Among the core assumptions that any self-respecting conspiracy theorist will adhere to under any and all circumstances are: (1) There are no accidents; and (2) There are no coincidences. Corollaries to these assumptions are: (1) Things that appear to be accidents, or coincidences, aren't. (2) They only seem to be accidents or coincidences because most people don't understand what's really going on. (3) But to the people who do know what's going on, the appearance of accident or coincidence is important, because it help to conceal their activities and their motives. Therefore, (4) Many so-called accidents and coincidences are not only superficial appearances that are just allowed to happen, but they are actually programmed and manipulated for maximum effect. And, oh yes, another corollary is: (5) Those in charge are never surprised, and they never lose.
This is what I would call the core conspiracy model – or let's say “meta-model”, since it serves as a pattern from which other, more specific conspiracy theories can be derived. Without these essential elements, it would be difficult to justify calling something a conspiracy – not that there aren't plenty of other ways in which bad things can happen, but we would have to call them something else. Now – notice, if you will, that the above “rules” imply that conspiracies have to involve not only secrecy and disinformation, but also a power base. In other words, the conspirators have to be able to manipulate not only actual events, but the perceptions of those events – and that process inevitably requires a base of operations for communications, information, propaganda, etc. Either that, or they have to have a disproportionate level of influence with the media – as we see quite frequently, when the media provide elaborate coverage of one event, but no coverage at all of another – objectively much larger – event. Either way, the manipulation of information is key; leave the raw facts to fend for themselves, and people might start to get the wrong idea. It is absolutely vital to start the “spin” process as soon as possible – as we saw with the JFK assassination, Waco, Oklahoma City, 9/11, and the Ft. Hood shootings, among many examples. And of course sometimes the “spin” overtakes actual events – as in the case of 7 World Trade Center, which was described (by the media) as having collapsed when it was, in fact, still standing – and no one had any reason to expect it to collapse. (No one who wasn't in on the caper, that is.)
Now there are, as I've mentioned before, some potential flaws in this standard model – for instance the tendency to see any evidence as evidence in support of the theory. Take... well, take “global warming” for instance, which is not a conspiracy theory per se. Data that reflect a warming trend are, of course, taken as evidence in support of the theory – but so are data reflecting a cooling trend, through some sort of convoluted reasoning that only government-funded scientists are capable of. So, in a standard conspiracy scenario, “information leaks” are taken as evidence, but so is the complete lack of information – because that means that someone is covering up. So why, for instance, was every piece of the destroyed twin towers – right down to the tiniest speck – hauled away to a top-secret location? What were they trying to hide? Well, maybe nothing – but all that secrecy and paranoia gets people wondering. And any time there is a “rush to judgment”, suspicions naturally arise. The names of all 19 9/11 terrorists – the ones who were actually on the planes – were released within hours of the attacks. But how did the FBI know? They were all dead! Did they really leave that obvious a trail, that could be established and proven within hours – and if so, why weren't they apprehended prior to carrying out the attacks?
See how easy it is? All you have to do is make one tiny scratch on the surface of the establishment narrative – the conventional wisdom – and you uncover a horde of intriguing and unanswered questions. And the problem with all of that secrecy is that if we ever are shown who, or what, is behind the curtain, we are no longer willing to believe it, because it was kept a secret for so long. So the net effect of giving the appearance of conspiracy is indistinguishable from the net effect of an actual conspiracy – something the establishment never seems to remember.
So with that as background, I turn to a discussion of the recent stock market thrill ride -- you know, that “incident” in which the Dow dropped 1,000 points in approximately ten seconds. Now, the first thing you’ll notice is that this story has already disappeared down the memory hole. Why? Well, it’s because the stock market mysteriously -- miraculously! -- corrected itself… just as mysteriously as it plummeted, it pulled out of its fatal nose dive and started soaring again, including a gain (on Monday) of over 400 points. Ah, what a relief! All’s right with the world again -- and we can continue to play on, oblivious as to the future.
But what happened?? (as if anyone was still interested) Who, or what -- if anyone or anything -- was to blame? Was it Greece? Well… excuse my skepticism, but the entire Greek national debt doesn’t add up to much more than one year’s worth of (taxpayer-funded) bonuses for AIG and Goldman Sachs. I mean, Bill Gates could whip out his checkbook and pay off half of it right now -- and he’d wind up owning half of Greece… which, IMO, is a much better bargain than giving it away to some sorry-assed United Nations agency. So I’m just not buying the “Greeks bearing gifts that just keep giving” argument. (Plus -- you’ll notice that Greece is getting bailed out. By, among others, the IMF -- which means, by us.)
OK then, how about the “fat finger” theory? Well… if that were true, it would just show how at once mindless and fragile the stock market is. And this is, in fact, what they want you to believe -- that it’s all random, impulsive, volatile, and basically out of control. Why they constantly push this model is a question I’ll deal with in a moment. But first…
What about all those automated programs that “kick in” with no human decision-making or intervention? We’re supposed to believe that the entire market is now run by machines, i.e. computers, with no human beings to get in the way of all the lightning-fast (literally, because it’s all done with electrons) transactions. OK then, please explain the fact that we still have to put with all those pictures of red-faced guys in blazers, dripping with perspiration, frantically gesticulating to one another on the floor of the exchange or staring despondently at the “big board”. Who are they, actors? Are they just pretending to buy and sell stocks? No, the human element is still very much in play, and anyone who claims it isn’t is either shirking their responsibility or -- again -- pursuing some sort of agenda.
Basically, both of these models -- the “out of control” model and the “controlled by machines” model -- are intentional distractions to give the impression that the stock market is a kind of looney-tunes house of mirrors and that it can’t be trusted -- which means that investors have to take their chances -- and if they wind up losing money, well, it’s no one’s fault, not even “the market’s”, because “the market” is so insane and irrational. So no one is ever to blame. In other words, a wall of apparent chaos and disorder has been built up intentionally, in order to obscure and hide the real processes behind the overt non-process.
Now that we’ve dispensed with the conventional wisdom, let’s think about what a good, solid, level-headed conspiracy theorist would have to say about all this. Remember, there are no “accidents”, and everything happens for a reason. The only sense in which it’s a “crisis” is that your conspiracy theorist, in order to maintain his credibility, has to come up with an explanation -- and this event does not readily lend itself to an explanation… or, not nearly as easily as, for example, the invasions of Afghanistan and Iraq, which are elementary exercises by comparison. But if one applies the time-honored method that is used so skillfully by E. Michael Jones, and just asks “cui bono?” -- who benefits? -- then the puzzle starts to fall into place. Let’s say you’re out to make a fast buck. (And is there anyone on Wall Street who isn’t?) One way -- out of many -- is to sell (or appear to sell) a whole lot of stock in a given company or companies in a very short time -- a “dump”, if you will. In other words, sell as much as you can before your act of selling starts drastically lowering the price. This causes panic on the part of other people who own the same stock, and they proceed to dump their shares as well -- but only once the price has dropped a bit… so they may be choosing a lesser loss over a (so they think) greater one. The result? The price of the stock plummets. Then, at a certain point, when you think it has gone down about as far as it can, you buy back all the shares you just sold, and probably more as well. At the end of the day you wind up with at least what you started with, plus all the cash you earned by the sale -- mission accomplished! You adopted the time-honored rule of thumb, except in reverse order -- you sold high and bought low. (And of course some other poor chump had to buy high and sell low -- but we don’t worry about him. If he doesn’t like the heat he can just get the hell out of the kitchen.)
Now, this particular strategy is probably one that the average day trader can’t utilize, because they just don’t have the volume. And even a fairly well-off person with a lot of capital may still not have the right sense of timing. It truly takes an insider to pull this sort of thing off -- and that, I submit, is precisely what has been happening on a cyclic basis starting at least as far back as the all-time Dow high of 14,000-odd. And you’ll notice in all this that what we’re talking about is the price of stock based on supply and demand; it has absolutely nothing to do with any sort of true value. And to make things even worse, a large element of the supply and demand resides with people who are ignorant, impulsive, and panic-prone -- pure gamblers, in other words. It is, in effect, a manic-depressive or bipolar marketplace full of manic-depressive, bipolar people -- which is why it’s so easy for the few sane (and cynical) ones to take advantage.
So what am I saying -- that this is all it was? Just one person, or a few people, out to make a fast buck? No -- I believe that may have been a fringe benefit, but it wasn’t the main point. Consider the timing. Congress is hot under the collar to “do something about Wall Street” and all of its abuses. The public is up in arms. “Tea partiers” are running up and down the landscape with torches and pitchforks, demanding the heads of the Wall Street robber barons on a silver platter. Now, you might think this is precisely the worst possible time for the stock market to step on its own schvantz -- but you’d be wrong. Yes, that is what all the media think -- or pretend to think. “This just proves that something needs to be done.” And, “This will strengthen the case for more stringent controls”. And, “This will shut the Republicans (who are all on the payroll of the Wall Street barons) up once and for all.” That is the conventional wisdom on the matter -- which is precisely why it’s wrong. I see last week’s events as a kind of warning shot, if you will, off the bow of Congress and the administration. What the people holding all the strings were saying was, basically, “Look, you assholes, this is what we can do, any time we want to. You think 1,000 points is bad? We can drop the Dow 2,000... 5,000... you name it. So back off.” In other words, the market -- as represented by the Dow -- is now being held hostage in order to derail the drive to increased regulation and control. And sure enough, we already see compromises being made in the area of new regulation; it’s going to be business as usual again before you know it. Mission accomplished!
Now, I can see your objections to this theory already. Why would Wall Street want to, in effect, commit suicide -- or near-suicide -- just in order to coerce Congress and the administration into not adding any more regulatory constraints? Well, for one thing, it’s not suicide, any more than the meltdown that kicked off the Great Recession was. In this case it was more like the “cry for help” that an _attempted_ suicide represents; the people doing the manipulating knew that the boat would right itself -- they were just rocking it in order to get people’s attention. Plus, you have to remember that the stock market is only the stock market, and the Dow is only one measure of its alleged health. The stock market, all told, is still only a fraction of the world’s wealth, and it’s, by and large, a paper fraction at that -- which is one reason why it’s so volatile. When all you’re dealing with is, ultimately, paper -- or electrons -- there is no objective standard of value. It’s all a matter of impulse, of day-to-day and moment-to-moment vacillation based on pure speculation. We make fun of things like the great Tulip Craze that overcame Holland a few centuries back… but at least that involved tulips! -- real things! But wait, doesn’t the stock market involve real things -- real companies, providing real goods and services? Yes, in theory -- but that doesn’t explain all the wild fluctuations, and it also doesn’t account for all the ancillary types of securities -- “derivatives”, “futures”, and so on -- that are even less anchored to reality. If the real assets of a corporation vacillated as much as its stock…. well, it couldn’t happen; it’s impossible. Factories would have to appear and disappear on a daily or even hourly basis. So the stock market is already halfway toward an Alice in Wonderland world of illusion… and as these “instruments” get more exotic, they become harder to trace to anything tangible, until it gets to the point where even the insiders don’t know, or don’t care. The paper and electrons turn into reality -- they become, in effect, the only reality that counts. (At least in this sense Warren Buffet has more common sense than most; he prefers to put his money and that of his investors into things that the average person can actually understand -- although he’s clearly not a purist in this matter, since he is also a good customer of Goldman Sachs.)
So what I’m saying is that the stock market is only the tip of the iceberg. What it really is is the interface between the Money Power and the ordinary citizens -- either as individuals or in the aggregate (mutual funds, retirement funds, etc.). It serves as a kind of magnet to attract money and take it away from the ignorant, and put it into the pockets of the “knowers”. But if it were all that obviously a simple highway robbery scheme, it would cease to be attractive, wouldn’t it? So, like a gambling den, it has to pay off once in a while -- and we all know that people have an amazing capacity for considering themselves winners when they are actually losers. This is why banks can still get away with paying interest on savings accounts that doesn’t even keep up with inflation. If you are making money on paper, you think you’re making money -- whereas, in fact, you’re the only one _not_ making money. Drive into any city in the country -- or in the world, for that matter. Who owns the biggest skyscrapers? The banks, of course. And why do you think that is? It’s because of all those “passbook savings accounts”. Well, this may be a slight exaggeration, but you get my drift. The business of America is to transfer wealth from the stupid to the smart -- but not so blatantly that the stupid catch on. (After all, if they were totally stupid they wouldn’t have any wealth to take.) This is only possible, of course, in a system which allows stupid people to have resources (other than the clothes on their back, a grass shack, and a bowl of gruel -- the lot of many in the “third world” even unto this day). The magic of America is that it has managed to create and foster a middle class that is kept more or less happy and content (except for those treasonous “tea partiers”) -- and productive! -- while being in what amounts to a state of glorified slavery. Yes, they produce -- but at night when they’re asleep the Money Power flies in the window like a vampire bat and sucks just enough blood out of their veins to provide it ample nourishment and render the victim passive and intellectually anemic… but still able to produce. This is, truly, the miracle of our age -- and it’s a good question how much longer this system can remain in place and functioning. (The Obama administration seems to have decided that it’s time to liquidate the middle class. Whether this represents the consensus of the powers that be remains to be seen. The difference is that politicians have politically-based “values”, whereas the powers that be have… well, power, and also money. They couldn’t care less about politics, principles, democracy, or any of the rest of that nonsense. So in a weird kind of a way the Money Power may be the only thing holding back the liberals and collectivists from totally exterminating the middle class, AKA the “kulaks” and “bourgeoisie”. So the next time Congress fails to increase your taxes you can thank Lloyd Blankfein. Maybe.)
So if the stock market is only the tip of the iceberg, where does all the rest of the world’s wealth reside? In real things, as it turns out -- land, manufacturing capability, technology… and, above all, gold. Gold, silver, precious stones -- you know, all that old-fashioned, fuddy-duddy stuff that peasants used to lust after, and refugees would sew into their coats. But honestly, would anyone with a grain of sense keep their wealth in the form of dollars these days? With the Treasury cranking out billions more each day, backed only by “the full faith and credit of the United States of America” -- and pardon me while I fall on the floor laughing. The only currencies that are really worth anything -- as always -- are those backed by gold, or something almost as good. Or, obviously, currencies that _are_ gold. I mean -- I hate to say it… it’s just a silly metal, and in fact it’s nowhere near as rare as many other metals or elements, but there you are. It’s bright, it’s shiny, and it has been the preferred medium of wealth and exchange for the entire human race since the dawn of time. I mean, if you’ve got a better idea let’s hear it. But in the meantime, we have to deal with it as a reality. And you can bet that, behind all this maelstrom of paper and electrons and securities and derivatives and etc. etc. there is a very high, solid wall -- and behind that wall sit the people who are truly in charge, and they live in a paper-free and electron-free environment. Their economic base is confined to things that have universally-recognized and, for all intents and purposes, eternal value -- and they look upon those who chase paper as nothing more than fools. Fools who can be taken advantage of and exploited, of course!
There is, by the way, a very interesting corollary to all of this, which is that the amount of real wealth in the world is fairly stable. The media are fond of talking about all the “wealth” that is lost every time the stock market (ours or anyone else’s) takes a dive -- but this is totally untrue. What’s “lost” is amounts of money (with no backing anyway) on an electronic spreadsheet -- and in fact that money was never in the form of cash, but only as “securities” (an ironic term, when you think about it). The “money” never existed -- and neither, in the ultimate sense, did the securities. It was all a balloon… a bubble… an illusion. The true “wealth of nations” does not consist of paper, and it never has. Now, this does not mean that wealth cannot increase -- but that increase has to consist of tangible goods -- i.e. the products of labor -- or of “human capital” -- people + education + skills + “intangibles” like motivation, attitudes, values, etc. How do we judge, for instance, the wealth of a bygone civilization? By the number of promissory notes we can dig up or find etched on clay tablets? Of course not -- that would be absurd. It’s always based on what they were able to build or manufacture, and on our best guess as to their level of sophistication in things like agriculture, medicine, the arts, and so on. Real things, in other words -- “quality of life” things. Did “derivatives” ever enhance anyone’s quality of life? Not that I’m aware. How about “sub-prime mortgages”? Well, they enhanced some people’s quality of life for a short time -- before they made it downright miserable.
So what I’m saying is that most of these generally-accepted indicators of “wealth” are pure illusion, and nothing more -- but this is why they are so dangerous, and why the people who know the score can so easily manipulate them. You think these Wall Street types “believe in” stocks? Hell no -- they’re the only people around who don’t. They are the financial equivalent of The Grand Inquisitor -- totally cynical and totally manipulative. (And who are the last people on earth to think the dollar is worth anything? Why, the folks at the Federal Reserve and the Treasury Department, of course.) So really, the way to “rebel”, if you will, against this totally corrupt system is to quit playing their game -- get out of their ballpark, and shake the dust from your sandals. But this is, of course, not easy to do, since we are all, to some extent, trapped in the web spun by the Money Power. We use this cursed “medium of exchange” even as we reflect on how meaningless it is. And when we accumulate a little bit extra (of what, no one knows) we don’t hesitate to exchange it for a different form of paper, AKA “investment”. The truth is that the most reasonable thing one can do with their earnings is to spend every cent of it immediately, on goods and services. Don’t save, but don’t go into debt either. Which is to say, don’t turn your money over to someone else to do with as they please, but also don’t commit to paying any of your future money back to someone else. You want to rebel? To sabotage the system? This is the way to do it. The idea is to neutralize, as much as possible, the Money Power -- to refuse credit and also to refuse to enter into the “churn” by which your wealth is recycled into someone else’s. If everyone adopted this strategy -- even for a year or two -- the Money Power would collapse. But every form of pressure is applied to make certain this doesn’t happen -- and government is, as usual, the biggest offender. Interestingly, it’s precisely when governments do collapse -- and their paper-based financial house of cards with them -- that people rediscover the things that constitute real value. The refugee with diamonds sewn into his clothes has a clearer vision of worth than all the victims of Wall Street combined. I mean, he may have had his problems, but at least he didn’t spend time worrying about the Dow.