Thomas A. Anderson

@shaunrein Wall Street loved this cost structure when they were drop shipping from China hollowing out the real economy making the margin usually preserved for hard work, rent seeking. Well that was never going to be permanent.

@shaunrein If a Chinese firm can manufacture an EV battery at cost because its factory loans are rolled over at 2% by a state bank, putting a 60% or 100% tariff on that battery doesn't make the American factory more efficient.

China has turned diamonds, mobile phones, autos into commodities that the common man can afford Soon it's going to do the same for chips and AI LLMs

@shaunrein These 400% markups in the US economy have been possible due to the petrodollar creating demand for dollars, not competitive priced goods having to compete with 10% markup financing structures. Tariffs don't fix the problems.

@shaunrein Trumps protective tariffs are to try and keep these 400% markup in place for the financial class as opposed to what Biden was starting to do with the Chips Act & Industrial Policy to compete with the financing structure.

@tomselliott The problems all started with the Reagan Revolution and bringing in Ayn Rand causing all the problems. The gold standard caused the Great Depression & abandoning it got the economy out of the depression.

Before becoming part of the Establishment, Alan Greenspan was an eloquent defender of the gold standard. Writing in Ayn Rand's "Objectivist" newsletter in 1966, Greenspan said a gold standard was the only way to protect people's purchasing power, and thus their property. The welfare state, he wrote, can only exist via govt created credit. "In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. "This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard." In the second paragraph, he gives us a wake-up call about our present reality. In that first, a clue for how we could one day reclaim our power. RIP

@tonyannett The Reconstruction Finance Corporation, Office of Price Administration & companies like Brown & Root that came out of it working with the state did orders of magnitude better then Greenspan's deregulation.

@Handre The United States didn't become an industrial colossus through laissez-faire venture capital; it built its dominance because men like LBJ, economists like Galbraith, and builders like the Browns weaponized the sovereign power of the state to build physical capacity at cost.

@Handre The LBJ-Brown & Root alliance: LBJ pulled strings with the Navy and the War Production Board. The state didn't care about their lack of experience. Using federal credit via the Defense Plant Corporation model, Brown & Root built Brown Shipbuilding from an empty, muddy pasture.

Alan Greenspan died today, and the man who spent two decades inflating bubbles will be eulogized as a maestro. Fitting, because he understood exactly what he was doing. In 1966 a younger Greenspan wrote an essay called "Gold and Economic Freedom." He laid out the case with precision. The gold standard protected savers from confiscation by inflation. Welfare statists hated gold because it stood in the way of their deficits. He wrote that the abandonment of gold made deficit spending a "scheme for the hidden confiscation of wealth." He was right. He knew it. Then he took the job running the printing press. From August 1987 to January 2006 Greenspan sat atop the Federal Reserve and did the opposite of everything that essay defended. After the 1987 crash he flooded the banks with liquidity and taught a generation of traders that the central bank would catch them every time they fell. They named the reflex after him: the Greenspan put. He cut the federal funds rate to 1 percent by June 2003 and held it there, and you watched housing prices detach from any sane relationship to income. Mortgage credit gushed. He went on television in February 2004 and suggested Americans consider adjustable-rate mortgages, roughly eighteen months before he started hiking rates into those very borrowers. The man who warned in 1966 about the hidden confiscation of wealth engineered the largest credit distortion in postwar history. Then came the apology that wasn't one. In October 2008, sitting before Congress as the wreckage smoked, Greenspan confessed he had found "a flaw" in his model of how the world worked. He was "shocked" that lenders had not policed themselves. You don't get to spend twenty years pricing risk at zero and then act surprised when men respond to the incentives you built. Any committee of economists cannot set the price of money better than a market can. Greenspan knew the answer at 40 and spent the next half century pretending he'd forgotten it. The savers he warned about in 1966 paid for that performance.

@Handre This is what terrifies financial interests in the west to compete with what China is doing the west going to go back to how it did financing in WW2. People like Lyndon Johnson understood this from WW2 working with Galbraith & engineering firms like Brown & Root.

@Handre You have to study how the Defense Plant Corporation subsidiary of the Reconstruction Finance Corporation finance the expansion of American industry so the state not Wall Street.

@Handre So you say only profit margins can allocate resources while using gold. They are having division of labor w/o profit & instead at cost that's is why they can produce things so cheaply & the west can't compete with the financing cost structure which is you get industrial policy.

@Handre Say China has state banks that print $/credit for production no gold involved, & their has being drastic deflation in the cost of items like batteries, solar panels, etc because they are doing a division of labor economy at cost instead of each layer w/ a 31% profit margin.

@Handre The real estate bubble in the US wasn't because of lack of gold but Ronald Reagan's deregulation of private credit using real estate as collateral that happens with gold or without gold, the inflation was deregulation of private credit not going off gold.

@_sn_n He & the people who put him in power didn't like an economically secure and educated middle class and went after both. Real Estate bubble, student loan bubble were some of the main attack vectors while promoting the trades & blue collar that propaganda works on.

then Reagan got elected