Where Fear Goes, Contagion Follows

by William Skink

It’s been an interesting couple of weeks for the global markets. While Greece has received much of the attention, the extreme measures China is taking to stabilize its stock market are worth paying closer attention to. In addition to QE (Quantitative Easing) type measures, tweaking interest rates, and forcing state institutions to buy back stock, stricter restrictions on selling have been implemented to keep the lemmings from leaping off the cliff:

Can pumping still more money into the economy to buy stocks offset the panic and urge to sell by investors? Will still more quantity of money injected into the markets really prove sufficient to offset the ‘fear factor’ of investors, as they try to salvage what they can, to take their money and run? Maybe not if those investors are mostly what are called ‘retail’ buyers—i.e. individuals rather than institutions—who are notoriously prone to herd mentality both in buying and selling stocks. And China’s stock buyers are reportedly 85% retail. So that’s a big problem, because once they panic, as they now have, measures to offset selling by encouraging more buying may not work very well. Indeed, may not work at all. Once it replaces ‘greed’, ‘fear’ of loss is a psychological mindset among retail investors that is difficult to turn around again.

That’s why China has also undertaken parallel measures to halt the selling of shares in the markets as well induce more buying. It has suspended sales of Initial Public Offerings (IPOs) for companies selling shares for the first time. It has taken action to check speculators, domestic and foreign finance capitalists, and stop them from ‘shorting’ stock prices, i.e. betting stock prices will decline which in effect only drives prices still lower. Another ‘stop-sell’ measure was announced by the China Securities Regulatory Commission, CSRA, on July 8. It ordered that holders of more than 5% of a company’s stock were henceforth barred from selling shares for the next six months. The government has also ordered more than 1500 companies on the China stock exchanges to suspend all selling of their stocks. Estimates are that between 50% to 70% of the China stock markets are thus ‘frozen’, with the majority of the companies prevented from trading their shares. So the precipitous decline in stock prices in recent weeks reflects maybe only a third of the companies at this point.

Combined, these measures expose China’s desperation, and that’s not good for jittery markets. Along with fear, at least for me, comes an increased propensity for paranoia. So when I heard about trading at the NYSE halting for over three hours because of a “computer glitch” I wondered what the hell might be actually going on? I’m certainly not the only one. Here’s a piece from Zerohedge about why the NYSE debacle matters. It’s an interesting read.

One of the realities that was never quite absorbed by the general public seven years ago when the markets melted down was just how insane the derivatives market had become. And in seven years post-crash, it’s gotten worse:

U.S. total public, personal, and corporate debt is now $60 trillion, and to a few cognoscenti, there is a palpable sense of teetering. Puerto Rico is running out of cash. Illinois struggles to pay pensioners while avoiding insolvency. Detroit is already in receivership. Irvington, Harrisburg, Oakland, Providence and a host of other municipalities are close behind.

But just where would a flock of black swans originate? Certainly Detroit is not going to tank the entire U.S. economy.

At the beginning of George Bush’s presidency, the total global derivatives market —credit default swaps, mortgage backed securities, forward contracts, currency swaps and their inscrutable mathematically murky cousins—amounted to $4 trillion. When Bush got finished with us, that is, when 8 million Americans lost their jobs and 3 million Americans lost their homes, the derivatives market had soared to $585 trillion. Kind of a jump and certainly a very lucrative gaming house.

When Obama took office, most thought he would bring these excesses under control and initiatives like Dodd-Frank or the Commodity Futures Trading Commission would shutter, or at least reign in, this egregious casino. Not so fast. The five leading “too big to fail banks” actually grew 28 percent bigger than when Obama took office. And the global derivatives market swelled to $1.5 quadrillion.

This is fucking madness. The mind boggles at these figures. How will this insane debt unwind? Will it take another World War?

No one can say. What’s obvious is this situation is not sustainable. Where do we go from here?

Distracted by Flags and Fountains

by William Skink

Montana’s leading Democrat blog, MT Cowgirl, has squeezed as much local political juice as possible from the tragedy that occurred at Emanuel African Methodist Episcopal Church in Charleston, South Carolina, last month. Of the 4 posts about a “confederate fountain” in Helena, this one has the best comment thread. I found myself nodding in agreement to this lengthy comment from Rob Kailey:

I’m beginning, more and more, to see this kerfuffle as a game of words, as if words actually control thinking, and not vice-versa. Don actually made a terrific point above in pointing out that Montana no longer uses disparaging words to refer to objects, things. We are right to do so because words like “squaw” are demeaning and diminutive to people who still walk and breath and join the American experience.

The Confederacy no longer exists. That was settled, as noted above, at the Appomattox Court House. It was settled by executive order from President Lincoln. There is no longer a Confederacy, it is just history. Yet history can’t be compartmentalized, sanitized. The very same South Carolinians who fired first on a union fort in Confederate territory were the sons and daughters of the South Carolinians who fought savagely, brutally, against the British who occupied “US” soil as according to the Declaration of Independence. Heroic traitors to traitorous monsters in less than a hundred years, right?

150 years after that, we are getting upset that a water feature bears the name of a long gone regime. Meanwhile, we have buildings, hospitals, lakes, monuments and roads bearing the names of Copper Kings and mining barons, the very people who hired thugs to kill workers for the love of money. Marcus Daly? Clark? Holter? Davis? They jumped claims, stole, murdered and incited riots. But they’re good Montanans so no outrage is forthcoming concerning the legacy of their words. Or … it’s possible that people are comfortable with a legacy that’s gone, just a part of history. Another example. Many of you may have visited the “Big Hole Battlefield”. It wasn’t a Battlefield, it was a slaughter of innocents. The visitor’s center makes that quite clear, but yet on every map you still see those words. “Big Hole Battlefield”. It’s strange to me that people are getting so het up about the words “Confederate fountain”, words that are meaningless to anyone save that they refer to a water feature in a park in Helena. So het up, in fact, that other commenters are willing to wish damnation on those who don’t find this a *really big deal*.

There is a part of me that absolutely agrees with Greg Strandberg, above. Who’s going to pay for these alterations that give folk the good feels? The folk of Helena will pay for the placard update, a small price, no doubts. The Democrats of Montana will pay for wasted effort on a another PC boondoggle. It won’t cost money, it will cost votes. Ultimately, it costs vision for the future of Montana because people are so concerned with it’s fantasy of past.

When the fight against racism is relegated to words and symbols, the fight against structural racism is ignored. That’s not to say there isn’t benefit to chalking up a victory in the symbolic fight, with the Confederate battle flag finally being removed the capitol of South Carolina. It feels like tides are turning when even Republicans acknowledge fighting for the Confederate flag is no longer a defensible position.

That said, as the optics and rhetoric adapt to the persistent eruptions of violent, overt racism, it should be asked: is substance following suit? And if not, why?

Here’s Paul Street describing America’s subterranean racism:

A different level of race and racism has to do with how the nation’s daily capitalist institutions, social structures, and ideologies function. Here we are talking about how labor markets, the financial sector, the real estate industry, the educational system, the criminal justice complex, the military state, the corporate system, and capitalism more broadly work to deepen, maintain, and/or reduce racial oppression and inequality.

At the first, surface and symbolic level, racism has experienced significant defeats in the United States since the rise of the Civil Rights Movement in the middle and late 1950s. Public bigotry has been largely defeated in the nation’s corporate-crafted public culture. Prejudiced whites face public humiliation when they voice openly racist sentiments in a nation that took “Whites Only” signs down half a century ago. Favorably presented Black faces are visible in high and highly public places across the national media and political landscape. The United States, the land of slavery, put a Black family in the White House six years and eight months ago. The new attack on the Confederate Flag is another moment in this long Civil Rights revolution over public-symbolic racism.

At the deeper, more covert institutional and societal level, however, racism is alive and well. It has not been liquidated beneath the public and representational surface – not by a long shot. It involves the more impersonal and (to be fair) the more invisible operation of social and institutional forces and processes in ways that “just happen” but nonetheless serve to reproduce Black disadvantage in the labor market and numerous other sectors of American life. These processes are so ingrained in the social, political, and institutional sinews of capitalist America that they are taken for granted – barely noticed by the mainstream media and other social commentators. This deeper racism includes widely documented racial bias in real estate sales and rental and home lending; the funding of schools largely on the basis of local property wealth; the excessive use of high-stakes standardized test-based neo-Dickensian “drill” and grill curriculum and related zero-tolerance disciplinary practices in predominantly black public schools; the concentration of black children into over-crowded and hyper-segregated ghetto schools where a highly disproportionate share of the kids are deeply poor; rampant and widely documented racial discrimination in hiring and promotion; the racist “War on Drugs” and the related campaign of racially hyper-disparate mass black incarceration and criminal marking. The technically color-blind stigma of a felony record is “the New N word” for millions of Black Americans subject to numerous “new Jim Crow” barriers to employment, housing, educational and other opportunities.

At this deeper level, the symbolic victories hold less traction. Removing flags won’t change the persistence of structural racism and adding a plaque to a water fountain won’t stop the push by white supremacists to make the Northwest their new Rhodesia.

The Civil War was fought to preserve an economy based on overt slavery, the kind with shackles and receipts of sale for human beings. The only way to justify this economic system was for whites to believe the pigment of their skin endowed them with superiority. This belief not only continues, but, I would argue, is exacerbated by economic conditions and cultural ignorance.

This is where Democrats fail.

What’s the point of celebrating symbolic wins when the structural reality persists? As white liberals celebrated Obama’s electoral victory, Obama chose to protect the Wall Street perpetrators of a subprime loan system that was overtly racist. This has been proven in court, and some of the banks have had the proverbial slap on the wrist, like Wells Fargo in 2012:

Wells Fargo settled a lawsuit brought for by the Justice Department for pitiful sum of $175 million dollars yesterday. Why do I describe the sum of $175 million dollars pitiful? Well first, this is Wells Fargo, one of the megalithic banking organizations that dominate the financial sector in our country. $175 million is a slap on the wrist for the, merely the cost of doing business.

However, the primary reason is what they did. Wells Fargo deliberately and illegally put minority home buyers in more costly sub-prime mortgages than other home buyers. In short, they used the race of their mortgage customers as the determining factor in how much they would charge them for these crap mortgages they peddled, which is outright racial discrimination on a mass scale.

Year after year, Obama made a lot of noise about going after perpetrators of mortgage fraud. But that was mostly all that happened, noise. Some may even be tempted to call Obama’s claims lies:

Two recent reports show that Obama and his Administration lied when they promised to prosecute Wall Street executives who had cheated outside investors and deceived homebuyers when selling mortgages to them.

On May 20, 2009, at the signing into law of both the Helping Families Save Their Homes Act and the Fraud Enforcement and Recovery Act, President Obama said: “This bill nearly doubles the FBI’s mortgage and financial fraud program, allowing it to better target fraud in hard-hit areas. That’s why it provides the resources necessary for other law enforcement and federal agencies, from the Department of Justice to the SEC to the Secret Service, to pursue these criminals, bring them to justice, and protect hardworking Americans affected most by these crimes. It’s also why it expands DOJ’s authority to prosecute fraud that takes place in many of the private institutions not covered under current federal bank fraud criminal statutes — institutions where more than half of all subprime mortgages came from as recently as four years ago.”

Then, in the President’s 24 January 2012 State of the Union Address, he said: “Tonight, I’m asking my Attorney General to create a special unit of federal prosecutors and leading state attorneys general to expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis. (Applause.) This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans. Now, a return to the American values of fair play and shared responsibility will help protect our people and our economy.”

However, two years later, the Inspector General of the U.S. Department of Justice issued on 13 March 2014 its “Audit of the Department of Justice’s Efforts to Address Mortgage Fraud,” and reported that Obama’s promises to prosecute turned out to be just a lie. DOJ didn’t even try; and they lied even about their efforts. The IG found: “DOJ did not uniformly ensure that mortgage fraud was prioritized at a level commensurate with its public statements. For example, the Federal Bureau of Investigation (FBI) Criminal Investigative Division ranked mortgage fraud as the lowest criminal threat in its lowest crime category. Additionally, we found mortgage fraud to be a low priority, or not [even] listed as a priority, for the FBI Field Offices we visited.” Not just that, but, “Many Assistant United States Attorneys (AUSA) informed us about underreporting and misclassification of mortgage fraud cases.” This was important because, “Capturing such information would allow DOJ to … better evaluate its performance in targeting high-profile offenders.”

Democrat apologists can say what they want about Obama’s record, but to me, the record speaks for itself. While the optics of Obama eulogizing one of the nine dead black victims of the Charleston massacre may be nice to see, on the surface, beneath the surface structural racism persists, while opportunities to make substantive changes have been squandered by the Obama regime.

There’s been a lot of talk about the post-Civil War propaganda to recast the Southern cause as one of States Rights instead of slavery. I think that’s the wrong conversation for us to be having. Instead I think we should be discussing how the Civil War didn’t really abolish slavery, it just forced one of the more odious methods of labor exploitation to evolve into using other means to oppress minority populations, like the criminal justice system’s reliance on the racist drug war and an economic system that uses debt to enslave entire countries.

But then that would bring up Democrat complicity in the perpetuation of these systems of oppression, and that’s just not good for Democratic electoral politics, right?

What Bernie Sanders Isn’t Saying

by William Skink

7 days ago it was the New York Times reporting on Bernie Sanders gaining on Hillary Clinton in Iowa. 5 days ago it was Slate talking about how big crowds seem indicative of Sanders’ polling trend, closing the gap to 19 points in Iowa. Yesterday, a new poll showed Bernie gaining ground in Florida.

It’s easy to get caught up in this populist insurgency against the Democrat’s corporate darling, Hillary Clinton. Those of us without blinders on can extrapolate from her past record what a Hillary Clinton presidency will look like, and it’s frightening. So it’s not surprising that the rhetoric from the Sanders campaign is like a narcotic when contrasted with the hollow proclamations from Clinton.

While Bernie seems to be saying all the right things about domestic issues, some have noted a conspicuous absence of rhetoric about foreign policy. Since over half of every tax dollar goes to maintaining the largest killing machine on earth, it seems like probably an important thing to talk about. Unless of course you think your positions won’t necessarily align with a certain populist branding bumping you up in the polls, right Bernie?

Here’s Bruce Gagnon, writing for Counterpunch:

The candidate was getting huge applause as he took on Wall St, the Koch brothers, income inequality and the like. He touched on all the traditional progressive buttons just like I’d heard Jesse Jackson, Ralph Nader, and Dennis Kucinich do in the past. Women’s issues, single-payer health care, student loans hitting young people, and more were addressed. Sanders called for free college tuition for all. He wants to create millions of new jobs. He talked about fixing our neglected and broken infrastructure. He hit hard on climate change calling for a sustainable society.

It was when he mentioned climate change that I figured he had to talk about the military industrial complex, because after all that is the pot of gold that has to be tapped in order to pay for building the new vision of America that Bernie so eloquently laid out. But nothing was said about the metastasizing Pentagon budget nor a mumbling word was spoken about foreign policy. Nothing about Russia (Sanders does support sanctions on Moscow), nothing about NATO expansion, nothing about Israel’s brutal attacks on Gaza (Sanders has publicly supported Tel Aviv’s attacks on Palestinians), nothing about negotiations with Iran, nothing about waste, fraud, abuse at the Pentagon, nothing about our endless wars in Iraq, Afghanistan, Syria, Libya, Ukraine, etc, and nothing about conversion of the military industrial complex to peaceful production.

After making many social program promises the only thing Bernie mentioned as a way to pay for all of this was a tax on “Wall Street speculation” which of course got a big cheer.

Maybe there are other reasons Bernie is avoiding foreign policy. Criticizing Israel is of course akin to political suicide, so Bernie definitely has to stay mum on pointing out how that murderous apartheid state continues to enact incremental genocide. And why talk about NATO encircling Russia when the propaganda in the states is so effective most people actually think it’s Russia acting as the aggressor?

No, talking about foreign policy isn’t a winning strategy if you’re wanting to win a political popularity contest. It certainly didn’t work in my favor at the old blog space, that’s for sure. People just don’t want to hear how insane America has become as it tries desperately to dominate global affairs, creating chaos where control can’t be achieved.

So enjoy Bernie’s pretty talk about inequality and sticking it to Wall Street and forget that actually addressing America’s big problems means accounting for the cost of maintaining empire.

Vague Story of a Woman from Troy Who Sent Senator Tester a Loaded Gun Hints at Larger Problem

by William Skink

Pete Talbot has a good catch here about a woman who was criminally charged after sending Senator Tester a loaded gun in the mail. It’s a good catch because the story is vague and it’s placement (for those older peeps who read actual newspapers) on page two of the Montana section does kind of obscure its significance.

The reporting hints at prior law enforcement involvement, some kind of investigation, and the temporary removal and return of the same firearm sent to Senator Tester. That is disturbing. And Montana, like too many states, is terrible at sending information to the national database that could, if used, be better at keeping guns out of the hands of people with serious mental illnesses.

Getting that information reported may be an incremental improvement, but in the meantime, what are people to do with a broken mental health system, anti-government sentiment among much of the state population and guns everywhere?

I’m probably not the best person to answer that question. Experiences I’ve had, up close and personal with the mental health system and it’s intersection with the criminal justice system, make me very biased. Over the last few years I’ve gone through a transformation that many readers of the old blog saw as a giving in to fear, and maybe they’re right, but ultimately I felt it was time for me to become a responsible gun owner.

What I don’t buy is the logic that more guns will stop gun violence. I’m not advocating for that at all. I’m just privy to the reality of how difficult it is to truly be preventative when it comes to mental illness and gun violence, and because I’m exposed to sometimes potentially dangerous people, I feel like I need to know how to safely handle and maintain firearms.

That’s particular to me, and not something I can explicitly justify. What I will say is things are improving, especially at the jail. Sometimes it’s good to have a new Sheriff in town. I’m actually cautiously optimistic that Missoula will get its shit together.

MAN ON MOWER

by William Skink

tiny tent webs in the grass holding
water droplets from the sprinkler
like jewels in the sun

my mower is your apocalypse

spray of the sprinkler in zone 4
makes a little rainbow in the mist
should I celebrate this?
I do not ask in the blistering heat

where the water does not fall
the grass turns brown

I live in a brightly colored college town
bursting with hopeful expectation

maybe someday condo utopia will arrive
trailer park fear disappear
and every lawn shall mist into existence

tiny rainbows

hovering above the roar
of hungry mowers munching
grass

that is amen before my ribeye steak
that is the lake of gravy
in the bowl of mashed potato
my spoon, pressing down, creates

our fate falls where we let it
goddamn it’s hot
tearing through tiny worlds in this yard

finally, the task is done, gas can empty
and tonight, after our crust cools off,
quiet work in the grass rebuilding webs

too bad that means nothing
to the mower