1 year ago
7/7/09
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George Grosz. Cain, or, Hitler in Hell. - Olga’s Gallery
I have a lifelong fascination with all things German, “outsiderish”, and confrontational, so it’s no surprise that I love George Grosz. Dadaist, anti-capitalist, anti-Nazi; Grosz was a deeply disillusioned and cynical artist with plenty of real-world activity to react against visually.
Unfortunately, this was also a pretty accurate description of most Weimar era progressives, and led directly to the major criticism against them: that they were conditioned as permanent critical outsiders and thus unable to transition into an effective governing class. Had they been more efficient at running a democracy, Hitler’s populist rhetoric may never have found a sympathetic audience and his first attempt at “revolution” (which ended in scorn and a jail sentence) may have been his only footnote in history.
I guess there’s probably a lesson here: if you want to change the world through political means, your time is better spent on day-to-day efficiency than criticism. Leave that to the artists, who, after all, are far better critics than a bureaucrat could ever be.
Fed to bolster the economy with $1 trillion purchase - a.k.a. the road to hyperinflation
I wrote a post about 3 weeks ago about the alarming news that I had heard from a bond trader friend of mine on how the Fed was trying to control the yield curve by buying at the long end and selling at the short end and how that gets us to hyperinflation. They did just that but in a massive scale - today comes the news that they are going to buy $1.2 trillion of long term government bonds.
Typically, the Fed buys and sells short term bonds to control the money supply. This is an unusual action in its size that significantly increases the money supply in the market - a lot of U.S. dollars all of a sudden appear out of nowhere.
This new infusion of cash in theory should lower the interest rate spread of treasuries and lending rates (i.e. banks will make loans at lower interest rates) and stimulate economic activity (i.e. people would start borrowing again to buy stuff).
On the other hand, increasing the money supply devalues the dollar. DJI went up 1.23% today but the JPY gained 2.47% against the dollar, the Euro went up 3.54% so actually today net net was a down day in the market for all of us.
The Fed is taking a big risk that could dilute the value of the dollar further and set the stage for future inflation. We still have to borrow and that is a lot harder to do with a weaker dollar.
Having studied mostly German history in college (and later worked for Allianz, the German insurer that is now the world’s largest financial company), the specter of hyperinflation is a pretty terrifying thought. It brings to mind ordinary Germans waiting in line at the bank in the morning, filling wheelbarrows with thousands of Deutschmarks, and rushing to the grocer to buy a loaf of bread before the money was devalued even further.
Even scarier: the paper I wrote as the ultimate summary of my history studies pointed to hyperinflation (and the very real fear of the middle class that it would give rise to Communist sympathizers) as a primary catalyst for Hitler’s rise to power. A man who was laughed at and jailed in the twenties for trying to spark what essentially was a populist revolution was looked at in a very different light by ordinary families who had lost everything in the crash and were now scared of being absorbed into a seemingly unstoppable Communist uprising.
More food for thought.
ok, one last inspiration post before I make some popcorn and watch a bad movie on a very quiet friday night. My German skills are failing me, and the text is really small, but if memory serves this is Death saying that he can’t take any more (after the trench warfare in Belgium has caused such stupefying levels of carnage).
via SIMPLICISSIMUS
I have a fascination with the early twentieth century subversive German literary magazine, Simplicissimus, that’s due in equal share to my German history classes, fall spent living and working in Munich right near the Alter Simpl, and appetite for imagery. Simplicissimus was important for more than its art, but it’s so visually stunning that it’s hard not to forget the political message…well, until you see a cover depicting Death stalking Europe during WWI or the “red beast” of Communism rising from beneath a city in the industrialized Ruhr valley.
Anyhow…more to come on this topic.
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