The Giant Paddle.

So the crisis lingers. The 2008 crisis was about millions of people being provoked into borrowing on a rising house market. When house prises fell their investment turned into a debt many couldn’t pay. The debts were real as were the houses but their notional value inflated and then deflated. Everything was real apart from the arbitrary nature of their value. These debts were finally left with the banks, which in some cases were bailed out by taxpayers. In effect we were all lumbered with the product of over valuation pumped up by aggressive bank lending. And now as in 1928 we are experiencing the very real after effects, slow growth, unemployment, devaluation/inflation and higher taxes. The profits from this over valuation went to the many strands of finance and those wise enough to sell when optimism is too high. Stocks rose in 1927 by 50% in one year and house prices rose dramatically prior to 2008. These rises bore no relationship to any underlying increase in value. So these rise/falls in value act to pump wealth from the majority to the financial minority. It appears that by a million small, uncoordinated individual decisions in capitalism money migrates to capitalists, and in communism money migrates to the centre of the communist structure. Even if we invented some new ‘ism’ you can guess where the wealth would flow. Maybe the strange thing is this is not due solely to avarice but friendship. We want to be good to our friends so if we find ourselves in the centre of the current ism we share our perspective with them. We are not friends with those outside it and leave them ignorant of our good news. This suggests the only ism to work for the majority will be Mixing-ism where society is stirred by a giant paddle placing rich with poor, powerful with powerless, tall with short etc in a sort of constantly changing partners folk dance. Maybe then the million small, uncoordinated individual decisions would benefit the whole.