ContraryGuy on October 28, 2011, 11:05:16 am
While they weren't Standard Oil, they were quite Standard Oil-ish.  They were also quite Coca-Cola-ish.
I realize that AnCappers believe that no capitalist can commit any wrong, but they can.  And they have.

Lets starts by saying that capitalism is not bad, or evil or anything.  It cant be; its just there.
Its all in how it is employed.
Little c capitalism is what makes the world go 'round; always has, and as long as people are willing to exchange something that is only indirectly valuable(money) for something that is directly valuable(goods or services), always will.

Big C capitalism is where people try to make money off of the transfer of money or other capital.  This starts out as a valuable service, but once the ability to make uncountable (and unspendable) amounts of money arises, the people involved fall prey to the temptation of greed and start making money for themselves instead of remembering what the purpose of capitalism (to make sure all parts of the market that need money get the money it needs) is.

But because the supply of value is finite, once the people who control the money have all of it, what happens to the people below them?  Barter?

There is an infinite supply of barter, but money is a much better store of value.  (In this case, 'money' includes refined precious metals such as gold.)

So, how does an anarchy, where there is no authority, moderate the worst excesses of human nature?
But only as it applies to capitalism, and business.  Lets not get too broad.

I don't understand the premise.  How does the "transfer of money or other capital" lead to some people having ALL the money?  As long as voluntary exchanges occur, I don't see how this is even possible.

If, for some strange reason, somebody or some group somehow managed to corner the market on a particular currency, this is not a problem in anarchy, as people could simply switch to a different currency.  It's only when the production of money is monopolized (by the government, for example), where your premise makes any sense.

For that matter, it's only because government power is there to be abused that the alleged big "C" capitalists are able to utilize it for evil purposes.  I know, you think without government, they would simply be evil in a more direct way, but this overlooks the costs of using your own resources for evil purposes.  For a business, that's simply bad business.  Letting government do the dirty work for you is much more easier and cost effective than doing it directly, especially if your competitors have similar resources.

Deregulation means getting govt overseers out of the way of business.  More de-regulation=less government.

I do wish some of you would pay more attention to the business pages...

Oh, I forgot, business reporters are in the pay of Big Govt and cant be trusted to relay the actual facts of the world.
And Fox News never lies, and always tells the truth...

Man, I wish some of you actually read anything about the real world at all... and not just libertarian tracts.

The financial meltdown happened because there was too little government oversight.
Before government regulations, there were financial panics every 10 to 15 years.
Do you want to live in an economic system where all your money is suddenly worthless every ten years or so?

As for the idea of "just switching to a different currency", you have no idea how terrible an idea that is.
Or how bad an idea it actually was.

I know I really havent answered your questions.  Its hard to get across the idea that businessmen dont always act in their own self-interest.  Modern Big C capitalists usually dont act in the best interest of the companies they manage.

In the last fiscal quarter, Goldman Sachs reported only its second quarterly loss.  It made record profits, but yet lost money.  How did they manage that?  Because they paid out more in salary and bonuses to the top executives than they had made in profit.
How is that in the best interest of the company?
The government didnt force them to give away all their profit, it merely said "you must document who you paid, when and how much."

Bank of America is firing 31,000 workers because the bank doesnt have enough business to pay them, but there is enough business to give senior executives $11 million dollars each in severance packages.

When you say "[banks] would simply be evil in a more direct way, but this overlooks the costs of using your own resources for evil purposes," I think you havent a glimmer of how the real world of finance and Big Business works.

Not all transfers of money are entirely voluntary.  Without taxes, you are still paying tribute to someone.  It doesnt have to be a warlord, or ganglord.
It could be a Protection Service, because the alternative is worse.
In an anarchy, do we all go back to well water and septic systems and hand cranked generators, or is there centralized water, sewer and power?
It may be an anarchy, but you still have bills to pay.

How some people end up with all the wealth is that they arrange things so that you willingly (if unknowingly) pay them.
They make money directly from purchases, loan, and fees for handling money.  
Wealthy people also make money from knowing things before you do, knowing things that are kept from you and from selling you things that they know will fail and they make money when it fails, because they have taken out insurance policies that only pay out when things fail.

I'm glad your idealism and naivete keeps you warm at night, but dont think for an instant that that how the real world works.

ContraryGuy on October 28, 2011, 11:24:50 am
Quote
Big C capitalism is where people try to make money off of the transfer of money or other capital.

Does this refer to where A makes money by letting B use some of A's money for a fee aka interest on a loan?  I'm just looking to make sure I've got your question straight.  Answering a question that wasn't asked can sometimes be amusing, but it doesn't, um, answer.

Nope.  Thats simple interest.  I'm talking about where A sells B's loan to C for a profit.  C takes B's loan and combines it with D-M's loans and convinces N that this package makes a mighty-fine investment, with a defined percentage rate of return guaranteed by Q's insurance company.
If N agrees, (and why wouldnt he since the investment is backed by all those honest people repaying their loans with interest, and guaranteed by Q's reputable insurance policy?), then C gets a fee for bringing the two together.
C then goes on to sell the investment to R,S,T,U & V.  Making a fee every time.

What C hasnt told any of those investors is that H-M are deadbeats and most likely will never pay back their loans.
C has taken out an insurance policy with Z's insurance company against the high probability that the investment will fail.  Part of the insurance goes to pay off Q so that he will insur the investment even though he is informed of how likely it will fail, so Q is not out any money when he pays off the rate of return guarantee.

So C makes money out of every transaction and from an insurance policy against success.

If you think this is complicated, you should read about the real thing.  It will make your head swim.
The Wall Street risk takers even had quantum physicist created equations that showed why there was 0 risk in any of these investments, and how nothing could go wrong.

Because math is never wrong, right?

(and remember, all of the stuff was performed legally and aboveboard with full disclosure to all voluntary participants)

sam on October 28, 2011, 01:47:46 pm
The financial meltdown happened because there was too little government oversight.

Odd then that most of the money was lost by quasi governmental entities, Fannie, Freddy, and the FHA.  Odd then that most of the money was pissed away on the supposed victims of redlining.  Odd then that the one and only bank that failed to make easy money loans, Beverly Hills Bank, was condemned by the regulators as racist.  Odd then that the two private banks that pissed away the most money, Countrywide and Washington Mutual, were the regulators favored pets and were famously over the top in extreme political correctness.

If the problem was too little regulation, odd then that all of this happened after Basel, an extraordinary explosion of regulation.  Glass-Steagall was seventeen pages.  Basel II, the source of all our financial woes, a system guaranteed to collapse, is so vast no one can say how large it is, other than that is is many thousands of pages over hundreds of documents.

Glass-Steagall is seventeen pages of relatively straight forward english.  Basel II is many thousands of pages of
incomprehensible gobbledy gook written by lobbyists and insiders.

Basel II is not the free market, but crony capitalism, and calls for more regulation are calls for more bailouts and more crony capitalism.

Read the CRA report on Beverly Hills Bank. http://www2.fdic.gov/crapes/2007/32069_071001.pdf Who had the power?
The nameless bureacrats enforcing the CRA, or the bankers?


Under Basel, the regulators guide the banks to invest "safely", which is to say, politically correctly

I was right at ground zero where the money was pissed away:  Sunnyvale, California, 2005, 2006.

Seemingly every loan that was made, was around seven hundred thousand dollars to well  over a million dollars, was no money down and cashback under the table, negative money down, and was made to an unemployed no-hablo-english hispanic.

So why were they making those ridiculous loans?  And who was making those ridiculous loans?  Well mostly it was
countrywide and Washington Mutual - banks whose bosses had drunk the PC Koolaid about redlining and all that, banks that in the end went under because of all the loans they had made to those poor victimized oppressed minorities, banks that were super duper politically correct, banks that were empowered by the regulators to take over other banks with other people's money because they were more politically correct than thou.

Every single bank except one was making easy money loans to everyone "No money, no credit, bad credit?   No Problem!", but some were reluctant, two, Countrywide and Washington Mutual, were wildly enthusiastic, and all of them that were making easy money loans were targeting their easy money loans primarily to protected minorities.

And what happened to the one bank that refused to make easy money loans?  The regulators condemned it as racist for not making easy money loans

Before government regulations, there were financial panics every 10 to 15 years.

Which panics did not lead to substantial inflation, deflation nor substantial unemployment, and from which the economy swiftly recovered.   The effect of government intervention has not been to eliminate crises, but to postpone them by printing money so that we get bigger but less frequent crises.

Do you want to live in an economic system where all your money is suddenly worthless every ten years or so?

But back in those days, your money did not become suddenly worthless.  Some bank accounts suddenly became worthless, but prices were stable then and they are not stable now.

The introduction of the fed was not justified on the basis of preventing financial panics, but on the basis that a certain private banker, whose bank's accounts had never become worthless, had too much power.  

The fed was introduced because responsible banking was rewarded by the market, rewarded by "too much" power and wealth, and irresponsible banking was punished by the market.  Predictably, what do we get?  We get irresponsible banking.
« Last Edit: October 28, 2011, 02:10:38 pm by sam »

mellyrn on October 28, 2011, 02:37:10 pm
Quote
The financial meltdown happened because there was too little government oversight.

Really?  From the real-world stuff I read, seems more like it happened because there was government collusion.

Quote
(and remember, all of the stuff was performed legally

Exactly.  Just 'cos it's legal don't make it right.

And yet you want even more laws (that "too little gov't oversight" remark)?


I asked about interest, 'cos interest has been of interest to me lately.

Imagine an island where there are only 100 dollars, and I have all the dollars.  You want to do something but need money to pay for it, so you borrow the $100 from me, at 10% due at the end of the year.  At the end of the year, you give me back the $100 but of course you don't have $10 because there are no more dollars (the only reason for this silly scenario is to make it clear that, as soon as interest enters the picture, we have a musical-chairs problem; it's less obvious with $billions sloshing around).  Three possibilities:

1) You've produced goods and have extra, let's say $50 worth, and I'm willing to take payment in goods, so I get the original dollars back plus a piece of your action.  Yay, everybody's better off.

2) You've produced goods but only $10 worth.  I'm still willing to take payment in goods, so I get my $100 plus your goods.  I'm richer, and you've just wasted a year.

3) You've produced nothing or very little (maybe total crop failure or something).  You are my debt slave to the tune of $10.

For that matter, if in any of the other cases I am not willing to take payment in goods, you are also my debt slave.

In all cases (except outright theft), whoever lends at interest gains; the borrower, not so much.  And something's gotta give -- either new dollars have to be created to represent the new goods produced (by whom? who decides? who keeps score?  Oh, and what about loans for nonproductive purposes like new cars?), or we're trying to put 10 marbles into a can and get 11 marbles back out, a fool's game.

It does seem to me that if a government was the bank (and the money-creator and scorekeeper), it could earn enough to obviate taxes (although no government's hunger for money can ever be satiated).  North Dakota started a state bank 90+ years ago and is today the only US state with a budget "in the black".  With banks in private hands, the private hands eventually own enough to buy all the government "oversight" (wink wink nudge nudge) they could possibly want.  Government -- oh goody we're saved.
« Last Edit: October 28, 2011, 02:40:12 pm by mellyrn »

Frank B. on October 31, 2011, 07:10:11 pm
Nope.  Thats simple interest.  I'm talking about where A sells B's loan to C for a profit.  C takes B's loan and combines it with D-M's loans and convinces N that this package makes a mighty-fine investment, with a defined percentage rate of return guaranteed by Q's insurance company.
If N agrees, (and why wouldnt he since the investment is backed by all those honest people repaying their loans with interest, and guaranteed by Q's reputable insurance policy?), then C gets a fee for bringing the two together.
C then goes on to sell the investment to R,S,T,U & V.  Making a fee every time.

What C hasnt told any of those investors is that H-M are deadbeats and most likely will never pay back their loans.
C has taken out an insurance policy with Z's insurance company against the high probability that the investment will fail.  Part of the insurance goes to pay off Q so that he will insur the investment even though he is informed of how likely it will fail, so Q is not out any money when he pays off the rate of return guarantee.

So C makes money out of every transaction and from an insurance policy against success.

If you think this is complicated, you should read about the real thing.  It will make your head swim.
The Wall Street risk takers even had quantum physicist created equations that showed why there was 0 risk in any of these investments, and how nothing could go wrong.

Because math is never wrong, right?

(and remember, all of the stuff was performed legally and aboveboard with full disclosure to all voluntary participants)

And because Fannie and Freddie (Agent C in this case) bought up massive amounts of sub prime loans and got AAA credit stamps put on them simply because they bought them. Also, because of their quasi-governmental status, those mortgages came with an implied guarantee.  Now when you do the math, those MBEs looked pretty good, and even if they aren't, then who cares, the US govt will not let Fannie and Freddie (and their pals) fail. So, physicists were right, there was 0 risk.  All natural market indicators were masked, and risk aversion  eliminated.  What happened next was entirely predictable.

The insurance part is normal, regardless of whether those mortgages are good or bad.  That is what AIG was in the business of doing for a long time.  Now they're a bank (so they could get all that TARP money).  Swell.

You are right that it was all legal.  Of course laws change with the prevailing political winds, so no big expectation there.  As to the "above board", I disagree. C, in your scenario, withheld important information on those mortgages, and misrepresented their credit worthiness, and thus their value.  That, my friend, is fraud.

sam on October 31, 2011, 08:00:07 pm
The FDA was seen as a way to get rid of an old danger without creating a new one which could be worse.

That is not what happened.   Just as the Fed was created not in response to a private sector financial crisis, but in response to a Jewish banker having too much power, and shortly after it was created, it created the biggest crisis of them all, the FDA was not created in response to a bad medication, nor in response to people getting sick from meat.

The FDA was created in response to an "expose" of the meat packing industry, which was in fact a grab for union power and centralized monopoly.  I repeat:  It was not created in response to people getting sick from eating meat.  They wanted to shut down ordinary people and ordinary butchers from butchering animals, to centralize the killing of animals.
« Last Edit: October 31, 2011, 10:26:05 pm by sam »

sam on October 31, 2011, 11:41:16 pm
As to the "above board", I disagree. C, in your scenario, withheld important information on those mortgages, and misrepresented their credit worthiness, and thus their value.  That, my friend, is fraud.

A functional financial system requires truth, and that lies be severely punished.  Affirmative action requires lies, and that truth be severely punished.  So when Affirmative Action came to finance, it was inevitable that the financial system would collapse permanently and irreversibly.  Our financial system is now undead, and will remain so.  The semblance of life restored by bailouts is purely pretence.

The overwhelming majority of the deadbeats were Hispanic deadbeats.  It was thus difficult to say that they were deadbeats without coming close to implying that Hispanics tend to be deadbeats, without implying that the CRA was fraud.  Either suggestion would destroy your banking career, and likely destroy your bank.

The CRA bureaucracy argued that credit standards had "disparate impact" on protected minorities.  Anything that has disparate impact impact is racist and illegal, because you are not allowed to defend criteria that have disparate impact by suggesting that the minority that they have disparate impact on is no damn good.  So if requiring people to have an income and assets tends to disqualify most illegal immigrants, you must be racist.  So you cannot require borrowers to have income and assets.  You cannot even argue that borrowers need to have income and assets, because that is perilously close to racism.

The west's economic crisis was caused by giving Nobel prizes to Marie Curie:

When they gave out Nobel prizes on the basis of race, sex, nationality, and political alignment rather than accomplishment, it became necessary to give out degrees on the basis of race, sex, and political alignment, rather than knowledge of the material, otherwise the discrepancy in degrees would be "discrimination", and if anyone was allowed to doubt that the discrepancy was discrimination, those with affirmative action Nobel prizes would be exposed to ridicule.

When they gave out degrees on the basis of race, sex, and political alignment, it became necessary to give out jobs on the basis of race, sex, and political connection, rather than ability to do the job, otherwise the failure of those with affirmative action degrees would be "discrimination", and if anyone was allowed to doubt that the discrepancy was discrimination, the degrees would be exposed to ridicule.

When they gave out jobs on the basis of race, sex, and political connection, it became necessary to give out a middle class lifestyle on the basis of race and sex, otherwise the failure of those with affirmative action jobs to live a middle class lifestyle would be "discrimination", and if anyone was allowed to doubt that the discrepancy was discrimination, the jobs would be exposed to ridicule.

When they gave out a middle class lifestyle on the basis of race and sex, the recipients still did not live a middle class lifestyle, so the money was not repaid.

So rather than ridicule Marie Curie's Nobel prizes, the government took on a trillion dollars of debt.

None of the changes that are necessary to get us out of this hole are politically possible, until it is politically possible to ridicule Marie Curie for getting a ludicrous Nobel prize for doing science while in possession of a pussy.

Trees do not grow to the sky, but they grow till they fall.  Affirmative action cannot be slightly reduced.  Being built on lies, it must grow till it collapses altogether.

« Last Edit: November 01, 2011, 12:32:17 am by sam »

macsnafu on November 01, 2011, 11:04:26 am
I'd just like to point out that much so-called "deregulation" still provides government protection or coverage of the allegedly de-regulated industry.  Back in the 1980's for example, savings and loans were deregulated by Reagan, giving them the freedom to invest in riskier things, but they were still covered by the FSLIC, federal insurance.  Naturally, when the bottom fell out, there wasn't enough money in the FSLIC to cover it all, and the taxpayers ended up paying for it. 
Rights include responsibilities, and government privileges are no better than government restrictions in the end.  In an actual unregulated free market, failed businesses would not be able to "socialize" their losses on anybody who did not incur those losses or not directly related to those businesses.

So most talk about deregulation is still a red herring in an attempt to blame laissez-faire or free markets for something that could not happen in a laissez-faire free market.  Government was still responsible for the financial crisis.

I love mankind.  It's PEOPLE I can't stand!  - Linus Van Pelt.

ContraryGuy on November 01, 2011, 11:48:18 am
As to the "above board", I disagree. C, in your scenario, withheld important information on those mortgages, and misrepresented their credit worthiness, and thus their value.  That, my friend, is fraud.

A functional financial system requires truth, and that lies be severely punished.  Affirmative action requires lies, and that truth be severely punished.  So when Affirmative Action came to finance, it was inevitable that the financial system would collapse permanently and irreversibly.  Our financial system is now undead, and will remain so.  The semblance of life restored by bailouts is purely pretence.

The overwhelming majority of the deadbeats were Hispanic deadbeats.  It was thus difficult to say that they were deadbeats without coming close to implying that Hispanics tend to be deadbeats, without implying that the CRA was fraud.  Either suggestion would destroy your banking career, and likely destroy your bank.

The CRA bureaucracy argued that credit standards had "disparate impact" on protected minorities.  Anything that has disparate impact impact is racist and illegal, because you are not allowed to defend criteria that have disparate impact by suggesting that the minority that they have disparate impact on is no damn good.  So if requiring people to have an income and assets tends to disqualify most illegal immigrants, you must be racist.  So you cannot require borrowers to have income and assets.  You cannot even argue that borrowers need to have income and assets, because that is perilously close to racism.

The west's economic crisis was caused by giving Nobel prizes to Marie Curie:

When they gave out Nobel prizes on the basis of race, sex, nationality, and political alignment rather than accomplishment, it became necessary to give out degrees on the basis of race, sex, and political alignment, rather than knowledge of the material, otherwise the discrepancy in degrees would be "discrimination", and if anyone was allowed to doubt that the discrepancy was discrimination, those with affirmative action Nobel prizes would be exposed to ridicule.

When they gave out degrees on the basis of race, sex, and political alignment, it became necessary to give out jobs on the basis of race, sex, and political connection, rather than ability to do the job, otherwise the failure of those with affirmative action degrees would be "discrimination", and if anyone was allowed to doubt that the discrepancy was discrimination, the degrees would be exposed to ridicule.

When they gave out jobs on the basis of race, sex, and political connection, it became necessary to give out a middle class lifestyle on the basis of race and sex, otherwise the failure of those with affirmative action jobs to live a middle class lifestyle would be "discrimination", and if anyone was allowed to doubt that the discrepancy was discrimination, the jobs would be exposed to ridicule.

When they gave out a middle class lifestyle on the basis of race and sex, the recipients still did not live a middle class lifestyle, so the money was not repaid.

So rather than ridicule Marie Curie's Nobel prizes, the government took on a trillion dollars of debt.

None of the changes that are necessary to get us out of this hole are politically possible, until it is politically possible to ridicule Marie Curie for getting a ludicrous Nobel prize for doing science while in possession of a pussy.

Trees do not grow to the sky, but they grow till they fall.  Affirmative action cannot be slightly reduced.  Being built on lies, it must grow till it collapses altogether.



Sam, your bigotry (since I do not know anymore of you than what is here, I do not know if you are a racist, but I suspect not; you hate gays and Jews alike.) is plainly apparent for all to see.
It is often amusing to see the lengths to which you will go to say that all the ills in America are the fault of group X or group Y, or from the consequences of government pandering to whatever group you are mad at today.
Why dont you Man Up and just say what you think: "All minorities must wear a distinctive ribbon so as to identify them to authorities."
You know, like Hitler did.
You obviously hate gays, so lets round them all up and gas them.  You dont believe in humane treatment, so when you round up all the gays they will be dispatched cruelly but efficiently.

You have a distinct distaste for Hispanic and poor people of all types, soi lets kill all of them too.

You hate all forms of authority and government, so lets kill them too; simply associating with such people is evidence of irredeemable guilt, so they should all be killed.

You are the kind of person that would make life in AnCap unbearable; at least for the short while until someone took offense and killed you.

I try very hard to ignore you or educate you, but it is such a lost cause.  I cant help myself, because I want to bring people to the realization of truth and facts.
Of course, I am not always right; but at least I try.

ContraryGuy on November 01, 2011, 11:53:29 am
Quote
The financial meltdown happened because there was too little government oversight.

Really?  From the real-world stuff I read, seems more like it happened because there was government collusion.

Quote
(and remember, all of the stuff was performed legally

Exactly.  Just 'cos it's legal don't make it right.

And yet you want even more laws (that "too little gov't oversight" remark)?


I asked about interest, 'cos interest has been of interest to me lately.

Imagine an island where there are only 100 dollars, and I have all the dollars.  You want to do something but need money to pay for it, so you borrow the $100 from me, at 10% due at the end of the year.  At the end of the year, you give me back the $100 but of course you don't have $10 because there are no more dollars (the only reason for this silly scenario is to make it clear that, as soon as interest enters the picture, we have a musical-chairs problem; it's less obvious with $billions sloshing around).  Three possibilities:

1) You've produced goods and have extra, let's say $50 worth, and I'm willing to take payment in goods, so I get the original dollars back plus a piece of your action.  Yay, everybody's better off.

2) You've produced goods but only $10 worth.  I'm still willing to take payment in goods, so I get my $100 plus your goods.  I'm richer, and you've just wasted a year.

3) You've produced nothing or very little (maybe total crop failure or something).  You are my debt slave to the tune of $10.

For that matter, if in any of the other cases I am not willing to take payment in goods, you are also my debt slave.

In all cases (except outright theft), whoever lends at interest gains; the borrower, not so much.  And something's gotta give -- either new dollars have to be created to represent the new goods produced (by whom? who decides? who keeps score?  Oh, and what about loans for nonproductive purposes like new cars?), or we're trying to put 10 marbles into a can and get 11 marbles back out, a fool's game.

It does seem to me that if a government was the bank (and the money-creator and scorekeeper), it could earn enough to obviate taxes (although no government's hunger for money can ever be satiated).  North Dakota started a state bank 90+ years ago and is today the only US state with a budget "in the black".  With banks in private hands, the private hands eventually own enough to buy all the government "oversight" (wink wink nudge nudge) they could possibly want.  Government -- oh goody we're saved.

You asked if I meant simple interest, and I said no.
Then you went on to talk philosophy, and basic money systems instead of dealing with reality.

I talked about the reality of fraud in the system, even with oversight, ineffective though it was.
AnCap in an established society has to deal with the facts on the ground, not pretend that everything starts from square one.  Because it wont.

I stated this divergence because I wanted to talk about Capitalism in AnCap.
Not philosophy.

How does AnCap deal with unseen fraud in big money circles?

sam on November 01, 2011, 01:53:35 pm
Sam, your bigotry (since I do not know anymore of you than what is here, I do not know if you are a racist, but I suspect not; you hate gays and Jews alike.) is plainly apparent for all to see.

You are the one that hates Jews. As for gays, I don't hate gays, I think they tend to be unreliable and transmit an alarmingly wide variety of diseases.  I don't think anything unfavorable about Jews, nor have I said anything unfavorable about Jews.  I used to think that Israel's policy on Palestinians terror was too harsh, but the consequences of the withdrawal from Gaza and Lebanon demonstrated it was too lenient.

It is often amusing to see the lengths to which you will go to say that all the ills in America are the fault of group X or group Y, or from the consequences of government pandering to whatever group you are mad at today.

If you want to blame lack of regulation for the great recession, you have to claim that the wise regulators failed to restrain the greedy banks from making no money down loans to people with no credit, no job, no assets, and no income.  

So what then did the regulators do when Beverly Hills Bank refused to make no money down loans to people with no credit, no job, no assets, and no income?

The regulators called them racists and demanded that they make "innovative" loans to Mexicans.

The overwhelming majority of dud loans were made to Mexicans.  The private banks that lost the most money, Countrywide and WaMu, were infamously PC.  The one bank that refused to lower its lending standards, Beverly Hills Bank, was condemned by the regulators as racist ("Substantially noncompliant with the Community Reinvestment Act") for refusing to lower its lending standards.

Every where in the world, the financial crisis has been a crisis of political lending, of banks making loans to government favored groups.  In the US, those groups were voting blocks favored on the basis of race.
« Last Edit: November 01, 2011, 02:11:40 pm by sam »

sam on November 01, 2011, 02:06:14 pm
How does AnCap deal with unseen fraud in big money circles?

Unseen fraud can only be dealt with after it becomes seen fraud.  After the shit hits the fan, the depositors hang the bankers.  Recall what happened to the board of Carrian Group.
« Last Edit: November 01, 2011, 02:09:00 pm by sam »

happycrow on November 03, 2011, 09:05:36 am
Concidering the above posts...

There is the whole "being a good neighbor" thing too. The thing that should stop 90% of all frivolous (sp?) lawsuits in the world and make people settle their differences outside court, possibly across a cup of coffee.

Don't tend to weight in on this sort of thing too much, though I do enjoy the discussions and CG's constant "Socratic Trolling," as it were, while I'm down here in TX and daydreaming of AK (and if I live long enough, Golevka).  But this statement reminds me that there are different legal concepts of justice.  One of them, as practiced by the Cherokee in the 18th century, is not so much concerned with punishment of crime, or even compensation for damage, but "restitution of mutual happiness,"  while they had a strong tendency to communitarian thought (and compulsion) much like their peers in New England and Germany of the time (not particularly attractive to us, though possibly attractive to CG).  I see a fairly strong parallel to that in how Cerean "courts" are shown to operate, and there are real-life equivalents.  I would in several cases accept compensation that was less than the actual value damaged, if said compensation made my life easier in some other way (e.g., if you busted up my car but were a generally agreeable and reliable person, I'd be fine with a smaller amount of compensation plus some work on my fences.  ymmv, of course).

(edited to fix vague and misleading writing)
« Last Edit: November 03, 2011, 09:25:13 am by happycrow »

sam on November 03, 2011, 09:10:54 pm
One of them, as practiced by the Cherokee in the 18th century, is not so much concerned with punishment of crime, or even compensation for damage, but "restitution of mutual happiness,"  while they had a strong tendency to communitarian thought (and compulsion) much like their peers in New England and Germany of the time (not particularly attractive to us, though possibly attractive to CG).  I see a fairly strong parallel to that in how Cerean "courts" are shown to operate, and there are real-life equivalents.  I would in several cases accept compensation that was less than the actual value damaged, if said compensation made my life easier in some other way (e.g., if you busted up my car but were a generally agreeable and reliable person, I'd be fine with a smaller amount of compensation plus some work on my fences.

I am in favor of more hangings, plus some floggings and castrations.  Observe that Singapore, by a quite moderate and reasonable increase in the severity of punishment, reduced crime to near zero.  There are few burglars in Saudi Arabia, few rapists in Singapore.  The rape rate in Singapore is one five hundredth of the rape rate in Europe.

Singapore in the 1970s used to have a crime rate similar to that of other countriess.  A moderate increase in enforcement and severity reduced crime levels to between one hundredth and one thousandth of that of other countries.

Would we have had this crisis if banks that ran out of money defaulted on their accounts, and bankers that defaulted on their accounts had to justify their accounting as accurate, cautious, and reasonable - or die?


happycrow on November 04, 2011, 09:00:31 am
Sam,

Respectfully, I see that as a bit of a case of goal-post-moving.  On two counts:

1.  We have not one banking crisis but several going on simultaneously.
2.  In neither case would THIS set of crises have occurred, because in an AnCap situation (or even a MinCap* situation) would you have had a governmental backstop using coerced tax funds allowing bankers to get away with high-risk affairs and letting them slide on Due-diligence.  Appraisal fraud such as was commonplace on the *commercial* side of the MBS market bubble (which gets much less news, and was why I left the banking sector for humbler but more honest pastures) might very well continue unabated depending on how "feudal" the arrangements wound up being.

*I actually prefer a Minarchy based on adult signatory-to-contract, given the semi-feudal experience of parts of the Mountain West Frontier.  But at this point, that's talking strawberry ice cream vs. mango-flavored, little difference compared to today's fascist state.

 

anything