The  S&P kindly attributed the ratings decrease to the "republicans who refuse to vote for increased taxes on the rich". How according to plan. How perfect to keep us small. To march forward with the idea that has the world in its grip. What fools they think us mortals. The regrettable thing is that if the common man were to see through it, and understand that the whole purpose of the ratings decrease was to increase taxes and gain more power and perks for the higher authorities, as there is obviously no chance of a default now or in the future as exemplified by the long bond yield of 2.2 %, which encompasses inflation expectations of 2% a year, a return of say 0.5 %, and a minus chance of default, why then the market might not go down on Monday, and the argument that we have to raise taxes and get the Republicans to appoint fellow agrarian reformers to the committee, might fail, and then the whole plan, the whole deal with the friends at the agency, all the posturing and flexionism, would be in vain.

So the stock market on Monday and Tuesday will fall. Let us remember where the index was on Friday 1197, and compare it to where it ends up when the committee issue the report, and point out that after the downgrade the market was up 10% or so to Thanksgiving. That will be a start. But then we'll have to explain that the reason the market went down in the first place was the failure of the Tea Party congress to reign in the business as usual, the fomenting of the idea that has the world in its grip et al.





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11 Comments so far

  1. Reid DeRamus on August 8, 2011 8:36 pm

    Can someone please provide a definition for flexionism? My assumption: the bending of market sentiment through regulation. I’ve seen it a few times around this blog and can’t get my hands around it.

  2. Mike Melamed on August 9, 2011 1:35 pm

    Think of flexons as the suckers, the weaklings, those who lose out in the markets…

  3. Ed on August 9, 2011 4:46 pm

    Mike you have it backwards. The Flexions are the power elite who rig the system (including the markets) in their favor.
    See the book Shadow Elite by Wedel.

  4. Murali on August 9, 2011 9:33 pm

    Hi Reid,

    Flexions are people who are close to the decision- making process, who are privy to key information-information which is only available to the public at a later date.

  5. Tarun on August 10, 2011 6:41 am

    There seems alot of comments on this site that find increasing taxes, particularly on the wealthy, a terrible thing. I wonder however why there is much less criticism for the flexion strategy to keep interest rates artificially low in turn producing more income inequality with the asymmetric effect on asset prices vs. consumer prices.

  6. Reid DeRamus on August 10, 2011 12:33 pm

    Thanks for clearing it up. I thought it was an action rather than a person.

  7. Anonymous on August 10, 2011 8:19 pm

    whenever I see someone type “alot” I lose enormous respect and completely disregard them unless they are a foreigner. It isn’t very important per se, but it shows a lack of attention to detail and how can I rely on a person like that. don’t make these mistakes anywhere, ever!

  8. douglas roberts dimick on August 11, 2011 4:21 am

    Flexian Defined

    Pursuant to Reid’s query and Ed’s citation of Wedel’s Shadow Elite, a quote from Page 5:

    “I call this new breed of influencers “flexians.” When such operators work together in longstanding groups, thus multiplying their influence, they are flexnets. Flexians and flex nets operate at one extreme of a continuum in crafting their coincidences of interests.”

    As accomplished sometimes ad nauseam here and at other sites of varying persuasions, one only has to survey without significant investigation to see the tracks left by such tribes of money and influence. Consider:

    (a) social-economic concentrics that are inter- and intra-parsed within federal and state levels of government (e.g., military industrial complex a la state employment rates and medical/pharmaceutical conglomerates a la block grants and entitlements);

    (b) two-dimensional religious/educational constructs that by definition are constitutionally shaped and identified from the political biometrics of endemic legislative and regulatory efforts utilized (by flexians) for manipulation of the two party system (e.g., abortion contra capital punishment and gun control contra freedom of the press);

    (c) alignment or detachment of two or more elements emanating from one or both of the two categories hereinabove (e.g., Obamacare as enacted, whereby ceasing federally funded programs supporting abortion was aligned with garnering pharmaceutical lobby support based on ensuring Medicare drug plan pricing remains industry fixed and not competitive, without government purchase discounting, so that corporate media focused public attention on cost of US military operations overseas contra NRA and defense lobby interests).

    Of the three, we might conclude that (c) requires consummate skill and craft with inventiveness as demanded of those “flexicons” operating within and in between and among national and international arenas. Why?

    It is a lot easier to shoot a moving target if one can control the movements of both the shooter and the target. This concept is analogous to the notion of traveling in space, whereby one factors in the rate at which space (as well as the object) is also moving.

    An aside, here we can see the curtain being raised as to the real masters of the universe supra Wolf’s Bonfire of the Vanities…

    Hence we do not hear “a lot” of talk about those of the markets (whom Nixon called “those Wall Street bastards”) or at least not as much as we do about the markets themselves. Bankers, investors, traders, speculators, and their minions flying first class with a summer home in the Hamptons… they are all in place – or space, I suppose, depending on political disposition and/or level of education – to keep the universe either in tow or spinning parallel to the interests of whom so ever they serve at any given point in time.

    Such constitutes my understanding of to whom that the Chair and this merry little band of daspec’ers are so referencing when they use the word, be it flexians or flexions or flexons…


  9. Nick Pribus on August 11, 2011 5:59 pm

    I had the distinct pleasure of taking my daughters to the new Harry Potter Park in Orlando a bit back, where the bravest of muggles may ride the Dragon Challenge Roller Coaster. It cannot really be described the feeling one gets while suspended upside down on that beast and an analogy escaped me until the past five S & P trading days. How terribly like and amusement park ride these markets can be, thrilling, exhilarating, frightening, and nauseating, fun and not for the faint of heart. Not sure what the markets will bring tomorrow, will I ride the coaster with both hands in the air caution to the wind or hanging on for dear life.
    Just apart from the Dragon Challenge the lesser Hippogriff coaster designed for those under 48 inches offering welcome relief, more the way the markets should be, gentle up and down bumps and turns with an easy start and slow stop – can we please step off this S & P terror ride and simply enjoy the market theme park for the rest of the afternoon.
    Or is the market just a constant carnival where we choose our own attractions and the adrenaline rewards correspond to the risk tolerance of the rider.

  10. Kermit on August 14, 2011 1:05 pm

    And to “Anonymous” who said:
    “whenever I see someone type “alot” I lose enormous respect and completely disregard them unless they are a foreigner.”

    I lose “alot” more respect for someone who uses what should be an insignificant detail to discredit a comment that seems to be difficult to answer.

    As I’ve said before, the only thing that bothers me more than the incompetence of the Left is the greed of the Right.

  11. Kevin Leo on August 18, 2011 11:15 am

    Indeed, it seems to me that the flexions were really after another grand bargain with the Fed for round 3 of QE. One wonders what the Super Committee is really for…if at first (or second) you don’t succeed…however, the current flight to quality is doing the job already! What does the Fed Model indicate today?


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