Like many American investors embedded in the rapidly globalizing world economy, I have been challenged by the recent domestic market conditions. The financial industry, crippled under the density of government intervention, has rapidly mutated from a system of rational self-interested agents to one of irrational entities who seem to lack a well-defined agency characteristic. Naturally, to succeed in this changing climate would require a drastic revision in one's strategic financial arsenal. Crucially, it also requires some unfortunate and unacceptable ideological concessions. Market models must account for what appears to be sub-culturally conditioned irrational behavior that is emergent in the neo-state capitalist system. In accounting for these effects, we implicitly acknowledge that existing models have failed. I argue that this is the wrong approach, and that these effects are an emergent property of our own ideological impurity.
No one would call it a stretch to read the past two years as hard evidence that the so-called failures of free market capitalism are actually the very proof of its intolerance for impure realizations. Simply put, when reason and logic no longer account for the rationale of the market, the tired laws of unidirectional causality suggests that one of two things must occur. Either our reasoning must change, forcing us to concede that what we thought of as rational behavior was actually irrational behavior masquerading as the rational, or the market itself must be manipulated into behaving rationally. We know this latter point to be a sort of inverse tautology, so the course narrows.
Through this deconstruction, one may easily arrive at a somewhat harsh reassessments of the so called "old" market models (namely, that they were incorrect) from their present failures, but is it not more powerful to reverse this causal relationship and say that the failures of these models are the very reason that they were wrong to begin with? In order to truly maintain ideological purity in this wasteland of conditional market freedoms, we must simply remember that when the market fails to operate rationally, it is because we ourselves have failed to interpret its behavior. However, it is obvious that this reversal technique fails when we claim that the impure realization of free market capitalism is merely a symptom of the implicit failure of free markets.
Accepting this, one can immediately see that the rules that govern rational behavior in the marketplace have all been warped into a sort of non-euclidean behavioral space. At the extrema, small changes in financial regulation produce enormous fluctuations in capital, while in the center of the policy space, truly substantially regulatory acts and longstanding policies seem only marginally effective. This produces a very widespread misperception that the federal government somehow has a one-to-one functional control over the health of the economy when it wields its tiny daggers. It is always a similar pocket of distorted forces that creates bubbles and overvaluations in every sector of the economy. The so-called government regulation sector is no exception, and mark my words, this bubble is about to bleed capital like a sliced artery.
It has often been said in hard social times: "We must not forget in our era of pillows and neckties that we are actually lions with whetted tongue, in search of meat." Indeed, as a set of animals, certain truths tend to be neglected in our daily interactions. One need only glance abreast at some of the more leftwing financial analysis publications such as "The Motley Fool" to see a flood of investment advice suggesting that investors would benefit from pre-empting this all-too-typical irrationality. The cost of all this is a loss of respect for the market process itself, and an undermining of the holistic faith in a deterministic economy. The solution, of course, is to funnel our investments toward the least regulated holdings and withhold as much capital as possible from those groups that are in bed with the powers that be. It is of course difficult to cut through the layers of obfuscatory publicity and the murkiness of the modern "annual report analysis" format. The message must be sent, however, at any cost. If a private firm lets this regulatory affliction touch its bottom line, then it is none but the investor himself who must step in and reject this state of affairs with his investment behaviors. They have always spoken louder than forlorn faces, angry words, votes and rifles combined.
At the very core of our behaviors, we must remember that while official government monetary value may no longer be unidirectionally deterministic, a compromise of value in supporting this turn of events is an implicit acceptance of them. When one invests in an overvalued "Green Energy" company, one is equally complicit in propping up the mythologies of green energy. Hence in order to objectively succeed in this climate, one's investments must no longer be viewed simply as a means of entrusting capital to establishments of sound financial constitution. Soundness is a term long lost for the rational agent. It is no longer ideologically sufficient to base one's portfolio on an optimally weighted formula for profit, because profit has been rendered meaningless by government overregulation. Though an eye must be kept on the calculated risks and rewards in reaping the milk from market ripples, one must remember the ideological precepts that make life possible and worthwhile in an asymptotically free-market.
In sum, a rapidly growing mass of the American public is beginning to awaken to the stark realities of investment in the new global world. In times of personal uncertainty, we must remember that our values and ideals are bigger than our own lives and certainly bigger than our governments. Generally, I feel no shame in admitting that my success has been furnished by the sort of persevering attitudes that have characterized all previous successful investors. Namely, timely currency speculation and a careful attention to consumer and financial industry trends. These are of course, timeless and indispensable strategies for a rational market, but they hardly tell the full story in the perpetual catastrophe that we face today.
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