"Sunshine libertarians"

A while ago, I left a comment to my friend jk's post explaining that Instapundit Reynolds is hardly a libertarian: "Reynolds is to real libertarians what a light beer is to San Miguel. There are superficial similarities until you realize the difference in depth and complexity."

On the same subject, here's a comment I left at the Foundation for Economic Education's blog -- how could I not resist when someone mentions Bastiat?

"but when libertarians join the inflation chorus, we know we a crisis exists."

Self-professed libertarians like Chapman bother me. I wish I could absolve him and dismiss his calls for inflation as misunderstood. If he had merely said in passing that "We need inflation," perhaps he only meant that inflation is a necessary counter to any deflation that the central bank is causing (and vice-versa). But he's clearly advocating central banking action to control the economy, creating inflation rather than risking deflation — ignoring who creates inflation in the first place. Also, he clearly does not understand the role of prices, that it's a Very Bad Thing for government to raise or depress them. Only buyers and sellers know when any given price is correct, not a third party.

Moreover, Chapman cited several statist measures and says, "It's possible these measures can restore the economy to health. But only possible." Someone who understands the free market, who has read Bastiat (whom I claim as a patron saint), implicitly knows that government cannot push without equally pulling elsewhere.

When we see Chapman's attitude in self-professed libertarians, we can now readily distinguish them as not truly believing and/or understanding the free market. Walter Williams recently told John Stossel, paraphrasing, that failed companies are important in that they provide information as to what decisions were bad. Similarly, I point out that during economic failures we can recognize state-worshippers by their reactions and calls for government intervention. In fact, there may be nothing as effective as an economic crisis for some of us to prove that we love and crave true liberty, and for others to expose themselves as having a form of freedom but denying the power thereof.

The Boy Scouts have an old term "sunshine Scout," referring to someone who only wants to do outdoor activities when they're pleasant (e.g. when the sun is shining). A true Scout will hike and camp when planned, even if it's cloudy and wet. A "sunshine libertarian," then, is one who touts "laissez-faire" when things are good, but is ready to turn to government for salvation when things are bad. A true libertarian credits the free market for successes and knows the free market is its own answer to any failures.

Thus when anyone claims to be a libertarian but supports these bailouts, which are merely theft in that they forcibly take one person's property to give to another, we know the person isn't a true libertarian.

Or is the problem in the very word "libertarian"? Is it what I feel, that "libertarian" has become so watered-down that it's meaningless? Even Sean Hannity has claimed, "We're pretty libertarian on this show," and lots of liberals call themselves the oxymoronic term "libertarian Democrat." Has the word "libertarianism" lost all precision in meaning that it's degenerated into a "big tent" for social liberals who oppose the War on Drugs but believe in wealth redistribution, and conservatives who talk a good line but ultimately believe in economic intervention? When the economy does well, it's easy for the latter to talk about "free markets" and "tax cuts." We see them all on the time on TV. More than a couple have their own shows where they pontificate not about real freedom (economic or otherwise), but about different ways for people to be taxed and regulated.

The slave may be free to smoke marijuana and be married to a partner of the same gender, or he may be beaten less harshly and/or more efficiently so he'll be more productive (a variant on the Laffer Curve), but in the end he's still a slave toiling for a master.

I'm going to have to stop calling myself a libertarian. There are too many who are giving the term a bad connotation.

The 2008 Rockefeller Center Christmas tree

Yet another beautiful tree. I took this on December 5th, at 4:49 p.m. when night was falling on Manhattan. Unlike previous years (here, here, here, here and here), where I rotated pictures to make the tree straight, this year I had the great luck to take a picture remarkably level. It's ever so slightly off that I didn't bother doing anything. There's a little grain in the image, but I didn't have time to try all the different ISO and exposure settings.

The morning before, I ran into some new friends who I've actually been seeing most mornings at Rockefeller Center. (Again, click the picture for the larger image.)

Props to Dwyane Wade

Proving once again that the power of individual charity is greater than anything government could do.

What could government have done to equal that, except by coercing others? Such coercion only discourages people from producing, in two ways. Those who labor know that a portion of their property will be stolen to be given to others. And others will work less, or not work at all, knowing that their lives can be paid for by others' taxes.

I can only imagine how much Wade pays in taxes, and he still is very charitable. You're a good man, Dwyane.

Merry Christmas to all, and God bless us, every one

Tonight was my first time hosting Christmas dinner. My wife and I hosted my mother, instead of the usual family party at my aunt's house, but I did all the serious cooking myself. If I may brag, the Eidelbus tradition of rib roast and mashed potatoes turned out as well as it ever did under my parents, not to mention my own fabulous barbecued ribs for lunch.

And to ruin Christmas for the rest of us, I counted at least three goddamn morons on the road. The first was on Stoneleigh Avenue in Putnam County, where someone had stopped their car in the middle of the incoming lane, i.e. without moving it onto the shoulder, and only a few seconds (at driving speeds) after a blind curve. I couldn't believe this complete idiocy, and then as I went around that curve, I saw three cars which I can only pray could stop in time.

Approaching home, I saw that one more imbecile has crashed into my poor neighbor's fence. It's a beautiful combination of a stone wall with white pickets on top, running along a fairly tight curve (20-mph). The guy keeps white Christmas-type lights on it all year long, so that nighttime drivers unfamiliar with the area, and who are too stupid to pay attention to the sign indicating a curve up ahead, will navigate through. Still, some damn fool once in a while...

Finally, after driving my mother home, some putz made a sudden left turn in front of us. I braked in time, but if that SOB had hurt us, then I'd have gutted him on the spot, Christmas or not. This was again on Stoneleigh Avenue, which has more than its share of bad drivers.

So God bless even these bad drivers, if anything to keep them the hell away from the rest of us.

Some looking back at past Christmastime entries:

Pope Benedict's excellent Christmas 2006 message
Santa Khomeini
Liberals' myth that Joseph and Mary were homeless, and how it was government that made inn rooms scarce
The Twisted Chipmunks Christmas Song

Happy birthday to Manny Pacquiao, the Pambansang Kamao

Though it's no longer the 17th in the Philippines, I still wanted to say, maligayang bati, Pac-Man. Thirty years old, and the best boxer today.

Looked like a lovely event.

You deserve it all, Manny. Strength and honor.

Arne Duncan is a goddamn idiot

See for yourself what a Harvard education produces.



It's like the old joke of the Harvard man who knocked at the MIT man's door. The MIT man called out, "Who's there?"

The Harvard man replied, "It's me."

The MIT man replied, "What are you saying?"

Simple logic always escapes the liberal mentality

A bunch of the truly dimwitted complained to the New York Had-Its-Time that Obama's stimulus program isn't doing enough for women: supposedly it's giving too much money for construction and other traditionally male jobs, and doing too little to bring higher pay to teaching and other traditionally female jobs.

Oh really? But liberals also claim, "Women can do everything a man can." (And femi-Nazis say women can always do it better, like the "And who better than women" letter writer.) But these complaints indicate that women evidently can't do these construction jobs after all. Not because of physical inability, but because they prefer comfortable jobs to ones that require rolling up their sleeves and getting dirty.

What could be more insane about the bailouts?

Einstein reputedly said, "Insanity is doing the same thing over and over, expecting a different result."

"Regulators scratch heads over housing crisis"

As I said to a friend last night, "Duh. Fucking duh."

We shouldn't be at all surprised that people got "help" and are still defaulting, or that "regulators" don't understand why their solutions didn't do a damn thing.

Nor should we be surprised when their solution is to throw more of other people's money at the problem: they'll tax us more (either now, or in the future to pay off debt they incur for us now) so we'll have the dubious satisfaction of paying off others' mortgages, and make us pay more for everything because the Fed will keep interest rates too low and thereby create inflation.

Most people are cowards, lacking the will to act

These people should be completely ashamed of themselves. Tonight an old man stumbled into the same Metro-North [edit: the same Metro-North train car, I meant to say] I was sitting in. He was dressed in a nice shirt and pants, tie, clean sweater, and an expensive London Fog overcoat. And from how he walked, how he struggled to put his coat on the overhead rack and how he plopped into his seat, he was clearly a bit inebriated. I wonder how he got onto our train, because it was on a lower level. He must have taken an elevator, or else someone helped him down the ramp and stairs.

Because he was dressed nicely, I figured he's just some old chap who went out with the boys and had one too many. He wasn't causing anyone any harm, just sitting in his seat at the same end of the car I was on, opposite side. He paid cash, so it likely wasn't his usual ride, and presumably he was too inebriated to stand in line to purchase a ticket (buying on-board has a surcharge, discouraging passengers from taking up the conductor's time).

At our second stop, he started to disembark. I started to worry, because he was halfway out the door but had forgotten his coat! Luckily someone told him the name of the station, and it apparently wasn't his stop. He started moving slowly back to his seat.

Well, I did the decent thing: I went over to see if he was ok, to ask where he was getting off, and to help him put his coat on so he wouldn't forget. His stop was the end of the line, where conductors make sure everybody disembarks (and hopefully they helped him get a taxi if necessary). But I was mostly concerned that he not forget his coat, with this weather. It wasn't that cold, but alcohol allows more body heat to escape, and he could get hypothermia if he wandered around too long without a coat.

Nobody else, and I mean nobody else, did a single blessed thing to help. Everyone was so deliberately tuned out that they didn't even look up! After the first stop, a lot of people got off the packed car. A 40-ish bespectacled guy and 20-something girl had been sitting next to the old man, and they both took the opportunity to move to new seats. After I helped the old fellow with his coat, I whispered to the other man, "I guess he had too much." He didn't say a word; he just didn't want to get involved. Never mind the kid, who appeared more interested in her music than anything else.

But I guess my action didn't go completely unnoticed. The man sitting in front of me, I'd guess 50ish, turned around, gave me a thumbs up and said, "You did a good thing." I simply replied, "Well, somebody had to."

What I didn't say (and probably should have said) was, "Why didn't you do something?"

Our train is almost always one of the newer models, but tonight's was an old one. Usually I sit in the last car, except that on older trains the last car has a lavatory whose smell spreads throughout, so on older trains I sit in the penultimate car. If it hadn't been an older train, if I hadn't sat in that penultimate car, who would have helped the old man?

Goddamn sheep. People have been so bred by government to let "authorities" take care of others, whether welfare workers or police officers. People don't want to get their hands dirty in doing actual things for others. People are afraid to get involved, like a few years ago when a punk attacked a man and his pregnant girl on the subway. Everybody else fled to the other side of the car. Then as tonight, these people should be ashamed of themselves. The pity is that they probably won't realize it.

I'm not writing this tonight to say I'm a saint. I'm not writing this to say you have to rescue people from violent attackers. I'm just saying to ask yourself: "Who is my neighbor?"

More cause and effect fallacies

As part of their Obama-worshipping, the Associated Press often employs the Post hoc ergo propter hoc fallacy to give credit to The One where credit is undue. Today we read:

"Wall Street extends big rally to 2nd session"

A stock market gaining in confidence shot higher for a second straight session Monday as investors bet that President-elect Barack Obama's plans to increase infrastructure spending will help lift the economy back to health. The major market indexes jumped more than 3 percent, and the Dow Jones industrials' nearly 300 point advance gave the blue chips their highest close in a month.

The truth about today's rally is that Obama's plan had nothing to do with it. He's been talking about this plan for weeks, so investors have had plenty of time to price it into the stock prices of any companies that might benefit.

Alcoa Inc., the world's third-largest aluminum producer, surged 18 percent on the news; while heavy-equipment maker Caterpillar Inc. jumped 11 percent.

[cough] What an idiotic short-term perspective. These weren't "rallies" on news of Obama's New New Deal, but fluctuations of the last several trading sessions due to bargain-hunting and profit-taking. Both Alcoa's and Caterpillar's gains merely brought them back to where they've been hovering for the last several weeks.




If either had exceeded their October 10th bottoming, then that might be something worth mentioning. But not this.

The major U.S. indices were up 3-4 percent today, but the simple explanation is bargain-hunting after Friday's plunge. Or if indeed The One is responsible for the rallies, what will we do when he runs out of appointees to announce and programs to propose?

Supposedly there was a "Geithner rally" on the day Obama named Tim Geitner to be the new Treasury Secretary. [cough] Obama named him on November 21st. November 21st was the third Friday of the month. Stock options expire on...the third Friday of each month. That is why you had your late-day rally, because everyone was scrambling to fulfill his contractual obligations at whatever price he could get. Not because Obama picked some anti-free-market interventionist twit, but you can be sure Obama chose that day for a reason.

With the help of the liberal media, Obama's deftly playing a sinister game of making people believe he's responsible for certain things that are in fact out of his control. Think of "A Connecticut Yankee in King Arthur's Court," specifically when the hero, during an eclipse, convinced everyone that it was he who made the sun disappear. The difference is that the Connecticut Yankee wanted to help people by destroying people's superstitions, allowing them to think for themselves so they could evolve beyond serfdom and enjoy the benefits of technological progress. Obama wants to be our king so he can "help" us, meaning keeping us well-controlled, all for our own good.

So if stocks fall tomorrow, can we then blame it on something Obama did? How about blaming Obama because his victory made Japan stocks fall immediately after his election victory?

Japanese stocks fall on Obama win

As U.S. television networks called the presidential election for Barack Obama at 11 p.m. on the East Coast and cued up celebrations in Chicago’s Grant Park and across the country, Japanese stock traders in the middle of their Wednesday afternoon workday had a very different reaction.

In trading in the half hour after the victory announcement, the Japanese Nikkei stock market declined steeply, falling from nearly 9,450 to below 9,250. Still, the index was up nearly 2 percent for the day on the strength of a rally earlier in the trading day.

Reuters quoted Tomomi Yamashita, a fund manager at Shinkin Asset Management, who noted that Obama’s tax proposals might have been behind the initial Japanese market reaction.

"His plan to tax higher income earners may dampen incentives a bit, and this might limit U.S. competitiveness,” he said, “and as far as the currency market is concerned, a Republican victory might have been better."

Did Obama's victory really make Japanese stocks fall? Probably not, but it's far more likely than any Obama announcements creating stock rallies.

Cause and effect, and perpetuating the lie about Shinseki

I'm constantly amused by headline writers' lack of ability to write clearly, and news editors' lack of ability to detect stupidity. The headlines below indicate that not only is the selection of Shinseki related to the economy, but the economy will get worse as a result of Obama picking Shinseki.



It's a tired old lie, repeated constantly this weekend, that Shinseki was "ousted" because he disagreed with the Bush Administration. He "left" in June 2003 exactly when he was scheduled to retire. Even the DailyKos nuts know it.

Shinseki's non-ousting disagreement with Rumsfeld was over additional troops needed to occupy Iraq. The liberal media is trying to portray Shinseki as somehow "foresighted" when in fact he said it would require "hundreds of thousands" more -- we now know that the successful "surge" didn't require as many. And the reason the "surge" worked was at least as much about refocusing our fighting strategy as increased numbers. Now just imagine if we had listened to Shinseki and deployed all those forces throughout Iraq: with our original mindset, it would have been a complete bloodbath.

In other words, USA Today is full of it. The New York Times was full of it (but what's new?). And James Fallow at The Atlantic is completely dishonest to ignore the real numbers that Shinseki proposed.

The irony of it all is that Obama is picking someone who supported an even larger Iraq occupation than anyone had envisioned, including McCain, when Obama himself opposed the surge from the start and still can't admit its success. (Note that I'm talking "success" from a tactical perspective, nothing more.)

And shall I say it again? So much for "change" in Obama picking yet another Washington veteran.

Eat crow, Lance Pugmire (spoilers ahead for the Pacquiao-De La Hoya fight)

Just in case the LA Times deletes this story, I decided to save a screenshot:



Well, the sight of De La Hoya's battered face, his left eye nearly closed, is all the proof we need of what Manny Pacquiao can do. What made the Golden Boy (El Muchacho de Oro) think that he was still young enough to defeat Pacquiao? He looked more like El Viejo, just standing there for much of the fight.

Pac-Man is truly one of the greatest boxers...ever. Much ado was made of Pac being lighter, but his official weigh-in of 142 pounds was not significantly less than DLH's official weigh-in of 145. And unofficially, Pac weighed in today at 148.5! It shows how weight can fluctuate very quickly water and a couple of big meals can add weight.

I was astonished that Pac didn't really look bigger than before, meaning his muscles weren't bigger and stronger, but more dense and stronger. It makes sense now as to how he can stay so fast: he gets stronger but without the added bulk. It helps his arm movements, but also his legs and feet. There are many videos online that show him training, and the methods are clearly effective. This is probably Pac's maximum weight class, because anything higher will leave him at a real disadvantage in reach, but then again, De La Hoya had a reach advantage.

Pac entered the area with "We Will Rock You" playing, while DLH chose something Mexican-sounding that I didn't recognize. The Philippine, Mexican and U.S. national anthems were performed. The one who sang ours, some hip-hop singer from her looks, completely butchered it (so what's new?). "Tharooooooow the perilous fi-ee-i-ee-i-ee-ight, o-ah-o-ahr tha ramparts we wa-i-a-i-a-i-atched, were so ga-i-a-i-a-i-llantly sta-re-ah-e-ah-e-ah-eaming!" Someone should have shot the bitch right then and there.

Then the fight began. Round 1 was one of the most amazing rounds I had seen in a long time. Pure finesse from both, but DLH just couldn't peg Pac like he wanted. Pac was too slippery! DLH would get him against the ropes a couple of times, but Pac like a fish would slide out of it. I found it hard to score, but I gave it to Pac.

Round 2: Pac was clearly in control. DLH is bigger and has a bigger reach, which are not helping him at all. Pac definitely won this. His strategy is to let DLH have the center of the ring all he wants, even if it means being on the ropes. His footwork is far superior. All that extra weight hasn't diminished his agility one bit.

Round 3: I thought DLH got cut below an eye. I was ICQing a friend and wrote, "HE'S CUT! HE'S CUT!" just like in Rocky IV. But after the round they were only putting ointment on redness; the skin hadn't broken yet. This might have been scored in DLH's favor, and it would turn out to be the closest he'd come to winning a single round.

Round 4: One of the fight announcers said it all, "Many wondered why Pacquiao took the fight. After the first four rounds, we have to wonder why De La Hoya took the fight!"

Round 5: Pac was hitting DLH with virtually every shot he attempted! Whatever DLH's strategy was, as devastating as his left hand has been for a decade, he was completely unprepared for Pac's own left hand, often coming right up the middle.

Round 6: A very defensive round. At this point they're really waiting for the other to move. But in the end, DLH landed 20% of his punches, while Pac still did a respectable 37%. "And Pacquiao is gradually reconfiguring De La Hoya's face..."

Round 7: Positively brutal...for DLH alone. His left eye was really closing up, and the announcer said, "This is the most power punches ever landed on De La Hoya in a single round in his career." Simultaneously, it might have been the most tremendous round of Pac's entire career! Or as it turned out, the second most tremendous round. DLH was already starting to bend down against Pac's furious flurry of abdominal blows.

Round 8: The 7th round was already a brutal, punishing round for DLH, and a display of Pac's all-around-excellent offensive skills. All that was exceeded by the most humiliating round of DLH's career. Pac landed a four-punch combo that was textbook. First a solid left that stunned DLH, leaving him unprepared for the successive right-left-right. Simply amazing.

In the end, "A humiliating defeat for De La Hoya who had to sit in his corner and listen to a discussion between his trainer, the cornermen, the referee and the ring doctor" about whether to stop before the 9th round. DLH was getting too tired, too dazed, too afraid that he was like a rookie fighter being schooled, and I think another round would have seen him flat on his behind.

Time for the old man to retire. He can still make plenty of money promoting, although it's tough, of course, not to be the one winning.

DLH: 83 punches landed, 402 thrown
Pac: 224 punches landed, 585 thrown

DLH: 51 power punches landed, 164 thrown
Pac: 164 power punches landed, 333 thrown

Excellent coverage of the fight here.

Next stop for Pacquiao: never mind Hatton, will Floyd Mayweather come out of retirement?

Go Pac-Man!

We're counting down to "The Dream Match" between Manny Pacquiao and Oscar De La Hoya. I said to a friend yesterday that, while I'm no no expert, I think it'll go the distance in Manny's favor. Of course, my wife and our respective families want to see him win! My sister-in-law also lives in Pacquiao's home city, whose people are already going crazy (just not in the Detroit or Boston style of vandalizing and rampaging).

I'll admit it: De La Hoya is more seasoned and has the more impressive record, but I think he's gotten old. Forget his unanimous decision over Steve Forbes earlier this year; it certainly should haven't been any less. The telling bout was last year against Floyd Mayweather. So I think DLH is pretty arrogant to pit his aging body against Pac's raw speed. It's that speed and tremendous ferocity that will nullify DLH's reach advantage. Six inches is significant by itself, but I don't think it will factor as much as DLH would like. Or hope.

It's expected that a boxer will lose some speed when he moves into a higher weight class, even the tremendously successful weight-shifters like DLH, Floyd Mayweather and Roy Jones Jr. But not Pac. The man is amazing in his ability to put on additional weight yet retain that same lightning speed. We've never seen Pac this heavy, and I don't wonder if it's slowed him down -- I wonder how much stronger he is while remaining just as fast! He's not just pound-for-pound the best boxer right now: additional weight gives him more power pound-for-pound, because of his famous training discipline. Combine that with his reflexes and ferocity, and if they go several rounds, DLH could get too tired. Never mind DLH's left hook. Watch for Pac to could lay him flat with one good hit.

A younger DLH would have been different. He probably could have won, but who knows.

"’We've dressed up in our best and are prepared to go down like gentlemen."

Billy Beck linked to a story about who must be the finest Indian waiter ever, and I'm reminded of what Benjamin Guggenheim reputedly said on the doomed Titanic.

As if we already didn't know Pat Buchanan is an idiot

He supports a bailout for American automakers, the supposed necessity of which I debunked the other night.

He complains that other nations are manufacturing powerhouses that sell more to us than we sell to them. Do I sell any bananas to my local grocery store, let alone an equal quantity that I buy from it? Have I sold two computers to Dell, to balance the two wonderful machines I've bought since last year? Of course not, and the same principle applies to everything else. It's perfectly normal to buy more from someone than you sell to the same; it's all balanced out in the end. Your trading partner may not even buy something else directly from you, but rather trade with someone else who might trade with you, or trade with someone else who trades with someone else who trades with you, ad infinitum. Trade isn't a matter of starting and ending points, but rather a complex web where everything (everyone) is connected -- perhaps not directly, but eventually connected through others. The bottom line is this: do you produce enough to buy what you want? For as Bastiat taught us, "Man produces in order to consume. He is at once both producer and consumer."

And Pat Buchanan complains that other nations don't tax their industries like we do. So the solution is for other countries to implement onerous taxation and reduce their own manufacturing output, in turn reducing the standard of living for everyone? Walter Williams put it best: "Imagine that you and I are in a rowboat. I commit the stupid act of shooting a hole in my end of the boat. Would it be intelligent for you to respond by shooting a hole in your end of the boat?"

As Bastiat taught us over a century and a half ago, it's a gift when other countries can sell us something at a lower price than if we made it ourselves. Consider his five points:

(1) That to equalize the conditions of production is to attack exchange at its very foundations.
(2) That it is not true that job opportunities within a country may be choked off by the competition of more favored countries.
(3) That, even if this were true, protective tariffs do not equalize the conditions of production.
(4) That free trade equalizes these conditions as much as they can be equalized.
(5) Finally, that it is the least favored countries that gain the most from exchange.

So why should we think it's "unfair" when South Korea buys very few cars from us? They specialize in building cars there, so it makes no sense for them to import American cars that cost more because of shipping, and which are probably unreliable. By definition, there is a balance in everything that exchanges hands, unless the South Koreans want to hold on to physical dollars (which does them no good). So the South Koreans buy American-made heavy machinery like John Deeres and Caterpillars, Boeing aircraft, maybe American-written computer software. They can also buy U.S. Treasury securities, or dollar-denominated U.S. assets like stocks and corporate bonds, or use the dollars to buy crude oil and other globally trade commodities that are priced in dollars. As I said in my first lesson for Warren Buffett, any currency eventually comes home:

Israel is running a trade deficit, which is actually typical of growing economies today, and Buffett is helping to balance it by acquiring Israeli assets. It wouldn't matter if Buffett were involved in 0% or 100% of all exports to Israel. Buffett would eventually do business with someone who would eventually do business with someone who exports goods and services to Israel. The money might get converted from shekels to euros to pounds sterling to dollars, and then Buffett would convert them back to shekels. It all balances out in the end.

And what country did I compare the U.S. to last night?

Russ Roberts and Bob Higgs on similarities to Japan's economic woes. Don't you feel better now?

NBER are a bunch of lampshades who inhale air conditioners through their anuses

If NBER can define a recession to mean whatever the hell they want, then I can also use words to mean whatever the hell I want. Remember that this is the same group that finally admitted in December 1992 that the recession had ended...in March 1991. They deliberately waited until after the election so Bubba could win on a "bad economy" platform, when the truth was that the economy was already recovering.

There haven't been the two consecutive quarters of decreased GDP (the traditional definition of recession), but we might find out that the 4th quarter will fulfill that. NBER can't risk that, though. They need a recession under a Republican president, so that an incoming Democrat can take credit for "fixing the economy." So they're just changing the rules to fit their agenda.

Will the Fed be stupid enough to lower the FFR?

Probably. (Hat tip to my friend Billy Beck.)

Tonight I don't have time to delve into the immorality of people being forced to use the government's money, so let's just play the Keynesians' own game. Even if their theories worked, and that's a big "if," look at the FFR now: go here and scroll to the bottom. What is the FFR these days? The real rate, not the intended one. (By the way, the AP writer apparently couldn't be bothered to find rates before 1990. The lazy idiot probably found this page and decided to go no further.)

So, uh, how can the Fed cut the target to 0.5% when it's already there? Does that mean we'd get an effective rate of 0%? And if it cuts it to 0%, does that mean we'd get an effective negative rate?

Anyone who understands Hayek will understand why the Fed can't even hit the target it's aiming for: there's no way such a small group, relative to the whole population, has the information necessary to control such a complex thing. Yet the Fed acts as if it can, and most people are so blind that they believe Fed officials. It's all based on Keynesians' flawed understanding of inflation, which they calculate based on prices. Milton Friedman taught us that inflation comes purely from monetary policy, so any drops in calculated CPI and PPI resulting from the recent drops in fuel prices are not in an of themselves indicative of true deflation. What we do see is that the Fed is still devaluing the dollar. The dollar hasn't "strengthened" lately because the money supply has been cut, unlike when the Fed caused the Great Depression by cutting the money supply. The dollar has been strengthening only vis-à-vis most other currencies, because other central banks are devaluing their currencies faster, and foreigners are buying dollars in massive quantities to buy U.S. Treasury securities.

The Fed is acting like a stupid doctor who worries a patient is losing too much weight, when in fact the patient is shedding obesity that resulted from the same doctor's force-feeding. The Fed has grossly inflated the dollar since 2001, and now it worries about "deflation" undoing part of it?!

Real estate collapse, a stagnant economy despite the central bank lowering rates nearer and nearer to zero...God help us if we're going to spend the next two decades like Japan's spent the last two. We're already in a "liquidity trap": interest rates are so low that monetary policy just can't provide any more economic stimulus, as artificial as it would be.