Posted To Ellen Brown’s Substack Newsletter 05/17/2023

Me: Basically speculative financialization is “of the devil”. Limited, emphasis LIMITED speculation and even hedging on actually productive pursuits is fine, but de-stabilizing an already unstable monopolistic paradigm of Debt Only with shorting is just pouring on the stupidity and enabling the already over weeningly powerful to further dominate the system and the people within it.

FOH: People who understand little of the intricacies of financial markets should think twice before making bold propositions.

Does the writer understand what put options are? (Buying a put is very much like selling the stock short.)

Does the writer understand swaps? (One counterparty is effectively long the stock, the other effectively short the stock.)

Does the writer understand hedging? (The market makers who sell call options to the general public hedge their directional risk by short selling the stock.)

Does the writer understand the role of efficient markets? Does she understand the contribution to efficient markets made by long/short pairs trading?

Does the writer understand how banning short sales would impact all these alternatives and legitimate functions of short selling? Maybe she does, but there is no hint of it in this vastly oversimplified call for a ban on short selling.

Me: All of the things you mentioned are just “epicycles” and “perturbations of Mars” to try to survive, game and/or make sense out of a paradigm that is waaaaay too anomalous not to require a new one….and that such change makes profitable investment a thousand times less risky than the unethical skurrying seemingly needed in the present one.

Reply to Rafi:

Reification can be a good or mistaken thing. What we need to do is reify the various aspects of the natural philosophical concept of grace like Monetary Gifting for instance…by implementing monetary, financial and economic policies that do exactly that.

Shorting and almost all other aspects of financialization are a negative reification of greed, dominance and even theft as Ellen has outlined.

Rather than rely on techniques devolved out of the present civilization long monetary paradigm of Debt Only let us bring universal security, macro-economic stability and actual ethics to the money system by integrating Gifting into the monopolistic current paradigm. With security the individual is much more likely to support and act with rationality.

In my book I propose a policy of a sliding scale percentage of required investment of earned and gifted income into actually economic/productive pursuits and into eco-bonds for research into new energy sources and to fund the mega-projects necessary to confront and handle climate change. Let us have that rather than the present crazy financialized golem that keeps all of the seeming unresolvable economic problems we have in continual effect.


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