Just how idiotic is it to seek to prevent what has already occurred? I suggest that is blatantly idiotic. Here is a case in point.
Earlier this evening, I noted ECB Seeks to Avert What Has Already Happened
I cannot help but laugh out loud at some of the headlines this evening. By any rational measure, confidence has collapsed, yet G-7 Seeks to Avert Collapse in Confidence
That the ECB needs to take these actions is a 100% sure-fire sign that investors have lost confidence.
That is ridiculous enough, but the height of absurdity is found in the G-7 Statement on Renewed Strains
We reaffirmed our shared interest in a strong and stable international financial system, and our support for market-determined exchange rates.
Today the G-7 advocated both currency and and bond-market interventions “whatever it takes” yet sings the praises of “market-determined exchange rates”.
I really do have to ask “Do These Idiots Realize How Stupid They Sound?”
Definition of Idiot
The above question is more complicated than it seems at first glance. In typical usage, “idiots” by definition do not realize what they are saying.
However, let’s throw out a definition as follows: Idiot – Someone devoid of common sense who lives in the shelter of academia or politics, with no real-world experience. Also included in this definition is someone with real-world experiences yet ignores the real world in favor of academics, politics, or desires.
Bernanke with a PhD, and Krugman with a Noble Prize both qualify as potential idiots under the above definition. Bear in mind that sometimes (when it suits their goals) both may say things that make perfect sense. I agree with Krugman about 20% of the time. Such is the problem with this definition of idiocy.
Common Sense vs. Purposeful Idiocy
On grounds of common sense, anyone simultaneously praising free markets and intervention on the exact same issue is an idiot.
But Wait! What if the statement was a lie on purpose, hoping that idiots in mainstream media would not catch the lie?
Is the support for free markets just another purposeful lie?
One cannot easily determine the truth in these instances. However, in accordance with Occam’s Razor, the simplest explanation is likely the best.
One case suggests that potential idiots are telling lies on purpose. The simple case suggests that idiots can be expected to behave like idiots.
Thus, I come to the conclusion that “These Idiots Do Not Realize How Stupid They Sound”.
Mike “Mish” Shedlock
Global Economic Analysis