Madoff, Ponzi schemes and the current financial crisis

An entertaining and interesting take by Peter Schiff at Taki’s Magazine.

From the link:

The United States Government runs its own balance sheet based on the Ponzi principal as well. Our national debt always grows and never shrinks. As existing debt matures, proceeds are repaid by issuing new debt. Interest payments on existing debt are also made by selling new debt to investors. The whole scheme depends on an ever growing supply of new lenders, or the willingness of existing lenders, to continue to roll over maturing notes. Of course, as was the case with Madoff, if enough of our creditors want their money back, the music stops playing.

In Madoff’s case, the rug pulling was provided by the huge financial losses suffered by some of his clients in other non-Madoff investments. When enough of these clients looked to sell some of their apparently well-performing Madoff assets to help offset such losses, the scam collapsed. The same thing could befall the United States Government. Now that China and our other creditors are looking to spend some of their U.S. Treasury holdings to stimulate their own economies, look for a similar outcome with even more dire implications.

The main difference is that while Madoff took elaborate steps to conceal his scheme, the U.S. government operates in broad daylight. It truly is amazing how faith in government is so pervasive that many can believe that politicians will succeed where private individuals fail, and that governments are somehow immune to the economic laws that govern the rest of society. Like those unfortunate to have been duped by Madoff and Ponzi, the world is in for a rude awakening.

Sugar daddies, feminism and outrage

I read the original at the Daily Beast and came to the same conclusion asRobert Stacy McCain writing here at Taki’s Magazine — it’s a work of fiction. I’ve known some local talent — ahem, dancers — who enjoyed the largess of sugar daddies, but the bit from “Melissa Beech” rang a little too much of fantasyland.

Who knows I’ve  run into some weird arrangements out there so anything is possible, but the whole tale does sound a lot like a hackneyed post-Sex in the City chick-lit plotline.

On top of that I thought it might just be James Frey at it again, writing in drag this time. The personal memoir is a totally discredited literary vehicle for the time being. 

Do hit the link up there and read McCain’s take on this. He fires a series of very well aimed volleys, not across the bow, but right into the heart of feminism. Well earned shots, too.

From the link:

 

She calls herself “Melissa Beech,” and if we take her thumbnail biography at face value, she’s a college senior, living in Philadelphia—and living in lavish style, thanks to her wealthy boyfriend. A successful media professional, he pays her rent, showers her with gifts, and takes her on expensive vacations. This “mutually beneficial arrangement” costs her beau something like $5,000 a month and was arranged by him, she says, “because his past girlfriends hadn’t understood that his work would always come first.”

Her story may be as phony as her pseudonym, but when Miss Beech told it via Tina Brown’s new outfit, The Daily Beast, the outrage she provoked was real. Her confessional elicited more than 100 comments—many calling her a prostitute—and prompted responses at Slate and Salon. Such was the outpouring of judgmentalism that Miss Beech produced a follow-up, interviewing her “benefactor” (as she calls him) who defended the legitimacy of their arrangement.

The right wing fights back against the far fringe

After the Palin veep picked proved to be an electoral disaster — and exposed a very ugly theocrat faction that before Bush 43 has always been coddled and marginalized. Now they seem to want blood of some sort. Right now that blood is taking form in the GOP brand. Beaten down, sullied and starting to rend where does the GOP go from here?

Well, there’s a lot of opposition to this electoral suicide. The American Conservative has fought against Bush 43 anti-conservatism for quite a while; a relatively new blog of young conservatives, Culture11, is seeking a new way as well; Taki’s Magazine also has been a fierce critic of Bush 43 politics; and now John Derbyshire of National Review fame has started a new blog, Secular Right.

And coming in January is another new blog by a National Review alum, David Frum. His offering is NewMajority.com and should be a very interesting entry into this moment of conservative/GOP/right wing soul-searching.

I’m very excited about Frum’s site because I’ve been offered the opportunity to blog at the launch. I’ll be coming at this debate from farther left than most I’m sure, offering my take on little “L” libertarianism — quite fiscally conservative and culturally liberal to moderate. I’m betting I ought to expect some very exciting feedback from the more partisan contributors, and especially readers. The challenge is welcome and I’m already planning topics to hit the gate running.

From the NewMajority pre-launch splash page:

NewMajority.com is a new political group blog edited by David Frum, and is scheduled to go live on Inauguration Day, January 18th 2009.

Update — I left Rebuild the Partyout the above list because I didn’t know about it until right now. Actually read about it first on a left wing site — Daily Kos. Looks like there’s going to be a total explosion of critical thought on fixing conservatism in general and the GOP in particular.

I’m still not certain the GOP as a national party is fixable right now. Something new may well arise out of all this intellectual activity and the GOP may become a party of marginal theocrats. Hopefully the theocrats get booted to their own little marginal party and the GOP returns to its small government roots and accepts a live-and-let-live cultural stance. Maybe too much to ask for, though.

Jack Hunter at Taki’s Mag on the state of the GOP

Pretty funny.

From the link:

Though I maintain my faith in the basic decency of loyal Republican voters, the accusation that some are just plain dumb has increasingly become harder to refute.

Here’s the video from the post. Be sure to hit the link and read some of the comments. Unless a few satirists made their best efforts, some commenters made Mr. Hunter’s point for him.