Minnesota Marriage Amendment

http://ballotpedia.org/wiki/index.php/Minnesota_Same-Sex_Marriage_Amendment_(2012)

"I cannot conceive of a personal God who would directly influence the actions of individuals, or would directly sit in judgment on creatures of his own creation. I cannot do this in spite of the fact that mechanistic causality has, to a certain extent, been placed in doubt by modern science. [He was speaking of Quantum Mechanics and the breaking down of determinism.] My religiosity consists in a humble admiration of the infinitely superior spirit that reveals itself in the little that we, with our weak and transitory understanding, can comprehend of reality. Morality is of the highest importance -- but for us, not for God." - Albert Einstein 'The Human Side', 1954

I must speak out against the Minnesota Same-Sex Marriage Amendment.  I feel a moral obligation to do so.

It seems as though the Republican party has been co-opted by the religious right, and for this reason I can no longer offer them any support. I never officially considered myself a Republican, but often voted Republican for economic reasons. Their economic ideology supports limiting the role of the government in our economy.  In action, they have often failed to apply this ideology.

It is clear our economy is in a horrible state.  Neither party is entirely to blame for this; both are responsible.  Neither party has been able to fix it.  This shifts my focus to different kinds of freedom, since neither party has been successful in ensuring our economic freedoms.

Constitutions are essentially rules governments operate by.

con·sti·tu·tion  (knst-tshn, -ty-) a. The system of fundamental laws and principles that prescribes the nature, functions, and limits of a government or another institution. b. The document in which such a system is recorded. c. Constitution The fundamental law of the United States, framed in 1787, ratified in 1789, and variously amended since then.

By amending Minnesota's constitution Republicans in the Minnesota legislature are attempting to change the role of the government itself.  Our national Constitution was designed to LIMIT the power of government and PROTECT the rights and privileges of its citizens.

The Minnesota Marriage Amendment is designed to do just the opposite:  it LIMITS the privileges of certain citizens (while granting them to others) and ENDOWS the State with power to discriminate based on sexual preference.

One could ask the question of whether any state should "support" or "recognize" marriage between either opposite or same-sex partners.  I am sure there are many single taxpayers that would argue that married couples should not receive favorable tax treatment simply because of their lifestyle choices.  

Whatever your view on this, the fact is that both state and federal governments do recognize marriage between a man and woman, and grant them financial and legal privileges based on their marital status. Therefore, denying those privileges to other married couples (based on gender) is discrimination.  

At the core of the issue, we are speaking of the state affording certain privileges to some, and denying them to others, based on whether they have the same genitalia as the person they choose to marry. 

The question then becomes, on what is that discrimination based?  We all discriminate.  Laws discriminate all the time.  For example, there are different penalties for different types of crimes. In this case, the discrimination  is based on a judgement of perhaps how much pain and suffering an action caused another, or perhaps the intent of the crime. 

Marrying a person of the same gender is no crime.  The state is discriminating if it denies the rights and privileges of marriage to same-sex couples while granting them to opposite-sex couples.  The problem is this type of discrimination is based not on reason, but on prejudice, fear, and hatred.

A constitution is not a law, it establishes the basis for law.  It is meant to protect and guarantee rights and privileges of individuals, not take them away.  The constitution is supposed to protect people against an overzealous state;  especially a state that has been hijacked by religious fanatics.

It is obvious that the Minnesota Marriage Amendment is based on religious beliefs.  Our Federal constitution establishes the freedom to practice your religious beliefs, not the right to use the government to force your beliefs upon another.

Question:  How does it harm anyone, anywhere, if  same-sex married couples are afforded the same privileges by the state as opposite-sex couples? 

Answer:  IT DOESN'T.

VOTE NO!  Minnesotans have a chance to be the first to defeat this type of hateful amendment.

The New Depression

I just read "The New Depression" by Richard Duncan.  If you want to understand our current economy, it is a must read.

http://video.cnbc.com/gallery/?video=3000110331

Rally To Fall Apart

For the very few readers I have left (I apologize for my lack of posts), I wanted to update you on where I think the market is headed.

You won't be surprised to know I think the stock, bond, and commodity markets are SEVERELY over priced.  We are headed for a fall that will decimate almost all asset prices.

Personally, I am outright short markets and individual stocks and in cash.*

As I have said before, we have just experienced a 30-40 yr bull cycle, driven by debt (credit expansion), central banks manipulation of money supply, demographics, and speculation.

The increase in prices of stocks, bonds and commodities we have seen since the 2009 bottom has not been driven by economic growth or value creation of any kind.  It has been "created" by central governments around the world printing money.  This money was given to the banking sector, and they have been speculating with it in the financial markets.  I do not know how long this manipulation of markets can continue, but I can see that it unsustainable.

The suspension of "mark-to-market" accounting rules in March of 2009 was the catalyst for the current rally.  Without this suspension, it would be apparent exactly how unhealthy our banks are.

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=agfrKseJ94jc

In layman's terms: FAS (Financial Accounting Standard) 157, required banks to value their assets (mainly outstanding loans) quarterly by marking them to market.  There is much debate about whether this practice exacerbated the 2008 financial crises.  In my opinion, marking assets to market is an ESSENTIAL tool for determining the health of financial institutions, and provides information that is absolutely critical for investors to have if they are to buy stock in a financial institution.

The suspension of FAS 157 by the Financial Accounting Standards Board allowed, and continues to allow, financial institutions to lie about the value of the loans they hold on their books.  This makes everybody feel better in the short run, because they can deny the fact that most of our large financial institutions are indeed insolvent.

Imagine if you could go to the bank and get a close to 0% loan, to use in anyway you pleased, with no collateral (or if collateral was required, you could just make up its value)!  Now;  imagine you could do this indefinitely, and when it became clear that you couldn't make the payments on this loan, the bank would just give you another one to use to pay the first, and there would be no impact on your credit rating.  Would this affect your behavior at all?

Of course it would, and this is the current arrangement many large financial institutions have with their bank (The Federal Reserve).

Still think this rally is sustainable?  Think again.

If you want to more information, or want to understand more about what caused the economic boom of the last 40 years or so, I recommend reading "The New Depression:  The Breakdown of the Paper Money Economy" by Richard Duncan.

*As always, trade at your own risk.  I am not advising you in any way.  You should seek the advice of a financial professional for investment advice.

Women Hating Religious Fanatics

As anti-American as anything could be:

http://www.cnn.com/2012/07/15/world/africa/egypt-clinton/index.html?hpt=hp_t1

This article is BEYOND upsetting.

If the headline isn't upsetting enough, the neutral, politically correct tone the rest of the article takes is nothing short of infuriating.

What country do we live in?

Let's speak out against evil when we see it.

I told you the radicals were going to try to take over in Egypt.  How do we like the look of their new Democracy?

Hitler was Democratically elected.

Never forget...we do not live in a Democracy, thank God.  We live in a Republic, based on balanced rule, not mob rule.  Our Republic is based on the Constitution and the Bill of Rights.  These documents gave the North the moral authority to free the slaves even when the majority was against it.

Our Republic has moral authority because it asserts the rights of individual human beings to life, liberty, and the pursuit of happiness, above mob rule, above any religion, and above collective rights.

Without this moral authority, which the new "Democracies" in the Middle East lack, they are nothing more than religious nation states ruled by the whims of the masses.

Do not mistake these movements in the Middle East for progress.  The opposite may be true.

Remember Benazir Bhutto?  Lara Logan?  Google them yourself.

How sad.

John Stewart Takes On Edward Conard

This interview is a must watch.  John Stewart should have been an economist.  Well, maybe not, then I wouldn't get to enjoy The Daily Show.

The Daily Show with Jon Stewart

What a great debate. I think JS is touching on a very important point. I have been thinking the same thing for a long time:

http://econmom.blogspot.com/search?q=our+economy+has+been+doped
http://econmom.blogspot.com/search?q=cancer
http://econmom.blogspot.com/search?q=this+is+not+capitalism

For just a few minutes, pretend you are neither a Republican or Democrat. Do this because if you cling to the ideology of either group, you will fail to see the truth. (If you are neither, it will be easier.)

Many Republicans, like Mr. Conard, base their defense of Capitalism not on moral arguments, but on overly academic ones.  This was the problem Greenspan had.  He failed to see the forest from the trees.  He paid so much attention to the details, that he forgot how to think clearly.

Are risk and reward related?  Absolutely.  This is obvious, and I can't imagine having the patience to write an entire book about it.  Does this relation mean that encouraging risk takers through the tax code always works?  No, not necessarily.  People are motivated by many things, money is not always one of them, and if it is, it is not always the most important.  Should we have a tax code that encourages risk taking?  Well, that depends, doesn't it? (To quote one of my favorite professors.)  It depends on what types of risk taking we are promoting and whether they are desirable for the economy as a whole or not.

What about creating a tax code that was neutral?  Would that even be possible?  Government may create an environment conducive to business and innovation by minimizing regulation and taxes, but should not in any case be subsidizing one business over another.  This not only creates moral hazard problems, but it makes the game unfair.  Subsidies are much more harmful to Capitalism than taxes.

Why?  Because they strip the Capitalists of a moral justification for their philosophy.  Subsidies make Capitalists hypocrites, and slaves at the same time. They are destroyers of Capitalism.  They skew the risk reward system to such an extent that it cannot be relied on as a market arbiter.

What industry is more subsidized and "coddled" as JS says, than any other (perhaps with the exception of oil and farming)?  The financial industry.  How?  The Federal Reserve (arm of the Government) "lends" free money to speculators at the big money center banks.  They then "invest" it in the stock market.

By fixing the price of money, which Conard calls "saving" the economy, the Government is giving these large financial institutions the biggest free ride in economic history.

If they make good decisions, they are rewarded handsomely. If they fail, they are bailed out by the taxpayers.  This is the "investor class" Edward Conard is speaking of, and many of them are indeed are feeding of the Government teat.  But they don't want you to know that.  They don't want to give up their subsidy, their advantages...and why would they?  If you were playing poker and you knew your betting money would never dry up, would you place riskier bets?

Obviously, not all in the financial industry fit this profile. There are many investors who participate in the market with the intent of not only making money for themselves and their clients (which is great), but also to support innovation.  It is the honest guys at the middle sized firms who don't have access to leverage at 0% and actually have to make money for their clients who are at a competitive disadvantage. They don't get Federal Reserve funding, but their clients still expect results.  Many true Capitalists are operating as independently of the government as possible, and putting up with many cumbersome regulations on top of it.  These are not the people or firms I am referring to.

I love that JS points out that in the while the real estate bubble was forming "We lost our minds chasing wealth."  He also asks a question I have been thinking about for a while:  Is our overvaluation of growth coming at the price of lost stability?  YES!  YES, it IS!

In a free economy, no central bank would be able to hold the price of money artificially low and in doing so warp the normal risk reward mechanisms imposed by markets.  In a truly free economy there would be no Goldman Sachs, no GM, no AIG, no Freddie and Fannie, and no taxpayer bailouts of hedge funds.

I say these things not to disparage Capitalism, but in the hopes we can save it.  We will NEVER be successful in cutting entitlements, which is necessary to the health and well being of this country, if we do not end Government subsidies and bailouts in the "private" sector.

If the "investor" class continues to behave as it has, and ignore these issues, I am afraid I will not be able to blame the masses for their rebellion.

'Nosce te ipsum'.

Know thy Self.

Half truths require no rigor.  I admire the man who tells the whole truth and nothing but the truth, and knows Him Self.

Does he exist? Yes, in all of us.

We all fall short of perfection, of truth.  Yet, he exists in all of us.

Tell the truth to your Self above all others and know the difference between yourself and your Self.

This is my only Religion.

We all have both.  We all are two.  The recognition of this reality implies you must employ free will and decide which to feed...the self...or the Self.

Which of your thoughts will you believe?

Repercussions

The repercussions of a mind...the effects.  Pretend it matters not...go on...deny your Self and go on.