The Impossibility of Capitalism

February 22nd, 2014

The Capitalist decides to build a new factory. He calls a real estate agent and buys a parcel of farm land. He whistles for his chauffeur and rides out to the site in his limo. He walks to the center of his land, raises his cane to the sky and lets out a mighty bellow: “Let there be construction!” And…

Crickets.

Nothing happens. And thus, Capitalism is refuted.

In order for a factory to appear on the site, somebody has to do some labor. Maybe the capitalist will take off his top hat and monocle, roll up his sleeves, and dig the foundation himself. Plenty of capitalists are more than willing to labor. For example, Mark Zuckerberg shoveled tons of bits before he became a robber baron trying to flood the nation with cheap labor. But without labor, nothing happens. Ever.

Now, what are the Capitalist’s options?

Plan A – He could knock on doors, and after negotiations, hire some of the local population to come work for him.

Plan B – If his neighbors want too much money for their trouble, the Capitalist can bring in foreign workers from some downtrodden nation like Bangladesh whose citizens are desperate to work for peanuts.

Plan C – The Capitalist can get laws passed that destroy the local economy in order to make the locals more pliable. That’s how they did it in Britain when they repealed the Corn Laws.

Plan D – The Capitalist can offer very generous compensation to a few of the locals, arm them with weapons, and frog-march the rest of the people onto the work site.

Throughout history, Plan D, slavery, has been the most common, and most profitable option. In recent decades, the USA has been following Plan B, and that too has been enormously profitable for the capitalists.

Plan A is the ideal, of course, but it is impossible under a regime of mass immigration, and free-trade with low-wage nations. The capitalists have stacked the deck in their favor for negotiating with workers.

The moral of the story is that Capitalism is not an economic system, but only the notion that the capitalist should hold the upper hand over the worker. And Socialism is the notion that the worker should hold the upper hand over the capitalist. Both are foolish notions that lead to disaster.

My preferred way of solving this social problem is to create a slight, artificial scarcity of workers such that capitalists would have to bid against each other for their services. When workers are scarce, they will automatically be well paid, and well treated. No regulation necessary. That’s what happened during World War II. While all the men were away, women like my mother had plenty of job opportunities to work for grateful and generous managers.

So, curtail mass immigration, curtail trade with low-wage nations like China, and problem solved. Nobody needs to be enslaved, and no capitalists need to be marched into ovens, Tom Perkins style. Income inequality narrows and everybody lives happily ever after.

The problem, of course, is that the capitalists have control of both immigration policy and trade policy. So, don’t expect any improvements until that control is broken. The people of Switzerland recently voted to put an end to mass immigration. Perhaps such sentiment will spread to the voters of other Western countries. After all, it is painfully obvious that mass immigration only increases income inequality.

Rachel Maddow is an Uncle Tom

February 22nd, 2014

Rachel Maddow sat right next to Bill Maher, and didn’t say a word, as he gay-bashed figure skater Johnny Weir. Said Maher:

“New rule: someone must tell Johnny Weir more ice and less capades. If I want to see something that gay on ice, I’ll order a daiquiri.”

Bill Maher

Has Maher ever lampooned anybody for being “too straight?” I doubt it.

I couldn’t find the video online of this incident, but it may be up somewhere now if you want to search for it. The incident took place at the 49:05 mark of the February 21, 2014 episode of the “Real Time with Bill Maher” show on HBO.

Was it a coincidence that Maher did that joke with Maddow right next to him? Maybe, but I suspect that he did it on purpose to emasculate her. Maher did the same thing to Neil DeGrasse Tyson back in November. Maher told Tyson that he sounded like Amos & Andy, and Tyson didn’t make a peep. You can see the Tyson video on this page.

It looks like Maher gets a kick out of demonstrating how spineless his guests are, and how they value being on TV more than their own dignity. As a distinguished scientist, perhaps Tyson doesn’t associate much with the type of people who would make racist remarks to his face, but what’s Maddow’s excuse? What kind of gay-rights activist takes such a thing lying down?

Tyson and Maddow both missed an opportunity to make themselves more famous. They could have made headlines by walking off the set.

On a lighter note, I haven’t been watching Maher’s show for very long, but years ago he had Artie Lange on and said to him: “Thank you for the dumb opinion.” Now Lange does a hilarious imitation of Maher:

NASDAQ-100 Megaphone Pattern

February 15th, 2014

Below is a daily chart of the NDX showing a megaphone pattern (click to enlarge):

NDX-Megaphone-Feb-2014

This pattern is sometimes called a “reverse symmetrical triangle” or a “broadening top” and is usually bearish. Here is a megaphone chart that I posted back in 2009:

ES Broadening Pattern

Two days later, the S&P 500 rolled over and dropped 63 points. But the correction only lasted six days, and the bull market resumed. So in that case, the megaphone was a signal to go to cash and get ready to buy the dip.

No pattern is perfectly reliable, and it’s not impossible for the market to shake off a megaphone. Perhaps Janet Yellen’s melodic voice has soothed the market beast. We will know very soon.

Charlie Sheen, Vatican Assassin – Mystery Explained

February 8th, 2014

When Charlie Sheen went nuts back in 2011, one of the crazy things he said was that he was a “Vatican Assassin Warlock.” He never explained what that meant, and neither could anybody else, but I have solved the mystery. Sheen makes his Vatican-Assassin comment at the 2:42 mark of this interview:


See more US News from ABC|ABC World News

It turns out that Vatican Assassins is a book written on an Amish farm in 2001 by white separatist Eric Jon Phelps. The Catholics and Protestants have been publishing propaganda against each other for hundreds of years, and Vatican Assassins is a modern edition of that genre.

Phelps believes that WASP culture is responsible for scientific progress and freedom, having broken Western Civilization out of the Dark-Ages death-grip of the authoritarian Catholic Church. Phelps is especially outraged by the machinations of “God’s Marines” – the Jesuits – and wants to kick them out of the USA.

Phelps is hoping that a state will succeed from the union, and if one does, he wants all WASPs to move there and fight against the federal government’s attempt to reel the state back in. He pretty much wants to re-fight the Civil War, and maybe even reinstate slavery. Here is a quote from page 503 of Vatican Assassins:

“As calculated, the Emancipation Proclamation destroyed the Southern culture that generally had been a blessing to the Negroes, in contrast to their barbarism and cannibalism in Africa.”

It was Eric Jon Phelps who called Charlie Sheen a Vatican assassin. Why would he do that? Because Sheen’s father, Ramón Antonio Gerardo Estévez (Martin Sheen) is an activist Catholic (photos here). Martin even took his stage name from show-biz priest Bishop Fulton J. Sheen:

As a militant protestant, Phelps finds Martin Sheen to be an odious Vatican operative. But why does he call them assassins? Well, Phelps believes that the Vatican seized dictatorial control of the USA by assassinating John F. Kennedy. He also believes that that the Jesuits assassinated Abraham Lincoln. At first, that sounds crazy. However, so many Americans believed it to be true that the USA broke off diplomatic relations with the Vatican in 1867. Relations were not re-established until 1984 – 117 years later!

Jesuit history is a lot more interesting than you might expect. And seeing that we have the first-ever Jesuit Pope, you might want to do some reading on the subject. But I don’t recommend Vatican Assassins. I give Phelps an “A” for effort because the book contains an enormous amount of information and photos. But his writing style is atrocious. Half the book is comprised of quotes from other anti-Jesuit propaganda books. Many of the quotes are from Alberto Rivera, an alleged ex-Jesuit who was more likely a simple con man.

Of course, if you are a right-wing, protestant redneck, you will probably love Vatican Assassins. But before you believe anything at all in the book, you need to do your own research because the book is simply not credible.

The most absurd act that Phelps accuses the Jesuits of is founding the Illuminati. Yes, Adam Weishaupt copied the organizational structure of the Society of Jesus, but it is established fact that the Illuminati and the Jesuits were arch-enemies. See this for more.

So, when Charlie Sheen said that he was a “Vatican assassin warlock”, he was mocking Phelps. The “warlock” part was a creative flourish added by Sheen.

Note: I can’t find the reference now, but somewhere Phelps stated that he was supported for three years by an Amish family in Pennsylvania while he was writing Vatican Assassins.

Record Tax Receipts – $32.2 Billion in One Day

February 4th, 2014

The IRS has set a new single-day, withholding-tax record by raking in $32.24 billion on Monday, February 3, 2014. Take a look at the Daily Treasury Statement (click to enlarge):

Record Withholding

The previous record of $30.428 billion was set on January 2, 2007, and some of that was likely delayed from December due to the holiday.

What does this mean? It means that there are lots of people working, lots of paychecks being cut, and lots of income for the IRS to withhold. The stock market may be correcting, but the jobs market is going full steam ahead.

Note: I know this is a record because I have daily data going back to 10/1/1998 in my database at The Daily Jobs Update.