For those of us which follow the happenings on Wall Street, and the business cycles, well, we see a lot that has gone “right” over the last many decades, but also some things which have not worked out so well. Each time there is a bubble burst, methane burp, violent sector rotation, market crash, or downturn in the business cycle, the blame games start, and the politicians jump in and scream, and then they tell us how they will fix it all. That’s all interesting since much of the cause of any major negative change like that is generally due to adversity caused by that very group of the podium pushing partiers.
Not long ago, I was having a very interesting conversation with a “Fair Value” accounting specialist who’d done a stint working with one of the largest re-insurers of the world. Today, he is a professor of economics. He explained how very important it was to have regulations and use fair-value accounting assessments to protect the investing public, and to keep an eye on Wall Street.
Okay so, I asked him “What is the “Fair Value” of a teacher these days,” And he took on the challenge and compared it to investment grade accounting rules. Offered up some decent suggestions on some metrics for such a fair-value assessment of “teacher-grade” educational investments, namely for us taxpayer’s footing the bill.
All good, and he indicated that education might learn a lot from Fair Value Accounting. Okay fine, so, I now ask that we go to his learning institution and put him through the fair-value procedures, and instead of market-to-market let’s use day-to-day teaching equivalents. As in how much did the knowledge base, understanding, or wisdom of the so-called enlightened student increase today, what is the total, and what is that worth out here in the real world.
The reality is that if we used Fair Value rules for teachers, professors, and teaching staff then most likely they’d all be let go and fired, regardless of tenure. I point this out because we have far too many theorists who’ve never actually run a business or had to make a payroll or create value out here in the real world. Thus, why on Earth are we listening to a word they say, Why do we always stop to consult these folks every time something goes wrong or doesn’t seem right,
The reason I ask this is because, this is what we’ve been doing all along for decades, and it hasn’t gotten us where we need to be. You know why, Sure, I’ll enlighten you – it’s because free-markets want to be free, and not controlled by contrived rules or an avalanche of bureaucracy and regulation, which really ends up obscuring the reality, and thus, the next set of regulations, rules, and guidelines cause more of the same. And each layer of nonsense clouds the next decision making process, until all you have is data coming out of your eyeballs, and miles of unintended consequences.
Seriously folks, if that is really the way we wish to play it, then let’s just go communist, give all of our wealth, freedom, and liberties to a strong central group of corrupt folks and their cronies to manage our civilization with an iron fist, and change the good ole’ USA into the USSA [pun on USSR]. At some point, investors need to do their own due diligence and we have to realize we cannot regulate morality, nor do we need amoral people in our legislature scheming up new regulatory concepts via their academic and far-left leaning wise men.
Why, Certainly I’ll tell you, because everything they’ve done so far has not worked, it’s obvious they are making it up as they go, and they will justify anything to put themselves above the citizens, businesses, and free markets by micro-managing the economic flows, labor, and monetary policies of anything that moves, ceases to move, or needs to move to improve their personal financial standings. Now I am not saying we don’t need a government, we do need the bureaucracy for some things, but we need to keep it in check, allowing it to do what is supposed to do, not what it does not understand or has no clue about.
Until the government and all those smiling economic advisors can balance their own books, they have no business telling businesses how to run theirs. Face it, social security, by definition is a Ponzi Scheme, yet these folks want to make accounting rules for the business community, investment sector, and then when their rules cause markets to collapse they move to bail them out, making me, the taxpayer foot that bill, Are you kidding me,
Government cannot even play within the rules it sets for itself, and yet, it now wishes to tell everyone else how to run their business, Does that mean bureaucrats are corrupt or evil, certainly not, many mean well, and are doing their best in a flawed system, but realize they don’t have the expertise in the private sector, thus have no business micro-managing ours.
What is the Fair Value of a Politician,
What is the Fair Value of a Regulator,
What is the Fair Value of an Economic Consultant to the Government,
And what on Earth have you done for us lately,