'They pose as having discovered and attained their real opinions through the self-evolution of a cold, pure, divinely unperturbed dialectic...while what happens at the bottom is that a prejudice, a notion, an 'inspiration', generally a desire of the heart sifted and made abstract, is defended by them with reasons sought after the event - they are one and all advocates who do not want to be regarded as such, and for the most part no better than cunning pleaders for their prejudices, which they baptise 'truths'
.. Frederich Nietzsche on philosophers, from 'Beyond Good and Evil'.
I was reminded of this quote because it strikes me as amazing that so many pundits and prognosticators didn't see the economic disaster in the financial markets in time to stem the disastrous effects before us. It points up a fact about human nature--even philosophers are tainted by wishful thinking. The notion that the good times will go on and on in some kind of "pro forma" perpetuity seems to infect those who analyze markets for a living. It's almost as if they don't want to believe that the boom will lead to the inevitable crash, that "irrational exuberance" will not lead to a fall, a panic, a recession, a myriad of financial collapses. This time the whirlwind will not occur.
But of course the markets were overheated, the financiers were over leveraged, and too many people were "flipping" houses or relying on their investments to just increase over and over, month after month. Meanwhile, the lenders would just bundle up the bad loans ("securitize" they called it) and pass them along to the next suckers who thought the economy would grow and grow. The last people to invest in the ebbing of boom times must have felt like kids do when they play "musical chairs" in kindergarten and discover when the music stops that there is no place to sit down.
I wonder if this exuberance can really be regulated--if people are willing to forgo some of the dreams of fantastic gain in exchange for insuring that there won't be a painful hard landing for so many next time. Maybe we've learned something if we climb out of the economic abyss in a few years. Or maybe in another generation this will all happen again with slightly different circumstances. Here's hoping for the former.
And here's a bit of Jon Stewart on "The Daily Show" from March 4th, making some sport out of these modern philosophers of economics.
These banks and corporations have certainly provided Jon Stewart with plenty of material. How kind of them.
ReplyDeleteIt's some consolation to know a few people are getting some good out of the pitfalls of the "miracle of the marketplace".
ReplyDeleteGreat clip Doug, Jon Stewart does an international weekly show that I sometimes catch here, or at least I did when I used to watch TV (my first sacrifice to austerity chic).
ReplyDeleteI remember watching his show a lot when I visited your country too and thinking it was the best thing I had seen on American national television (yes I'm the sort of tourist that flies 3,000 miles to sit in every night watching TV and drinking cans of Bud....gone native sorta ).
Anyway....this expose of pundits is great, I think it would be good to put quotes from what the FT and other financial experts said 'on this day' last year, 2 years and 5 years ago on the Calendar on Multiply front page.
It would be an hilarious feature I think, but quite demanding.
I love the Nietzsche quote too, it has a very postmodern twist to the invective.... which actually might also be taken as evidence of self loathing on his own part, but taken at face value, Nietzsche's comments are obviously a plea for original thinking and intellectual freedom, rather than the derivative posturing of academe as the repository of all philosophical 'truth'.
So no, not self loathing perhaps...not so much as a total sense of alienation and self pity from Friedrich here I think..... nobody said being an ubermensch was going to be easy.
Great post Doug.. I think even a cursory acquaintance with Marx would have given these pundits a scintilla of caution perhaps.... but then again who wants their phone tapped and to lose their nice little media job?
The American dream promises you will better off than you started. Many people get wrapped up in making money at all costs. To many people want something for nothing. They extend themselves and then get caught up in the reality of paying it back. Also some people began trying to make money at all cost.
ReplyDeleteThe segment did a good job letting us know the so-called experts dod not know much more than we did, I hope we realize no one really knows it all and we need to be more careful in the future.
Regarding your wonder (question), yes exuberance can be regulated...via interest rate control...Greenspan is in the top 5 to blame for the catastrophe by making money so cheap to borrow for so long in the early 2000s. Plenty of warning signs also provided to regulators such as Cox (chief of SEC), also to blame.
ReplyDeleteString 'em up!
Stewart's writers have an easy job; simply criticize everything and everybody, which is not very entertaining or funny really, but I admit this was a better skit.
Yes, indeed, the tag of "ubermensch" is not for sissies. Tough being in the vanguard of any new social designs come to think of it. Even Karl Marx probably would have been surprised to see a Marxist-led revolutionary government busting out in semi-agarian Russia circa 1917--I think he was thinking Western Europe would lead the way back in the 1870's.
ReplyDeleteGood point about "Know Your Marx" on the business end. I remember taking a a class on Marx and Hegel and other courses on how the USSR and China ran their economies in the early 1980's--as well as the business/government models in Japan. It was the early 1980's and I don't recall many business majors and potential MBA candidates over in our social science building at Cal-State. They probably could have used some sober assessments of how capitalism developed and how its sharp edges expose themselves at times like this. Learning to have total faith in the market in the Age of Milton Friedman was probably more the dish they were served in their general courses.
I'm not sure exactly when they stopped banning books by Marx in some school curricula. Certainly the 1950's and much of the 60's in the USA were a bad time for anybody not in the humor for signing loyalty oaths and having the FBI pop by or keep you on their lists for observation.
The thing about modern pundits is that they aren't so much right as entertaining. Sharon Begley, a columnist for "Newsweek", had what I thought was a good take on this matter in a op-ed called "Why Pundits Get Things Wrong" (2/23/2009)
"Bold, decisive assertions make better sound bites; bombast, swagger and certainty make for better TV. As a result, the marketplace of ideas does not punish poor punditry. Few of us even remember who got what wrong. We are instead impressed by credentials, affiliation, fame and even looks—traits that have no bearing on a pundit's accuracy."
Thanks for your excellent takes AA.
It's true Fred. People start cutting corners to financial success. They don't want to get left behind. The fact is some of them will; they are not bad people just unweary. (Well, they are a few bad ones as we are finding out and as Jon Stewart showed in the clip below, like that "Sir" Alan Stanford creep.) All this exuberance also harms millions of innocents as well in job losses and depressed equity in home prices.
ReplyDeletePeople were happy to take up loans they shouldn't have touched, and the banks and the government weren't doing anything to warn them off, so why not?
I agree we all have to relearn caution.
I think the "smart old men" let the country down--they were much too cozy with those they were supposed to regulate. Now look who has to clean up the mess--you, me and those others of us who weren't invited to the party!
ReplyDelete' Good points ledge!