Bill Bonner on the crowd and the Big Lie

Crowds need lies, not truths; they are incapable of living with the infinite complexity, paradoxes, nuances, and gray areas of the truth.  Mobs belittle the truth to the point that it no longer resembles itself.

From the truth that stocks can rise for long periods of time came the lie that they will always do so.

From the truth that consumer spending can boost an economy became the lie that consumer spending is all an economy needs.

From the truth that consumer credit can boost consumer spending became the lie that credit can replace actual savings.

From the truth that the Fed can manipulate the economy in the short run became the truth that the Fed could control it over the long run.

From the truth that foreigners are generally willing to accept U.S. dollars in exchange for valuable goods and services came the lie that they must always do so.

And from the observation that the American economy - with its emphasis on debt, consumer spending, and stock market investing by the lumeninvestoriat - was a great success in the 1990s, came the fantasy that it represented the end of history.

Taken together, blended and simplified, these notions came to produce a sentiment that was completely at odds with the wisdom of previous generations and contrary to economic reality.

~ Bill Bonner, Financial Reckoning Day (2003), pp. 240-241

Kevin Duffy on QE to infiinity

Central bankers are the compulsive gamblers of our times.  They had already bet the house and kids. Now they’re betting the afterlife.  They have no clue they’re holding the losing hand...

~ Kevin Duffy, March 23, 2020

Steve Mnuchin: "The economy is going to come back better than ever" (2020)

We are going to destroy this virus and the economy is going to come back better than ever.

~ Steve Mnuchin, Treasury Secretary, interview with Maria Bartiromo, Fox Business News, March 22, 2020

Murray Rothbard on the correct policy for ending a depression

If government wishes to see a depression ended as quickly as possible, and the economy returned to normal prosperity, what course should it adopt? The first and clearest injunction is: don’t interfere with the market’s adjustment process. The more the government intervenes to delay the market’s adjustment, the longer and more grueling the depression will be, and the more difficult will be the road to complete recovery.

~ Murray Rothbard, America's Great Depression (1963), p. 19

Tom Hanks tweets one week after testing positive for Covid-19

Hey folks.  Good news: One week after testing Positive, in self-isolation, the symptoms are much the same.  No fever but the blahs.  Folding the laundry and doing the dishes leads to a nap on the couch.  Bad  news: My wife has won 6 straight hands of Gin Rummy and leads by 201 points.  But I have learned not to spread my Vegemite so thick.  I travelled [sic] here with a typewriter, one I used to love.  We are all in this together.  Flatten the curve.  Hanx

~ Tom Hanks, tweet, March 17, 2020

Kevin Duffy on the coronavirus, division of labor and civilization

Before the Industrial Revolution, men routinely enslaved each other and went to war over limited resources. Today, civilization is supported by cooperation and the division of labor (free trade). If you destroy that - which is EXACTLY what governments around the world are doing in response to the coronavirus - you destroy civilization itself.

~ Kevin Duffy, Facebook post, March 22, 2020

Regeneron CEO on the economics of developing a Covid-19 treatment

There are some people who suggest we’re sitting around rubbing our hands together trying to figure out how to profit from the misfortune of this virus. This couldn’t be further from the truth. You have people who are risking their health, and that of their families, by coming to work in the labs and manufacturing facilities to do all that stuff with only one goal in mind: How fast can Regeneron produce this and deliver it to the public? It’s very frustrating for people to have any misimpression that this is easy work, at a time when many of us, including myself, are socially distancing. I’m sitting talking to you from home because I don’t have to be in the lab, while so many dedicated people still have to come to work. They’re heroes and heroines.

~ Leonard Schleifer, "Regeneron's CEO Says We Could Have a Covid-19 Treatment 'Quickly'," Barron's, March 21, 2020