So this is what I have been saying, except that greenspan, in his coded language has removed the recovery option:

“a rebound at this stage is not something … in the immediate outlook”

This is the full greenspan quote:

“Former U.S. Federal Reserve Chairman Alan Greenspan warned on Tuesday the U.S. economy was “on the brink” of a recession. He said via video link to an investment conference in Johannesburg the chances of that economy falling into recession were more than 50 percent and a rebound was unlikely. Asked if the U.S. economy was in recession, Greenspan said: “We are on the brink”. “A rebound at this stage is not something I think is in the immediate outlook,” he added.”

Or here is how I would say it:

“Regardless of what the current HISTORICAL data shows, which is all backward looking, there is no currently known potential increase in knowledge, representing an increase in technology and productivity which can pull us out of this recessionary period, compensating for the debt driven economic trajectory, that the scope of it is global on a scale we have not seen since the great depression, when governments interfered with economies under the guise of nationalism, socialism and communism, and that there are coincidental demographic waves and cultural conditions, especially cultural beliefs and governmental policies, that will make this a protracted and difficult period. The only way I can see out of it is an immediate and harsh investment in nuclear energy, a new national power grid, and near elimination of hydrocarbon energy sources except for long haul trucking. This will create a competitive crisis that will transform all industry worldwide as well as cause a dramatic shift in materials science. It will also dramatically shift the world’s political power base which has artificially left despots in control of energy sources. There may be other strategies but this is the only one that is visible to me aside from an expanse in computing power due to extra-Godelian computational ability. Furthermore, the delta in time between now and whenever that change in energy production reaches critical economic mass, which can be incorporated as productivity change and cost savings, is the entire opportunity cost that will be expressed as a recessionary period in the economy. “all costs are opportunity costs”. There is a part of me that finds it interesting that the ‘green’ movement of the sixties, which is really a reaction to overpopulation, and which delayed the development of nuclear power, heavily influenced the severity of this recession. A recession which I think will be the second great depression. The green movement is just a mask for communism. As we have learned, is democracy. The majority cannot agree on anything of consequence, because they cannot understand anything of consequence. In fact, this limitation is what defines the majority.”

Empiricism is simply a more skeptical view that sacrifices intertemporal prediction for temporal certainty. It is an error testing device for one’s perceptions.

However, and this is very important: meaningful human trends will always be extra-empirical if you wish to act on them at a low opportunity cost. Empirical evidence, in the sense that we use empiricism today, means that any intra-empirical content, or better said, anything that can be acted on with certainty, is a very high cost. Because what you have to change is people’s knowledge. Extra-empirical knowledge can be changed at a low cost.

The problem with this approach is that there is a difference in metaphysics that people use to describe trends, and therefore develop foresight for the application of current perceptions. The first of these metaphysical differences is the intertemporal division of labor, which all people simply ignore, or are unaware of. The second of these metaphysical differences is simply a set of errors based upon what it is possible for different population sizes to agree to in any period of time.

The more I work on the problem the more aware I become that this problem is not solvable in a democratic framework. In fact, a democratic framework DEFINES why the problem is not possible to solve. On the other hand, this problem does not exist for kings. And kings are only a problem if they make laws. We made a great error in intellectual history. The purpose is not to make philosopher kings. It is to make “Rex Regius Economicus”: guardians of the institutions of cooperation.

Cheers

In the novel “Pattern Recognition” by William Gibson, the author of “Neuromancer”, who created the Cyberpunk idea in the eighties, the protagonist is a woman who has what is described as an ‘allergy’ to bad brands. In particular to really bad ones like the Michelin Man. She hires herself out to companies as a consultant on brand development, but in her personal life, has to be careful what clothes she wears, and has to cut labels off those she does, to protect herself from having a reaction to bad memes.

I tell people that I sense the economy through similar measures. I’ve collected enough data now that I understand that it’s just a form of pattern recognition (not some form of magic), and that I’m just sensitive to certain patterns: body language, product packaging, clothing styles, news media content, popular myths and advertising narratives, temporal changes in ambitions, temporal changes in company strategies, and especially the intertemporal heroic content of media, advertising and product strategy. I sense these things the way other people sense colors. Then I go find the data somewhere that supports or refutes my senses. In some cases, this doesn’t require much other than shopping, and making notes. In particular I am highly sensitive to the underlying narratives, and in particular the narratives that are economically productive or destructive. In essence, this is what an economy is: the metaphysical assumptions that people express by their actions: longer and higher risk and more heroic ambitions or more hedonistic ambitions, versus more temporal and more conservative ambitions.

This is why I was fairly accurate in predicting the period of the recession. I started tracking the intertemporal narrative content of products and services as a predictive indicator. This indicator, because it requires investment and risk, and is illiquid, is less flexible and open to manipulation than markets (where investors often have an interest in disinformation), and is more forward looking, because product cycles are longer than investment cycles. At first glance, this approach might appear subjective but it’s only complex. The art is in deducing the narrative relative to other products and services, not in collecting the data itself. In more simple terms, most people who study trends in investment, would say that “we have fully explored the increases in productivity from the desktop computer revolution”, for example. But this is looking backward at sales rather than forward at expressions of the belief of manufacturers and marketers.

Some artists I work with have a similar sensitivity, but it’s to the experiential and consumptive or hedonistic content. So they are exceptional at understanding how to communicate ideas easily. I sometimes wish my sensitivity was as pleasant. Mostly, mine delivers me bad news.

Last night at dinner, I noticed that Tattoos went out of fashion.

Tattoos were made sexy by the MTV beach culture, and the fact that most children in generation Y were raised as pets, as lifestyle choices by boomer and post-boomer parents, not as independent economically productive individuals. They seek meaning where there is none, because that meaning that does exist is counter to their current desires. They were not prepared to face a world of challenges and scarcity, but instead they were a parental exercise in denying the existence of such things. They were then coddled in schools fearful of litigation, enamored by socialism or communism, abhorrent of judgment and the intolerance necessary to create a productive society that compels people to productive conformity, and staffed by teachers from the bottom fifth of graduating classes. They are now are America’s “useless generation”: completely unaware that they are Shi-Tzu’s and Golden Retrievers. That they were raised as Pets. As Toys. And because of the booming debt economy, they have no reason to act otherwise.

The fashion of worshiping the ignorance of gang culture. Creating a visible sexual trademark using tattoos. Extending childhoods mode of dress. A near total absence of masculinity matched only by the French court in the seventeen hundreds, or in Nero’s Rome. Eschewing conformity and creating their own, not as a rejection of their parent’s hedonism, but embracing and furthering it. These are just a few of the properties they used to create an identity. This identity to them is simply fashion. But the fashionable elements have common features. These common features are ‘cool, cute, and interesting’ for a reason. The reason is the shared symbolism of premature wealth, and it’s resultant hedonism.

Instead of generation Y, we should call them the “Pet Generation”. The Rhinestone Dog Collar Generation.

I have been warning for years that if this recession turns in to what I think it will, that the pets will be looking for the bowl of food, and it will no longer be there. But the human animal is resilient, and can learn, and learns well under stress, and they will, if necessary, transform themselves into something suitable.

But regardless of the grander social economy that caused all of this, Tattoos went out of fashion.

Perhaps I should say instead, that the broad intertemporal collective theory that controls whether such things as tattoos are an expression of the romantic, individual, social and fashionable, or of poor judgment, non-conforming, non-productive and unfashionable has begun tilting the other direction. Fashion is an acknowledgment by a demographic. We aren’t there yet. It takes a while. Because fashion like this starts with the upper classes and works its way down to the lower ones. Subcultures persist, the same way there are still older hippies in parts of the country, and closet hippies among the boomers. However, regardless of where we are in the curve, they are going out of fashion.

I’ll have to see how long it takes before this comes to more popular consensus. And then the “I had a tattoo” post-tattoo demographic will form a sort of short term social strata.

Spengler, who writes for Asia Times, said recently, that these kids will now learn to wear suits and ties, and be thankful for a job, even if it requires hard work. I am not so sure. In other nations, in history, sometimes there are not enough people in the population with the motivation and ability to form a correction.

But in the mean time, invest in tattoo removal technology. It’s much more expensive than the original tattoo, requires higher skill to employ, and has medical and insurance implications.

As for erasing the Tattoo of Ignorance from the collective version of the global generation Y, the Pet Generation, I’m afraid that it’s like removing the more physical thing: there is no quick fix, it leaves a scar, and it’s painful.

Curt

When my parents were divorced, apparently most family photos were consigned to the same fate as the Alexandrian Library. But my mother managed to find two pictures of my grandfather that I’ve posted below. There are many family photos dating back into the eighteen hundreds that were on our wall in the house in Middletown, but those disappeared during that difficult time as well. And for a variety of reasons, some intentional on my part, some that were constructed by my father post-divorce to estrange me from my grandfather for reasons that I’ll keep to myself, I remain estranged from most of my extended family on that side. This isn’t particularly problematic for me because the level of dysfunction there was substantial in my father’s generation, and one of the reasons I left the area was to get away from all of it. That departure was very good for me in every way possible. Even now I can only tolerate being in the area for a few days at a time. Another testament to east coast puritanism that became east coast liberalism because of the Sufferage Movement and the Civil War. In the 1700’s it was one of the best places to live on earth. Today it is just another casualty of the war economy and the import then export of manufacturing labor. It’s revolting and the people are depressing, nihilistic and seething with inter-class hatred. The only thing the northeast has going for it any longer is some old architecture. Aside from that it’s all Cleveland. Another lost empire. Another wrecked economy.

But back to my grandfather. It’s odd, but I can smell the sweet cigar smoke when I see his pictures. And feel his constant, distant disapproval of everything around him.

The portrait was done for the business I believe sometime in the late fifties?

The baby he holds in the other photo is me, circa 1960. There is an ancient organ to the left, and a projection screen behind him. He was an amateur photographer and film maker, and I am pretty sure that this photo was taken in the film room in the basement of the house on Maple Shade Road in Middletown.

I used to think I was a lot like him but I am really much more like a mix of him and my Grandmother Kay. And only recently have I come to understand that I got the best of both of them, and their minds were wonderful things.

One of the basic values I took from my grandfather was his unstated but constantly demonstrated Englishness and longing for lost empire. I am not sure that he understood that he was a product of it. But that’s what he was. Educated with the great western tradition, and a living symbol of it.

There is a long tradition at Ascentium of using photoshop to put my face on compromising images. There are quite a few of them out there so I’ll try to collect a few of them here for posterity:

As Napoleon

All Kinds of Jargon
From: A Cox Crow: http://www.coxesroost.net/journal/2008/06/15/all-kinds-of-jargon

After reading The Austrian Economists site for a while now, I notice it shares some features with some papers Niall Ferguson posted on his website. Namely, name-dropping.

I’ve been out of academia for 15 years now, since I graduated from Fordham, and haven’t really read much “academic” work since I started reading Mr. Ferguson’s papers last year. While they were on the whole interesting, I was struck by how many references he made to his references. Often times it seemed that instead of writing about history, he was writing about writing about history. (And, really, I’ve never found reviews of “the literature” to be very enlightening; though they may reveal other avenues of investigation, they have no place in an expository essay.) Mostly this was a distraction, but in some cases it was downright harmful, since he would explain something only by reference to someone else’s work with which I was not familiar.

The authors at the aforementioned site do the same. They use authors’ names as shorthand for that author’s entire body of work, with which one is assumed to be familiar. Well, I’m not.

RE: “They use authors’ names as shorthand for that author’s entire body of work,”

I

am sure this is far more information than you are looking for. However it might be interesting to you. Technically, “Name Dropping” is a logical error that is an “Appeal To Authority” when the logic of the author’s argument cannot rest on it’s own merits.

Yes, this is common in the literature but there is a reason for it: Austrian authors are narrative philosophers in the Continental tradition of philosophy. They are not analytical authors using the tools of analytical philosophy or mathematics. (Some of them would disagree with the Analytical statement but it’s close enough for this explanation.)

1) Most simply, each philosopher of economics in the school tends to offer only a few ideas, but they are vast in scope. This means that referring to a book is referring to an idea.

2) This is just my opinion, but I think that Austrians tend to write for Austrians and as such, giving chapter and verse is a little bit like stating the obvious with precision, and on top of that, given the concepts they’re putting to paper, reading just the passage pointed to in context would be fairly pointless. Also, the people you are referring to are generally those who are illustrating an example of something stated by one of the philosophers in essay form. This is very different from describing the results of measurements in a scientific test.

3) Austrian ideas are not analytical statements that are linguistically testable as syllogisms, or facts that can be tested by reference or experiment, but instead a network of a-priori statements whose merit can be understood only against the other statements in the network. (more below - but in in the absence of understanding our current error in human thought, we cannot state them better than this at present.)

This difference in how to communicate concepts may appear simple but it is a profoundly complex problem in human thought. And one’s intuition to discount them because of it is a mistake.

The Austrian school believes (accurately) that we have not solved the problem of induction (what can be known), and in particular, they place more value on creativity (creative destruction, innovation, entrepreneurship) instead of prediction. Since the equilibrial and mathematical tools used by the Classical School, and the linguistic methods of the Analytical Philosophers appear to be able only to describe history, not the future, and in particular, not predict the most important economic function: what we can know (or the impact of it) then the very tools that make possible simple description (what you’re looking for) cannot often be reduced to simple statements - until and if, we solve the problem of induction.

(AN EXTREME ASIDE: You could explain this metaphysically as similar to the problem of creating calculus, relativity, evolution and now induction, by understanding that our error in each case was in thinking about fixed objects instead of relative objects described only by their relationship, and in turn, that this is human-vanity, considering ourselves the fixed object by which to measure change.

I have been working on the problem for a long time now and it is far more complex than any other technical problem we have solved. It is similar to the problem with multi-dimensional constructs in string theory, but exponentially more complicated since time is plastic in the mind while being at least categorically constant in the physical world, and this class of problems is difficult if not close to impossible to test, and computationally, if such a word can even be used, relies on plastic categories (objects) operating in parallel at different rates, where the only correspondence between these trajectories is the frequency in time of the concepts used to convey consequential utility.

I know this sounds ridiculous but it’s the best description of the problem such a short space will allow.)

More simply stated, Austrians describe boundary conditions in time determined by knowledge and ignorance. Most academic work published today instead consists of declarative statements. (The English took their philosophical tradition as well as their political ideas and accounting methods around the world it seems - for a mix of good an ill.)

Maybe another way of looking at it is that the Austrians are the only school currently active that acknowledges these fundamental problems as fundamental truths, and the remaining schools are simply enumerating permutations of a very complex error not dissimilar from scriptural religion: a fixed universe using two dimensional mathematics. (Basically, equality - which seems is not possible to use to solve this problem.)

So, what appears to you to be simple is actually a very complex problem and the clarity you seek in fact, an unintended attempt to compound a common error. And Austrians are doing their best.

We have to solve the problem of induction.

Cheers

PS: Each philosopher added something significant to the body of thought. People like Mises and Rothbard actually did a tremendous amount of work writing revisionist history to show how our most common beliefs are flawed. But I think if you go through the work, you’ll find that they each contributed these basic ideas, and most of their work is sweeping explanation of the application, and must be, because we have not solved the Hume/Kant/Hayek knowledge problem: induction.

Marginal Utility/Imputation: Friedrich von Wieser “… value is not made up of the factors that make up a good; instead, it is made up of the most valuable use that the last good can be put to—the marginal utility of the finished good.”

NOTE: In other words, that value is future-looking not past-looking. Or better yet, that the value of a thing comes from the opportunities it creates for the person who justify his theories by proof in action, not that he can look back and justify his earlier ideas. It is this directional-view of knowledge that is consistent in the Austrian school. Again, this is related to the problem of induction and creativity, not the classical and marxist ideas of efficiency and justification. Justification is simply making excuses for one’s ignorance at the time the decision was made using REASON as the means of testing history. Opportunity creation and trade is the means by which we test our ideas in the real world with actual tests. Again, this is a problem of inductive reasoning.

Marginal Utility/Subjective Value: Carl Menger
Cooperative Economic Calculation: Ludwig Von Mises
Property Necessary For Calculation: Murray Rothbard
Innovation As Determinant of Competitive Productivity: Israel Kirsner
Reason Exists Because Of Property: Hans Hermann Hoppe
Traditional (non-explicit) Knowledge as primary vehicle for economic knowledge: Friedrich Hayek
Property-Monarchy Ultimate Form Of Government/Democracy is simply a form of communism: Hans Herman Hoppe

Lastly, this is a very Nietzcheian philosophy compared to the Christian philosophy of the Anglo world. It says that our most important duty is to leave free those who create to make the world a better place, that excellence is our objective, and that we are unequal. The Christian Anglo world view is an extension of the Catholic universalist idea that we are equal, among other things. Which on it’s face appears to be false, and perhaps foolish.

It is a world of opportunity rather than a world of blame. It is heroic. Expansionist. Competitive. Individualistic.

(Cross-posted on my site.)