Economy going down

1.

I doubt many of you have missed that we're in somewhat of a global economic crisis. And for you who did miss it... we are. Now, you all being more or less human, I suspect your first reaction at this point is to ask “who's to blame?” and, well, I don't blame you. It would be horribly nice if we could just point at something, say that's to blame, remove it, save the economy and go home for a nice cup of tea and maybe a few buttered scones. Unfortunately, we can't, and the reasons behind our economy's recent stint down the hill are far more complex and more then a little hard to understand. Still, it'd be a hell of a short post if I didn't try.

A lot of people put a fair bit of blame on the sub-prime mortgages, and I have to agree. Now, a sub-prime mortgage is when a bank allows a more high risk loaner, who would ordinarily not qualify for a loan due to the high risk of not being able to pay back, to borrow money any way. Which seems like a pretty stupid thing to do, until you take into account the fact that the bank charges a far higher interest rate, thus gaining more money in the long run. Of course, it still feels kind of like a gambit, and you'd think the banks are still taking a big risk. Which is true, but they didn't quite see it that way.

Because when the banks came up with the idea, the economy was on the rise so fast you'd think somebody shoved a rocket up it's unmentionables and the banks... well, the banks had more money then they knew what to do with. On top of this, housing prices were climbing like mad and people were looking to buy, even the poor ones. So the banks figured that if they lent the poor people money to buy houses and made them put those same houses up as security, they couldn't lose. Because if the loaners could pay, they got their money back, plus a fat interest. If not, well, they got a house that was worth far more then the money they'd put out to get it.

And to be honest, this could have worked. Had the rise kept up, the banks would have gotten their money and a bunch of people would have gotten some nice houses. Economy would have gotten a little boost. 'Course, profit like that is probably gonna make you want to do the same thing again, so I suppose the sub-prime mortgages were doomed to go down eventually, inevitably.

Problem is, the market changes. Eventually, people stop wanting to buy houses, inflation kicks it, economic recession makes an appearance and the growth... stops. Suddenly people aren't earning quite as much as they used to and those big, fat interest rates become just a little too steep to handle. And so people, well, they give up the houses they put up as collateral. Except those houses aren't worth close to what they used to be, and certainly don't increase in value as the banks put countless more homes out on the market, increasing availability and thus decreasing value.

The banks don't even cut even. And, well, banks losing money is sort of a problem. Because their money is, well, it's really OUR money, right?

And I'm not just talking about American bank customers. No. See, the banks decided to sell these loans, or rather the profit from them, as securities. Which essentially meant that people bought a stack in the loans, and the supposed future profits from them. And not just people, but companies, other banks in other countries. And suddenly, like a big game of dominoes, what started as a not so minor problem in the American economy suddenly turns into a very much major issue for the entirety of the western world. And, to be honest, much of the eastern one too, seeing as how we're the ones buying all their oil and cheap, pirate brand sneakers.

Of course, the Sub-prime mortgage crisis is not the only reason we are where we are. No, there's inflation, recession, diminishing economic growth and just plain old lack of demand all helping to put a lid on the economy. And, this is natural. Growth can not be sustained indefinitely, which the banks unfortunately forgot in their hunt for profit, and the economy will inevitably begin to cool off and slow down, stabilize. It goes in waves, has for the last hundred or so years. So it's only a matter of time before it picks up again.

Of course, what does this stuff mean, for me? Sure, it sounds all fancy and stuff, but will it even affect me? Well, for once, I suspect my video game hobby (addiction) will get a tad bit more expensive, though if the economists who speculate that the video game industry will weather this storm better then most are right, I'd barely notice the change. Still, I'd probably notice how more then a few businesses would go bankrupt and how goods and services both experience a rise in cost.

Of course, I'm glad I'm not China, which has 40% of it's economic income flowing from international export. And, with our economy backpedaling, we're gonna cut down on production and import, meaning that a lot of Chinese middle-class workers are gonna lose their jobs and go back to being lower class. Personally, I'm wondering if there's gonna be an angry uprising or if China will act aggressively to save the financial status of it's large middle class. Either could and probably would have far-reaching consequences for the world, and I suspect neither option is especially pleasant.


2.

This is not the first time the economy's decided to go head first into the abyss, nor, do I suspect, will it be the last. The great depression of the 30's and the bursting of the dot-com bubble both have a few things in common, and there are certainly things that could be learned from studying them. BUT! The main problem here comes from one, very simple, thing. Imaginary money. Or rather, debt as an acceptable form of currency.

In the current economic system, banks make money. And I'm not talking about earnings, I'm talking about pulling money out of thin air to lend out, as authorized by the various world governments. Most of us think electronic money acts as representative of cash stored in bank vaults, and that cash in turn for gold or silver stored in federal reserves. This is not true. The money we lend from banks have no physical representation, but is instead representative of debts society at large owes the bank. And this is no secret, it's out there, fully admitted. Problem is, as Marshall McLuhan said, “Only the small secrets need to be protected. The big ones are kept secret by public incredulity.”

The money in your pocket is not, like the money of old, representative of gold. It is instead representative of the interest owed to the bank, and the bank makes up more of it every time somebody gets a loan. And they can make up as much of it as they want, as long as they stay within something known as the Fractional reserve requirements. Which states that they are only allowed to 'make' money at a ratio against the actual money that their customers have deposited into their bank. At a Fractional reserve requirement of 9:1, a bank with a 100 dollars worth of deposit can loan 900 dollars worth of money that it simply makes up. Now, the problem is that, in the closed system of our economy, the make believe money of one bank increases the deposit in another and vice-versa, creating an ever escalating increase of deposited money and thus an increase in the money they can lend.

Now, when we want to pay back a loan to the bank, which requires interest, we turn to the public economy to get that money. Problem is, all the money in the public economy comes from the bank, which means the money we use to pay back is the interest of somebody else's loan. In a system where all money comes from the bank's loans, how can we be expected to pay back the loans plus the interest they demand? The answer, we can't. Imagine you have a pool, which is the principal, the money you and everybody lent. Also all the money in circulation, in other words. Then you have a second pool, a bigger one, which represents the principal plus interest, what the banks want back. Now imagine trying to use the water from the first pool to fill up the second one... Doesn't work does it?

Only way to make it work is to borrow more money, increasing the first pool but at the same time increasing the second one, which grows even bigger then the first one because of the added interest.

The economy is, in other words, dependent on the commercial banks to give regular injections of more money to make it work. Money which they get from people loaning. During the great depression, people stopped loaning, money dried up, the economy sunk like a stone.

If you ask me, the main lesson we need to learn is that an economic system dependent on people loaning more and more money just to work isn't sustainable, and the sub-prime mortgage crisis is a perfect example, on a small scale growing bigger, on what can happen to our economy when the upwards spiral of lending and indebtedness goes wrong. What we, more then anything, need to learn from this and other, previous crises is the flaws inherent in our monetary system, and become loud enough about our dissatisfaction to spur our governments and our people into doing something to fix it, which would require a new economic system.

A while back I mentioned who to blame. Well, you can certainly blame the sub-prime mortgage crisis, but you should really be blaming the banks, for profiting and perpetuating a system of economy that constantly demands more money then currently exists.


3.

Rothstein speculates that, had the United States used a more socialistic model for education, health care and segregation, the entire thing could have been avoided. He has some points.

Education, certainly. Had the loaners had a little better education within the spheres of math and economy, they might have been able to more critically assess their ability to pay the loans back. Of course, a problem arises when you think about the fact that, the banks do they same. Every time you go get a loan, they check your credit history, your job, your salary. They check all these things and make sure you have the capacity to pay back, with a healthy margin in case of 'rainy days'. The Sub-prime loans were aimed specifically to people WHO FAILES THESE CHECKS! Now sure, a healthy education might have dissuaded some of these people from taking the loans, but the problem lies not in the loaners being unable to assess the risks but in the banks, for being fully able but instead taking massive risks despite knowing them, and then piling on even more interest on top, further decreasing the loaners ability to pay back. Along with using clever language and initially low, but mobile, interests rate to mislead the loaners into thinking the end interest would be far, far lower then it actually was.

As I said, education would certainly have helped but this was a highly skillful lie that would have followed more then a few of us, even here in well-educated Sweden.

His points about social security and public health insurance certainly rings true. Both would have decreased the costs to the loaners, which would have given them more money to sink into the banks. The question is, would the difference have been great enough, in large enough numbers, to make any real difference? This is a mathematical and statistical question I have no way near the qualification or time to properly research and calculate, but it's something worth keeping in mind.

But if this IS true, why would the government choose this time to cut back on the two things which, if Rothstein is right, would best serve to prevent the wave of foreclosures from echoing in our country? Even I, an anarchist, have a hard time believing the government is really THAT stupid. Then again, I certainly have no problems assuming they're willing to screw the public to put more money in the pockets of people who contribute to the election campaigns.

And well, our own economic crisis in the 90's certainly shows our socialistic system is not immune to similar ills.

He seems, to me, to be missing the real point. Namely, that this has nothing to do with liberalism. It doesn't, because a liberalism system functions just as well as a socialistic one in the long run. Not at all. These are, to me, the symptoms of our inherently flawed economic system. Socialism, liberalism... they're all playing around in the same diseased pool. They're doomed to get sick.

Gender issues

I heard a joke once. It went something like ”What's the difference between men and women?”. Funny, isn't it, how I've been tasked with seriously answering a question phrased just like a joke I heard once? I'm laughing, if only because there's people out there thinking a bunch of high schoolers can seriously answer a question like that. Ask me, they're expecting us to fail, miserably. If they're not, they're the biggest optimists this world has seen since Don Quixote.

So why do I find this question so patently absurd? Well, apart from the fact that saying so gives me a chance to insult my teachers, a chance any high schooler would jump at on mere principle, it's a question so vast in scope and so shrouded in false perceptions, indoctrination, social stigma, stereotypes and a few millennia worth of discrimination that actually getting at anything remotely resembling an objective truth would take the collective geniuses of the world five lives and a weekend, and I ain't no genius. Still, I'm not even gonna pretend I don't have my views on the subject, but I'd like to make it abundantly clear that I realize I ain't telling truth, I'm telling opinion. More precisely, mine.

There are of course rather glaring differences between men and women, which rarely takes the average horomonal more then a cursory glance to notice. Men and women are quite obviously different in terms of physiology, with men sporting such manly things as broad shoulders, pronounced chins, prominent cheekbones and facial hair while women get stuck with wider hips, breasts and longer index fingers. 'Course that's just the superficial little things, but even now those lines start getting a bit blurry. It takes little more then a google search to find discover there's women with facial hair, men with breasts and that whole finger thing is apparently quite the hot topic.

Dig a little deeper and we start getting down to the really big biological differences, such as child birth and reproduction, neither of which I think require any real introduction. The crux of the matter is, there is a biological difference between men and women, though it gets rather blurry from time to time. Of course, that difference is all physical, which brings us nicely to the topic of debate, namely... Behavior.

Now, while most people agree that men and women differ in the realms of the physical, the issue is far less clearcut once you start speaking of how we act, think and feel. There is a plethora of stereotypes concerning both men and women, shifting constantly from culture to culture. But some of the most prevailing ones, least in our rich, western culture are that women are supposedly more vindictive and caring (how those two go together I don't know) while men are aggressive and less apt at child care. There are others, like how women are more responsible and better students, men are better at sports and far more interested in sex, women are manipulative, men are direct and countless others that seem to come and go as they please.

Personally, I think they're all, well, bullshit. Not because I don't think a man can be more interested in sex then a woman or that a woman can be a better student then a man, because both could certainly be true. I think they're bullshit because they're somehow assuming all women, and men, are the same, and that's the sort of generalizing that lead to fathers having their gender stack against them in child custody cases and women being marginalized in the work place. The problem is that we don't see individuals, we see gender. And when you form stereotypes about a group of people, especially one wide enough to constitute half the entire human race, you're gonna end up with a whole lot of false ideas and preconceived notions. And what's worse, you're gonna assume people conform to these notions.

Which means that if you've been told that men aren't good parents, you're gonna be just a little more hesitant to give a man custody over his children. And you're gonna get uncomfortable when people break your expectations, viewing them as 'wrong' or problematic. Which, when your expectations include women being shy and cautious, puts all women in a catch 22 position when it comes to work. They're either shy and cautious and thus gets passed over for promotion for not being noticed, or they're forward and thus gets passed over for promotions because they're problematic and make you ill at ease. It's absurd!

The entire thing is so ingrained in our culture that we're raising our kids to fit into our ideas about gender. And we've been doing it for thousands of years, and then we have the audacity to go around saying that somehow constitutes proof that there's a difference? No wonder boys are more aggressive then girls when we're giving them fake guns to play with. I mean, what did you expect them to do, beat those little plastic swords into little plastic plowshares and go play farmer? And no wonder girls are more apt at cooking when the quintessential girl toy is a plastic oven. We are what we're made to be, and in a culture that's been treating women and men differently since we stopped living in caves, we're made to be very different.

Look, I'm not saying there isn't some difference between men and women. There's certainly scientific evidence that could point the fact. But how are we expected to find what little behavioral difference there is under this mountain of expectations and ideas and stereotypes and sexism and hate and religion and oppression and rebellion and revolution and Barbie dolls we've been telling our kids to live up to since we discovered fire!?

And this entire debate is so twisted up in itself that it's very existence makes any real, true progress impossible! How the hell are we supposed to reach equality when the entire debate is doing nothing but perpetuating the segregation? The entire issue we're trying to solve isn't to remove the social stigma that makes us divide by gender, it's to somehow build a counter on top of all the crap we have in our heads. It's like instead of trying to find a curse for the disease, we're accepting we're sick and just adapting the world to fit our, new sick selves.

Sure, we could try affirmative action, we could try having the government move in and equal the salaries, we could try forcing women into male-dominated careers, and it might help. It might put women in male-dominated careers, it might give them more equal salaries. But, what kind of message would that be spreading in society? If women need the government to step in just to get a job, doesn't that kind of prove their too weak and helpless to do it themselves, that they really aren't the same as guys, that maybe, just maybe, they really should stay home and take of the kids instead of running around trying to be something they clearly can't be without the help of legislation and laws?

 What we need to do is change society, the way we view men and women. Or rather, we need to stop viewing people are men and women all together. We need to stop perpetuating our ideas, we need to stop dressing up our daughters in pink and our sons in blue. We need to stop calling girls who sleep around sluts and guys who do it studs. We need to stop bitching about how all guys are idiots and all girls are bitches. We need to stop generalizing and, more then anything, we need to stop complaining and start doing. And I'm not talking about legislation or laws, I'm talking about committing yourself to raising your kid to be an individual and not a boy or girl. If your son wants to wear pink, let him. If your daughter wants to roll around in the mood playing war, then you best get ready to do a whole lot of washing. And every time you hear a story about a girl sleeping around and think 'what a slut', give yourself a good slap for me, would you?



Another question I'm supposed to answer is how I would react if I were to change gender, willingly or otherwise. I might, for starters, say that I would probably not go through the change willingly, unless I had the option to go back. While the experience is tempting, I'm rather comfortable in this body and I'm not in any real hurry to go change it. Took me a lot of time getting it just the way I want it.

But, I don't really know how much I would change. I'm 18, which means much of my personality and identity has been formed and set, so I can't imagine my behavior or personality would undergo any noticeable shift, unless that unknown factor of the gender itself carries some sort of innate change that I don't know about, but, well, if it does, I don't know about it.

I do, however, imagine that society would look at me quite differently. I'm the first to admit that I'm rather forward and loud, traits not exactly considered desirable and prudent in a woman. Coupled with the fact that I tend to speak my mind and probably wouldn't bother putting on makeup or wear dresses, I can't imagine I'd been seen in a very favorable light by society at large.

I do think a lot of my personality comes from my gender, but not because I'm a guy but because I've been raised as one. There might have been some smidgen of a basic beginning of a secondary personality lingering at the back of my head when I was born, but I suspect that my childhood and life accounts for 99.5% of my personality. We are shaped by our experiences and I suspect that the differences in how we raise girls versus how we raise boys cause, through a a cascading effect, a plethora of changes. I mean, just look how people react when a girl takes a tumble compared to the reaction of a boy taking an equally bad plummet. The girl is coddled, hugged and told to slow it down. The boy, meanwhile, is given a quick hug, a band aid and is told to go outside while his dad almost brags about how his son's tough enough to be the next Chuck Norris. And as we grow, it just gets worse. Girls are told the horrors of getting pregnant while young and told to make their first time 'special' while guys are given a pat on the back, a twelve pack of condoms and the social expectation to lose their virginity within a month of turning legal.

So, were I raised as a girl, I suppose I'd be quite different. 'Course, seeing as how my identity was formed from my childhood, a me raised a girl wouldn't be a me at all.



Now, we are supposedly a very progressive and equal country, where what you are don't matter as much as who you are. Least in theory. Now, we're certainly a far better country to be a women in then, say Sudan, where Female genital cutting is still practiced and very common, but being better is not the same as being good.

Now, the first order of business would be to decide just what factors determine how 'equal' a country is. Now this is the real hard part, because there is no true way of measuring actual equality, just like you can't measure happiness. Instead, what you have to do is look at things that would be reasonable symptoms of equality. Equal pay, equal hours, equal division of genders and various cultural backgrounds among politicians and high ranked executives, all indicative of an equal, balanced country, right?

Or is it? Sure, I doubt anybody would argue that being a woman in a country with a few females in power is better then being one in a country with none, but you can gawk at all the statistics you want, you're never gonna be truly able to tell if a country is equal judging by a bunch of numbers. No, if you want a real, true look at how fair and equal a country is, you're gonna have to go and use the hermeneutic approach. Because equality isn't in laws or rules. It's in people, and the injustice and discrimination people allow to happen. Sweden isn't equal because of our laws, it's equal because our society strives to be, because we as a whole (barring certain elements) work to make it so. We don't accept inequality between the sexes, we feel that gender mutilation and racism and segregation are bad things and we work to correct it.

To mention Sudan again, laws wouldn't put an end to the female genital cutting or the discrimination. Equality would only come once the mentalities and social acceptance of it was purged from the social mind, a process that's far more grueling then merely signing a few papers and putting up a few laws.

And it is in this respect that I think Sweden actually qualifies as a very equal country, because we view racism and sexism as wrong and actively, more or less, work to purge it from our society. There's certainly lingering elements remaining, and we have a long way to go but the social views on it has begun to change for the better, and that, that's more then half the battle.

Still, our society isn't perfect and, well, a lot of the old ideas about men and women remain in our collective psyches. Some careers are still closely associated with women and men are still linked closely with authority in both our minds and practice. We're not utterly equal, though we've come a long way, but we're not there yet. There is no denying that some of the old gender-stereotypes still fester in our minds and we still suffer emotional discomfort when we see them violated and the inequalities that still exist in our society can, least partially, be attributed to them.

Now, I seem to recall opening this post with a joke, but I never told the punchline, did I? Well, figure it'd make a pretty good closing statement. So, what is the difference between men and women?

The answer: Two letters.

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