There is no Recession in Heaven
World stock markets are rising. Money is moving. Great chunks of zeros on flat screen monitors are shifting at the speed of light around the world, from financial capital to financial capital. Very, very wealthy people - the gods of finance - are shifting digital funds from safe, dull investments to take advantage of the returns higher risks afford, and right now, the funkiest risks are in equities listed on exchanges around the globe. To the gods of all our markets, there is no recession in heaven.
By the investment decisions of a tiny portion of the human population, their activities reflected in the rise and fall of indexes and funds, we are told the "recession" has bottomed, green shoots are growing. That all the data computers can crunch says otherwise - that the general economic condition of the west is still collapsing - has no bearing what so ever on the "masters of the universe". They understand as they always have that economics is a mugs game. Those are rules for the little people. As lords of finance, they know they are market makers, and not market followers, and so make money wither up, down, or sideways. In the insulated world of the finance titan, there are no rules and fates are determined by human irrationality and foible alone.
The humans who have the power to shift billions with a simple nod do not share the same reality as the rest of us. They are other worldly. They do not live with the rest of us, do not eat or work or play or socialize with us. They do all those things together, warm and cozy amongst one another in their separate world. Their homes are many and are spread across the globe, each one of which has gates and security and very cheap "help". They don't cook their own food, and they don't go to Burger King. They don't shop for themselves and don't cut coupons or chase sale items. They won't chat with you in the line at Wal Mart. Many don't dress themselves, none pump their own gas. They don't MSM, Twitter, Facebook, or YouTube and everywhere they go they have their own, personal toilet. Every one of them was born like this, and knows the world in no other way.
T. Boone Pickens (the great American oil man) blithely quipped to national television audiences on Bill Maher, that while recent economic travails had cost him a billion, he still had a billion left. Hardship is relative. It is certain that the loss of a billion dollars would set anybody off, and it is surely so for a finance titan. However, while his emotional state may well have equalled that of another who just lost his job at Jiffy Lube, the practical result of the loss for each are magnitudes apart. Four hundred bucks in the bank and a family to feed - forever - gives one a different understanding of the world than another with the prospect of a billion dollars and growing, forever. Daily decisions are...different, and no decisions are different as much as those involving money.
The 7 billion members of the planet who are not finance titans have to obey the laws of basic economics, because we are the fat part of every Gaussian curve. With limited financial prowess, we obey as best we can all laws of supply and demand, all of us the faithful heritage of Adam Smith's rational man. In that other world, no such rules apply and indeed, there never was any attention paid to that which was so patently false anyway. Millions, then billions, and now trillions of dollars worth of wealth are pushed around based in large part on the freedom from basic economics that affords personal, human, and decidedly irrational behaviour to such a very few, the few whose liquid magnitudes can and do set prices and markets. They are the markets. A very large part of global investment finance rests as much on individual personality as it does the studied art of measured risk. And some of this personality is vein, vile, and stupid - at times irrational, animal, and exuberant.
When US Federal Reserve Board chairman Alan Greenspan famously said in the 1990's, "But how do we know when irrational exuberance has unduly escalated asset values...", he wasn't talking to us. He was questioning the mindset of the other world as he knew it, innocently admitting to a force he knew well, but we did not. Animal spirits are what drive decisions in that world, and those decisions all too often make markets and prices. The enormous amounts of concentrated wealth and power these few gods of finance command are employed for the benefit of, or in relation to realities as those gods understand them. Realities that are divorced completely from those the rest of the world knows.
So the stock market is rising, driven by billions of digital dollars shifted there by a small part of the human race, out of personal interest and for the benefit of them alone. But the recession isn't over, only the exchanges are busy, and the exchanges are the traditional grazing grounds of the masters of the universe. For the rest of us, it hardly matters a hoot down here, a million miles below. Hardship slogs on, the future recedes, and this low world of ours grinds away in the lines at Wal Mart, or the filthy tables of Burger King.
Every one of us was born like this, and knows the world in no other way.
Aetius Romulous
Historian, Economist, Accountant, Writer, and blood sucking CEO.
Born at the wrong end of the Baby Boom Generation - too late to enjoy the ride, too early to have missed it, and stuck in the middle with the mess.
Aetius writes and blogs from his frozen perch atop the earth in Canada, spending the useful capital of a life not finished making sandwiches and fomenting revolution.
It's a living.
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Is This What We Want? - Essays on the question of our world
Economic Democracy Demands One World Balance
There Is No Recession in Heaven
Stock Markets are Not Democratic
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