Wednesday, November 25, 2015

It is 1968 all over again

Many of the men I drink coffee with are veterans from the Vietnam War era.

They have little good to say about L. B. Johnson and Robert McNamara's running of the war from half a world away.  War is fluid and windows of opportunity open and close rapidly.  Top down cannot exploit those windows because it moves too slowly.  Distance causes loss of information.

Paradigms function by filtering out extraneous information.  They start failing as the information becomes more diluted and less vivid.  At some point the shadows on our retinas overwhelm the tiny whiff of real data and we see the ghosts our ideology tells us we should be seeing.

David Stockman recently wrote a piece about the paradigm mismatch between Wall Street and Washington DC.  The team in Washington is replaying the losing Johnson-McNamara gameplan.  They are picking winners and loser from cozy parlors in DC.  They demonstrate all of the moral authority of gun runners for the Irish Republican Army.

The "Smart Money" on Wall Street shows all of the restraint of drunks pillaging the bar on the Titanic.  World War III may be spooling up and the traders are trying to squeeze the last molecule of profit out of the deal.

Keep your powder dry and stay away from crowds.


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