Africa via the Gates Foundation.

    Way to pick on the one prominent rich family who is doing the right thing! Expletive-head!.

    1. rd

      I was going to make the same comment.

      If he wants to whack Bill Gates, he should do it because Microsoft (like all other major corporations) has been out-sourcing many of their jobs overseas.

      Bill Gates’s kids could end up with the same issue as other millenials because their dad reduced their future opportunities.

      1. alex

        Gates’ name is only used in the headline and is only used as a metaphor for the extremely rich. In the past it would have been Croesus or Rockefeller. He’s not picking on Gates in particular.

    2. Hugh

      Let’s see. If Gates “gives away” 90% of his fortune and he has say 40 billion, that would give his kids a measly 4 billion. Oh, the humanity! I can see them now panhandling from their stretch limos now. How sad.

      The truth is that the rich seldom give away anything, and never anything important. Setting up charitable foundations is just a way for them to shelter their wealth from taxes while effectively keeping control of how it is used. That wealth should have been taxed away from them. Alte (and allowing them to put their name on lots of things). Alternately, Gates could simply have signed it over to the US government. However, re this last, that was the whole object of setting up the charitable foundation to keep this from happening. In present circumstances, Gates would just be giving his money over to a system which would distribute it to other kleptocrats. Even in an idealized version where it went to actually be used for the good of the American people, when has a kleptocrat like Gates ever shown any interest in that?

      1. Procopius

        That reminds me of the Texas Oilman joke from when I was a kid. Two wealthy Texas oilmen are sitting at their country club when a guy who owns more than both of hem put together walks in. One says to the other, “You know, his parents were poor, they only left him a few million dollars, and he built it up into a real fortune.”

        1. Clonal Antibody

          You might find – Born on Third Base interesting

          Forbes Magazine likes to herald its reports on the wealthiest Americans as demonstrating the realization of the American dream: that one can go from rags to riches. For Forbes, the Horatio Alger story is the true story of America.

          But careful identification of how Forbes’ centi-millionaires and billionaires attained their wealth tells a different account of the plebeian origins of the richest Americans. Half of those on the Forbes 400 list started their economic careers by inheriting businesses or substantial wealth. Of these, most inherited sufficient wealth to put them immediately into Forbes’ heaven. Only three out of ten on the Forbes list can be regarded as self-starters whose parents did not have great wealth or own a business with more than a few employees.

          The data, then, do not support the assumption that the United States is a true meritocracy where the most able rise to their rightful positions. Nor do they defend the contention that the United States is structured so that authentic equality of opportunity prevails. Inheritances undermine the achievement-reward equation.

          In 1995, it took only $340 million to break into to the Forbes 400. In 1996, the hurdle was raised to $400 million. By 1997, it was $475 million. The net worth of the wealthiest of the wealthy is increasing much faster than that of the rest of us.

          Underlying Forbes’ and others call for dramatically lowering taxes on the wealthy and decreasing or eliminating taxation of capital gains is the belief that we need wealthy people so that they can save, become entrepreneurs and provide jobs for the rest of us who are not as wise, energetic or risk-taking as they are. What proportion of the Forbes 400 established successful companies? Perhaps a quarter. We lack data on employment and other benefits of these enterprises.

          Rather than concocting fables about our supposed “opportunity society,” the editors of Forbes really ought to be examining the starting-gate advantages that the bulk of the Forbes 400 enjoyed. And while they’re at it, perhaps they could delve into a few other questions: Exactly how does the great wealth of a very few benefit ordinary people? Do great concentrations of wealth block out opportunities for others to innovate? Do the consumption patterns of the wealthy distort the values and ambitions of many others? Are materialism and commercialism promoted by the display of enormous wealth? Is the power of big money corrupting political democracy

          The data quoted above is from 1997. In 2010, instead of $475M to make the Forbes list, the number has jumped to $1.05B – a growth rate of ~7% per year compared to a 4.7% nominal GDP growth rate.

    3. dcblogger

      Gates is giving money to cities to fund charter schools that are managed by companies he owns. It is just a way to enrich himself by destroying public education in our country. He also was a backer of the deeply corrupt Michelle Rhee

      Paris Hilton is an exceedingly silly girl who has never asked us to take her seriously and who has been disinherited by her very rich grandfather.

      Gates on the other hand is a convicted monopolist capitalist who is destroying our schools. No amount of scorn is sufficient for such a villain.

    4. KFritz

      Bill Gates helped create a mediocre OS. He then used a (literally) world class level of drive and aggression, ruthlessness, clever advertising, and many of the other tools and strategies of Monopoly Capitalism to dominate the OS market.

      With the winnings fr/ this ethically ‘dubious’ enterprise, he’s engaged in ‘doing good.’ Has he spent the same energy used in accumulating his wealth to consider the best use for his winnings?

    5. Anon

      Bill’s vaccination drive for the poor follk comes with a price: drug patents, which is inimical to the very interests of those same poor folk, but kind of kind to big pharma’$ bottom line.

      The basic goal seems to be to extend globally US-style patent protection and basic rentier IP behavior (NB not every region of the world imitates US norms, for example, software is not patentable in Europe.

      Africa would benefit more from HIV/AIDS being declared an epidemic, so that patent protection of medications to treat such illness would not apply.

      Case in point: the court case that led to South Africa having its arm twisted to sign up to TRIPS:

      WHO played an instrumental role in the formulation and implementation of the South Africa National Drug Policy of 1996 whose objectives are “to drugs of acceptable quality to all citizens of South Africa and the rational use of drugs by prescribers, dispensers and consumers.” The 1997 Medicines Act 90 was an embodiment of many key principles of the National Drug Policy which included: parallel importation, generic substitution, quality control of imported medicines, voluntary price reduction, international competitive tendering for the public sector, essential drugs list and standard treatment guidelines.

      The court case in South Africa was initiated at the behest of 39 pharmaceutical companies which challenged parts of the 1997 Medicines Act 90, contending that the law would destroy patent protections by giving the health minister overly broad powers to produce, or import more cheaply, versions of drugs still under patent.

      At the request of the South African Ministry of Health, WHO identified relevant international legal expertise to support, and report, to the Government of South Africa. The 39 pharmaceutical companies eventually dropped the case unconditionally on 18 April 2001. In a joint statement of understanding between the Republic of South Africa and the Applicants (the 39 pharmaceutical companies), it was agreed that,

      “…the referenced applicants recognize and reaffirm that the Republic of South Africa may enact national laws or regulations, including regulations implementing Act 90 of 1997 or adopt measures necessary to protect public health, and broaden access to medicines in accordance with the South African Constitution and TRIPS.”

      Harvard Law School paper from 2005 on the South African HIV/AIDS/drug patents controversy and the 1998 court case, contested by 39 big pharma “philanthropists”:

  4. Cilly

    Two comments on Thoma’s post:
    First, I don’t know what factor he is using for Okun’s law but, given the jobless “recoveries” so far this millennium, it is clear that GDP growth doesn’t have the same pull on employment that it used to so, I think his estimates of recovery in the labor market – bleak as they are – are probably overoptimistic.
    Second, as he points out, Obama’s proposed package falls short – far short – of what’s needed. (Again.)

  5. craazyman

    They may love their iPhones but I hate my Droid.

    Well, “hate” is a bit strong, but the thing seems like a crab feast. You burn more calories extracting the crab meat than you get by eating it. And so you walk away from the feast hungry as hell.

    I usually hit McDonald’s or Burger King after a crab feast. And so with the Droid the battery always seems to need charging, the camera works but isn’t 1/10th as good as a cheap digital pocket camera, the screen is too small to read websites on the bus, I haven’t yet found an app that does anything useful for me, I’m not into texting so couldn’t care less about that, it’s just a tad too big and heavy to fit comfortably in a shirt pocket, and all gee-whiz screen gadgets are one big yawn after the other.

    What’s wrong with just staring out the bus window, channeling and dreaming when you need to kill 10 minutes? Why do you need to distract yourself with electronic nonsense? Maybe I’ll figure it out some day. ha ha.

    1. Jib

      Dude, your doing the crab feast wrong. I get stuffed on crab. We eat a lot of it, Dungeness crab (but it is getting expensive). Invest in your own tools, learn how to use them, then feast like a walrus!

  6. Eleanor

    Check out the Victoria Crowned Pigeon from New Guinea and the Purple Crowned Pigeon from Australia. Both lovely!

  7. Jim Haygood

    ‘The subjects didn’t demonstrate the classic brain-based signs of addiction. Instead, they loved their iPhones.

    Can anyone read this over-the-top advertorial without getting that it’s product placement?

    It’s the same technique used in films, in which a smiling, laughing group of friends consume a prominently displayed and branded beverage.

    Yesterday I saw precisely the same ‘product love’ metaphor in a CVS store — a sticker on the glass door of the ice cream novelties case read, ‘Don’t lick the freezer!’

    These are increasingly desperate times in the Consumers Paradise, comrades. Readers will understand that organs of the state such as the Times-Titanic are obliged to run undisguised advertorials to support themselves.

    Don’t kiss your iPhone, don’t lick the freezer, and don’t munch the carpet.

    1. Dave of Maryland

      I find variants at the local supermarket: 4 for $5. 10 for $10. Do I need four or five or ten of (whatever) – ? No, actually. One or two is usually enough. And do I notice the disguised increase in price?

      Krugman is right when he says there’s no inflation per se. He hasn’t caught the fact that if I used to move 100 units a month and now only move 70, I have to increase the unit price in order to make up the lost sales. Inventory may not cost any more than it used to, but every unit sold has to cover more ground.

      1. Cahal

        ‘He hasn’t caught the fact that if I used to move 100 units a month and now only move 70, I have to increase the unit price in order to make up the lost sales.’

        But you have contradicted the inviolable law of demand!

        1. Dave of Maryland

          What law? Demand has dropped. This is a sad fact. Prices are flexible. Prices have always been flexible.

          1. Cahal

            Traditional theory teaches that if demand drops prices go down. In practoice, merchants respond by increasing prices. I was parodying economists who think demand is a physics-like law.

  8. Jim Haygood

    This weekend features a stunning exercise in Boomer narcissism:

    LITTLE ROCK, Ark. – Celebrating the 20th anniversary of the start of his presidential campaign, Bill Clinton on Saturday offered a vigorous defense of President Barack Obama against what he called the same anti-government stances he faced during his campaign and two terms in office.

    Holding hands with Hillary Clinton, the former president arrived at the stage to Fleetwood Mac’s “Don’t Stop Thinking About Tomorrow,” the song that became the anthem of his 1992 presidential bid. The weekend’s events included the dedication Friday of a $10.5 million pedestrian bridge at his presidential library.

    The speech was the centerpiece of a weekend commemorating Clinton’s presidential announcement, but it also offered plenty of parallels between his presidency and Obama’s, including opposition on multiple fronts from Republicans.

    “There’s not a single example on our planet, not one, where an anti-government strategy has produced a vibrant economy with strong and broad-based growth and prosperity,” Clinton said.

    This inveterate pair of political hustlers has been conducting their permanent campaign to run for, serve in, or exert influence upon public office for 37 years now. More like fifty, if you count their student government days. Campaigning comes as naturally to the Clintons as breathing, or building $10.5 million pedestrian bridges to nowhere.

    It was the Clintons’ first year in office which convinced me to march down to the county clerk and change my registration to ‘Independent’ from ‘Democrat,’ which it had been ever since I was old enough to vote. The retroactive tax hike (after promising a ‘middle class tax cut’); the Hillary health-care nightmare — GAAAHHHHHHH!!!!!!

    Clearly this determined pair of self-promoters is not going to stop their infernal pestering of their fellow citizens until their natural demise intervenes. Even then, it would not be surprising if the former president’s headstone is equipped with a loudspeaker to continue lecturing us with his recorded speeches. Hillary, one suspects, is more likely to settle on birdsong for her perpetual broadcast:

    ‘CAW! CAW! CAW!’

    1. wayne

      Correction. It’s not a bridge to nowhere, it’s bridge to his private library. You can bet Clinton didn’t pay for it out of his own pocket and that some school in Arkansas is crumbling on the heads of little children because of it.

    2. sleepy

      I had an elderly uncle in Arkansas (born 1910) who changed his registration from democrat to independent after Clinton’s first term as governor.

      Bubba had lied about not increasing the state car license fee–he went from $2 to $3.

      1. craazyman

        Sounds like a 50% tax increase to us. Your donation of $50 or $100 can help us turn back the tide on government theft of your hard earned money, even if you didn’t do anything to earn it. How’s that for a deal?

        Sincerely yours in profit and in truth,

        Mr. Ewell B. Rich, Chairman
        Mrs. Ivanna B. Rich, President
        American Taxpayers United Against Government Theft
        US Post Office Box 105b
        Bozo, Texas

    3. Glenn Condell

      ‘march down to the county clerk and change my registration to ‘Independent’ from ‘Democrat,’

      I am flummoxed by the whole idea that your right to vote is predicated on your telling the world (or at the very least the electoral system) who you are likely to vote for. From an Australian perspective it is truly weird. Here, you are simply registered to vote (it’s compulsory) and it is officially no-one else’s business whose side you’re on. It’s kind of sacred, like the confessional.

      You guys extend the concept into state judicial and bureaucratic appointments too don’t you? Republican judges, etc. Our wigs have their own political views no doubt but the openly partisan public office holder is a rara avis, the culture no doubt originating in the Brit civil service handed down to us.

      It just seems strange that in the US of all places you find this mingling, rather than a separation of powers, at the very grass roots. Of course the third power, the Church (or Gahd generally) also mixes with the state’s business but that is at a level much further removed from the mechanics of democracy, more in the realm of culture and ideas.

      1. Maximilien

        Glenn: Okay, voting in Australia is compulsory. But do you have the option of “none of the above” or of spoiling your ballot and having either choice counted? Because in such a system you should. Otherwise, your vote has been coerced and it has no validity.

        1. Glenn Condell

          You can vote ‘informal’ which is basically ‘a pox on both your houses’ and yes it is counted.

          And we still use paper votes, with reps from major parties and electoral officials on hand at each polling station to ensure no shenanigans. There is a paper trail that can be audited. Woe betide any politician or party who tried to sell electronic voting as the way of the future. We saw what happened to you.

          People write things like ‘no nukes’ on ballots as part of a campaign on occasion – so far as I’m aware they’re counted too.

      2. Yves Smith Post author

        It’s due to our primary system. Only party members get to vote in primaries for their party. In New Yorkstate, you are effectively disenfranchised if you don’t register Democrat, many key races are decided in the primaries.

        1. Glenn Condell

          That makes sense, thanks. Our parties have members decide who’ll run in particular seats but this is not done with state electoral machinery, it’s internal, so there is no administrative carry-over into the general election.

  9. Clonal Antibody


    You might have missed these

    From Global Economic Intersection – Pre-Crisis Leverage Effectively Reached 3,000:1

    This was based on this article from The Political Commentator – Guest Post: 3,000 TIMES LEVERAGE…HIDDEN – the single handed cause of the housing (price and overbuilding) bubbles and financial crisis…

  10. Abelenkpe

    ” I fancy I will be immune to iPhone romantic enslavement when I finally break down and get one.”

    Yeah I used to think that. Be prepared for love

    “Happiness, hit her like a train on a track
    Coming towards her, stuck still no turning back..”

    1. propertius

      I’ve (or should that be “iVe”?) had an iPhone for a couple of years now. I travel frequently, and it’s an extremely useful travel tool. I hardly ever use it as a phone (something I would not have anticipated when I got it).

      I do not love it – anymore than I love a hammer or a socket wrench.

    1. Jeff

      Have you seen this comment from the Citibank joins in rape of customers article?

      “F. Beard says:
      October 2, 2011 at 6:12 am

      We made a big mistake with the FDIC. Instead of insuring private bank deposits, the US Government as the sole issuer of its currency (ignoring the FED for the sake of argument) should have created a free, 100% risk free-money storage and check clearing service that did not lend or borrow money.

      And once the population has a safe place to store its cash then all government privileges for the banks can be eliminated without concern for the depositors. There would no longer be guaranteed interest but on the other hand without the extreme bank leverage that government privilege allows there would be far less price inflation risk and the banks would be far safer too for those who sought

      1. Bill

        OMG, what kind of destructive fun could those
        Congresscritters have with that pot of money ?!!!

        I mean it sounds like a great idea in an ideal
        political world, but……you know…..

  11. Schofield

    With reference to the Greek barter network. Tough luck if you’re severely disabled, or elderly and infirm, and nobody, or few, to rely on in a barter network.

    1. reslez

      Tough luck if you’re severely disabled, or elderly and infirm, and nobody, or few, to rely on in a barter network

      That’s tough regardless of the economic system. They probably don’t have much money either.

  12. Jeff

    A note to Yves’ webmaster…in OS 10 on a Mac, using Firefox the following masthead grouping and all similar ones are and have been washed out and almost
    invisible for weeks…After the end of the quoted
    part, everything is dark and readable. Thanks

    Recent Items

    Links 10/2/11 – 10/02/2011 – Yves Smith
    Citi Joins Bank of America in Finding New Ways to Bleed Customers – 10/02/2011 – Yves Smith
    Is JP Morgan Getting a Good Return on $4.6 Million “Gift” to NYC Police? (Like Special Protection from OccupyWallStreet?) – 10/02/2011 – Yves Smith
    Catch Us on Harry Shearer’s Le Show Today – 10/02/2011 – Yves Smith
    Links 10/1/11 – 10/01/2011 – Yves Smith

    Saturday, October 1, 2011″

    End of washed out segment…

    1. Clonal Antibody

      I believe that the washout problem is web browser version specific. I does not show in Firefox 4.01 or Google chrome 10.0648

      But the problem does show up in Seamonkey 2.4 and 2.5 Beta, which are based on later versions of Firefox.

      I am presuming that on OS X, you are using Opera. Both Opera and Firefox are based on the Gecko layout engine, while Google Chrome is based on Webkit and Explorer is based on the Trident engine. So this appears to be a problem with the Gecko layout engine.

      So it is not clear whether the problem is something that should be addressed by the webmaster, or something that should be addressed by the programmers at Mozilla.

      1. Procopius

        Thanks for the pointer. Now I know who to send this particular complaint to. However I wish Yves would get her webmaster to do something about the links anyway. I mean, orange on white, how readable do you think that is? My eyes aren’t as young as they used to be, although I don’t feel old yet. Some kind of disconnect there. But maybe use the roolover tag to change the color to dark blue or something. They are really very hard to read.

      2. Procopius

        Thanks for the pointer. Now I know who to send this particular complaint to. However I wish Yves would get her webmaster to do something about the links anyway. I mean, orange on white, how readable do you think that is? My eyes aren’t as young as they used to be, although I don’t feel old yet. Some kind of disconnect there. But maybe use the rollover tag to change the color to dark blue or something. They are really very hard to read.

          1. Clonal Antibody

            Unvisited links are orange, and visited links are turquoise. Since you are the author, and have visited all the links, you see them as turquoise.

        1. Clonal Antibody

          I believe, that Temptingfate below has shown where the offending html code is. This is an issue for the webmastr/webmistress and not an issue for Mozilla

    2. temptingfate

      The culprit is in the span style. Safari is ignoring span style=’filter: alpha(25); opacity: 0.25;’. Firefox is doing what it is told.

  13. Jeff

    Re bartering in Greece, there have been alternate currencies here in the U.S. for decades.
    Notably, the Ithica Hour in upstate New York which
    is time based.

    Plenty of local currencies with nominal values such
    as the Fairbuck in Fairfax, California.

    You really see who is producing something of value
    when barter happens. “You mean you won’t trade ten
    dozen eggs for an hour of my life coaching???!”

    1. Jim

      Bartering in Argentina, a few months before the government did the right thing: ending the currency peg with the dollar.


      To Weather Recession, Argentines Revert to Barter


      Published: May 06, 2001

      Bartering, that precapitalist form of commerce popular in Indian villages in Latin America even long after the Spanish conquest, is making a far-reaching comeback in Argentina as an improbable safety net for a forlorn middle class not accustomed to the hardships that are a way of life elsewhere in the region.


      Today the clubs have more than $7 million worth of scrip in circulation, bar-coded to guard against counterfeiting. An estimated $400 million in goods and services were traded last year. Organizers say they expect an 80 percent increase in the value of the transactions this year because of the deepening recession.


      The trueque clubs expanded in popularity without government support. But as it continues struggling to find a way out of the economic malaise, the government has itself recognized the value of the clubs as a safety valve that provides not only economic benefits but also a social and psychological boost for people who can take problems into their own hands in a communal setting.


  14. doom

    Interesting how that fantastic objects business is pressed into service to condescend to people who think Obama is full of shit. Those malcontents, they’re not applying objective standards of governance to his derelictions and betrayals, oh no, they’re besotted with a dream that defies reality itself. We must empathize with their irrational ideations in order to cure them.

  15. MyLessThanPrimeBeef

    Personal income declining 0.1% would be bad, but if it declines -0.1%, wouldn’t that actually be an increase?

  16. Susan the other

    The Guardian. Kingsnorth’s article about economic collapse being a crisis of bigness. Yes. That sounds right. Similar to the theory that all advanced civilizations fail. This thesis, of a 50s economist named Leopold Kohr, says that to be viable, an economy must remain small and be inclusive. Local. Kohr wrote a book, The Breakdown of Nations, using this analysis. He concluded that all governments and economic models fail when they get too big. I think, in addition to our crisis of bankster capitalism, Europe is the political example for here and now. They tried to go economically big, but wanted to maintain the social smallness of each member country, and they have failed. They must either go back or go forward into unproven territory. They fear to go forward because they will lose the social pact of smallness.

    It would be nice if there were a new social factor: grassroots internet and real-time communication. This ability might be an answer. It might be the way we make big small again. So far we haven’t used it appropriately. We need to do a better job. As well as clean up all the unmitigated felonies.

    1. Glenn Condell

      Kohr had a point about becoming Too Big To Sustain… like the widening gyre, things fall apart, the centre cannot hold, the falcon cannot hear the falconer, mere anarchy is loosed upon the world, etc… but it not size alone, it is the attendant complexity as you scale up, the economies of scale that make everything cheaper and more efficiently delivered end up introducing a degree of fragility that did not exist when elements of your enterprise were discrete. (This is Joseph Tainter filtered thru John Robb)

      The ceding of independent decision-making and action-taking from the nodes to the centre mean great gains in ‘productivity’ which may even result in a reduction of smaller, everyday SNAFUs but which ultimately reduce the buffering slack or redundancy in the system which in the past had protected it from localised shocks. One goes down, the others help it back to it’s feet. Nowadays we’re more efficient, but also more brittle. Hello Black Swan.

      There is some well founded pesimism about the future of states themselves – not just too big and complex but untrustworthy – their original function has been perverted into special interest protection so that they lose legitimacy with most citizens, who cannot be confident that their govt can provide the most basic political goods – security, food, shelter, education, health, etc.

      So we need to localise food and energy production but must keep a state superstructure of some sort to prevent conflicts between have and have not localities, to keep us all on the same page via a well protected and serviced internet so that essential innovations go viral and social mores don’t veer dangerously apart geographically, and so that responses to external threats can be monitored and met.

  17. YankeeFrank

    It seems occupy wall street is having a hard time getting together a list of demands, so I thought I’d start one, but I don’t know where to post it so I came home to NC to post it. Here goes:

    list of demands

    1. revoke corporate personhood — upper management must be held accountable for all crimes committed by corporations, and that includes jail terms and other punitive measures just like a regular person would receive

    2. no money in politics. all political campaigns publicly financed. anyone caught giving money to candidates and politicians will be tried and thrown in jail for at least 5 years.

    3. revoke power of the criminal banks (BofA, Citibank, Goldman, JPMorgan/Chase, Wells Fargo, Morgan Stanley — all who created fraudulent mortgage backed securities) to create money from nothing, and from taking deposits from the public. Reimplement Glass-Steagal and a tobin tax on financial transactions.

    4. create state banks in the model of North Dakota that also provide free accounts for citizens

    5. outlaw credit default swaps, interest rate swaps and other derivatives

    6. outlaw speculation in commodities markets

    7. full universal healthcare for all who want it

    8. free and quality education through college and grad school for all who want it

    9. all student loan debt forgiven

    10. no interest rates on loans or credit cards of any kind above 8%

    11. reduce military budget to at most half current level

    12. end wars in afghanistan, iraq and all other middle eastern and other nations

    13. immediate investment of $10 trillion to create a fully green economy and recreate our manufacturing base

    14. ban all chemical use not proven to be safe, as the law in Europe provides

    15. all federal bureaucracies will be run by career employees — no more political appointees to run our government services as they corrupt and destroy the mission of these institutions, such as the EPA, the NLRB, OSHA, etc.

    16. pass the EFCA law allowing simple union voting not controlled by corporations

    17. reintroduce full progressive taxation, with the highest tax bracket, for those earning over $10 million per year of 70% as we had in the Eisenhower era.

    18. lower taxes in middle income and the poor, and remove the limits on payroll tax deductions so all income is subject to payroll tax

    19. tax investment income at a minimum 10% higher level than the median federal income tax rate paid by individuals.

    20. remove all deductions for corporate taxes and create a progressive tax for corporations, so small businesses are taxed minimally, and large businesses are taxed at the full 35% rate.

    21. heavy fines companies that close American factories and offshore jobs. provide tax or other incentives for companies to hire American workers

    22. cancel the h1-b, l1 and other visa programs and force companies to hire and train American workers.

    23. total ban on fracking and massive clean up of toxic waste sites. corporations that pollute will have their upper management jailed for a term not less than 10 years.

    24. pass a law that ensures fines for illegal acts committed by corporations are at least double whatever profit was made from the illegal activity.

    25. any corporation or bank that is so large it is systemically dangerous must be broken up into smaller entities.

    26 actively enforce antitrust laws and strengthen said laws to ensure fair capitalist competition. Ensure no vertical or horizontal monopolies.

    27. immediately break up all media monopolies. only allow a single corporation to own one media enterprise in any given region. That means if a corporation owns one newspaper, that is it. One tv station, that is it. Etc.

    1. Clonal Antibody

      In light of the JP Morgan contribution of $4.6M to the NY City Police Foundation, I would add a 2a to your

      2a No government service, federal, state or local, or its employees can have foundations or other fund raising mechanisms to raise money from the general public – they are to rely totally on government funding. This would include Police Officers Benefit Associations and the like. Government employees can have a union, and that union can fight for raising their pay and pensions. But that union cannot and should not raise money outside of its membership. Any donation to a government employee, or organization of public employees outside its membership should be considered a bribe — this would include advertising in association publications etc.

    2. knobstiffington

      What you are looking for are principles that reduce and simplify your (almost neverending) list. Someone said “economic justice” but that might be a bit thin.

      An unrelated point, it is now telling how infantile identity politics has turned out to be. The fragments that flew off during the 80s cannot find common cause here. But if not here, where? And when? The infinite flexibility of, say, Judith Butler’s political ontology is more than implicitly aligned with liberal capitalism. What can we expect from movements whose single overarching claim is “Let ME in!”?

      Good luck with your list.

      1. YankeeFrank

        The list is under 30 points long and represents a counterattack against the attack on and corruption of our society. The length of the list is in direct proportion to the depth of corruption. Principles are nice, and the Occupy Wall Street crowd seems to be doing a good job of that, but at some point concrete solutions need to be outlined.

      2. Glenn Condell

        Don’t be list-averse, knob. Even your simplicity-seeking reductio ad principium would have to be formulated as a list wouldn’t it? And as you yourself admit, what’s left after you boil all the specifics out of it is ‘a bit thin’. Motherhood statements, that’ll do the trick.

        Your first and third paras are fine, but the one in the middle is a worry. I especially liked the way you weaved Judith Butler’s political ontology into it – genius. Well, I’m sure it would be if I understood it.

        Frank, as a fellow list-lover, I enjoyed yours and concur that actual proposals are what is needed now, not woolly-headed if well meaning platitudes.

        I would only quibble with a few things – the Nth Dakota model s/be not just state but Fed too, money credit should be a public function and government should not borrow what is after all it’s own money at interest from private parties, with the same N Dakota fostering of local businesses for full employment (or as near as poss) as it’s charter.

        As for CDS and CDO etc – don’t outlaw but impose the Tobin tax (a great piece in support of this at London Banker – which would render the million transactions a minute trend uneconomic. Then bring all such investment vehicles under the regulated umbrella of a clearing desk with every transaction timed and tagged. Also, there should be no such thing as an ‘off balance sheet’ SIV or anything else – all interests must be declared on balance sheets and in annual reports and prospectuses.

        I agree health and education should be free to all. The index of a society’s health, and it’s worth to its citizens is how it treats its less fortunate members – esp how it prepares them for life and looks after them when they’re down. Elites need to be ventilated through regular infusions of talent from an educated lower rank, so circulation needs to be encouraged – recent trends are excluding whole classes from higher education (see this frightening piece from the LRB on UK education ‘reforms’ – Note that a govt report which recommends that govt get out of funding universities was overseen by Lord Browne, the CEO of BP, who got out of the hot seat just in time to help destroy one of the world’s great legacies of inclusive higher education.

        TBTF is fine too, but I would add a couple of other innovative ideas I’ve come across. One is that any financial institution which receives government support must not pay it’s highest paid employee any more than 25 times that of it’s lowest. The other came from Europe via Charles Ferguson; a stake in all investment vehicles recommended by advisers in any institution receiving govt support must form part of the remuneration of those advisers.

        See knob, with concrete proposals you can agree or disagree, you can argue pros and cons, but it is hard to sit on the fence. Statements of principles are fine as far as they go, but that’s not very far.

        I went to see Slavoj Zizek last night (Sydney Festival of Dangerous Ideas) and I enjoy him immensely, great fun. But my problem with him is that he forever shies away from any program or even particular measures. He is at pains to make it clear that he deals in ideas – warnings which are well thought out with historical and contemporary references (often cast in joke form) about ecology, bio-tech, energy and capital, and he limns their development and potential for further damage wittily and often brilliantly, but he is ultimately a fence straddler. I guess he is smart enough to know that the moment he does dip his toe into specifics he might find that offers to talk at places like the Opera House dry up rather fast.

        But specifics are what we need now. First principles can come later!

    3. Jack Parsons

      And another: stop deducting interest in business. Bear Sterns went down when it had 13b in cash and borrowed 71b per day on a one-day basis. Once interest is not deductible, loaning money to business stops being economic. You have to invest, not lend.

  18. Mandy

    Yves, I’d be grateful if you could limit your use of, type links in your links list.

    Our network administrator does not allow them to link through. It can’t be as good for your sites ranking as the original link.

  19. Hugh

    I don’t disagree with Kohr’s statement that “instead of growth serving life, life must now serve growth, perverting the very purpose of existence.” But that small nations are more peaceful, more prosperous, and more creative is contradicted by much of European history. Smallness too has problems: insularity, paranoia, resource insufficiency to deal with large scale crises.

    The problem with bigness is that it provides very fertile ground for a lack of responsiveness to change and a lack of accountability. We see this in corporations all the time, like Microsoft for example, where initial innovation establishes a market share where innovation is then stifled and the market share itself is used to maintain and increase itself. We see it in our own country where a tiny space of the Northeast, Rhode Island, or empty spaces like Wyoming, Montana, North Dakota, and Alaska get as many Senators as a huge entity like California. Where historical anachronisms like the Senate or the electoral college can still determine the content of every legislative act or swing an election against the popular vote. Or a more recent anachronism like the Fed can control the money supply for the benefit of banks, the corps, and the rich, and not the American people.

    The problem I would say is when there is bigness and no counterweight to it that keeps the focus on human needs and makes sure that society’s resources are distributed accordingly.

  20. Cahal

    Yves and commenters:

    A Canadian economist, ‘Chris Auld’, has posted a fairly vitrolic review of David Orell’s excellent ‘Economyths’:

    Auld demonstrates exactly what you would expect from a neoclassical economist having his discipline threatened – misrepresenting Orrell, claiming he ‘doesn’t understand economics’, and so forth.

    I posted a brief response but got tired very quickly. If anyone more eloquent and patient would be so kind as to put him in his place, you’d be doing the world a service.

    1. mk

      thanks for that link to, found a great radio program on criminal profiling

      and a link to Edge 2011 Master Class: The Marvels and the Flaws of Intuitive Thinking
      Edge Master Class 2011 – audio DANIEL KAHNEMAN lecture,

      Steven Pinker in the Q & A section: “I argued at Harvard that when we were trying to identify what should any educated person should know in the entire expanse of knowledge, I argued unsuccessfully that the work on human cognition and probabilistic reason should be up there as one of the first things any educated person should know.”

      great stuff, thanks again!

  21. mk

    “You Love Your iPhone. Literally. New York Times. I am the proud owner of a stupid phone. I did love and still miss my NeXT computer. Since I really don’t like cell phones, I fancy I will be immune to iPhone romantic enslavement when I finally break down and get one “~~~~~~~~~~~~

    who wants to get involved in a stupid system that wants to infect you with it advertising/marketing tentacles to keep your attention within it’s closed system where it makes all the rules and members happily (or not) submit.

    capture a market with a device, then sell access to it.

    That’s what they do at the brain center at MIT, figure out how to keep humans attached to these devices for advertising/marketing purposes.

    No thanks, I am no longer a “consumer” to be captured, I quit (starting to anyways).

      1. skippy

        The old saying “don’t blame the tool” seems applicable here.

        Skippy…yep need to find better users.

        1. MyLessThanPrimeBeef

          Science projects tend to be expensive…most of the time.

          Who’s got the money? Who controls those who’s got the money?

        2. mk

          It’s a choice not to buy into that system, based on openess, price, where manufactured, their politics, etc.

  22. Bill

    Yves: “Since I really don’t like cell phones”

    OK, that makes me feel better, somebody younger
    and a lot smarter than I am also dislikes cell
    phones. Actually, I hate all phones mostly, but
    cell phones in particular, partly because when
    I want to use a phone, all I need is a dial tone,
    keypad, and phone line, and that’s all.
    Also, I have a hand tremor that’s partly age related
    that makes using very small things almost impossible.

    I still have a land line, the cell is only for
    a car emergency, but unfortunately I usually forget
    to take it……another reason to hate cells, I
    can never remember how to use them exactly.
    Getting old such fun…….. :(

Comments are closed.