Contradictions! Contradictions! Contradictions!
Now that the big European economies have decided to unabashedly, in no uncertain terms, put their pocketbooks where their mouths are and bail out capitalism (as if there was any doubt), the markets have rallied. Even the currency markets soared. At one point during the day the Euro gained over two percent on the dollar.
This comes only a few days after investors were convinced the sky was falling. It's now a distant memory, but remember when the Dow fell nearly one thousand points during the day? (It eventually gained back a good deal of that, but the psychological damage was done.) Much of this was blamed on the near default in Greece. But there were also reports of someone accidentally putting an extra zero somewhere in an electronic trade. Oops! Some Monday detail and all hell breaks loose!
The NY Times described it like this:
Whew. Glad that's over. Now it's more like this:
Domestically, the Dow gained four hundred points and rose almost four percent. The S&P (a much more telling index by the way) rose almost four and a half percent. Sure, people are still concerned about debt, but being concerned is, you know, relative to your situation. I'm a lot more concerned about paying for my credit card when I'm unemployed than I am when I've got a job. All in all, we've got our high back. At least for today.
So what is to make from all this? Even from the bourgeoisie's point of view, two things are evident. One being the "let's build a wall" folks are out of the loop. They remind me of John McCain stumbling around the stage looking for the podium during that infamous Presidential debate. When a country like Greece, whose economy is about as big as Joe Mauer's contract, can influence our markets so much, the idea that a wall on the Rio Grande and a pseudo-fascist sheriff in Arizona are going to stem the tide of globalization is laughable. Sorry folks. History says you lose.
The other main point is that market fundamentalism is dead. It never really caught on in Europe, but when the largest economy in the world starts thinking it doesn't need the State to protect itself, certain, more realistic, sections of the ruling class get worried. Other than a few true believers, they have all fallen in line by now. Sometimes it takes a crisis to clear some heads. Bank defaults are one thing, country defaults are quite another. (Crap Argentina. I guess you were a decade off.)
But from a point of view that is contrary to those who control industry, we are, perhaps even more than in times past, living through the theatre of the absurd. How could it be that a typo could mess up the way we allocate our resources to such an extent? Why is it we gamble on our ability to feed people? Why is it some people, who are not at all accountable to the public, have so much influence over our daily lives? Isn't the economy supposed to work for us, not the other way around?
Well, ladies and dudes, we are being managed by a bunch of men lost on a backroad convinced they know where they're going and too proud to ask for directions. Sometimes the road smooths out, and we see some familiar landmarks, but a right-turn later and we're back in the middle of nowhere, cursing each other out and pissed off because we haven't ate all day long. We need to get off this road. And we need a map. Really. A map and a plan. It appears many people's initial reaction to Wall Street is correct. This market stuff is, for lack of a better word, bullshit.
Now that the big European economies have decided to unabashedly, in no uncertain terms, put their pocketbooks where their mouths are and bail out capitalism (as if there was any doubt), the markets have rallied. Even the currency markets soared. At one point during the day the Euro gained over two percent on the dollar.
This comes only a few days after investors were convinced the sky was falling. It's now a distant memory, but remember when the Dow fell nearly one thousand points during the day? (It eventually gained back a good deal of that, but the psychological damage was done.) Much of this was blamed on the near default in Greece. But there were also reports of someone accidentally putting an extra zero somewhere in an electronic trade. Oops! Some Monday detail and all hell breaks loose!
The NY Times described it like this:
A bad day in the stock market turned into one of the most terrifying moments in Wall Street history on Thursday with a brief 1,000-point plunge that recalled the panic of 2008. It lasted just 16 minutes but left Wall Street experts and ordinary investors alike struggling to come to grips with what had happened — and fearful of where the markets might go from here.
At least part of the sell-off appeared to be linked to trader error, perhaps an incorrect order routed through one of the nation’s exchanges. Many of those trades may be reversed so investors do not lose money on questionable transactions.
But the speed and scale of the plunge — the largest intraday decline on record — seemed to feed fears that the financial troubles gripping Europe were at last reaching across the Atlantic. Amid the rout, new signs of stress emerged in the credit markets. European banks seemed to be growing wary of lending to each other, suggesting the debt crisis was entering a more dangerous phase.
Traders and Washington policy makers struggled to keep up as the Dow Jones industrial average fell 1,000 points shortly after 2:30 p.m. and then mostly rebounded in a matter of minutes. For a moment, the sell-off seemed to overwhelm computer and human systems alike, and some traders began referring grimly to the day as “Black Thursday.”
Whew. Glad that's over. Now it's more like this:
The initial market reaction was ecstatic. The euro jumped back above the $1.30 mark for the first time in a week before falling back slightly. Greece’s 10-year borrowing costs plunged by almost half.
In afternoon trading, the Euro Stoxx 50 index, a barometer of euro zone blue chips, rose more than 8 percent, following on modest gains in Asia.
Domestically, the Dow gained four hundred points and rose almost four percent. The S&P (a much more telling index by the way) rose almost four and a half percent. Sure, people are still concerned about debt, but being concerned is, you know, relative to your situation. I'm a lot more concerned about paying for my credit card when I'm unemployed than I am when I've got a job. All in all, we've got our high back. At least for today.
So what is to make from all this? Even from the bourgeoisie's point of view, two things are evident. One being the "let's build a wall" folks are out of the loop. They remind me of John McCain stumbling around the stage looking for the podium during that infamous Presidential debate. When a country like Greece, whose economy is about as big as Joe Mauer's contract, can influence our markets so much, the idea that a wall on the Rio Grande and a pseudo-fascist sheriff in Arizona are going to stem the tide of globalization is laughable. Sorry folks. History says you lose.
The other main point is that market fundamentalism is dead. It never really caught on in Europe, but when the largest economy in the world starts thinking it doesn't need the State to protect itself, certain, more realistic, sections of the ruling class get worried. Other than a few true believers, they have all fallen in line by now. Sometimes it takes a crisis to clear some heads. Bank defaults are one thing, country defaults are quite another. (Crap Argentina. I guess you were a decade off.)
But from a point of view that is contrary to those who control industry, we are, perhaps even more than in times past, living through the theatre of the absurd. How could it be that a typo could mess up the way we allocate our resources to such an extent? Why is it we gamble on our ability to feed people? Why is it some people, who are not at all accountable to the public, have so much influence over our daily lives? Isn't the economy supposed to work for us, not the other way around?
Well, ladies and dudes, we are being managed by a bunch of men lost on a backroad convinced they know where they're going and too proud to ask for directions. Sometimes the road smooths out, and we see some familiar landmarks, but a right-turn later and we're back in the middle of nowhere, cursing each other out and pissed off because we haven't ate all day long. We need to get off this road. And we need a map. Really. A map and a plan. It appears many people's initial reaction to Wall Street is correct. This market stuff is, for lack of a better word, bullshit.
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