But We Need the Eggs

Re-posted from

Epsilon Theory

Ben Hunt of Epsilon Theory is one of those rare minds who not only can think outside the box while simultaneously standing inside, but personally grow and prosper while doing so. I suspect his secret springs from the fact he did not enter the "financial" field thru the traditional doors, windows and dungeons nearly all others are directed towards as the price of entry.

The article below, which was posted by Ben over a week ago, is in my opinion a must read, even for those who care little to nothing about the "financial" world. He hits the nail squarely on the head in a manner anyone can understand.

Bottom line...we have been, we currently are, and we will continue to be lied to about the "state" of our financial affairs in order to further enrich and empower a small select group of people. And our most effective defense is not to understand the minutia of the lie, but to simply see the lie for what it is, a lie, and not participate.

Please, invest 10 minutes of your time and read the article in its entirely.

Cognitive Dissonance.

ALVY SINGER: This guy goes to a psychiatrist and says, “Doc, my brother’s crazy; he thinks he’s a chicken.” And the doctor says, “Well, why don’t you turn him in?” The guy says, “I would, but I need the eggs.” Well, I guess that’s pretty much how I feel about relationships; y’know, they’re totally irrational, and crazy, and absurd … but, I guess we keep going through it because most of us … need the eggs.

Annie Hall (1977)

I realize that we must un-person Woody Allen today, but Annie Hall is a great movie regardless. That’s Duane Hall in the picture above, Annie’s brother, as he drives Alvy and Annie to the airport after confessing to Alvy that his secret fantasy is to slam the car into the oncoming headlights. No one does crazy better than Christopher Walken.

We’re all passengers in the backseat of the State-driven car, and we all suspect that our drivers might be high-functioning lunatics, and we’re all terrified about what they might do next.

But we need the eggs.

We need a stock market that only goes up.

We need to consume more healthcare. We need to consume more education. We need to consume more travel. We need to consume more Netflix on more devices. We need to consume more social media. We need to consume more “experiences”.

And we need the credit to do all of that NOW.

I was thinking about that Annie Hall scene a lot in the past week, what with the Green New Deal ™ and the Modern Monetary Theory ™ proposals in the news, replacing the Tax Cuts ™ and Supply-Side Economic Theory ™ of just last year.

If there’s one oldie-but-goodie ET note I’d want everyone to read, it’s Magical Thinking, published in September 2016.

Here are some of the money quotes from that note. It’s a long pull, so I’ll put them in large font so you don’t gloss over it:

See, the problem isn’t with the Fed. They’re going to do what solipsistic, magical thinking priest-kings have done for ten thousand years … more of THAT. More solipsism. More magical thinking. More 4-year-old egomaniacal determination that their spell casting efforts are the ONLY thing that stand between us and utter ruin.

No, the bigger problem is with us. The bigger problem is that we cannot imagine a solution for our current economic and political problems that does not rely on greater and greater state-directed spell casting. Monetary policy spells not working? Well, golly, I guess our ONLY alternative is to try some fiscal policy spells. Really? That’s the best we can come up with? I understand that this is what the courtiers are going to say. But I expect more from the rest of us. I expect more from myself. …

In phase 3 — and this is where we are now in the historical process, somewhere between the end of phase 2 and the start of phase 3 — the priest-kings are challenged by a rogue priest in their midst (rare) or an alt-priest coming out of nowhere (common). By “nowhere” I mean that the alt-priest is an Other, whether that’s a foreign religion or a foreign geography or a foreign (i.e., non-priestly) caste. The alt-priest isn’t about tweaking the spell or casting it louder. He’s about doing an entirely different spell, and he’s about accusing the incumbent priests of incompetence or worse. The alt-priest is always a populist, and populism comes easy when the incumbent spells have been failing … and failing … and failing.

What does Phase 3 look like? It looks like this:

The incumbent priests begin an intense CYA effort …

There’s no time to lose in explaining why past spell-casting “worked” to achieve the goals of the new religion, even if the explanations evaporate under the most cursory examination. No worries … no one ever reads past the abstract.

For example, this ECB “research” is purely a simulation, based on a model assuming a channel for asset purchases to reduce unemployment. Amazingly enough, the simulation works! No actual data was collected or analyzed here, but the “results” are presented as a historical fact.

The old priest-kings themselves launch an apology tour …

Because it’s critical to revise history NOW before the alt-priests take control …

Some incumbent priests see clearly where the zeitgeist is moving, and begin to position themselves for the new religion …

It’s all happening again.

With the election of Ronald Reagan in 1980, Supply-Side Economic Theory swept out the incumbent priest-kings and ushered in a sea change in monetary and fiscal policy spell-casting that would totally reshape our political and economic world.

There was no “evidence” that Supply-Side policies would work. Hell, the core (and trite) idea here was famously drawn by Arthur Laffer on the back of a cocktail napkin. But it fit the political needs of the zeitgeist, and so it was.

INSKEEP: So you’re saying borrow the money, make the investment. The economy will grow. It will pay off the debt.

OCASIO-CORTEZ: Absolutely. Because we’re creating jobs.

INSKEEP: Although, I do have to say, you mentioned the Republican tax cut. They said the same thing about the tax cut – let’s do this tax cut. The economy will grow. It’s going to be great. It’s going to pay for itself. Hasn’t turned out to be true at all.

OCASIO-CORTEZ: Absolutely. And I think that that is an important distinction to make because when they were advancing that cause, they had no evidence to say that these things were going to happen. But we actually do have the evidence. For every $1 invested in infrastructure, we get $6 back.

“For every $1 invested in infrastructure, we get $6 back.”

“We can revitalize our economy and create tens of millions of jobs in the process.”

This is EXACTLY the same language, based on EXACTLY the same nonexistent “evidence”, that every GOP shill has used for the past 40 YEARS to justify tax cuts and supply-side economics without end.

But now it’s going to be the Democrat shills justifying tax hikes and demand-side economics without end.

It’s all the same con, and it’s all happening again. Except this time it’s not to the direct benefit of the Oligarchy but to the direct benefit of the State.

Not to worry, though, I’m sure the Oligarchs will find a way to muddle through, just as the State found a way to thrive over the past forty years. They’re friendly rivals, the Oligarchy and the State. No sense in messing up a good gig.

So what do we do? How do we stop this?

Well, this was my first idea.

I know it’s frustrating, but this isn’t something to be “stopped”, at least not in the way you’re asking the question.

Why not? Because it takes a State to “stop” a State. And that cure is ALWAYS worse than the disease. To quote myself again …

The more we embrace and encourage state-directed magical thinking, whether it’s of the monetary or fiscal policy sort, what we are actually doing is opening the city gates to the old evil magic and the alt-priests of fascism and totalitarianism.

We will never protect the city by embracing one State-directed ism over another State-directed ism, by embracing the shame and mendacity of democratic socialism over the shame and mendacity of Trumpism, or vice versa. We may think we’re fighting the good fight here, but I promise you we are not.

We cannot “stop” the magical thinking of the Statist Right or the Statist Left by joining one side or another and fighting this fight on their own terms.

But we can subdue the power of magical thinking. We can diminish it over time. We can put the Cults of the State and Oligarchy back in the freakin’ bottle where they belong.

How?

First, we refuse to play the magical thinking game of the Statist Right OR the Statist Left.

• We train our mind’s eye to see clearly the invisible dimensions of Narrative,  Abstraction,  Metagame  and Estimation, dimensions that subsume and control the visible worlds of politics and economics. In so doing, we visualize the worldly truths of citizenship and investing for ourselves, not as some received truth broadcast by the Missionary caste.

• We use that visualization of these wordly truths with a full heart, meaning that we act according to the principles of Reciprocity and Identity, principles that organize a pack of like-minded and truth-seeking individuals for long-term success. In so doing, we defeat the alienating efforts of the Nudging State and the Nudging Oligarchy over time. Every time.

So before you cast that next vote or send that next tweet, ask yourself:

If you don’t have an answer to the first four questions, or if you can’t answer the last two questions with a solid YES, then don’t do it. Just don’t play the game, whatever that game might be. It’s really as simple as that.

Second, we find our pack of like-minded truth-seekers and we tell each other one simple thing, over and over and over: YOU ARE NOT ALONE.

And this is how we change the world.

Not through a political party, but through a movement. Not from the top down, but from the bottom up. Not by being negged, but by negging them. Not from close engagement with the State and the Oligarchy, but from a knowing and wary distance.

Handshake by handshake, good deed by good deed, bird by bird.

We will write the anthems, not the laws, and that’s why we will prevail.

Because it always does.

Clear eyes, full hearts, can’t lose.

Re-posted from Epsilon Theory

Cognitive Dissonance

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