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WB: All That Glitters
Billmon:
The dollar has indeed been sinking — against the euro, the yen and the most of the leading emerging market currencies (although not the Chinese yuan, which is still pegged.) But the slope of the greenback’s downward curve has been nothing compared to the upward trajectory of the price of gold. Somebody out there (there being the People’s Bank of China) is still trying to soak up all that excess dollar liquidity — counterflooding, as it were. Let’s hope they keep it up.
All That Glitters
For those too young to remember, during the 1980’s gold peaked when businesses that used gold as a raw material began suffering. Gold is a fun abstraction for the idle, and ignorant, investor (and there are certainly enough people who are paid handsomely to keep it so), but, for others, it is a real mineral, with real effects on people’s lives.
On this more mundane level, where poor people’s lives are concerned, and not rich people’s fears and fantasies of wealth, the increasing price of gold is very bad. It inevitably signals the development of more ecologically devastating gold mines, kicking more peasants off the land, and polluting more rivers. Gold may function as a financial abstraction (to the endless fascination of those who obsess about the disappearance of “fiat money” among others), but it has very real consequences for many indigenous people whose livelihoods are taken away by unimpeded TNC development.
If the increasing price of gold turns Central America and Papua-New Guinea into Haiti with open mines and suppurating rivers, it does more than just destroy our favorite vacation destination. It kills, sickens, takes away the livelyhood, and displaces, countless thousands. If these deracinated masses are lucky enough, they flee to the endless sprawl of shantytowns encircling third world cities — this desperate infusion eventually contributes to the ever burgeoning mass of immigration to our own shores.
I know I’m stupid and I sound “shrill,” as this need not really concern us, and it is a small price to pay for doubling, or quintupling our money. But I ask anyone here to explain how investing in activity such as this is in any way different from investing in the company that manufactures bombs, and then celebrating every time Fallujah, or some other unfortunate city, is leveled?
And I am not concerned with the innocence or sanctity of our intentions. This blog should be for people who seek to look beyond such self-vindicating apologies. I am concerned with the effect of our actions, wittingly or unwittingly, upon others. And in this effect, I can see only devastation.
Where should you put your money in uncertain times? Unless you want to be as much a part of the problem as those who invest in Halliburton, while at the same time decrying war, you should use your money to create the kind of world you desire to live in — and the companies and co-operatives that are working to create it. If you like where you live, invest locally to increase the values of your community. Listen to Katherine Austin Fitts.
Soros has famously pronounced investing to be an “ammoral activity,” that is, having no moral value whatsoever. Such brazen, and self-aggrandizing, denial of the basic laws of cause and effect are to be expected by the pathologically rich — after all, if one takes a position in a company, wouldn’t one then be obligated to lobby for tax benefits and changes of law that benefit said position; and don’t those real-world changes have moral effects and ramifications? Apparently not, in the virtual world of finance, where shedding “negative externalities,” upon the unwitting public is done as blithely — and regularly — as farting with joyful abandon where one supposes no one can hear it.
Fear is a great tool. The elite can use it to control the disposition of other’s money at will. But it does not have to be that way — certainly not among this group.
Yes, if we are frightened about what is happening in this country, we can flee to somewhere else. We can attempt to be like the conscienceless rich, and spend our whole lives fleeing from Gstaad to St. Barts, from Mustique to Sun Valley, from the Hamptons to Ibiza, and on and on, in a vain attempt to escape “negative externalities.” Or we can grow up and take responsibility for the world we live in, the world we are a small part of creating. That means settling down in a physical locale, taking responsibility for that land, that ecosystem, and fighting the “negative externalities” — the inequalities, injustices, and ecological damage done to that place. It means consciously working to heal our world, and our place in it.
It also means forgoing the type of financial returns that “investors” expect, which can only be made at the expense of others — at the expense of laid off workers and shuttered factories; at the expense of vanishing pensions, and vanishing environmental and labor laws; at the expense of the security of every working person in the endless pell-mell rush to the bottom.
It means decoupling our sense of security — and identity — from the Dow Jones average. The Dow rises when labor standards fall. The Dow rises when “negative externalities,” like nuclear waste, require expensive amelioration programs. The Dow rises when more of us get cancer, requiring years of expensive medical treatment. To quote Katherine Austin Fitts, the Dow rises when “we are caught up in an endless cycle of increasingly expensive interventions for our increasingly destructive actions.”
I went to sleep as a happy member of the “Moon” community; I woke up in “Ayn Rand Land.” Sheesh….I knew I was drinking a dangerous mix last night. What’s next — celebrating the memory of “Uncle Alan?” I can find Libertarian blogs that exhibit more long-term awareness than this. Or perhaps, in our collective fear, long-term awareness has suddenly become declassé — a comfortable old sweater to be discarded now that it has developed a hole.
This is neither a Luddite view, nor is it irrelevant to our long-term security, or the disposition of our money. And it has direct application to investing. After all, what mind game are we playing on ourselves when we insist upon seeing gold as an abstraction, while bemoaning the increasingly hard-edged realities of another commodity, namely, oil? It is our choice whether we choose to invest in oil, or wind power; whether we invest in GM, or like Bill Gates, invest in railroad stock. It is our choice whether we invest in worker’s collectives, and co-ops, or TNCs.
It is our choice whether we fight for better labor laws, or higher profits. Unfortunately the interests of the investor class and the worker class are different. We can be liberals, or maybe they call them “New Democrats” these days, and pretend that they aren’t — but, in reality, they are.
It is our choice whether we seek sustainability, or endless growth. They are mutually exclusive, and they do have ramifications: Sustainability means a living wage, medical care, provisions for old age, a population within the carrying capacity of the land, etc.; Endless growth means increasing returns from “abstract” commodities like gold, oil, water, and GMO food, as well as increasingly expensive medical interventions aimed at the rich, etc. Sustainability means providing for all. Endless growth means (as ideology would have us believe) that the best of us thrive, while the lazy and shiftless fall behind. In reality, endless growth, means, according to Bill Blum’s formulation, that we rise according to the level of violence we can countenance. The ruthless succeed, while the less aggressive, the unlucky, the unfortunate, the sickly and the weak get what they deserve.
In the “Brave New Darwinian World” of endless growth, Emma Lazarus’ Famous Poem, The New Colossus, in which she implores,
“Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tost to me,
I lift my lamp beside the golden door!,”
is a mere curio, relegated to the forgotten environs of eighth-grade English class. Is this the world in which we choose to live?
It is sad when I have to quote from the notoriously liberal, anti-growth, anti-investor, rag, The New York Times, to make my point:
Behind Gold’s Glitter: Torn Lands and Pointed Questions
Oct. 24, 2005
There has always been an element of madness to gold’s allure.
For thousands of years, something in the eternally lustrous metal has driven people to the outer edges of desire – to have it and hoard it, to kill or conquer for it, to possess it like a lover.
In the early 1500’s, King Ferdinand of Spain laid down the priorities as his conquistadors set out for the New World. “Get gold,” he told them, “Humanely if possible, but at all costs, get gold.”
In that long and tortuous history, gold has now arrived at a new moment of opportunity and peril.
The price of gold is higher than it has been in 17 years – pushing $500 an ounce. But much of the gold left to be mined is microscopic and is being wrung from the earth at enormous environmental cost, often in some of the poorest corners of the world.
And unlike past gold manias, from the time of the pharoahs to the forty-niners, this one has little to do with girding empires, economies or currencies. It is almost all about the soaring demand for jewelry, which consumes 80 percent or more of the gold mined today.
The extravagance of the moment is provoking a storm among environmental groups and communities near the mines, and forcing even some at Tiffany & Company and the world’s largest mining companies to confront uncomfortable questions about the real costs of mining gold.
“The biggest challenge we face is the absence of a set of clearly defined, broadly accepted standards for environmentally and socially responsible mining,” said Tiffany’s chairman, Michael Kowalski. He took out a full-page advertisement last year urging miners to make “urgently needed” reforms.
Consider a ring. For that one ounce of gold, miners dig up and haul away 30 tons of rock and sprinkle it with diluted cyanide, which separates the gold from the rock. Before they are through, miners at some of the largest mines move a half million tons of earth a day, pile it in mounds that can rival the Great Pyramids, and drizzle the ore with the poisonous solution for years.
The scars of open-pit mining on this scale endure.
A months-long examination by The New York Times, including tours of gold mines in the American West, Latin America, Africa and Europe, provided a rare look inside an insular industry with a troubled environmental legacy and an uncertain future.
Some metal mines, including gold mines, have become the near-equivalent of nuclear waste dumps that must be tended in perpetuity. Hard-rock mining generates more toxic waste than any other industry in the United States, according to the Environmental Protection Agency. The agency estimated last year that the cost of cleaning up metal mines could reach $54 billion.
A recent report from the Government Accountability Office chastised the agency and said legal loopholes, corporate shells and weak federal oversight had compounded the costs and increased the chances that mining companies could walk away without paying for cleanups and pass the bill to taxpayers.
“Mining problems weren’t considered a very high priority” in past decades, Thomas P. Dunne, the agency’s acting assistant administrator for solid waste and emergency response, said in an interview. “But they are a concern now.”
With the costs and scrutiny of mining on the rise in rich countries, where the best ores have been depleted, 70 percent of gold is now mined in developing countries like Guatemala and Ghana. It is there, miners and critics agree, that the real battle over gold’s future is being waged.
Gold companies say they are bringing good jobs, tighter environmental rules and time-tested technologies to their new frontiers. With the help of the World Bank, they have opened huge mines promising development. Governments have welcomed the investment.
But environmental groups say companies are mining in ways that would never be tolerated in wealthier nations, such as dumping tons of waste into rivers, bays and oceans. People who live closest to the mines say they see too few of mining’s benefits and bear too much of its burden. In Guatemala and Peru, people have mounted protests to push miners out. Other communities are taking companies to court.
This month a Philippine province sued the world’s fifth-largest gold company, Canada-based Placer Dome, charging that it had ruined a river, bay and coral reef by dumping enough waste to fill a convoy of trucks that would circle the globe three times….
Whoopee! Maybe the price of gold will hit $3000! Hurrayyyyyyyy!
I can’t wait to visit “Moon” again for my next investing lesson. Maybe we will hear about the profits to be made in strip coal mining, or the coming nuclear power bonanza!
One thing I’m sure: With a site like this, I’m bound to become a millionaire in no time at all! Which is probably good, because following adice like this, I will have “no time” left to enjoy it.
So, let me repeat one more time:
Fear is a great tool. The elite can use it to control the disposition of other’s money at will. But it does not have to be that way — certainly not among this group.
Posted by: Malooga | May 4 2006 15:33 utc | 16
@American,
Have you pursued other investment opportunities which do not have the same negative consequences and found them wanting in some way? If so, could you share your experiences with us, and why you rejected more positive alternatives?
Have you researched Solari and other local based investment schema? Have you explored other avenues of socially conscious investing?
Or are you just ignorant, self-satisfied, lazy, and hypocritical?
Those who manufacture the armaments that are used to kill the innocent of Iraq and Afghanistan in our “War on Terror,” do so because the jobs they have provide them with financial security. Those who become members of America’s “Foreign Legion,” the lawless vigilantes which we call “Private Contractors,” also often take those jobs because they are the only ones they can get in order to provide for their families.
You have no standing to criticize the war, and the extra-judicial killings committed by private contractors in Iraq, when your own actions are responsible for an equal amount of killing for your own personal profit.
Not having seen you on this blog before, I can only presume that you are against the war in Iraq; perhaps I am wrong, perhaps you are in favor of it. It is highly profitable, and it is making many astute investors very wealthy.
I would hope that you would take the time to at least read the New York Times article about the deleterious effects of gold mining, and visit the website, No Dirty Gold I linked to above. Note that I am not categorically against investing in “usable commodities,” I am just pointing out that there are better choices, and worse in the field. You can invest in cocoa, or you can invest in “fair trade” cocoa. You can invest in sustainable lumber farms, which do not clearcut, or you can follow the path of Charles Hurwitz, and clearcut every redwood in the Northwest.
I am attempting to point out that our actions have ramifications. You are countering that your need for financial security necessitates you taking no responsibility whatsoever for your actions.
And yes, there are different ethical standards for the uneducated working poor, who live hand-to-mouth, and the co-ordinating class of educated professionals, who grease the skids for the smooth functioning of the capitalist state, and value their investment income as a way of separating themselves — financially, culturally, and “morally” — from the hand-to-mouth crowd.
Capitalism thrives on “Little Eichmanns” like you, who profess no greater social goal beyond your own personal enrichment. Or maybe they do have other goals, but these are mere hobbies, not meant to impinge upon the greater goal of self-enrichment. Given “the low probability of implementing a fair economy within the next five years or so” (at least in some sort of Manichaean either/or categorical way, which you seem to require to goad you into taking any moral responsibility whatsoever for your actions), I would hate to feel that I am in any way “haunting” your precious conscience with my remonstrances.
It is sobering to think that when Social Security is finally privatized, as it most certainly will be after it is gutted, a whole army of 300 million “Little Eichmanns” like you will have been created, and unleashed against the global poor. 300 million pathologically short-term, self-interested, self-replicating, viruses, ready to gobble up the resources of the global south like an army of Pac-men gone berserk. 300 million “investors,” who have no greater interest beyond the rate of return they receive next quarter, and who will greedily scarf down their seed money, with nary a nod to the future.
Your investing had better bring you great wealth by then, because you will sorely need it in order to rest safely behind the massive walls of your gated community, built to protect you from the ravaging hordes of the less fortunate, locked and starving outside the gates. Follow the lead of the US in Iraq: Think not about the reliability of your supply lines. That appears to be a sure formula for success.
Happy investing!
Oh, and many happy “returns.”
Posted by: Malooga | May 4 2006 17:47 utc | 19
No, I, like everyone else here, is faced with moral quandaries every day, and in every way, in this crazy society. We are all integral parts of a “whole” system which is crazy, and is leading mankind to destroy the very planet which has nurtured him.
We all make moral choices. What I’m trying to say, is that all of the choices we make have moral components.
There are few completely right or wrong choices, but there are better and worse choices. And it is up to us to educate ourselves about the ramifications and repercussions of our choices, so that we make the best choices possible.
No one is completely holy, or environmentally “clean.” Nor can we move towards simplicity and sustainability faster than we are ready to, otherwise we will boomerang back, like on an overly restrictive diet. Likewise, it is counterproductive to play the game of “I am cleaner than you,” as it only produces a false sanctimony, pride, and lack of compassion for the state of others, and where they happen to be on their journey.
What we can do is educate ourselves and make the best choices we are capable of. Since no one is completely pure, we all bear some complicity for the state of the planet, and the suffering of others. As adults, we should strive to be conscious of the nature and extent of our complicity in this destructive system. We didn’t create it, but we live within it, and as adults we are to some extent co-creators of the future evolution of the system.
There is a sadness to this awareness, and to many it is simply too painful to face, so we deny our responsibility, and lose ourselves in an escapist veneer of false cheer. But this needn’t be so. Taking responsibility for something means becoming an adult, and feeling empowered, rather than disempowered. It does not mean that we can magically solve difficult and intractable problems, but it means that we move from being unconscious actors, or, in a sense, victims of the problem, to a place of responsibility, engagement, and stewardship. This changes our relationship to the problem: We are now able to approach the problem from a very different space.
We are privileged to be born in the most affluent nation on the globe. Until all trade is fair and equitable, taking into account the rights and livelihoods of those who produce the goods we consume, and until all of civilized activity is environmentally sustainable, then we are responsible for the suffering and illnesses of others who produce what we consume. Contrary to neo-liberal cant, consuming more does not produce greater equality, according to their falacious “rising boat” theory, but produces more inequality and suffering among the global poor. The earth is straining at its production limits, and the more we consume, the more poor are pushed off their lands and into machiladoras, and other systems of organized wage slavery. The more we consume, the more land is environmentally devastated.
As we see the reality of global warming rapidly manifest, and as we experience the exponential growth of cancer rates in the developed world, as well as the militarily exploited world through the use of DU, we must learn that even small individual actions can lead to other small actions, by ourselves and others, which cumulatively can have large beneficial effects. Certainly, our actions in the developed world have thirty or more times the effect of someone’s actions in the less industrialized world.
There is no room for Nihilism here. Ghandi had no time for doubt or wrong action. Change is something we help to create. This is especially important for those of us with children, who wish for our children lives as long as ours, with as many, if not more, opportunities.
I always remember the prayer that we said every day before eating, back when I spent time in the Soto Zen monastery, Shasta Abbey: “We must think deeply about the ways and means by which this food has come.” The same can be said about every thing we come in contact with.
Now, let me explain why I chose to use the term “little Eichmanns.” It is a term with a history. To my knowledge, it was first employed in an essay by the anarcho primitivist philosopher, John Zerzan, in an essay justifying the sentiments, but not the actions, of the Unibomber, Theodore Kaczynski.
“The concept of justice should not be overlooked in considering the Unabomber phenomenon. In fact, except for his targets, when have the many little Eichmanns who are preparing the Brave New World ever been called to account?…. Is it unethical to try to stop those whose contributions are bringing an unprecedented assault on life?”
The phrase was next employed by the historian, Ward Churchill. In an essay called, “Some People Push Back,” later expanded into the book, “On the Justice of Roosting Chickens,” he described the “technocratic corps at the very heart of America’s global financial empire” working in the World Trade Center as “little Eichmanns,” while attempting to understand the actions of those employees, claiming that they, and the vast majority of Americans, had ignored the civilian suffering caused by the sanctions on Iraq during the 1990s, which he characterized as a policy of genocide.
In both cases, the term is used to describe the actions of unthinking workers — or shall we say, workers who believe that because they are undertaking seemingly rational actions, albeit, in a “world gone mad,” a system bent upon its own destruction — and that belonging to this system frees themselves from the need for thought about their role within the system. They have become mere functionaries within the system, and so believe that they have no responsibility for the effects of the system. Hannah Arehnt describes this phenomenon as “the banality of evil.”
In other words, I am not calling you a Nazi, or trying to insult you. I am implying that you have become an unthinking actor in this case, a mere functionary, and that your actions are, in some small way, creating a world in which neither you nor I will want to live. I am employing my weapon of choice, in this case mere words, strung together into a rational and emotive argument, in an ethical attempt “to try to stop those whose contributions are bringing an unprecedented assault on life.”
I am not demanding that you change your actions. I am demanding that you explore the possibilities of changing your actions, and then weigh an honest assessment of the true costs and benefits of those actions with the true costs and benefits of actions you may not have considered yet.
That act of research, exploration, and rational analysis would, in my mind, change you from being a “little Eichmann,” that is to say, an unconscious actor, into a conscious actor, one who is willing to accept the consequences of his actions.
So again, I am not trying to attack you as a person, or even your actions, per se. What I am trying to attack, as forcefully as possible, is the sense of helplessness, the sense of a lack of options, and, most importantly, the sense of willful ignorance that not only you, but everyone on this post, has chosen to fall under, as if in a spell: That one’s own actions do not have consequences that can be helped, but that the actions of others — war supporters, in this instance — are unsupportable, and must be changed.
In psychology this is known as the Fundamental attribution error. We excuse our own actions, but fault the actions of others. In laymen’s terms: My shit don’t stink, but yours sure does.
I hope this explains my position a little more fully. And yes, this does come directly from me and who I am attempting to be and become in this world. So it is a personal argument, but hopefully, not a sanctimonious one.
I very much appreciate your responses, and welcome the opportunity to engage you in civilized and polite argument.
Oh, and no, I don’t have children for the very reasons stated above. But I love the little creeps, and had I been born one hundred years earlier, or before I had sussed all this out, I would have had many, many, many of them.
Posted by: Malooga | May 4 2006 22:01 utc | 32
So, let me repeat one more time:
Fear is a great tool. The elite can use it to control the disposition of other’s money at will. But it does not have to be that way — certainly not among this group.
If you think that you are getting over on the elite by putting your money in gold, you are sadly mistaken.
Over the past five years you could have made more money investing in railroad stock than gold. There are plenty of other investments that pop up from time to time that have some positive value.
Let me repeat: Anyone who invests in gold in order to make money has no reason to criticize anyone who goes off to kill in Iraq in order to make money.
Put another way: Investing in gold for financial security is tantamount to killing in Iraq for financial security.
Either the world is round, and our actions have consequences, or it isn’t, and we live in lalaland with the Bushites where we believe that we can create our own reality, in contra-distinction to niggling “facts.”
Either you understand this or you are intentionally setting up a personal state of willful ignorance to justify your own brutality — some would call that a working definition of civilization anyway.
Well, educate yourself. Before you invest in gold, take this year’s vacation money and head off to some beautiful tropical locale, only instead of drinking margaritas while basting in your own sweat at the beach, visit one of the many gold mines detailed in the Times article. Meet, talk, and befriend the campesinos and hear their stories. Look at the land and the rivers and the ocean. Talk to the local ecologist, if he is still alive and hasn’t been desapparecido’ed in the middle of the night. Visit the factory that makes the cyanide. Do some birding, if there are any left. Then, after you have done your research, come home and invest in gold. I wont like you, but I will respect you. And you will have learned that you can use a vacation for more than fear-driven escapism.
The problem with our society is that it decouples us from the consequences of our actions. Civilization is designed to do just that. Immigrants do the jobs we don’t want to countenance. Immigrants butcher our meat while we work in advertising agencies composing pictures of pretty chicken and noble cattle on fantasy farms. I long ago decided that if I was going to eat meat, I had to learn to slaughter and butcher an animal. And so I did. I healed myself, I made myself whole, by re-coupling with the effects of my actions. And I can look any vegetarian gold investor in the face and tell him why I am a better man than he.
Driving every peasant in the third world off their land and polluting every river and ocean in the world will not bring security to humanity. And eventually it will not bring you personally any security.
Maybe you think you are a sharpie and you can get in and get out with a profit before your actions affect your life directly. Maybe you are the type who honestly has no clue why the undeveloped world hates us.
You can’t be against empire and “preventive” war, and for gold. Gold is empire, gold is blood money. Gold is the original war in Latin America, and it still is. The “Conquistadores” are not a fifties doo-wop band.
I can hear a giant sucking sound by most of the usual posters on this blog because they don’t want to hear that what they are doing is as destructive as the actions that they decry others for doing.
What do you call someone with progressive values who insists on his right to make money at all costs? When I grew up, we used to call them “Rockefeller Rebuplicans.” And that is what this blog is full of: Beneath the thin veneer of “progressive” values lies the ruthless conceit in one’s one perogatve to make money at all costs, combined with the liberal fear that one will not make enough money because one isn’t as greedy as the “businessmen.”
I don’t give a fig for labels like left or right. I consider myself a “radical” in the sense that it means trying to get to the “root” of a problem in order to understand it. And I have no time for liberals who seek to appropriate my style as window dressing to justify their depredations.
But Robert Jensen says it better than I:
Some of my best friends are liberals. Really. But I have found it is best not to rely on them politically….First, some definitional work: In the contemporary United States, I use the term “left” or “radical” to identify a political position that is anti-capitalist and anti-empire. Leftists fight attempts to naturalize capitalism, rejecting the assertion that such a brutal way to organize an economy is inevitable. Leftists also reject the idea that the United States has the right to dominate the world, refuting the assertion that we are uniquely benevolent in our imperial project. Liberals typically decry the worst excesses of capitalism and empire, but don’t critique the system at a more basic level.
Liberals sound like radicals, decrying empire, but secretly they hedge their bets, and political beliefs, by investing in gold.
Let me leave you with one last real world example about investing. In Western Massachusetts, in Northhampton, a community group has been trying for four years to raise $7-8M in order to construct a local food co-op. All the studies have shown that this is the single most conducive environment for a co-op in the country, and that it would instantly be hugely successful and profitable. It would support community agriculture, and profits would go back into the community, unlike the capitalist, faux-progressive, Bread and Circus. This amount of money is nothing in the real world. I could raise that money in one day for a capitalist, privately owned supermarket. Four years! Half the investment would be paid back by now, had they managed to raise the money in the projected one year.
You don’t need me to tell you how money works. Michael Phillips and Paul Hawkins and Steward Brand and Katherine Austin Fitts have all done better jobs than I. So get off your computer screens and connect with members of the community where you live and figure out how to add value to your own neighborhood.
Or sit at home, invest in gold, and bemoan the fact that corporations run our lives, and all the stores are sterile chains, and that the only jobs are in the military.
Posted by: Malooga | May 5 2006 13:54 utc | 47
@gmac:
That is true, but I am vainly attempting to point out that as true as that may be, actions still do have consequences, and that the consequences of investing in gold are horriffic.
Even if all the world’s gold investors are only looking for a financial hedge, as the price rises, the pressure increases for more gold to be mined, and more mines to be developed and brought on line, and more peasants to be displaced, and more of the environment destroyed, and more penniless immigrants to attempt to flood into developed nations, etc.
Since everyone here is concerned with the rising price of oil, the same argument could be made that investing in nuclear power is an appropriate hedge. But no one is making that argument on this blog, for fairly self-evident reasons.
What is the difference? The difference is gold fever: An unwillingness among so-called “progressives,” who profess to be anti-war, anti-nuculear power, and pro-environment, to take any responsibility for their actions. They are suckered in by the glitter, the high-class allure, the elegance, and the “purity,” of gold — both as a device, a mechanism, a hedge, and as hard metallic evidence they they have “arrived” as members of “the investor class.”
This is the same mentality evinced by the comfortable middle-class Greens of Europe, and to a lesser extent, the US. These so-called progressives actually only care about the environment because they fear that changes may impinge upon their high levels of consumption. They have no interest in labor movements, which they consider declassé, beneath themselves, and frankly, workers are dumb, awkward, clumsy, and embarrassing to talk about and concern one’s self with. This is why the Green movement is ultimately moribund, and why it forms such easy alliances with power. But, I better stop here, because by now I have probably insulted everyone on this “progressive” blog.
Either actions have consequences, or they don’t. This should be self-evident, especially to anyone who attempts to think about and engage with this world, as denizens of “Moon” profess to do. One can elide this fact, one can justify one’s actions as mere abstract “investments,” or one can bury one’s head in the sand of the Iraqi desert if it makes them feel better. But that doesn’t change the fact that actions do have consequences. And the level of denial here is higher that the “security wall” which Israel has built.
**************************
@fauxreal:
It is very hard to project what things would be like if “all hell breaks loose.”
We are much more dependent on all sorts of chains of supply than previous generations. I think that these fragile, interconnected supply chains which support modern life are much more the risk to worry about, rather than a runaway inflationary spiral.
It depends how long and how deeply the chains of supply are disrupted. For a brief spiral, physical possession of gold could be helpful. For anything much longer or deeper, gold would become worthless, and a basement full of oil, sprouting seeds, canned vegetables, and beef jerky, would be far more valuable then the equivalent amount of gold.
The point I am trying to make is that such an event is a remote possibility at present, and planning for such an event by investing in gold and off-shore slave labor corporations only increases the odds of triggering such an event. Investing locally, and taking responsibility for the state of one’s local environs, does much to prevent such an occurance.
What’s the name of the game in game theory where if everyone follows their own short term benefit things get worse for everyone, etc.? Uncle $cam would know.
Posted by: Malooga | May 6 2006 13:59 utc | 52
Thanks for the cogitory help, gmac.
Yes, many things have an environmental cost. You name some. But gold is worse than all those by an exponential degree.
But, my point is that many fine investments have a NET NEGATIVE cost, in other words, they help things, rather than make them worse, as gold does.
I gave railroad stocks — which would cut down on auto travel — as an example, but there are an infinite number of other examples if one decides that one intends to do good, rather than ignore the consequences and “do bad.”
For instance, investing in rehabing old properties, rather than developing new ones. Or investing in an insulation company. Or anything else which improves efficiency, or reduces consumption, or supplies more with less. Old Bucky Fuller used to call this principle “ephemeralization;” seems we’ve forgotten it around these environs.
(Yes, it can be argued that demand is elastic, and, like a gas, will expand to the limits of its constraints. But, this is not always the case. Besides, the more we can slow down and reign in growth, the longer a window we have to awaken people’s consciousness’ about the state of things, and possibly begin to turn them around.)
Given the abstract choice between investing in a nuclear reactor or a bank of windmills, a classical economist would look at immediate returns. I would hope that the crowd on this blog would look a little deeper.
We can invest in the company which manufactures the more efficient lightbulb, or makes lumber from recycled water bottles, or invest in local co-ops until they are as big as Mondragón. Somebody must have made money growing Mondragón into the seventh largest corporation in Spain over the past sixty years.
The choice is really ours whether we want to turn the wheel of Karma backwards or forwards.
We can find better investments for our money; we just have to decide that we want to look further than the prescriptions of the Wall St. Journal, or The Economist.
For instance, if I had a large chunk of cash, I might invest a certain percentage in real estate. One could hedge one’s bets by investing in several continents. If you couldn’t do this directly, you could invest in REITs. Then I would invest a certain percentage in breakthrough companies which I think are improving our lives through empheralization. I might invest some money in a group that does micro-lending. If I wanted to invest in bonds, I might look at bonds from the city of Curitiba in Brazil, which is working hard at building a more sustainable city (Plus there is the bonus hedge one gets when the dollar falls). If I was hellbent on investing in extractive mining, I might look at Zeolite, a mineral used in many energy saving inventions. Anyway, I could go on, and into more detail, but you get the point.
There must be a kazillion firms out there, all angling for a piece of your money with what they call “socially conscious investing.” Like eco-tourism much of it is a scam, but by no means all of it.
I can’t make a better case than I have throughout this thread. It seems most people would still insist on at least “keeping all options on the table,” even if one of them is the nuclear “NIMBY” option. If a tree falls in the woods and we don’t hear it, then it didn’t really fall. If cyanide leaches into a river whose name we don’t know, and it kills people we never heard of, well, then probably none of this ever really happened.
As the noted ethicist, and mother of our Emperor, Barbara Bush, famously said, “So why should I waste my beautiful mind on something like that?” Or as many here seem to be saying about gold, “So why should I waste my pedestrian mind on something beautiful like that?”
Posted by: Malooga | May 7 2006 7:30 utc | 54
Great Link, Stormcomin’. There’s a pdf file (which I don’t know how to link) buried in there for converting suburbia into a sustainable system. Here’s an eye-popping note from it (p. 14)…
Recall “the pause that refreshes”?? Next time you want to reach for that cola, consider:
A striking case study of the complexity of industrial metabolism is provided by James Womack and Daniel Jones in their book Lean Thinking, where they trace the origins and pathways of a can of English cola. The can itself is more costly and complicated to manufacture than the beverage.
Bauxite is mined in Australia, trucked to a chemical reduction mill, each ton of bauxite processed and purified into a half ton of aluminium oxide. It is then stockpiled, loaded on a giant ore carrier and sent to Sweden or Norway, where hydroelectric dams provide cheap electricity. After a month-long journey across two oceans, it usually sits at the smelter for as long as two months.
The smelter takes two hours to turn each half ton of aluminium oxide into a quarter of a ton of aluminium metal, in ingots ten meters long. These are cured for two weeks before being shipped to roller mills in Sweden or Germany. There each ingot is heated to nearly nine hundred degrees Fahrenheit and rolled down to a thickness of an eighth of an inch. The resulting sheets are wrapped in ten-ton coils and transported to a warehouse, and then to a cold rolling mill in the same or another country, where they are rolled tenfold thinner, ready for fabrication. The aluminium is then sent to England, where sheets are punched and formed into cans, which are then washed, dried, painted with a base coat, and then painted again with specific product information. The cans are next lacquered, flanged (they are still topless), sprayed inside with a protective coating to prevent the cola from corroding the can, and inspected.
The cans are palletized, forklifted, and warehoused until needed. They are then shipped to the bottler, where they are washed and cleaned once more, then filled with water mixed with flavoured syrup, phosphorus, caffeine, and carbon dioxide gas. The sugar is harvested from beet fields in France and undergoes trucking, milling, refining and shipping. The phosphorus comes from Idaho, where it is excavated from deep open-pit mines – a process that also unearths cadmium and radioactive thorium. Round-the-clock, the mining company uses the same amount of electricity as a city of 100,000 people in order to reduce the phosphate to food-grade quality. The caffeine is shipped from a chemical manufacturer to the syrup manufacturer in England.
The filled cans are sealed with an aluminum ‘pop-top’ lid at the rate of fifteen hundred cans per minute, then inserted into cardboard cartons printed with matching colour and promotional schemes. The cartons are made of forest pulp that may have originated anywhere from Sweden or Siberia to the oldgrowth, virgin forests of British Columbia that are the home of grizzly, wolverines, otters, and eagles. Palletised again, the cans are shipped to a regional distribution warehouse, and shortly thereafter to a supermarket where a typical can is purchased within three days.
The consumer buys twelve ounces of the phosphate-tinged, caffeine-impregnated, caramel-flavoured sugar water. Drinking the cola takes a few minutes; throwing the can away takes a second. In England, consumers discard 84 percent of all cans, which means that the overall rate of aluminium waste, after counting production losses, is 88 percent. The United States still gets three-fifths of its aluminium from virgin ore, at twenty times the energy intensity of recycled aluminium, and throws away enough aluminium to replace its entire commercial aircraft fleet every three months.
Every product we consume has a similar hidden history, an unwritten inventory of its materials, resources, and impacts. It also has attendant waste generated by its use and disposal … The amount of waste generated to make a semiconductor chip is over 100,000 times its weight; that of a laptop computer, close to 4,000 times its weight.
Posted by: jj | May 9 2006 8:44 utc | 58
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