Wednesday, January 20, 2010
Regular WSJ Columnist Writes Incredible Article on Gold
...and I don't mean it as a compliment. I really can't even begin to describe my feelings on today's article by Thomas Frank. Here's an excerpt:
(1) The government actually has all the gold it says it has.
(2) The government doesn't sell gold to suppress its price.
(3) The government would never do something just to harm its political opponents.
(4) The government would never do something that would hurt the economy.
(5) People who think FDR committed a massive crime are cranks.
(6) People who think gold is a good investment are stupid.
I'm not sure I want what Frank is selling.
Supporters of President Obama like to point to recent TARP-loan payoffs, plus interest, as an example of federal success. His opponents, by and large, have long held that government should be run like a business; their former leader, George W. Bush, once announced that "government should be market-based."So just to boil down some of Frank's positions in this piece:
It is a terrible idea. Were the government actually to begin understanding itself as a market-based, profit-maximizing enterprise, determined to bring down the deficit by whatever means present themselves, can there be any doubt what it would do?
It would sell gold. Oh, it would sell lots of gold. It would put Fort Knox on eBay. Mr. Obama could film the TV commercials.
...
The other day, as I watched the zillionth commercial for gold investments flicker by on Fox News, I thought to myself: What would happen to the American right if the price of gold suddenly tanked?
As anyone knows who has Googled the phrase, "FDR Gold Confiscation," gold has long been the obsessive investment choice of a certain species of antigovernment crank. Its allure is especially strong for the disaster cohort—for those who believe that hyperinflation is just around the corner; that default by the U.S. government is a real possibility; and that democracy itself is something of a fraud, a populist Ponzi scheme pulled off by slimy politicians and the central bankers they've hired to run the printing presses.
One reason gold has been bid to its current stratospheric heights is because more and more investors and fund managers have signed on to this dark belief that America's judgment day has finally come.
Were the administration to get started on the great gold dump, however, we'd come to a different judgment day very quickly. When the massively inflated price of that metal collapsed, it would probably take with it a hefty chunk of the portfolios of tea-party types, survivalists, Birchers, dittoheads, Objectivists and almost every imaginable species of secular end-timer.
...
Just for fun, the administration could then smooth the whole thing over with some tactical libertarian cant. It might declare that the price of gold had been propped up artificially for decades by the state's irrational hoarding. Privatization is a far better option, administration officials might purr. It lets the market speak.
And so, in an irony worthy of Oscar Wilde, it would be the gold-investing contingent of the right who would discover that they had risked their fortunes on the whim of the very government they distrust and despise.
But it is the opposite irony that probably ensures that a great gold-dump will not take place. In addition to denting the holdings of countless extremists, such a move would also deal a massive blow to the hedge funds that have reportedly made enormous bets on the barbaric metal. Their losses would then reverberate through the financial system, inevitably shaking the institutions deemed "too big to fail." And before long, government would have to ride to the rescue of those who have wagered so much on the government's collapse.
(1) The government actually has all the gold it says it has.
(2) The government doesn't sell gold to suppress its price.
(3) The government would never do something just to harm its political opponents.
(4) The government would never do something that would hurt the economy.
(5) People who think FDR committed a massive crime are cranks.
(6) People who think gold is a good investment are stupid.
I'm not sure I want what Frank is selling.
Comments:
I'll tell you what is: it's bizarre, real far left, Brookings-is-too-conservative, bizarre.
Besides that, it's just plain weird.
Besides that, it's just plain weird.
Are you an antigovernment crank when you oppose anything the government might want to do or does, or just the things Thomas Frank thinks the government should do?
is there such a thing as a 'pro-government crank', does Frank acknowledge the existence of this species? Which species is ultimately more politically influential? Which species is more dangerous? Which species is more numerous?
# posted by 
: January 21, 2010 at 4:40 AM
: January 21, 2010 at 4:40 AM
>I'm not sure I want what Frank is selling.
You know very well what he is selling. He is selling goverment, goverment, goverment.
I use to get all worked up with this articles, but this one really got me laughing. Either I am getting use to it or the desesperation is getting too evident.
You know very well what he is selling. He is selling goverment, goverment, goverment.
I use to get all worked up with this articles, but this one really got me laughing. Either I am getting use to it or the desesperation is getting too evident.
# posted by : January 21, 2010 at 8:06 AM
: January 21, 2010 at 8:06 AM
A few years ago, I wanted to know what the fuss was about Mr. Frank. So I bought his best seller “What’s The Matter With Kansas” for 15 cents to find out.
Unlike Krugman who presents his “arguments” with wonky charts, Frank simply believes every lie and myth about the free market and acts as though only a moron wouldn’t see it his way. The theme of his book is that Kansans would obviously be better off with a dose of heavy progressive policies and that the sneaky evil right wingers have tricked them into voting Republican against their true economic interests. Zzzzzzzzzz
He’s about as smart as Ed Schultz of MSNBC but without the pizzazz.
Unlike Krugman who presents his “arguments” with wonky charts, Frank simply believes every lie and myth about the free market and acts as though only a moron wouldn’t see it his way. The theme of his book is that Kansans would obviously be better off with a dose of heavy progressive policies and that the sneaky evil right wingers have tricked them into voting Republican against their true economic interests. Zzzzzzzzzz
He’s about as smart as Ed Schultz of MSNBC but without the pizzazz.
# posted by : January 21, 2010 at 9:34 AM
: January 21, 2010 at 9:34 AM
Thomas Frank: Not as insightful as Bill Moyers:
Moyers: You go on to write that the political triumph of conservatism has coincided with the rise of the Washington area to the richest rank of American metropolises. But can't it be said that the ascendancy of liberalism turned government into the cornucopia of spending which became a vast feeding ground for predators of all stripes?
Frank: During its heyday, liberalism was often depicted in these terms-as a giveaway to special interests, handouts to organized whiners, pork-barrel projects like the TVA. There may have been some merit to those charges-they aren't my subject in this book so I don't know-but whatever they were, they are as nothing compared to the kind of money presently being sent down the chute to defense contractors and homeland-security operators and so on.
As for Washington's wealth, it is uniquely a phenomenon of the era of privatization and outsourcing, not of liberalism.
*****
“Frank comes from a leftist political perspective and is highly critical of Republican governance, especially the presidency of George W. Bush. However, he has also criticized the Democratic Party for "swearing off economic 'liberalism'". He is unique among writers on the American Left both for his political outlook, which revives the discourses of the American Populist Movement of the late 19th and early 20th centuries, and for his polemical style, which has been said to update that of the muckrakers of the same historical era."
He received his PhD in history from the University of Chicago in 1994.
Moyers: You go on to write that the political triumph of conservatism has coincided with the rise of the Washington area to the richest rank of American metropolises. But can't it be said that the ascendancy of liberalism turned government into the cornucopia of spending which became a vast feeding ground for predators of all stripes?
Frank: During its heyday, liberalism was often depicted in these terms-as a giveaway to special interests, handouts to organized whiners, pork-barrel projects like the TVA. There may have been some merit to those charges-they aren't my subject in this book so I don't know-but whatever they were, they are as nothing compared to the kind of money presently being sent down the chute to defense contractors and homeland-security operators and so on.
As for Washington's wealth, it is uniquely a phenomenon of the era of privatization and outsourcing, not of liberalism.
*****
“Frank comes from a leftist political perspective and is highly critical of Republican governance, especially the presidency of George W. Bush. However, he has also criticized the Democratic Party for "swearing off economic 'liberalism'". He is unique among writers on the American Left both for his political outlook, which revives the discourses of the American Populist Movement of the late 19th and early 20th centuries, and for his polemical style, which has been said to update that of the muckrakers of the same historical era."
He received his PhD in history from the University of Chicago in 1994.
# posted by : January 21, 2010 at 10:00 AM
: January 21, 2010 at 10:00 AM
Bob Roddis,
That's great! I love it when people admit their ignorance then argue vehemently in spite of it.
That little bio you pulled of him sounds like what you could write about Matt Taibbi if you were trying to find polite euphemisms for the idiotic, poorly written and terribly reasoned trash he belches out on a regular basis, too.
That's great! I love it when people admit their ignorance then argue vehemently in spite of it.
That little bio you pulled of him sounds like what you could write about Matt Taibbi if you were trying to find polite euphemisms for the idiotic, poorly written and terribly reasoned trash he belches out on a regular basis, too.
One more point....
Mr. Thomas "PhD in History" Frank apparently cannot tell the difference between the free market and corporatism. That's a very important intellectual attribute to have if you intend upon being a long-term best selling authority on history, economics and culture.
We're doomed.
Mr. Thomas "PhD in History" Frank apparently cannot tell the difference between the free market and corporatism. That's a very important intellectual attribute to have if you intend upon being a long-term best selling authority on history, economics and culture.
We're doomed.
# posted by : January 21, 2010 at 12:39 PM
: January 21, 2010 at 12:39 PM
Would it be accurate to say that the price of gold is NOT rising, but the dollar's value is decreasing? Thus, gold is a stable commodity that fluctuates in value only to the extent that fiat money is the measure of 'value'.
I think I have heard this argument before, and I'd love to hear your take on this as an economist.
Also, if that's true (and here is where I get stuck), then should we expect and see prices in other areas to rise as well? I keep hearing that there is NO inflation.
Can you lend a hand here?
Thanks in advance for your information .
I think I have heard this argument before, and I'd love to hear your take on this as an economist.
Also, if that's true (and here is where I get stuck), then should we expect and see prices in other areas to rise as well? I keep hearing that there is NO inflation.
Can you lend a hand here?
Thanks in advance for your information .
I reckon china would step up to the plate with a pile of treasuries and buy the lot and the u.s. would then have a big pile of paper.
# posted by : January 21, 2010 at 8:26 PM
: January 21, 2010 at 8:26 PM
Oh, there's inflation alright. Walmart's english muffins are now $2.12. A couple years ago, at most, they were $1.68. That's a 20% price rise. And don't get me started on pickles.
The comments on Frank's column at WSJ pretty much demolish his thinking anyway.
Franks seems to have no clue whatsoever how much gold the US Fed holds.
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Franks seems to have no clue whatsoever how much gold the US Fed holds.
# posted by : January 22, 2010 at 7:53 PM
: January 22, 2010 at 7:53 PM Subscribe to Post Comments [Atom]
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