Dallas Fed's Fisher on capitalism and banks
Here's what Dallas Fed''s President Fisher says about the banking system and capitalism:
"Paulson, the Congress and other officials will ``will engineer an appropriate recapitalization of the banking system in a manner that does not kill the goose that lays the golden eggs of the practice of capitalism,'' See full story here at bloomberg.
To think that banks are the most important part of capitalism is false. This is a snake oil salesman telling me that the most important oil in the world is snake oil.
Capitalism will do just fine without banks. It worked before banks, it will work even if banks completely disappear. I hope that at least 50% of them will-they are useless entities to scam savers of their money.
Mr. Fisher would do well to visit a Texas Instrument's Fab right under his nose in Dallas; that's capitalism. If Adam Smith were alive today he would be proud to see division of labor and capital being employed so well as in a semiconductor manufacturing facility. And I would bet that he would be aghast at how little the banking industry has progressed-and probably even has gotten worse since his times.
Banks were designed to put capital of savers to productive uses-not to loan for houses (a consumption expense, see Adam Smith-houses are not investments, they are consumption loans), real estate or play with derivatives.
Markets will be back-but I hope that the pension funds, the corporate treasurers, and the mom and pop savers of the world will come out smarter not to trust the banks as much as they did before. This will be very good for capitalism-capital will fall into better hands, hands which will allocate it better for the benefit of all. And it will eliminate more of these useless overpaid middlemen called banks.
But to see an important guy in the Federal Reserve talk about the importance of his own profession or of his cousins is funny-you see now that astrologers (they do have Economics and Finance degrees, two disciplines closely related to Astrology. To be fair and not to sound like I am picking on them, Psychology, Sociology, Political Science, etc. fall in the same camp) have risen to the highest levels of Government-and central banks and their staff seem to have quite a few of them.
Sanjay
"Paulson, the Congress and other officials will ``will engineer an appropriate recapitalization of the banking system in a manner that does not kill the goose that lays the golden eggs of the practice of capitalism,'' See full story here at bloomberg.
To think that banks are the most important part of capitalism is false. This is a snake oil salesman telling me that the most important oil in the world is snake oil.
Capitalism will do just fine without banks. It worked before banks, it will work even if banks completely disappear. I hope that at least 50% of them will-they are useless entities to scam savers of their money.
Mr. Fisher would do well to visit a Texas Instrument's Fab right under his nose in Dallas; that's capitalism. If Adam Smith were alive today he would be proud to see division of labor and capital being employed so well as in a semiconductor manufacturing facility. And I would bet that he would be aghast at how little the banking industry has progressed-and probably even has gotten worse since his times.
Banks were designed to put capital of savers to productive uses-not to loan for houses (a consumption expense, see Adam Smith-houses are not investments, they are consumption loans), real estate or play with derivatives.
Markets will be back-but I hope that the pension funds, the corporate treasurers, and the mom and pop savers of the world will come out smarter not to trust the banks as much as they did before. This will be very good for capitalism-capital will fall into better hands, hands which will allocate it better for the benefit of all. And it will eliminate more of these useless overpaid middlemen called banks.
But to see an important guy in the Federal Reserve talk about the importance of his own profession or of his cousins is funny-you see now that astrologers (they do have Economics and Finance degrees, two disciplines closely related to Astrology. To be fair and not to sound like I am picking on them, Psychology, Sociology, Political Science, etc. fall in the same camp) have risen to the highest levels of Government-and central banks and their staff seem to have quite a few of them.
Sanjay
Labels: general commentary
posted by Sanjay "John" Gandhi at 10:41 AM
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