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 | "Hands off" says Wall Street to Obama Posted by Michael E. Marotta on 4/22, 3:53pm | |
| "Wall Street was unimpressed by President Obama's argument for financial reform on Thursday. The reaction of nearly a dozen financial industry workers ranged from skepticism to animosity." -- And such comments as were published were muddled examples of mixed-premise excuses for actual thinking. Official text of the President's comments here. This is deja vu all over again. When the US Treasury looted Drexel Burnham of a quarter trillion dollars, the culprit was "junk bonds." Immediately after the arrest and imprisonment of innovator Michael Milken, the FTC allowed the (regulated) trade in "high risk" (versus "blue chip") bonds. Now, here, too, President Obama wants to limit high risk investments that he does not understand. Granted that "some" or even "many" so-called "traders" might not understand them, so what? Einstein claimed publicly not to understand quantum mechanics -- and given his weakness in mathematics, he might not have been kidding -- but quantum mechanics is real and so were and are the (ahem) derivatives that were and are traded. We objectivists are hot for gold and silver as if they were given to us by the gods themselves, but they are only "derivatives" for cows. In the 19th century, Sir William Ridgeway showed that the mina of silver and the shekel of gold are the value of a slab of bronze not surprisingly the size and shape of an oxhide. When you get down to brass tacks, a Federal Reserve Note is a mystical derivative. Who cares? Only muscle-mystics of limited ability to abstract abstractions. So, among the many moral questions is the basic practical problem: Is America going to be prohibited from high yield risks that the President cannot understand, or are Americans going to be allowed to create new forms of wealth? | ||
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