“If you must break the law, do it to seize power: in all other cases observe it.”

– Julius Caesar.

Fellow Americans, global citizens, rent seekers, and producers, I’m sorry to report we’ve crossed the Rubicon. In the 2,069 years since the apocryphal crossing (significant for Occidental readers), the only difference in the seizure of power are the increasingly sheepish ways with which it is done. The original occasion was as terrifying as it was transparent – political enemies fled en masse excoriating Gaius Julius before and after the event. In tow they took their treasures, their families, and their estrangements. Rumors of political assassination, which eventually became reality, followed the new imperator and became a norm, that’s how unpopular a sudden seizure of power generally is.

Contemporarily, the taking of power and the responses are usually different, but they do rhyme as history so often does. For instance, in 1973 Pol Pot and CPK’s collectivization of production in villages resulted in farm owners slaughtering their own live-stock (rather than give them up to the collective) as they fled the territory claimed by the Khmer Rouge. This grasp at power was loud and transparent as was the reaction.

A soft power grab, and the one directly related to this article, is exemplified by the countless times a monarchy, democracy, republic et al. has debased the value of the domestic exchange in order to surreptitiously collect taxes on the population. But it’s more than a tax, these authors take control over the pricing of production, with the skill and precision an untrained fireman takes control over a firehose. Unlike the CPK and Gaius Julius Caesar, responses and evacuations do not ripple through society when these actions at first transpire. This theft is gradual and quiet, so generally it garners very few enemies excepting prescient members of the population. 

“That’s Novel”

The corona virus isn’t the only novel thing we’re witnessing today. The sudden and extreme swing in unemployment is absolutely unmatched in a history that doesn’t include rape, pillage, and salting the conquered earth. The reaction to the pandemic inspires molten partisan emotions as people battle over the best response to the novel and invisible destruction of our daily inefficient toil, this makes for great water cooler conversation were the proximity of our bodies not a danger to our lives. As per usual every crisis brings out everyone’s armchair expertise and if you’re not careful the concerns will live rent free in your head and resolve nothing.

“Never let a good crisis go to waste.”

– Every Contemporary Despot Wannabe

You’ve been paying attention since the crisis took hold, and in that short time you’ve noticed something familiar in the air. Behind the loud and boisterous arguments in the reception hall you can tell a chef is cooking up something spicy in the back. Hints of saffron, dill, and overwhelming scents that shouldn’t be enjoined except by an expert culinarian. It beckons and draws you from the reception hall. There you see a familiar dish through a haze of fragrant mists, leaping oil fed flames, and blasts of errant steam, monetization. Indeed, beyond the loud reception hall there are soft conversations occurring in other rooms (articles, if you will). The narrative you notice is taking on the tone of a familiar theoretical debate.

“What if it doesn’t work?”

“We must try.”

“But it’s never worked before!”

“On the contrary, it worked for my great-uncles in the Land of Oz just fine.”

“Well, studies show the long-term effects of…”

The theory evolves into action, yet the American public warmly embraces the prodigal response of our banking masters (crowned and sustained circa 2008). My only excuse for my countrymen’s supine response is that the pain from the great recession has not been forgotten, and the the slow boil of our fiscal impoverishment since the recession has been easily ignored. Many of us have not realized that we’ve slowly become accustomed to being buried by obligations. Even if we endeavor to live within our means, the needling of financialization is in every consumptive want. Need a phone, here’s a lease. Need a house because your friend just gained 100% equity in less than three years, just put down 2% or less. Want a car, don’t put anything down, but we will put a tracker in it to tow it away if you don’t pay on the note – deadbeat. 

Now at present we’re in a situation that requires the shutdown of services, resulting in the sudden disemployment for roughly thirty percent of the population at a rate that has never been seen before. Those still standing are still in the same condition, they are anchored debtors with their heads barely above water. The rest of the population cannot meet their basic needs of shelter and food. For the first time in over half a century in America food bank lines extend farther than Starbucks and Chick-fil-A ever dared to dream. Risking redundancy here, it’s important to point out that these ‘bread’ lines, observed with present eyes, depict the peculiar condition of many Americans, that is, luxury vehicles lining up to receive basic necessities.

As an aside: This phenomena as well as BOJ experience in monetary experimentation leads this author to believe deflation is incoming, however due to controls over the flows of money by our monetary authorities, deflation and inflation will be selective. Tread carefully.

“What does this have to do with the price of tea in China?”

The response by the public was at first demonstrated at the ensuing market panic, it was affected with fear in the reception hall as strip malls became ghost towns overnight. In the other back rooms adorned with that scintillating smell, the deference our ‘leaders’ were on full display, they did not appear to be concerned with FED decisions that endeavored towards unprecedented FED market action (unprecedented for America) – action that exists outside of their mandate. It was decisive and ‘for the greater good’; $2 trillion dollars would be spent to make sure America remained great. In fact, the cooler heads in congress prevailed to make a decent profit, much to the chagrin of a minority of the population that was paying attention to such things, would that I had the means for such unscrupulous money management.

The slow drip of unelected market monopoly action has met with an historic amount of proper conduct, servile accommodation, and regulatory tail-tucking. Historically un-American.

Perhaps the tolerance are nestled in the belief that these actions are for the greater good, despite the countless consequential and predictable actions to the contrary. It’s not that inhumane actions by hedge funds (It’s tough out there for hedge funds, the very name is synonymous with excess) are unseemly, they are, but consider a different angle – they are the Cadillac Escalades lined up in a ‘bread’ line, this ‘bread’ just happens to be ‘cabbage’ issued at 1%.

80%-90% of small/medium sized businesses in this environment do not last without a constant unbroken stream of customers. The cost of commercial space, wages, supplies, insurance, etc. leave businesses with very little to assume as a net gain, let alone savings. The slightest deviation from business as usual could be survived in the past, but when a well has been dry for this long, in most eras of healthy economic activity, herds of businesses would abandon the dry well, leaving ghost towns their wake (i.e. novel solutions to novel problems) – instead, in our age, the herd has adapted to recent events so they stay close the well, confident that they will find water. Rather, they find an IOU.

“Bureaucracy is a construction by which a person is conveniently separated from the consequences of his or her actions.”

― Nassim Nicholas Taleb, Skin in the Game

I’ve never been in the midst of economic devastation that wasn’t limited to my own pocket book and the abuse I personally administered. Additionally, it was never an abuse that I could not personally resolve. But, in observing BOJ-level decisions being made by our FED I am floored. You could navigate a satellite of Jupiter through the fissure separating the economy/real world and the market. Society is completely split and market action depicts it best, 20 million unemployed but QQQ is only 10% off its highs. 

In a recent podcast that will not be named a frustrated host exclaimed their annoyance with gold bugs and people that did not sponsor the bailout of, well, everything. The host stated the Federal Reserve’s participation in the marketplace is simply part of the market from now on, there is no longer a separation and that’s just the way it is due to market conditions becoming progressively worse (the slow boil of our financial impoverishment). The host then went on to tease this same group for not understanding why the market should go up in parallel with unemployment numbers – at this point I was hooked, this same phenomena was of special interest for me since the widening gap between the real world and the pricing of equities seemed absurd – akin to “burning the shorts” for the hell of it. Aside from that assumption, I had no explanation for it, luckily the host would provide one. – “That’s just the way it is!” That’s all. Like the FED taking a permanent position in the market place, “That’s just the way it is!” 

2,069 years of development and technological advancements, philosophical inquiry and hard nosed grit succeeding over impossible problems has endeavored this response to soft power seizure in the modern world. “That’s just the way it is.” We will have to wait sometime for the effects of this level of profligacy to summon its accompanying spell of indigence for those most vulnerable. Unfortunately for us, it will come sooner than the 2,069 year old lesson that should have taught us better.