Anyone here read Atlas Shrugged?
- Thread starter nvanprooyen
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Actually haven't read Ayn Rand since high school - and it seemed too simplistic then. But I read a lot of SF back then, and a lot of it was a lot scarier than she was. Today I can just read the newspaper and connect the dots.
Rand disapproved of fraud (and rightfully so).
She didn't disapprove of getting the better end of a voluntary deal with idiots. Value is subjective.
I read Atlas back in college. Seemed pretty dead on, and it was a little eerie watching the whole dotcompost bubble/meltdown and subsequent housing bubble/meltdown through the Rand prism.
Someone asked who would be *our* John Galt - I don't think anyone will. I think Rand used Galt as an allegory for the quiet, faceless people who do the right thing day in and day out and keep a system rolling along. I think what's happening right now is akin to Galt giving up; all the quiet people, whether willingly or no, are saying 'fuck this' to a corrupt system gamed by evil men, and so, without their collective efforts to support it, is failing and falling, exactly as it should.
Someone asked who would be *our* John Galt - I don't think anyone will. I think Rand used Galt as an allegory for the quiet, faceless people who do the right thing day in and day out and keep a system rolling along. I think what's happening right now is akin to Galt giving up; all the quiet people, whether willingly or no, are saying 'fuck this' to a corrupt system gamed by evil men, and so, without their collective efforts to support it, is failing and falling, exactly as it should.
You ever wonder if some things are self-fulfilling prophesies? Kinda like how a Recession happened because we convinced ourselves we were in one, and as such we followed suit to the expected behavior. (A company's value can nosedive from sheer psychology of the shareholders alone).
If the book and others like it were written to a slightly different note, would we be reflecting that instead?
If the book and others like it were written to a slightly different note, would we be reflecting that instead?
You're talking about confirmation bias.
Consumer confidence doesn't cause recessions. A lack of capital, (exhausted because interest rates were kept too low, too long) and over consumption lead to recession (economic contraction).
I can't stand people saying the economy is based on confidence. Confidence is a reflection of our understanding of the fundamentals. When the fundamentals are good, we're confident, when they are poor, the economy sucks.
Confidence is just our reaction to objective reality.
To believe otherwise is just double think.
Recessions don't happen because people think themselves into them. They happen because the real economic factors that drive economies suck.
Bubbles happen because people talk themselves into them. People convince themselves a tarpaper shack is worth a million dollars, and suddenly people are willing to shell out a half mil for a doghouse.
A stockmarket is merely a symptom of investor psychology, not a driver of economies. It is easily disconnected from reality. That's how you can have tech bubbles and Enrons and WorldComs.
Economies, at a root level, are nothing more the ratio of production vs consumption. When you have a balance, you have a healthy economy. When you have an imbalance, you have an ailing economy.
If the imbalance persists long enough (or worse, is aided and abetted for obscene profit, as ours has been for decades), the eventual collapse (nothing more than a correction, or restoration of balance) of the economy in question will be directly proportional in its pain to the size and duration of the imbalance it has sustained.
In other words, yes, we did it to ourselves, but no, it's not in our heads.
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I agree with your post except this part.
Bubbles happen at the fundamental level. No matter how good we feel about the economy, we can't get 16 hours production out of an 8 hour shift, and we can't double the capacity of our factories by feeling good.
The fundamental that drives booms and busts, is the interest rate. A low rate of interest communicates the economy has lots of savings, and it is safe to consume aggressively.
A high interest rate communicates a lack of savings, and encourages savings (by making the returns profitable).
When the government lowers the rate of interest so that it doesn't accurately reflect how much savings (capital) is available to sustain investment, people start spending when they should be saving, and this creates an unsustainable boom which must be later liquidated in a recession.
Interest rates. Very important to how investors, entrepreneurs and consumers order their decisions to buy new things.
Yes, interest rates are a crucial component, I totally agree with you there (damn you, Alan Greenspan). But we DO talk ourselves into bubbles, or "manias". The greedy dumbfucks out there who bought 1,2,15 McMansions in order to "flip" them were without a doubt assisted in their greedy stupidity by low interest rates and cheap loans being offered on every streetcorner. But it was the fundamental idea that "real eastate always goes up" that truly fueled the bubble, not just the cheap money.
Had prices not gone into the stratosphere, no amount of cheap money would have helped. Look at what's happening now - cheapest money in ages, and no one is buying a damned thing! Why? Most fundamentally, because we stopped believeing the lies we told ourselves about the value of housing.
The same with the stockmarket. Greedy dumbfucks buying stocks with euphoric P/E ratios, never bothering to actually look at the fundamentals of a company.
Yes, interest rates are key, the goobermint has the authority and obligation to "take away the punch" when the party gets too wild, but the bottom line is everyone needs to take personal responsibility not to get shitfaced.
There is no crisis of credit, so while it's a beautiful page, I didn't watch it yet because the title is fallacious.
There is a capital crisis. Credit is not capital.
Should I watch it, or is it a bunch of double think populist BS?
It also doesn't help when people treat their leaders like rock stars or minor gods.
When Bush tells people to go shopping during wartime, or Obama tries to tell people to buy stocks when the market is unraveling, people are easily misled. There is too much entropy, so we're all compelled to listen to experts.
I got lucky and found an easy intro and follow up with economics, otherwise I would still be repeating the stupid shit I was told to believe years ago.
God, I hate it that you're right.
Not because it's you, but because you're right.
Sheep, I tell you - we're all sheep. Think I'll go oil up my Glock.
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