Quote of the Day
Great spirits have often encountered violent opposition from mediocre minds.Albert Einstein
Pro-Liberty Thought of the Day
Suffer the Little Children: An Innocent Victim of the War on Drugs
I first became of this story through Drudge Report and then Reason; for some reason, I had trouble embedding the news media video here; I did find it republished on Youtube (embedded below, available as of publication date). I'm not buying into the sheriff's excuse: some surveillance of the home would have revealed other parties, and there's no excuse for tossing a grenade without looking; even if the targeted suspect was there, he could have been injured without due process. We need to stop the madness; I do not believe in recreational drugs of any type, but it is too costly and all but impossible to keep people from making their own mistakes.
The Stock Market and the Fed
My retirement accounts reached an all-time high valuation yesterday. That doesn't mean I've done all that well over the past year; I've worried about valuations in the market, and bonds have seemed ripe for a correction, a little of what we experienced when Bernanke hinted of a Fed taper. I've made some ill-timed choices along the way, but I've been more disciplined about cutting my losses. For all I know, the market could suffer a 20% correction next week, wiping out years of gains...
I'm not sure, 5 years into the "Obama recovery", once again looking long on the tooth, with stalwarts like WalMart and McDonald's reporting softer numbers, a first-quarter 1% GDP contraction, more tepid consumer sentiment, an ongoing long-term unemployment problem, and consumer debt rising again:
Historically, the debt-to-income ratio was well below 90 percent, he said, though it peaked at almost 130 percent just before the recession. At the end of the third quarter of 2013, before the increase seen in the Fed report, it was still above 100 percent. The savings rate also decreased each month in the fourth quarter.There are some wild anomalies: who would have guessed two years ago that 10-year Spanish and Italian bonds would be selling for under 3% yields? Treasuries under 2.5%? High yield (junk) bonds at 5%? There is no room for error... In the meanwhile, the Fed, European Union, and Japan have cranked up the printing presses.
There are a few anomalies bothering me: (1) why the Fed is tapering now, (2) why gold prices are dropping despite monetary printing. On the latter, I could see, for instance, if the Fed owes Germany gold they don't have in stock, they might have an incentive to drive down the price of gold in order to acquire it. And granted, if the dollar is gaining strength and/or if inflation is weak, the demand for gold would weaken. I haven't come across a good explanation for the former, although I would argue that it's long past due. It could be the Fed is concerned that the economy has not been strong enough to push a 2% target inflation rate, they have accumulated enough assets to sell and take money out of circulation if the velocity of money picks up, there's enough intrinsic demand for Treasuries to keep rates low, they have soaked up enough toxic assets to shore up the banks, they want to avoid the appearance they are financing the deficit, they are seeing signs of cheap money rekindling asset bubbles, they want to express confidence in the dollar, and/or they want to move towards a more traditional monetary policy and policy tools. It could also be PR to shift blame if economic conditions deteriorate (i.e., "proving" the "free market" will fail, justifying more activist policy). I'm not sure. I've read the views of a few economists but none convincing enough to reprint here.
However, some Chicken Little's are already blaming tapering for weak 1Q14 results, a housing market losing steam under higher mortgage rates; emerging markets are worried that rising federal rates will price them (at an offset) out of the market. Here's what I know: we already know we've got an unsustainable college loan debt, central banks have always timed their moves too much, too little, too late, and the Fed's power in terms of policy options is limited and indirect at best; it exacerbates economic uncertainty, perpetuates failing businesses, and obfuscates natural business cycle indicators. I'm not sure we are seeing the "all-in" of retail investors whom are usually late to the party prior to a market top yet, but I remember recently posting about a city or state wanting to sell bonds figuring they could earn returns beating the interest rate on the bonds. That's a fatal conceit that raised a red flag to me.
Facebook Corner
(IPI). In a step toward meaningful pension reform, Oklahoma lawmakers passed a 401(k)-style plan for all new non-hazard duty state workers.
When signed into law, Oklahoma will join Michigan and Alaska in requiring its new employees to participate in defined contribution plans. Michigan made the move in 1996 and Alaska in 2005.
Six other states already offer optional defined contribution plans for some of their employees. Employees in Florida, Montana, South Carolina, North Dakota, Ohio and Colorado can choose between staying in the traditional defined benefit plan or moving to a 401(k)-style plan.
Another 10 states offer either mandatory or optional participation in hybrid retirement plans that combine both defined benefit and defined-contribution plans.
But, not to rain on this parade, how does this resolve the cash flow issues involving the Baby Boomer tsunami itself? Not to mention the dubious double standard for public safety personnel? (I do think disability is a valid concern.) I don't think the cash flow savings from younger, lower-earning public employees will be enough to shore up potentially decades of payments of half-pay or better for Baby Boomer retirees....
[A follow-up exchange from yesterday's post on the issue of Snowden: patriot or traitor; most libertarians probably see Snowden primarily as the patriot whistleblower on NSA run amok. My nuanced response: criminal violation, breach of contract. I don't have an issue with the leak/public disclosure of bulk data collections but with the nature and extent of Snowden's unauthorized activities.]
The NSA is violating the rights of Americans. What is more important to you? Total patriot here.
I find the NSA violations of citizen privacy unconstitutional. But you are ignoring the fact that the preponderance of what he collected did not involve the NSA program. The information he took could have or still be used to shakedown governments or blackmail people. No "patriot"--he is on the run vs. facing the consequences for breaching his contract.
(Reason). The #NSA says Edward Snowden never tried to whistleblow. Does it matter?
Although I think that the NSA revelations are troubling and corroborate a government bureaucracy run amok at the expense of the people's liberty and right to know, Snowden violated the contract underlying his clearance, and I believe that is sufficient to call into question his integrity; I believe I read a recent report that Snowden claimed that he made a good faith effort to communicate his concerns. The self-serving Mr. Snowden's bluff has been called: put up or shut up; surely, he should be able to document time, dates, party, message.... I would respect Snowden a lot more if he would stand trial for the charges against him instead of hiding behind one of the world's most corrupt regimes.
(IPI). Auditor General William Holland reported that Illinois paid $12 million for dead Medicaid enrollees.
Illinois had been using a private contractor to scrub its Medicaid eligibility rolls, but the firm was blocked by AFSCME.
The firm was finding that 40% of the Medicaid enrollees were ineligible for the program. And that was only halfway through the project. According to estimates, the private-contractor Medicaid scrub could have saved Illinois taxpayers $350 million per year.
Evidence all those dead voters out of Chicago are finally getting their "fair share"..
(Reason). By treating the Koch brothers’ activities in critical but fair terms,Sons of Wichita points to Libertarianism 3.0, a political and cultural development that, if successful, will not only frustrate the left but fundamentally alter the right by creating fusion between forces of social tolerance and fiscal responsibility.
Ideally, true Libertarians like myself do not call themselves right wing. But IMO, that doesn't mean that we can't participate in or help fund right-wing movements if we think it's going to be advantageous for marketing our perspective to the mainstream. The funding strategy that the Kochs are using, in this context, is probably going to be more advantageous in the short-term than building a new party or ideology from scratch.
I'll simply point out here that Ron Paul proudly wore the most authentic conservative label: "From 1937 - 2002 Ron Paul ranked the #1 most conservative member of Congress in a study by the American Journal of Political Science." Now the right wing doesn't necessarily mean libertarian; for example, paleoconservatives like Buchanan are likely to meddle in the economy when it comes to things like mercantilist policies which most libertarians would reject from free market principles. And military conservatives have a fiscal double standard when it comes to defense spending. And, of course, the Chamber of Congress has reportedly pledged to spend up to $50M to defeat more conservative Tea Party challengers, like Justin Amash. I think fusion libertarian-conservatives like Paul and Amash differ more in the skepticism of government power and international meddling.
[separate comment]
Some of the discussion in this thread is muddled. "A socialist can be libertarian." Not a chance! I'm willing to concede the existence of left-libertarians, whom are skeptical of anything big--government, businesses, etc. And it's possible for some small groups, e.g., religious, to enter into a voluntary contract to share personal resources.
As a right-libertarian, I share certain social norms, traditional institutions of marriage and family; I don't believe in the role of the state to intervene in a community's standards, but at the same time, I don't believe in the state or any other groups intervening, short of the violation of some person's unalienable rights of life, liberty and property. I don't believe in the culture of political correctness nor in the Big Nanny coalition of liberals and conservatives to micromanage other people's dubious choices, e.g., alcohol, drugs, prostitution. I don't see myself as a social liberal; I see a distinction between tolerance and acceptance.
A little troll stomping (I'm a little annoyed with banker/corporation scapegoating):
Attorneys are a necessary evil but Wall Street Bankers are all going to hell I imagine.
No. The Fed and over 2 centuries of failed bank regulators and bad, morally hazardous public policy.
[See Cicero quotation above] is a bit of nonsense. No one should become richer through causing damages and injuries to another. To profit from cleaning up after damaging or injurious situations is not inherently problematic.
Tow companies might often be run by scumbags profiting off of everyone's shitty day, but consider car parks with no entropy-reducing dynamic.
You completely miss the point. Cicero was not arguing against just compensation for services rendered. The full quote is "According to the law of nature it is only fair that no one should become richer through damages and injuries suffered by another"
"For Cicero, natural law obliges us to contribute to the general good of the larger society. The purpose of positive laws is to provide for "the safety of citizens, the preservation of states, and the tranquility and happiness of human life."
More Innovative Proposals...
Political Cartoon
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| Courtesy of Henry Payne via Reason |
Carly Simon, "Jesse"
