High Frequency Trading nothing better than a bucket shop

Brilliant

Charlie Smith at Of Two Minds weighs in on the health sick-care reform boondoggle.

There is a solution so simple and so radical that it is “impossible” (and of course you’re reading it here): shut down insurance and all government entitlements, and return to the “golden era” of the 1950s when everyone paid cash for health-care.

Be sure and check out the very interesting graphic of costs associated with giving birth at Santa Monica hospital ca. 1952.

Would returning to the days of old be regressive? Would quality of care plummet? Would the cost put the health of people living from paycheck to paycheck at risk?

The answer to each question has to be an emphatic No.

Has care gotten better since 1952? Only marginally. People are still getting sick and dying.

Quality of care will actually improve. After all, nearly all the money paid for treatment goes to insurance companies… which goes to cover inflated values of costs, and handsomely reward executives with exorbitant compensation.  After all the execs didn’t get into health-care to help people, rather it is to help themselves. Put the money where it counts, in actual care for the patient.

The free market will actually drive the cost of health-care down so that everyone would be able to actually afford it. Even people like me who are uninsured (my choice). They would also be forced to answer that wake-up call that they are responsible for their own health and not the fatherhomeland, and better quit smoking/overeating/drinking/drug usage/texting while driving.

Debate as it is purposely being framed isn’t about health care it is about health insurance
The entire health-care debate underway is completely slanted in maintaining the status quo. It isn’t about how to best maintain and support good health of our fellow man and child; it is centered on how best to compensate the middle man, i.e. the insurers and big pharma, and inflate the cost of care to guarantee big bonuses, while still having the ultimate say on quality of care you should recieve- and the healthinsco still reserves the right to refuse you any time it is deemed too costly.

It makes perfect sense to let the free market set the level of each individuals cost of care, not bureaucrats, not parties where profit motive is their primary (only) interest.

Not only would this idea of a cash-based system be the tonic necessary to eliminate fraud and waste, but the quality of care would actually rise.

But of course, rational ideas such as this are immediately shut out of the “debate” because so many special interests have their hands in the pie. They prefer to install a system that helps them to rip-off Americans, where the state and crony accomplices want to keep you alive as long as possible to squeeze the last dollar out of your cold dead hands.

[Of Two Minds]

***UPDATE***

Ilargi comments:

The difference between US and Western European health care lies exclusively in the political power acquired by corporate industries, in this case -mainly- a combination of drug manufacturers (closely linked to the chemical industry) and insurance companies (which are in turn closely linked to Wall Street banks). The US needs to fabricate its own system because it needs to satisfy the perverted influence industry has on not just health care itself, but also on the political process.

[theautomaticearth]

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***UPDATE***4:11 PM 8/5/2009

Healthcare “Reform”: Cui Bono–To Whose Benefit?

[Of Two Minds]

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“It will be many years before the masses discover just how completely they have been fleeced by the power elite.” -Richard Smith

Shell game insight

Treasury paying banks not to lend:

“The Fed is payng banks higher interest rates now… to keep their funds parked at the Fed instead of loaning that money to the American people.”

Oh well, it’s not like we need more debt in the hands of the people. Would you give a loaded gun to an infant?

[H/T]

How wrong they were

Benron’s frequent use of the word “healthy” makes me wonder- if he were a doctor, what would the condition of his patient be today?

Reverse Bank Heist

The Case Against Larry Summers

An excellent primer on why “the man with the toxic hand” responsible for one eastern European nation re-embracing communism after his policies ended in disaster for that country should not be a front-runner for Fed. Inc. Chairman (or allowed anywhere near public policy craetion or people in public office for that matter).

The article is resplendent with examples, serving as a veritable tip sheet of facts about this arrogant econotard and his gargantuan ethical lapses: Summers Soft on Derivatives Regulation; Summers Supported Repeal of Glass-Steagall; Summers’ Wall Street Fees and Perks; Summers Pressured Congress to Stop Exec Pay Caps; Summers’ Role in the California Energy Crisis; Summers Fired a Harvard Whistleblower?

Enjoy. [Faux Bidness]

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During the California energy crisis of 2000, then-Treasury Secretary Summers teamed with Alan Greenspan and Enron executive Kenneth Lay to lecture California Governor Gray Davis on the causes of the crisis, explaining that the problem was excessive government regulation.[11] Under the advice of Kenneth Lay, Summers urged Davis to relax California’s environmental standards in order to reassure the markets. [Wiki]

Dark Pools and Other Matters

H/T

Weekend reading

The US-China Ponzi scheme
by Jon Markman

By unwittingly tying together their fortunes as they pursued their own interests, the 2 nations have put themselves on an economic path of mutually assured destruction.

Over the past decade, Americans were able to outspend their incomes by easily rolling their debts forward through serial home refinancing. The situation was never ideal, but it worked as long as the value of their collateral — their homes — kept rising.

Madoff clients’ households crashed, and now one-time millionaires are broke. The reality is that they were always broke; they just didn’t know it yet.

“People need to realize that China doesn’t actually have any real U.S. money,” Das says. “Unless they can turn in their bonds and exchange them for something else, they’re only paper assets. Yet if they try to exit the position, they’ll destabilize the dollar, and the value of the rest of their assets will plunge. And that’s not even their biggest problem. It’s that they also need to keep buying Treasurys, or interest rates will go up and their capital losses will be terrible.”

In short, Das says, Beijing thought it had discovered the perfect scheme for establishing independence from the West, yet it has instead made its dependence worse than ever. And he observes that one unspoken reason that China has gone whole-hog on its massive, $650 billion fiscal stimulus program — creating more factory capacity in a country that is already reeling from overcapacity — is that the effort gives it cover to stockpile copper, oil, iron ore and other hard assets that it considers to be better stores of value than dollars.

There is only one solution left: a long, slow, boring, lonely, soul-crushing process of digging out from under the piles of debt that got us into this mess.

[MSN]

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The Seigniorage Curse
by Gregor MacDonald

Another country that now looks quite arrested in its development is the United States. But not because of an Oil Curse. Rather, the United States appears to have finally succumbed to its multi-decade “advantage” via dollarization. In dollarization, the US Dollar has been the world’s reserve currency, and the United States economy has “enjoyed” the freedom to borrow and print ad infinitum without the usual penalties.

Seigniorage had allowed us to stop earning our living, and eventually we “bundled up and packaged” our real estate. Interestingly, it’s only in the aftermath of the burst housing bubble that we observe how many Americans are being ‘forced to sell” their homes. In fact, Americans had already sold them.

[Gregor.us]

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Washington’s Dilemma: This Isn’t a Recession, It’s a Collapse
by Gregor MacDonald

Nothing in the public record since the year 2000 indicates that Larry Summers, Ben Bernanke, or Tim Geithner understood that we had been building a skyscraper of private sector debt in textbook blow-off style, since the deflation scare of 2001. Now, two years after FED repair operations began on the broken credit system, and over 3 years since US real estate topped in price, major portions of the country are staring at further home price declines in most major markets. Indeed, it appears that the same macro cycle of the last two Autumns is about to repeat, with more waves of foreclosure, more withdrawals from savings and investment to pay for living expenses, and the attendant bailouts of financial institutions that comes around each time.

[Seeking Alpha]

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“Free is coming to an end.” -Gregor MacDonald

Max Keiser takes offense to Goldman Sachs story

Part I

Part II

But but but… I thought “well-capitalized” meant something

“Even as CIT Group Inc. teetered near collapse this week, neither the company nor its overlords at the Federal Reserve Board ever backed off their official position that the struggling lender was “well capitalized.”

“Coming from the world’s most powerful central bank, that designation used to mean something about a company’s financial strength and ability to absorb losses. Not anymore.

“Investors watched yesterday as yet another major financial- services company angled for a government bailout — this time unsuccessfully — while still sporting U.S. banking regulators’ highest capital rating. It’s a sure thing CIT won’t be the last.

“By labeling almost all its loans as investments instead, CIT got to avoid writing them down to market values.

“So, for capital purposes, the only difference between an insolvent CIT and a well-capitalized CIT was a mere utterance by management that it planned to keep holding the loans. No wonder so many zombie banks continue to roam the country. All they have to do is wish away their ruin, and the rules let them.“

“Most banks that failed during this crisis were considered well capitalized just prior to their failure.” -U.S. Treasury Department’s 88-page report outlining its regulatory overhaul plans

[BB]

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10:50 US Senator Bunning says FDIC’s Bair said up to 500 more banks could fail – DJ

DJ reports FDIC Chairman Sheila Bair believes up to 500 more banks could fail, a U.S. senator said Bair told him in a recent meeting. “She told us that unless something dramatic happens, we could lose up to 500 more banks,” Sen. Jim Bunning, R-Ky., said Thursday at a hearing of the Senate Banking Committee on the foreclosure crisis. Bunning said Bair made the remarks in a recent meeting. “That means that people who make mortgages in local places …. people that could really help in a foreclosure will not be there,” Bunning said.

[DJ Newswire]

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“If you can’t be just, be arbitrary.”  -an Orange County Traffic Court Judge