Korean Job Discussion Forums

[mises]

[Dev]

[Sergio Stefanuto]

Bowling for Columbine was very flawed. It argued that (a) the US has high homicide rates and (b) American society demonizes black Americans, for example via the TV show Cops. But (b) contributes to (a), apparently, because people, due to a hysterical fear of blacks (thanks to Cops), buy guns - the corollary being a lot of guns and a lot of homicide. Correct me if I'm wrong, but that, as far as I can tell, seemed to be Moore's argument. Some stats from the FBI would blow this apart immediately, but I shall refrain from posting them at the moment, because I may have mischaracterized Moore's position.

[rogue123]

(1) Whose fault were the Great Depression in the 1930s and the Global Financial Crisis of 2007~? It can't, logically, have been the free market's fault if it's never existed, so what were the problems?

(2) I know a company whose value is bound to soar in the coming years, so much so that, according to my estimations, if I invest $10,000 now, I'll get a $1,000,000 return in 2015. If all goes to plan, after that, I'll probably buy a lot of gold, silver and platinum as a hedge against inflation and, well, pretty much retire. I'm quite anxious to do this, as you can imagine, but I didn't realize I was in some fundamental way unfree, so, if you don't mind, leaving aside obvious things like paying taxes and obeying the law, could you explain in what way I am not free?[/quote]

I hope you are intentionally misinterpreting.
A poster above referred to a "truly" free market, in which he implied perfect competition (0 barriers to entry) and information. It was pointed out that this has never existed and is utopian.
1) Apologists in awe of the free market will, indeed, argue, just as you say. "Because there was gov't intervention," they chant together, "the market went awry." To them, depressions or severe recessions are ONLY caused by intervention--this argument is ahistorical as a cursory study of economic history reveals.
Free-market fundamentalists tend to believe that this or that institution is the cause when markets go bad. Almost always, it is the government and/or the Federal Reserve--an institution largely demanded by the capitalist class in order to be the lender of last resort in times of financial panic. These free market romancers want laissez-faire, and are generally receptive to the functional aspect of the inevitable downturns of capitalism. But democracy really cramps their style. In times of capitalism's crises, they expect masses of people to sit on their hands and wait as the economy recovers "in the long run." Major public outburst, organizing, and protesting, took four years after the onset of the Great Depression. In the eyes of the free market utopian, people demanded all kinds of stupid, useless things that protected them from the most barbaric excesses of capitalism. When you try and wed capitalism and democracy, what you see is what you get.
What is more important, here, rather than attempting to pin down the causes of the Great Depression (GD)--of which there is much scholarship--is rather looking at the Federal Reserve (FR) Chairmans belief in what exacerbated that crisis: Bernanke believes that had the FR at that time simply flooded the economy with money, the GD would have been much less severe. He is known as "Helicopter Ben"--due to his stance on the GD that is perfectly in-line with Milton Friedman's famous 'helicopter drop' of money. In short, their view is that the GD was monetary, and so could have been combated almost entirely in monetary terms. Thus, in our own time, Mr. Bernanke flooded the markets with money and, just as Keynes taught, in a liquidity trap this only adds to the hoarding of money, not to new credit creation and activity, and, famously, is just "like pushing on a string."
More damning is that these guys (Federal Reserve board members and council of economic advisors) missed the biggest asset bubble in the history of the world and still have their jobs. Thus, just about at the height of the housing bubble, Ben Bernanke stated,
�House prices have risen by nearly 25 percent over the past two years. Although speculative activity has increased in some areas, at a national level these price increases largely reflect strong economic fundamentals, including robust growth in jobs and incomes, low mortgage rates, steady rates of household formation, and factors that limit the expansion of housing supply in some areas.� (Ben S. Bernanke, �The Economic Outlook,� October 25, 2005)

2) You are apparently very free to fundamentally misinterpret the discussion. In any case, the MARKETS with which you wish to engage are not "perfectly" free in the sense of conventional economic theory. Regarding your decision to invest in said company's equity, you are as free as you wish to believe: for every buyer there is a seller. See Akerlof, "The Market for Lemons."

peace

[Dev]

[quote="Sergio Stefanuto"]Bowling for Columbine was very flawed. It argued that (a) the US has high homicide rates and (b) American society demonizes black Americans, for example via the TV show Cops. But (b) contributes to (a), apparently, because people, due to a hysterical fear of blacks (thanks to Cops), buy guns - the corollary being a lot of guns and a lot of homicide. Correct me if I'm wrong, but that, as far as I can tell, seemed to be Moore's argument. Some stats from the FBI would blow this apart immediately, but I shall refrain from posting them at the moment, because I may have mischaracterized Moore's position.

[The Happy Warrior]