That voice! All a'quiver with the dread of self-knowledge that it is confabulating a story, much like the "money" that his Open Market Committee spins out of the increasingly carbonized air. His words fill the vacuum of the collectively blank American mind, where hopes and dreams spin like debris in an Oklahoma twister, only to fall incoherently on a landscape of man-made ruins. If Federal Reserve chairman Ben Bernanke were hooked up to a polygraph machine when he made a public statement — such as last Wednesday's testimony before congress — I bet the output graph would look something like a seismic record of the 9.0 Fukushima megathrust, all fretful spikes and dips.
When historians of the future ponder our fate around their campfires, they will marvel that this society invited such a temporizing little nerd to act as its Oracle-in-Chief… that he made periodic visits to sit before the poobahs of the land, and issued prophesies that nobody could really understand — and that the fate of the people in this land hung on his muttered ambiguities. Let's face it: people need oracles when they don't know what the fuck is going on.
What's going on is as follows: America's central bank is trying to compensate for a floundering economy that will never return to its prior state. The economy is floundering because its scale and mode of operation are no longer consistent with what reality offers in the way of available resources at the right price, especially oil. So, rather than change the scale and mode of operations in this economy — that is, do things differently — we try to keep doing things the same by flushing more "money" into the system, as though it were a captive beast receiving nutriment.
One problem with that is that the "money" is no longer money. That is, it's not really an effective store of value, or pricing reference. It remains for the moment a medium of exchange, but the persons exchanging it grow suspicious of what this "money" purports to represent. Does it stand for promises of future repayment? Hmmmm. Those promises are looking sketchy lately, especially since this is an economy that does not generate enough new real wealth to make the interest payments, let alone manage to pay back the principal. Is it a claim on future work? Some are afraid that the future work deliverable will be less than they expect. Whatever else it is, does it find respect in other societies where different money is used?
These questions are making a lot of people nervous these days. Of course, a time will come when all matters concerning this particular incarnation of money will be seen as strictly ceremonial. Ben Bernanke, we will understand, was not stating facts before congress but rather singing a song, or rather chanting in a low, repetitive, tedious way in the primal manner of a frightened person trying to comfort himself with reassuring sound — that is, prayer. You'd be surprised how well that goes over in a place like congress, which is stuffed with prayerful characters, people who exist in a religious delirium. These are not the people who are nervous, by the way. The nervous tend to be more secular, and inhabit the margins of life where unconventional thinking thrives weedlike at a remove from all the mental toxicity at the center.
These nervous ones are looking ever more closely these days at the distant nation of Japan, where an interesting scenario is playing out: the last days of a giant industrial-technocratic economy. The story there is actually pretty simple if you peel away the quasi-metaphysical bullshit it comes wrapped in these days from astrologasters like John Mauldin and Paul Krugman, viz. Japan has no fossil fuel resources. Zip. You can't run their kind of economy without the stuff. And they can't. Japan is crapping out, as they say in Las Vegas. Tilt! Game over. As this happens, Japan issues a lot of distracting financial noise that involves evermore "creation" of their own "money," and the knock-on effects of that, but it's all just noise. Japan's only good choice is to go medieval, that is, to give up on the rather hopeless 150-year-long project of being an industrial-technocratic modern super-state, and go back to being an island of a beautiful artistic hand-made culture. I call that "going medieval," though you could quibble as to whether that's the best word for it, since I'm not talking about cathedrals or crusades.
One of Japan's other choices is to "go mad-dog," something they actually tried back in the mid-20th century. It didn't work out too well then. The Japanese leadership is making noises about "re-arming," and a nice state of conflict is already simmering between them and their age old rivals-victims next door in China, a country that has lately enjoyed the upper hand in the industrial-techno racket (though it will be faced with the same choices as Japan not too many years hence). Do the Japanese start another world war on their side of the planet? Let's hope not. Let's hope they lay down their robotics and their nuclear reactors gently and go back to making netsuke. Just give it up and do things differently — after all, that's what all the human beings on the planet have to do now.
For what it's worth, Japan's stock market has tanked a hearty 14 percent in the past five days, if that means anything, and I'm not sure it does considering the aforesaid "noise," but there you have it. Our own stock markets are mercifully closed this holiday, having given American worriers an extra day of anxious reflection on the state of things out there. My own opinion is that we're all going medieval sooner rather than later and the big remaining question is how much of a mess we'll make on the journey to it.
Also, personally, I don't like these manufactured holidays when the landscape is cluttered with morons enjoying motorsports. I'll be working today, and grateful when it blows over.
Picture credit: Jesse's Cafe Americain