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No Knowledge, No Accountability, No Problem: How Financial Institutions Use "Unknowable" to Dodge Responsibility for Their Own Mess (Zeus Y., January 2, 2008)
There is an interesting term being bandied by banks, the term "unknowable." Pay careful attention: They say their losses (and investor losses to the extent that [insert acronym for "creative/innovative" loan repackaging vehicle here] have gone bust) from the subprime mortgage fallout are not “unknown” but "unknowable." How can there even be a monetary system, much less a functioning system of investment if worth is unknowable? Faith-based accounting? The most scrutinized, double-checked, and (especially with technology) rigorously quantified sector of human activity is now saying, "Wuh, who knew, and who knows how much, a few trillion here, a few trillion there."
Is it just me or is this the one of the craziest thing you’ve ever witnessed-- an entire global system, built upon assigning value to physical things, now has nothing physical to assign value to and doesn’t know that the value might be even if they did? To the extent these nouveau financial systems have assigned value, it has been entirely phantom-like, wherein junk bonds are AAA because ("wish I may, wish I might"—kazam) I can mark them to some fabricated market model, not the market itself.
Our entire global finance system has entered virtual reality, and when "real reality" kicks back, the answer seems to be, "Well, we just thought it was all a video game, and we thought all those virtual gold coins we collected on our vision quest were actually real gold, and since we built our entire financial dealings around them, now our accounting is itself virtual."
It will be interesting to see how history responds when this gets revealed—IF it gets revealed, and that is a big "if." We can already see moves by banks and governments alike to bury the real amounts of the losses and hide them in bailouts of all sorts. So the term "unknowable" really means "I don’t WANT to know, and I want to prevent you from being able to know because I’m afraid of what might happen." This, of course only applies to losses. Just as with the corrupt executives from Enron and WorldCom ending up on the front covers of major news and financial magazines, everyone wants you to know when the profits are rolling in, virtual OR real, legal or illegal, it doesn’t matter. So we are now witness to a grandiose narcissism on a global scale among the reality-challenged financial so-called elites, and when they screw themselves over with their own cleverness, they try to stick us with the bill, as usual, except this bill could consume our pensions, our salaries, and those of our kids.
This is a real challenge to democracy, which runs on transparency of information and accountability. You may recall the news account where FEMA (the ones who botched Katrina, "heckuva job Brownie") were advised by their lawyers not to know or make it known that their trailers were full of health-destroying formaldehyde, and to PREVENT investigation, because then they would be liable for the fallout. If they were ignorant, however, ("I didn’t know, even though I do.") they were supposedly legally protected. A government agency, whose only job is to protect the public safety, is actively hurting people, and running the other way and hiding in ignorance when it comes to accountability. Sound familiar? SEC, Federal Reserve Board anyone? This is a world gone mad, where doing your job means not doing your job.
This is analogous the Bush’s "first (Enron) CEO in the White House" approach to foreign policy and use of covert intelligence. Force "creative" interpretations on foreign events to push an ideology (be it "profit" or "enact geo-political and economic dominance in the Middle East under the guise of fighting terrorism and bringing democracy"), "stovepipe" (skim) false intelligence and "evidence" that proves your claims, fire or shout down as "soft on terrorism" or pessimists anyone who disagrees or tries to warn others, promote toadies and people willing to compromise their integrity, and create your own reality.
(In this the infamous choir boy for the Real Estate Asssociation, David Lareah is a lot like Paul "the Iraq War will pay for itself in oil revenues" Wolfowitz.) Oh, and when "real reality" comes knocking, blame everyone else and/or say "who could have known." It was "unknowable," "unthinkable." Have a short memo that says “Osama Bin Laden determined to strike the U.S.” that mentions only two cities, New York and Washington, D.C. AND mentions the use of planes and the targeting of building in possible terrorism, a MONTH before 9/11 happens, and you say "who knew." What? Our intelligence didn’t have the exact dates and times?
There is nothing unknowable or unthinkable about this fakery. The only thing we have to decide is whether we are going to agree with this delusional thinking, or we going to, not just "demand" accountability from the same louts that have built careers upon denying responsibility and getting rewarded for it, but ESTABLISH responsibility ourselves.
This happens not just through the electoral process, but in our own clear thinking, purchasing decisions, and lifestyle choices (i.e. refusing to jump on the home purchasing stampede) , and in our collective decisions and actions-- informing and organizing each other to bring about a truly optimistic, democratic, and reality-based American and global dream that rewards innovation, integrity, and humaneness and rebukes corruption, laziness, irresponsibility, and self-serving fantasy.
We ought to see reality, not as a downer, as the Madison Avenue types would have us believe, but as the intriguing basis upon which to access and challenge our ingenuity. Instead of weaving fantasies and appealing to the psychological weaknesses of others, we embrace the necessity and goodness of where we are. The U.S. is best a country of reality-based innovation. The Wright brothers did not construct a virtual airplane. They constructed a real one. When we are being led by those who simply have lost contact with reality, and whose self-serving fantasies end up hurting us all, we ought to receive this with an element of gratitude—that we now realize that we ought to wake the heck up and develop our own leadership. We don’t need to "take the power back" financially or politically. We already have it. Parasites need a host. We are the host, and we don’t need parasites. We don’t need middlemen. We have the capacity. All we need is the confidence, the choice, the compassion, and the conviction to move forward together.
For more on a wide array of other topics, please visit the oftwominds.com weblog.
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