Monday, May 30, 2011

Fun facts about Memorial Day

Subtitled: Why I Hate the South, Part 37

1. The first Memorial Day was a gathering of liberated slaves in South Carolina who thought it cruel that the locals had dumped a bunch of bodies of Union soldiers in an unmarked grave in Charleston. On May 1, 1865, they gathered near the mass grave, disinterred the bodies and gave them all, individually, a more proper burial. Literally THOUSANDS of people showed up for this, pretty much all of them black.

2. The organization of the Grand Army of the Republic, which had become a relief organization for distressed Union veterans, started "Decoration Day" celebrations on May 30, 1868--a day chosen because there was no major battle held on May 30.

3. As Reconstruction ended, Confederate states, not to be outdone, established their own versions of the holiday. Each state initially picked a different day, making a fine point of NOT picking May 30. Eventually, as the mythology of the Lost Cause spread, the Southern states settled on June 3, which JUST SO HAPPENS TO BE Jefferson Davis' birthday.

(Actually, they had a separate Memorial Day, too, but it was Jefferson Davis' birthday that was the state holiday, not Decoration Day. Should clearly illustrate the priorities of Southerners.)

4. A few Southern communities, such as Columbus, MS, mourned ALL the war dead, not just the Confederate soldiers, but this is notable only because it was rare.

5. World War I horrified everyone enough to stop making it about rehashing the Civil War, and eventually the entire nation standardized on May 30. The name gradually changed from "Decoration Day" to "Memorial Day", not officially becoming known as such until 1971, also the first year it was celebrated on the last Monday of May. This year, it just so happens to be May 30.

6. Lest you accuse me of politicizing Memorial Day, that's EXACTLY what people did in the early years of it, both in the North and South, and they kept doing it until, once again, World War I temporarily shocked them out of their idiocy.

7. So, today, take a few minutes to think of a soldier who died in agony on a lonely battlefield for someone else's pride. Because if you did that every day, you'd go mad with grief and rage.

h/t for this to Michael Moore, of all the fucking people

Saturday, March 12, 2011

I'm gonna Keynes ALL OVER YOUR FACE

"Too big to fail" is an unfortunate colloquialism for a very real problem called "systemic risk." We faced systemic risk in late 2008. I'll give you some examples of how our entire financial system nearly came to a screeching halt, which would have resulted in failure of dozens of major corporations, the loss of tens of millions of jobs, and a deep deflationary depression that would last for a generation.

The first thing that was happening is that people were buying so many T-bills that the yield was actually negative. For instance, they were paying $10,001 to the government for a guarantee that they would get $10,000 90 days later. This is more than just a quirk--negative bond yields indicate that people with large sums of money no longer trusted the banking system at all. They were stashing their money in the only place they thought was safe--the US government.

The problem with this move is that in times like this, investors see the negative yields on T-bills and freak out and flee corporate bonds as investments. This was a serious problem for a company like GE, which had several bonds due, but the bond market was in a condition called "ask only", which meant that NO ONE was bidding on bonds. This was very, very bad, as it meant they would probably default on the old bonds. Further, defaults on those bonds would cause any corporations holding those bonds to default on THEIR bonds, and on and on and on.

When people running business start seeing THIS happen, they start to hoard cash. Oh, wait, they're doing that anyway. This is, in fact, the cause of our protracted high unemployment. With businesses hoarding cash, they're not investing in new business and hiring people.

Anyway, you can see how this can rapidly get out of control. This is why the government had to intervene. It did so very poorly, which means if we face systemic risk again, we're probably fucked.

By the way, this phenomenon makes inflation and deficit fears 100% WRONG, and trying to reduce the deficit in the current financial environment is going to take us back in the direction of systemic risk, but a slower, grinding form that develops over months and years, rather than the imminent world of shit that we faced in 2008.

The reason it is wrong is that for deficits to be a problem, there has to be investment in the private sector that is "crowded out" by deficit spending. But there is nothing to crowd out right now. The MARKET HAS SPOKEN and it says that THE GOVERNMENT is the most attractive investment at this time, yet the leaders of our government are terrified of spending money on anything actually useful (that would be--GASP--SOCIALISM!) and giving their investors a good return.

The result will be deflation, economic stagnation, chronic unemployment, and increasing misery and rage and a risk of a fascist uprising.

This is Keynes 101, BTW. 19-fucking-33 all over again.