Post-bubble is a way of life
Mar. 5th, 2007 12:19 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
imomusAs anyone who even glances at newspapers will have seen this past week or so, we're in the middle of a "correction" -- big money is being wiped off share values. It's said to have started with rumours that the Chinese government were planning to make a tougher business environment in order to slow down the country's overheated, bubble-style growth. Anyway, today shares continue to slide, amidst conflicting noises: Correction: this could become a crash after all, thinks The Guardian's chief economics journalist. But Treasury chief feeling good about economy, contradicts Reuters. Gung ho hum!
Now, a lot of the selling we've seen this week represents typically irrational capitalist behaviour -- hunches, worries, fears, projection and paranoia trigger more hunches, worries, fears, projection and paranoia . This storm in a rich man's bone china teacup needn't really concern the rest of us. The huge sums of money being lost are largely imaginary, purely notional, and concentrated, anyway, in very few hands.
But what might a big crash mean to the rest of us? Might it even be rather good news? I think the answer to that depends on the answer to the question "How big?" The kind of crash people call a "correction" would mean very little to me, personally. I own no property, no house, no car. I have no dependents. Neither do I have any debt. I could live on a quarter of the sum I'm currently earning, and it wouldn't honestly make much material difference to my life. A crash would only start to impact my life if it made air travel more expensive, or made the internet somehow stop working.
Berlin isn't just a city well-protected from rising sea levels, earthquakes, and so on. It's also well-protected from financial instability. This is a city with incredibly cheap prices, a city populated by people who manage to live well on little money, a city of renters rather than owners, a city pretty familiar with post-materialist lifestyles.
But a warning on just how wrong things can go here, in other circumstances, comes from Kafka's experience of the city in the early 1920s. High inflation and unemployment led to such poverty, misery and civic unrest that Kafka, already seriously ill with tuberculosis, didn't dare buy newspapers or venture into the centre of town. He stayed in a rather dull suburb with his girlfriend, Dora Diamant. Then again, the same conditions of instability attracted the younger, tougher Bertolt Brecht, who came to the city to agitate for communism. He later described Kafka as "a man too much trapped under the wheels" of the capitalist system rather than someone looking for alternatives. But even Brecht had to flee when the Nazis used instability to grab power. They eventually murdered Kafka's sisters in concentration camps.
The big fear, should a big crash come, isn't so much the immediate economic effects, but the political ones. What would a desperate America do if and when it realized that, as The Guardian thinks, what we're seeing now is its supremacy crumbling away? Might the empire lash out with more ill-advised military adventures, try to take the world down with it?
It's easy to get apocalyptic, though. I prefer to think that what's been happening this last week or so -- and seems set to continue this week -- might actually be a bit of a boost, a filip, an incentive to people to start looking at their basic priorities in life.
My own brand of post-materialism matches Berlin values with Japanese ones. Here, for instance, is Kyoichi Tsuzuki, in the afterword to "Tokyo Style", his documentation of the way ordinary Tokyoites live in small spaces:
"Today, amidst Japan's unprecedented devotion to money, even after property and fame and desires have all been attained, somewhere in the backs of our minds lingers an altogether Asian vision of the quiet life in a thatched hut deep in the mountains.... There's a Buddhist adage that says: Half a mat to sit, one mat to lie down. No matter how huge a mansion you may build, there's no need for more than one-meter by two-meters when you sleep; no matter how many dishes are set out before you, there's no eating what will feed ten. Sure, given the choice, who wouldn't like more space instead of less? Still, if it comes down to working extra hard just to pay high rents and mortgages, then there are people who would rather spend that time surrounded by their favorite things."
Atelier Bow Wow have followed their interest in "pet architecture" -- basically the design ingenuity of poor people responding to vastly over-valued real estate -- with a book about the Post-Bubble City, in which small, sustainable private houses become a metaphor for the body, and for local personal survival. Post-bubble is a way of life.
It isn't just Japanese in Japan who feel this way. David Duval Smith of design group Namaiki really impressed me with a lovely interview he gave Theme magazine. Namaiki do just enough work for corporate clients to follow their own interests, which have veered recently into guerilla gardening -- the greening of spaces in the city and outside it.
"The model for my farms," says Smith, a New Zealander, "is Masanobu Fukuoka’s seed ball project and Bill Mollison’s Permaculture system of sustainable agriculture. (Fukuoka is the pioneer of natural farming and sustainable agriculture in Japan who now gives lectures abroad. Mollison is an Australian researcher.) Basically, the idea is to spread the seed and let nature go. It’s about living in an edible jungle. You don’t need to pay 100 yen to buy a few pieces of lettuce or herbs. You just plant some seeds, the rain falls and they grow, and you get hundreds of leaves and thousands of seeds the next year.
"People have been calling them “guerilla farms” or “green graffiti,” I guess because it is done without permission. But I believe it is a victimless crime, if a crime at all. No one profits [financially], there is no damage, no loss of anything. A gross and a net gain.
"I came to a realization that nothing was more miraculous than soil and seed. They are positive in every sense, right up to the massive real profit in seeds at the end of the plant’s life, clearly sustainable, and essential to human existence.
"The project also was started as a reaction to the car, which I believe is a true villain in communities. Cemented roads are unproductive, as is parking. Yes, personal mobility is important, but I think that can be addressed more intelligently. And also, yes, goods and delivery systems are important, but only in commerce and the consumer market, which is quite unsustainable. At present, it takes 100 calories to make 10 calories of food, not to mention petroleum-based fertilizers, machine harvesting, plastic, and the worldwide delivery involved. This is unsustainable, unhealthy, and unintelligent. Vegetables are best fresh, and so I thought that they should be grown locally.
"People sometimes use the expression “going to seed” to refer to something in the process of declining or decreasing, but I think going to seed is a necessary part of life."
Now, a lot of the selling we've seen this week represents typically irrational capitalist behaviour -- hunches, worries, fears, projection and paranoia trigger more hunches, worries, fears, projection and paranoia . This storm in a rich man's bone china teacup needn't really concern the rest of us. The huge sums of money being lost are largely imaginary, purely notional, and concentrated, anyway, in very few hands.
But what might a big crash mean to the rest of us? Might it even be rather good news? I think the answer to that depends on the answer to the question "How big?" The kind of crash people call a "correction" would mean very little to me, personally. I own no property, no house, no car. I have no dependents. Neither do I have any debt. I could live on a quarter of the sum I'm currently earning, and it wouldn't honestly make much material difference to my life. A crash would only start to impact my life if it made air travel more expensive, or made the internet somehow stop working.Berlin isn't just a city well-protected from rising sea levels, earthquakes, and so on. It's also well-protected from financial instability. This is a city with incredibly cheap prices, a city populated by people who manage to live well on little money, a city of renters rather than owners, a city pretty familiar with post-materialist lifestyles.
But a warning on just how wrong things can go here, in other circumstances, comes from Kafka's experience of the city in the early 1920s. High inflation and unemployment led to such poverty, misery and civic unrest that Kafka, already seriously ill with tuberculosis, didn't dare buy newspapers or venture into the centre of town. He stayed in a rather dull suburb with his girlfriend, Dora Diamant. Then again, the same conditions of instability attracted the younger, tougher Bertolt Brecht, who came to the city to agitate for communism. He later described Kafka as "a man too much trapped under the wheels" of the capitalist system rather than someone looking for alternatives. But even Brecht had to flee when the Nazis used instability to grab power. They eventually murdered Kafka's sisters in concentration camps.The big fear, should a big crash come, isn't so much the immediate economic effects, but the political ones. What would a desperate America do if and when it realized that, as The Guardian thinks, what we're seeing now is its supremacy crumbling away? Might the empire lash out with more ill-advised military adventures, try to take the world down with it?
It's easy to get apocalyptic, though. I prefer to think that what's been happening this last week or so -- and seems set to continue this week -- might actually be a bit of a boost, a filip, an incentive to people to start looking at their basic priorities in life.
My own brand of post-materialism matches Berlin values with Japanese ones. Here, for instance, is Kyoichi Tsuzuki, in the afterword to "Tokyo Style", his documentation of the way ordinary Tokyoites live in small spaces:
"Today, amidst Japan's unprecedented devotion to money, even after property and fame and desires have all been attained, somewhere in the backs of our minds lingers an altogether Asian vision of the quiet life in a thatched hut deep in the mountains.... There's a Buddhist adage that says: Half a mat to sit, one mat to lie down. No matter how huge a mansion you may build, there's no need for more than one-meter by two-meters when you sleep; no matter how many dishes are set out before you, there's no eating what will feed ten. Sure, given the choice, who wouldn't like more space instead of less? Still, if it comes down to working extra hard just to pay high rents and mortgages, then there are people who would rather spend that time surrounded by their favorite things."
Atelier Bow Wow have followed their interest in "pet architecture" -- basically the design ingenuity of poor people responding to vastly over-valued real estate -- with a book about the Post-Bubble City, in which small, sustainable private houses become a metaphor for the body, and for local personal survival. Post-bubble is a way of life.
It isn't just Japanese in Japan who feel this way. David Duval Smith of design group Namaiki really impressed me with a lovely interview he gave Theme magazine. Namaiki do just enough work for corporate clients to follow their own interests, which have veered recently into guerilla gardening -- the greening of spaces in the city and outside it.
"The model for my farms," says Smith, a New Zealander, "is Masanobu Fukuoka’s seed ball project and Bill Mollison’s Permaculture system of sustainable agriculture. (Fukuoka is the pioneer of natural farming and sustainable agriculture in Japan who now gives lectures abroad. Mollison is an Australian researcher.) Basically, the idea is to spread the seed and let nature go. It’s about living in an edible jungle. You don’t need to pay 100 yen to buy a few pieces of lettuce or herbs. You just plant some seeds, the rain falls and they grow, and you get hundreds of leaves and thousands of seeds the next year."People have been calling them “guerilla farms” or “green graffiti,” I guess because it is done without permission. But I believe it is a victimless crime, if a crime at all. No one profits [financially], there is no damage, no loss of anything. A gross and a net gain.
"I came to a realization that nothing was more miraculous than soil and seed. They are positive in every sense, right up to the massive real profit in seeds at the end of the plant’s life, clearly sustainable, and essential to human existence.
"The project also was started as a reaction to the car, which I believe is a true villain in communities. Cemented roads are unproductive, as is parking. Yes, personal mobility is important, but I think that can be addressed more intelligently. And also, yes, goods and delivery systems are important, but only in commerce and the consumer market, which is quite unsustainable. At present, it takes 100 calories to make 10 calories of food, not to mention petroleum-based fertilizers, machine harvesting, plastic, and the worldwide delivery involved. This is unsustainable, unhealthy, and unintelligent. Vegetables are best fresh, and so I thought that they should be grown locally.
"People sometimes use the expression “going to seed” to refer to something in the process of declining or decreasing, but I think going to seed is a necessary part of life."
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finances and flowers
Date: 2007-03-05 11:49 am (UTC)I realized then, that, Louisville being a small american town with hardly one million inhabitants, this list could fill weeks and weeks of newspapers, if all the millionaires in the world were listed on it. I wondered what would happen if all of them decided to go to the bank to ask for their money in cash? I think, there is not so much money. And from this I concluded that a financial crash is a world wide illusion.
About gardening: when I lived in Amsterdam in the eighties and nineties, pavements were full of dog shit and streets were full of cars. An utopian idea enlightened my days. It was to break open the streets and turn them into park lanes. Mix seeds with dog food, so their heaps would become fertilizer and seed bomb at once. What wonderful result it would have if tropical seeds were used. Think of the exotic plants and birds that would arrive.
Meanwhile in Berlin, the palast der republic is almost dismantled. It will leave an open space in town for some years...
greetings from the east of town,
rinus
Re: finances and flowers
Date: 2007-03-05 12:00 pm (UTC)Re: finances and flowers
Date: 2007-03-05 12:21 pm (UTC)Alan Greenspan: "We have a problem trying to define exactly what money is. the current definition of money is not sufficient to give us a good means for controlling the money supply."
Congressman Paul asked "Well, if you can't define money, how can you
control the monetary system?"
Greenspan replied "That's the problem."
(no subject)
Date: 2007-03-05 12:33 pm (UTC)Human economic behaviour is capitalist behaviour, and there is nothing inherently irrational in anything that's happening on the market right now.
Thing is, an Asian downturn has been in the coming for some time now. The Chinese economy - or should I say economies - have defeated almost insurmountable obstacles to secure economic growth. They've had to tackle the possibility of a southern construction bubble, a dependence on cheap and sometimes irresponsible government credit, a continuing unfamiliarity with the logic of comparatively cautious western capitalist practices, and various structural oddities stemming out of the essentially planned nature of the Chinese economy. But there's absolutely no way an economy, planned or market-based, could actually keep on growing like the Chinese economy has in the last years and expect it to keep up forever.
What this will now do is that, if it does turn out to be a real Chinese recession - corrective or not - it'll reverberate into the American economy and therewith into the European economy. So while China restructures itself, releases capital, fires workers so they can reshuffle into jobs someone actually needs done, and so on, the EU and America are going to have to temporarily write off the benefits that Chinese growth would've offered in terms of exports.
This means capital for the bankers, profits for the businessmen, and jobs for the workers. None of these are "notional and imaginary" because unlike you're sort of arguing here, markets do not actually exist in a Platonic vacuum outside the ken of mortal men.
(no subject)
Date: 2007-03-05 12:42 pm (UTC)Now, this is just not the case. Capitalist behaviour is human economic behaviour, but just a small subset of it. Think of communist five year plans, or barter systems.
Re: finances and flowers
Date: 2007-03-05 12:44 pm (UTC)(no subject)
Date: 2007-03-05 12:52 pm (UTC)Saying that the stock market wealth (that's quite possibly evaporating slowly) is imaginary and notional is perfectly correct in the philosophical realm, in the way that money is all notional and imaginary. It might even be good economics in the sense that Chinese investments probably are overvalued. But it's not imaginary wealth and it's not inconsequental wealth. Arguing that would be the moral equivalent of Homer Simpson disappointedly going "Twenty dollars? But I wanted a peanut!"
Re: finances and flowers
Date: 2007-03-05 12:53 pm (UTC)UK M4 is up 13%
Eurozone M3 is up 10.6%
China M2 is up 15.9%
South Korea M3 is up 10.6%
Australia's M3 is up 13%
Russia's M2 is up 48%.
lots of liquidity in the market to squelch it.
(no subject)
Date: 2007-03-05 12:54 pm (UTC)(no subject)
Date: 2007-03-05 12:57 pm (UTC)Much of the value wiped off shares this week will have been of this type. Purely speculative "money" which never finds expression except as numbers in electronic space, and whose disappearance won't really be tragic.
(no subject)
Date: 2007-03-05 01:11 pm (UTC)But, obviously, money that goes into banks gets shuffled into loans, which go into businesses, while money that is spent on stocks and shares also goes someplace - namely, whoever sold those stocks in the first place. It's almost impossible to not circulate money around in a sufficiently developed, credit expansion-based capitalist economy.
What you're apparently criticising is, however, that an investor wishes to save real, actual money by cashing in their assets before they depreciate in real money terms, and I don't get how that is irrational. Aftert all, while there is an element of sheer speculation about the market, stock prices still represent the price of owning bits of companies with varying degrees of genuine capital and real income. In fact, if anything is wrong with the "casino" stock market these days, it's that it frequently ignores that basic fact.
(no subject)
Date: 2007-03-05 01:14 pm (UTC)I'm ganna get what I want
Date: 2007-03-05 01:17 pm (UTC)(no subject)
Date: 2007-03-05 01:19 pm (UTC)Re: I'm ganna get what I want
Date: 2007-03-05 01:24 pm (UTC)(no subject)
Date: 2007-03-05 01:48 pm (UTC)Re: I'm ganna get what I want
Date: 2007-03-05 01:54 pm (UTC)(no subject)
Date: 2007-03-05 02:06 pm (UTC)(no subject)
Date: 2007-03-05 02:57 pm (UTC)(no subject)
Date: 2007-03-05 03:02 pm (UTC)(no subject)
Date: 2007-03-05 03:08 pm (UTC)(no subject)
Date: 2007-03-05 03:11 pm (UTC)Let's all do it--- besides, what could be better than smashing your hands around in some muddy clay? Oh, that's true; fucking over Monsanto and eating the fruits of your la-la-la labors. "It only takes a mustard seed" of faith in keeping things small, and using what we have. Bravo!
(no subject)
Date: 2007-03-05 03:12 pm (UTC)(no subject)
Date: 2007-03-05 03:17 pm (UTC)Right now economic growth is driven, not only by government investment, but also extensive western business involvement, and I'm not entirely sure if the Chinese government realises how much they need to keep the business atmosphere predictable and secure after the market settles down. Fact is, looking at what might quite possibly be a major southern construction bubble, it's rather evident mid-level Chinese government officials do not widely understand how markets work and why it's not very smart to put money in things that do not actually create returns. They're doling out money like candy; if the market reacts negatively, it's quite possible the Chinese middle managers will blame it for what is partially their own financial failure. And that's simply not conductive to anyone's economic well-being.
(no subject)
Date: 2007-03-05 03:29 pm (UTC)