The Demand Crisis and the Wall Street Pirates. Aaaargh!

The Demand Crisis

We could demand that all the pirate trunks of ‘toxic assets’ be loaded onto flatbed trucks and driven back to California where they belong. Overnight, California would need no more IOU’s.

By Greg Moses / The Rag Blog / July 17, 2009

They tell us we’re experiencing a crisis of demand, but they have a backward idea of it.

To turn the picture right side up, we begin with the biggest lesson from the financial sucker punch hitting workers of the world this year — human value comes from having real work to do.

Today’s value crisis hits hardest where profits — and this is why they are called earnings — are failing to produce new tools. This is the demand crisis. Our demand that leaders take better care of the people’s tools has not been heard.

Of course, as the great London philosopher sez in Capital Volume One, tools are contradictory things. The better tools get, the fewer workers needed per unit. Hence the labor-management contradiction. Hence the iron law of social revolution. Dearborn, then and now. Once you start making better tools you can’t help but create — what shall we call it? Change?

And the big problem with change is that people try to go around or over or under or WITHOUT the progressive re-production of tools. No new tools, no real change.

Capitalism is of course the holy system which speaks the language of the Gospel and promises to keep tool making dynamic and efficient so that value flies up from work. And it does have a metaphysical charm owing to our impression that profit and tools derive from some conjoined living form.

The great San Francisco economist Henry George said interest payments are legitimate social demands because the wealth we put back into tools needs to grow like anything else. Of course any living thing can demand disgusting amounts of fodder and grow to obscene proportions on that basis, but it should not use the words of Henry George as an excuse for that.

Now, if we are consistent in our terminology here, we could say that anyone who kills the living conjunction between earnings and tools can be considered anti-capital. But if we were consistent in just this way, we would demand triple damages from Wall Street for a trillion or more anti-capital crimes.

Instead of consistent terminology, however, what we are getting fed these days is nonsense soup. For example, in my home there is an electric soap box where people sit for hours yammering about how outraged they are at outsized cash payments going to workers at institutions who once made a contest of stashing wages and profits into silos that nobody can find.

Well, who was it let go of that money in the first place? Who should demand it back? Predatory lending is piracy. Predatory lending that inflates a mortgage bubble is piracy. To find pirates, you don’t have to go all the way to Tortuga or Mogadishu.

Today there is some question about how to value “toxic assets” that derive from predatory debt. But there’s a simple way to value the cost of such piracy. How much would it cost to give every penny back?

We can solve this demand crisis in at least two ways. First, we could demand that all the pirate trunks of “toxic assets” be loaded onto flatbed trucks and driven back to California where they belong. Overnight, California would need no more IOUs.

Or second — because to be honest about it we secretly admire pirates and sometimes find ourselves dreaming that we could join them — we can demand that all these big-bonus banking houses show us how they are putting their talents to work funding the next generation of tools that we have been needing as a nation since about this time last year.

We demand that they assist California, too.

Meanwhile, we know what the yammering soap boxers want us to believe about the demand crisis. They want us to believe anything really that will keep us from connecting the dots. In that direction there’s a demand crisis, too.

[Greg Moses is editor of the Texas Civil Rights Review. He can be reached at]

The Rag Blog

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5 Responses to The Demand Crisis and the Wall Street Pirates. Aaaargh!

  1. Steveherb says:

    Bank statements and prior years taxes is a requirement to obtain any loan. Over inflating income by three times is an impossibility unless the homeowner also lied to the IRS and paid more in their prior years taxes. That's a far fetch idea to pay more in taxes to buy an over qualified home.

    Stated income and no doc. loans doesn't cut it for an excuse. Again they had the bank

  2. Steve makes a very valid point indeed!!!

  3. Steveherb says:

    Thank you. These pirates are getting away with my home, my life savings as a down payment, and my material investment in upgrades along with my hard work. The only help I read about is to modify these loans. Even the lawyers are modifing loans using the threat of court. You don't negotiate with pirates! You blow them out of the water! Yes I'm uneducated to loan borrowing, not stupid. That

  4. Anonymous says:

    It takes two to tango. There is a great difference here: Traditional Pirates take/took by force, yours have the ‘victims’ working with them as partners.

    Greed and status can be very powerful motivators. Liars (and those who condone) exist in human nature. Let’s be honest here, both parties are to blame whether by design or ignorance.

    If it’s too good to be true – it probably is.

  5. Steveherb says:

    It has to be a case by case basis. Yes the motives. I placed down over 20%. No second just a first. My broker even called over to my acountant to get a copy of 06 taxes since I only brought in 04 and 05. Still my income showed three times inflated. Stated income and no doc loans allowed the broker t put down whatever they wanted. He said I didn’t qualify for a fix since I’m self-employed and my income flucuates so it would be better to take out an Option-Arm. All he had to make sure was that there was enough in cash reserves so I wouldn’t default within the first year. Otherwise the lenders would have pulled a red flag. But they wouldn’t have either. Why? They lied and took out a high-risk insurance policy with out telling me. And I’m not talikng about the P.M.I.
    They needed to inform me I was taking out a high-risk loan in writng before the loan closed because it caused me to pay a higher interest rate.
    Sec. 4905. Disclosure requirements for lender paid mortgage insurance.

    Yes motives. The motives to each parties intentions. I’m out here trying to help the real victums. Not come up with silly little metaphors.

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