Saturday, 15 September 2018

times are bum and getting bummer, still we have fun

Our thanks to Boing Boing for the timely and annotated reminder of how only a few journalists really were prepared to ask the tough and probing questions in the wake of the sub-prime mortgage crisis, precipitated by one bank’s declaration of bankruptcy that revealed the fantastic nature of six hundred billion dollar portfolio, and most were to believe hard-scrabble legends to keep up the charade. As one of those exceptional reporters, Matt Taibbi, prefaces “history is written by the victors” in his reflection on the lost decade—not hyperbole, especially when one considers the regressive caution and pessimism and the generation caught in risk adverse times—and a legacy we are still very much heir to. An overly elaborate narrative, deflecting and assigning blame, was offered as sort of an allegory to explain something as immediate as a greedy and fraudulent practises, which the public could have easily digested and understood and not find themselves in an even more compromised position later.
It was a truth that one couldn’t squeal to the proletariat since their confidence and complicity in the system—contributing to pension-schemes and the dream of home-ownership—not only generated wealth for those barons of industry that can spin straw into gold but was also already entrenched as a matter of national security and a question of macroeconomics eschatology. As big and over-leveraged as US debt is, supply exceeds demand for foreign countries who would like to park its cash in government-backed bonds, considered as safe an investment as anything and with a guaranteed rate of return but with retirement-funds and pension-schemes competing for a safe bet, foreign governments resort to the next best thing: real estate in the form of home loans and mortgages. In order to keep the faith that internal and external backers have in all bonds, the financial system’s junk bonds have to be buoyed up as well by shielding dishonest brokers from the wages of capitalism. This calculated behaviour on the part of economists was the disdain that fostered the attitude that allowed some to be turned away from experts—lumping in those not worthy of their trust in with legitimate and helpful institutions—and by extension the establishment.  And now we are all living with the effects of that misplaced anger.