Experts Warn Of 2010 Meltdown

By on May 25, 2010 in News 12

About a week ago I posted a story entitled “The Financial Crisis Is Back: Get Ready For Contagion.” Stock and commodity (precious metals excepted) markets worldwide did indeed take a nosedive very shortly afterward. Morning Liberty has collated a variety of dire forecasts for economic meltdown in 2010 from a variety of people who are far better informed than me. Each receives a thorough review with multiple comments over at AboveTopSecret.com. Here’s a taste:

Bob Chapman:
First 6 months of 2010, Americans will continue to live in the ‘unreality’…the period between July and October is when the financial fireworks will begin.
· The FED will act unilaterally for its own survival irrespective of any political implications …(source is from insider at FED meetings).
· In the last quarter of the year we could even see Martial Law, which is more likely for the first 6 months of 2011.
· The FDIC will collapse in September 2010.
· Commercial real estate is set to implode in 2010.
· Wall Street believes there is a 100% chance of crash in bond market, especially municipals sometime during 2010.
· The dollar will be devalued by the end of 2010.

Gerald Celente:
Terrorist attacks and the “Crash of 2010″. 40% devaluation at first = the greatest depression, worse than the Great Depression.

Igor Panarin:
In the summer of 1998, based on classified data about the state of the U.S. economy and society supplied to him by fellow FAPSI analysts, Panarin forecast the probable disintegration of the USA into six parts in 2010 (at the end of June – start of July 2010, as he specified on 10 December 2000…

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  • http://twitter.com/likeluke Luke Gardner

    Chapman's a metal hawking goon. Don't believe the hype.

    • TwoCoppers

      Hate to disagree bub, but…
      1) Most analysts that have been 'hawking' precious metals over the last six months have been right on.
      2) Mild unrest has a funny way of spiraling out of control rather quickly, which often brings about crackdowns and changes to law, which has a funny way of bringing about more unrest…
      3) I find it interesting that the recent story of the millionaire banker who's mansion was surrounded by @200 armed protesters didn't make a bigger splash in the mainstream media. Looks like poor folk are starting to realize that rich people are only human too. Same thing happened in France a couple of centuries ago.
      Should be an interesting year.

      • HOD

        #1: While analysts might have been correct in their recent predictions about gold, in the long term, gold has a terrible rate of return. According to economist Thomas Sowell (winner of the National Humanities Medal, among other honors) “a dollar invested in bonds in 1801
        would be worth nearly a thousand dollars by 1998, a dollar invested in stocks that same
        year would be worth more than half a million dollars. All this is in real terms, taking
        inflation into account. Meanwhile, a dollar invested in gold in 1801 would by 1998, be
        worth just 78 cents. The phrase, “as good as gold” can be misleading as the phrase
        “money in the bank”, when talking about the long run.” (Basic Economics: A Citizen’s Guide to the Economy, 2003)

        #2: Speculation. I recommend you read Michael Crichton's essay “Why Speculate?”

        #3: Speculation. I recommend you read Michael Crichton's essay “Why Speculate?”

        • Wreckingball

          Insurance policies have a terrible rate of return, but most people have at least one. Gold, by and large, isn't used as an “investment” (except by the likes of Warren Buffet, central banks and the World Bank – and what do THEY know…), it is used as insurance against falling markets, economies and currencies, and quite successfully at that. For investors who are trying to survive and move forward in our current environment of massive corpo-governmental looting, gold has been working very well. No speculation there.

  • HOD

    “Why Speculate?” by Michael Crichton (2002)

    My topic for today is the prevalence of speculation in media. What does it mean? Why has it become so ubiquitous? Should we do something about it? If so, what should we do? And why? Should we care at all? Isn't speculation valuable? Isn't it natural?

    I will join this speculative bandwagon and speculate about why there is so much speculation. In keeping with the trend, I will try express my views without any factual support, simply providing you with a series of bald assertions.

    This is not my natural style, and it's going to be a challenge for me, but I will do my best. I have written out my talk which is already a contradiction of principle. To keep within the spirit of our time, it should really be off the top of my head.

    Before we begin, I'd like to clarify a definition. By media I mean movies television internet books newspapers and magazines. That's a broad definition but in keeping with the general trend of speculation, let's not make too many fine distinctions.

    First we might begin by asking, to what degree has the media turned to pure speculation? Someone could do a study of this and present facts, but nobody has. I certainly won't. There's no reason to bother.

    Today, everybody knows that “Hardball,” “The O'Relly Factor,” and similar shows are nothing but a steady stream of guesses about the future. The Sunday morning talk shows are pure speculation. They have to be. Everybody knows there's no news on Sunday.

    But speculation is every bit as rampant in the so-called serious media, such as newspapers. For example, consider the New York Times for March 6, 2002, the day I was asked to give this talk. The column one story that day concerns George Bush's tariffs on imported steel. We read:

    Mr. Bush's action “is likely to send the price of steel up sharply, perhaps as much as ten percent..” American consumers “will ultimately bear” higher prices. America's allies “would almost certainly challenge” the decision. Their legal case “could take years to litigate in Geneva, is likely to hinge” on thus and such.

    In addition, there is a further vague and overarching speculation. The Allies' challenge would be “setting the stage for a major trade fight with many of the same countries Mr. Bush is trying to hold together in the fractious coalition against terrorism.” In other words, the story speculates that tariffs may rebound against the fight against terrorism.

    You may read this story and think, what's the big deal? Isn't it reasonable to talk about effects of current events in this way? I answer, absolutely not. Such speculation is a complete waste of time. It's useless. It's bullshit on the front page of the Times.

    The reason why it is useless, of course, is that nobody knows what the future holds.

    Do we all agree that nobody knows what the future holds? Or do I have to prove it to you? I ask this because there are some well-studied media effects which suggest that a simple appearance in media provides credibility. There was a well-known series of excellent studies by Stanford researchers that have shown, for example, that children take media literally. If you show them a bag of popcorn on a television set and ask them what will happen if you turn the TV upside down, the children say the popcorn will fall out of the bag. This effect would be amusing if it were confined to children. The studies show that no one is exempt. All human beings are subject to this media effect, including those of us who think we are self-aware and hip and knowledgeable.

    Media carries with it a credibility that is totally undeserved. You have all experienced this, in what I call the Murray Gell-Mann Amnesia effect. (I call it by this name because I once discussed it with Murray Gell-Mann, and by dropping a famous name I imply greater importance to myself, and to the effect, than it would otherwise have.)

    Briefly stated, the Gell-Mann Amnesia effect works as follows. You open the newspaper to an article on some subject you know well. In Murray's case, physics. In mine, show business. You read the article and see the journalist has absolutely no understanding of either the facts or the issues. Often, the article is so wrong it actually presents the story backward-reversing cause and effect. I call these the “wet streets cause rain” stories. Paper's full of them.

    In any case, you read with exasperation or amusement the multiple errors in a story-and then turn the page to national or international affairs, and read with renewed interest as if the rest of the newspaper was somehow more accurate about far-off Palestine than it was about the story you just read. You turn the page, and forget what you know.

    That is the Gell-Mann Amnesia effect. I'd point out it does not operate in other arenas of life. In ordinary life, if somebody consistently exaggerates or lies to you, you soon discount everything they say. In court, there is the legal doctrine of falsus in uno, falsus in omnibus, which means untruthful in one part, untruthful in all.

    But when it comes to the media, we believe against evidence that it is probably worth our time to read other parts of the paper. When, in fact, it almost certainly isn't. The only possible explanation for our behavior is amnesia.

    So one problem with speculation is that it piggybacks on the Gell-Mann effect of unwarranted credibility, making speculation look more useful than it is.

    Another issue springs from the sheer volume of speculation. Ubiquity may come to imply a value to the activity being so assiduously carried out. But in fact, no matter how many people are speculating, no matter how familiar their faces, how good their makeup and how well they are lit, no matter how many weeks they appear before us in person or in columns, it still remains true that none of them knows what the future holds.

    Some people still believe that the future can be known. They imagine two groups of people that may know the future, and therefore should be listened to. The first is pundits. Since they expound on the future all the time, they must know what they are talking about. Do they? The now-defunct magazine Brill's Content used to track the pundit's guesses, and while one or another had the occasional winning streak, over the long haul they did no better than chance. This is what you would expect. Because nobody knows the future.

    The second group that some people imagine may know the future are specialists of various kinds. They don't either. As a limiting case, I remind you there is a new kind of specialist occupation-I refuse to call it a discipline, or a field of study-called futurism. The notion here is that there is a way to study trends and know what the future holds. That would indeed be valuable, if it were possible. But it isn't possible. Futurists don't know any more about the future than you or I. Read their magazines from a couple of years ago and you'll see an endless parade of error.

    Expertise is no shield against failure to see ahead. Paul Erlich, a brilliant academic who has devoted his entire life to ecological issues, has been wrong in nearly all his major predictions. He was wrong about diminishing resources, he was wrong about the population explosion, and he was wrong that we would lose 50% of all species by the year 2000. His lifelong study of these issues did not prevent him from being wrong.

    All right, you may say, you'll accept that the future can't be known, in the way I are talking. But what about more immediate predictions, such as the effects of pending legislation? Surely it is important to talk about what will happen if certain legislation passes. Well, no, it isn't. Nobody knows what is going to happen when the legislation passes. I give you two examples from the left and right.

    The first is the Clinton welfare reform, harshly criticized by his own left wing for caving in to the Republican agenda. The left's predictions were for vast human suffering, shivering cold, child abuse, terrible outcomes. What happened? None of these things. Child abuse declined. In fact, as government reforms go, it's been a success; Mother Jones predicts dire effects just ahead.

    This failure to predict accurately was mirrored by the hysterical cries from the Republican right over raising the minimum wage. Chaos and dark days would surely follow as businesses closed their doors and the country was plunged into needless recession. What was the actual effect? Basically, nothing. Who discusses it now? Nobody. What will happen if there is an attempt to raise the minimum wage again? The same predictions all over again. Have we learned anything? No.

    But my point is, for legislation as with everything else, nobody knows the future.

    The same thing is true concerning the effect of elections and appointments. What will be the effect of electing a certain president, or a supreme court justice? Nobody knows. Some in this audience are old enough to remember Art Buchwald's famous column from the days of the Johnson Administration. Buchwald wrote a “Thank God we don't have Barry Goldwater” essay, recalling how everyone feared Goldwater would get us into a major war. So the country elected Johnson, who promptly committed 200,000 troops to Vietnam. That's what happens when you choose the dove-ish candidate. You get a war. Or you elect Richard Nixon because he can pull the plug on Vietnam, and he continues to fight for years. And then opens China.

    Similarly, the history of the Supreme Court appointments is a litany of error in predicting how justices will vote on the court. They don't all surprise us, but a lot of them do.

    So, in terms of imminent events, can we predict anything at all? No. You need only look at what was said days before the Berlin Wall came down, to understand that nobody can predict even a few hours ahead. People said all sorts of silly things about the Communist empire. I can't quote them, because that would mean I had looked them up and had facts at hand, and I have promised you not to do that. But take my word for it, you can find silly statements 24 hours in advance of the fall of the Russian empire.

    So I say again: NOBODY KNOWS THE FUTURE.

    Now, this is not new information. It was Mark Twain who said, 'I've seen a heap of trouble in my life, and most of it never came to pass.”

    If speculation is really worthless, why is there so much of it? Is it because people want it? I don't think so. I speculate that media has turned to speculation for media's own reasons. So now let's consider the advantages of speculation from a media standpoint.

    1. It's incredibly cheap. Talk is cheap. And speculative talk shows are the cheapest thing you can put on television, They're almost as cheap as running a test pattern. Just get the talking host, book the talking heads-of which there is no shortage-and you're done! Instant show. No reporters in different cities around the world, no film crews on location. No research staff, no deadlines, no footage to edit, no editors…nothing! Just talk. Bullshit. Cheap.

    2. You can't lose. Even though speculation is correct only by chance, which means it is wrong at least 50% of the time, nobody remembers and therefore nobody cares. People do not remember yesterday, let alone last week, or last month. Media exists in the eternal now, this minute, this crisis, this talking head, this column, this speculation.

    One of the clearest proofs of this is the “Currents of Death” controversy. This fear of cancer from power lines originated with the New Yorker, which has been a gushing fountainhead of erroneous scientific speculation for fifty years. But the point is this: all the people who ten years ago were frantic to measure dangerous electromagnetic radiation in their houses now spend thousands of dollars buying magnets to attach to their wrists and ankles, because of the putative healthful effects of magnetic fields. They don't remember these are the same fields they formerly wanted to avoid. And since they don't remember, you can't lose with any future speculation.

    Let me expand on this idea that you can't lose. It's not confined to the media. Most areas of intellectual life have discovered the virtues of speculation, and have embraced it wildly. In academia, speculation is usually dignified as theory. It's fascinating that even though the intellectual stance of the pomo deconstructionist era is against theory, particularly overarching theory, in reality what every academic wants to express is theory. This is in part aping science, but it's also an escape hatch. Your close textual reading of Jane Austen could well be wrong, and could be shown to be wrong by a more knowledgeable critic. But your theory of radical feminization and authoritarian revolt in the work of Jane Austen-with reference to your own childhood feelings-is untouchable. Similarly, your analysis of the origins of the First World War could be debated by other authorities. But your New Historicist essay, which includes your own fantasy about what it would be like if you were fighting in the first war…well, that's unarguable. And even better, how about a theory of the origin of warfare beginning with Paleolithic cave men? That's really unarguable.

    A wonderful area for speculative academic work is the unknowable. Religious subjects are in disfavor these days, but there are still plenty of good topics. The nature of consciousness, the workings of the brain, the origin of aggression, the origin of language, the origin of life on earth, SETI and life on other worlds…this is all great stuff. You can argue it interminably. And it can't be contradicted, because nobody knows the answer to any of these topics-and probably, nobody ever will.

    Then there is the speculative work of anthropologists like Helen Fisher, who claim to tell us about the origins of love or of infidelity or cooperation by reference to other societies, animal behavior, and the fossil record. How can she be wrong? These are untestable, unprovable, just so stories.

    And lest anyone imagine things are different in the hard sciences, consider string theory, for nearly 20 years now the dominant physical theory. More than one generation of physicists has labored over string theory. But-if I understand it correctly, and I may not-string theory cannot be tested or proven or disproven. Although some physicists are distressed by the argument that an untestable theory is nevertheless scientific, who is going to object, really? Face it, a untestable theory is ideal! Your career is secure!

    In short, there is now widespread understanding that so long as you speculate, you can't lose.

    Now, nowhere is it written that the media need be accurate, or useful. They haven't been for most of recorded history. So now they're speculating….so what? What is wrong with it?

    1. Tendency to excess. Mere talk makes drama and spectacle unlikely-unless the talk becomes heated and excessive. So it becomes excessive. Not every show features the Crossfire-style foodfight, but it is a tendency on all shows.

    2. Crisisization of everything possible. Most speculation is not compelling because most events are not compelling-Gosh, I wonder what will happen to the German mark? Are they gonna get their labor problems under control? This fact promotes the well-known media need for a crisis. Crisis in the German mark! Uh-oh! Look out! Crises unite the country, draw viewers in large numbers, and give everyone something to speculate about. Without a crisis, the talk soon degenerates into debate about whether the refs should have used instant replay on the last football game. So there is a tendency to hype urgency and importance and be-there-now when it's really not appropriate. Witness the interminable scroll at the bottom of the screen about the Queen Mother's funeral. Whatever the Queen mother's story may be, it is not a crisis. I have even watched a scroll of my own divorce roll by for a couple of days on CNN. It's sort of flattering (even though they got it wrong.) But it is surely not vital breaking news.

    3. Superficiality as a norm. Gotta go fast. Hit the high points. On to our next guest. Speculation adds to superficiality.

    4. Endless presentation of conflict may interfere with genuine issue resolution. There is evidence that the television foodfights not only don't represent the views of most people-who are not so polarized-but may tend to make resolution of actual disputes more difficult in the real world. At the very least, they obscure the recognition that we resolve disputes every day. Compromise is much easier from relatively central positions than it is from extreme and hostile, conflicting positions: Greenpeace vs the Logging Industry.

    5. Interminable chains of speculation pave the way to litigation about breast implants, hysteria over Y2K and global warming, articles in the New Yorker about currents of death, and a variety of other outcomes that are not, by any thoughtful view, helpful. There comes to be a perception-convenient to the media-that nothing is, in the end, knowable for sure. When in fact, that's not true.

    Let me point to a demonstrable bad effect of the assumption that nothing is really knowable. Whole word reading was introduced by the education schools of the country without, to my knowledge, any testing of the efficacy of the new method. It was simply put in place. Generations of teachers were indoctrinated in its methods. As a result, the US has one of the highest illiteracy rates in the industrialized world. The assumption that nothing can be known with certainty does in truth have terrible consequences.

    As GK Chesterton said (in a somewhat different context), “If you believe in nothing, you'll believe in anything.” That's what we see today. People believe in anything.

    But just in terms of the general emotional tenor of life, I often think people are nervous, jittery in this media climate of what if, what if, maybe, perhaps, could be…when there is usually no sensible reason to feel nervous.

    Like a bearded nut in robes on the sidewalk proclaiming the end of the world is near, the media is just doing what makes it feel good, not reporting hard facts. We need to start seeing the media as a bearded nut on the sidewalk, shouting out false fears. It's not sensible to listen to it.

    We need to start remembering that everybody who said that Y2K wasn't a real problem was either shouted down, or kept off the air. The same thing is true now of issues like species extinction and global warming. You never hear anyone say it's not a crisis. I won't go into it, because it might lead to the use of facts, but I'll just mention two reports I speculate you haven't heard about. The first is the report in Science magazine January 18 2001 (Oops! a fact) that contrary to prior studies, the Antarctic ice pack is increasing, not decreasing, and that this increase means we are finally seeing an end to the shrinking of the pack that has been going on for thousands of years, ever since the Holocene era. I don't know which is more surprising, the statement that it's increasing, or the statement that its shrinkage has preceded global warming by thousands of years. The second study is a National Academy of Sciences report on the economic effects to the US economy of the last El Nino warming event of 1997. That warming produced a net benefit of 15 billion dollars to the economy. That's taking into account 1.5 billion loss in California from rain, which was offset by decreased fuel bills for a milder winter, and a longer growing season. Net result 15 billion in savings.

    The other thing I will mention to you is that during the last 100 years, while the average temperature on the globe has increased just .3 C, the magnetic field of the earth declined by 10%. This is a much larger effect than global warming and potentially far more serious to life on this planet. Our magnetic field is what deflects lethal radiation from space. A ten percent reduction of the earth's magnetic field is extremely worrisome.

    But who is worried? Nobody. Who is raising a call to action? Nobody. Why not? Because there is nothing to be done. How this may relate to global warming I leave for you to speculate on your own.

    Personally, I think we need to start turning away from media, and the data shows that we are doing just that, at least from television news. I find that whenever I lack exposure to media I am much happier, and my life feels fresher.

    In closing, I'd remind you that since we're awash in this contemporary ocean of speculation, we forget that things can be known with certainty, and that we need not live in a fearful world of interminable unsupported opinion. But the gulf that separates hard fact from speculation is by now so unfamiliar that most people can't comprehend it. I can perhaps make it clear by this story:

    On a plane to Europe, I am seated next to a guy who is very unhappy. Turns out he is a doctor who has been engaged in a two-year double blind study of drug efficacy for the FDA, and the study may be tossed out the window. Now a double-blind study means there are four separate research teams, each having no contact with any other team-preferably, they're at different universities, in different parts of the country. The first team defines the study and makes up the medications, the real meds and the controls. The second team administers the medications to the patients. The third team comes in at the end and independently assesses the effect of the medications on each patient. The fourth team takes the data and does a statistical analysis. The cost of this kind of study, as you might imagine, is millions of dollars. And the teams must never meet.

    My guy is unhappy because months after the study is over, he is in the waiting room of Frankfurt airport and he strikes up a conversation with another man in the lounge, and they discover-to their horror-that they are both involved in the study. My guy was on the team that administered the meds. The other guy is on the team doing the statistics. There isn't any reason why one should influence the other at this late date, but nevertheless the protocol requires that team members never meet. So now my guy is waiting to hear if the FDA will throw out the entire study, because of this chance meeting in Frankfurt airport.

    Those are the lengths you have to go to if you want to be certain that your information is reliable. But when I tell people this story, they just stare at me incomprehendingly. They find it absurd. They don't think it's necessary to do all that. They think it's overkill. They live in the world of MSNBC and the New York Times. And they've forgotten what real, reliable information is, and the lengths you have to go to get it. It's so much harder than just speculating.

    And on that point, I have to agree with them.

    Oh-and by the way? Almost none of the speculation in that story about Bush steel tariffs proved true.

    http://www.crichton-official.com/speech-whyspec…

  • HOD

    “Why Speculate?” by Michael Crichton (2002)

    My topic for today is the prevalence of speculation in media. What does it mean? Why has it become so ubiquitous? Should we do something about it? If so, what should we do? And why? Should we care at all? Isn't speculation valuable? Isn't it natural?

    I will join this speculative bandwagon and speculate about why there is so much speculation. In keeping with the trend, I will try express my views without any factual support, simply providing you with a series of bald assertions.

    This is not my natural style, and it's going to be a challenge for me, but I will do my best. I have written out my talk which is already a contradiction of principle. To keep within the spirit of our time, it should really be off the top of my head.

    Before we begin, I'd like to clarify a definition. By media I mean movies television internet books newspapers and magazines. That's a broad definition but in keeping with the general trend of speculation, let's not make too many fine distinctions.

    First we might begin by asking, to what degree has the media turned to pure speculation? Someone could do a study of this and present facts, but nobody has. I certainly won't. There's no reason to bother.

    Today, everybody knows that “Hardball,” “The O'Relly Factor,” and similar shows are nothing but a steady stream of guesses about the future. The Sunday morning talk shows are pure speculation. They have to be. Everybody knows there's no news on Sunday.

    But speculation is every bit as rampant in the so-called serious media, such as newspapers. For example, consider the New York Times for March 6, 2002, the day I was asked to give this talk. The column one story that day concerns George Bush's tariffs on imported steel. We read:

    Mr. Bush's action “is likely to send the price of steel up sharply, perhaps as much as ten percent..” American consumers “will ultimately bear” higher prices. America's allies “would almost certainly challenge” the decision. Their legal case “could take years to litigate in Geneva, is likely to hinge” on thus and such.

    In addition, there is a further vague and overarching speculation. The Allies' challenge would be “setting the stage for a major trade fight with many of the same countries Mr. Bush is trying to hold together in the fractious coalition against terrorism.” In other words, the story speculates that tariffs may rebound against the fight against terrorism.

    You may read this story and think, what's the big deal? Isn't it reasonable to talk about effects of current events in this way? I answer, absolutely not. Such speculation is a complete waste of time. It's useless. It's bullshit on the front page of the Times.

    The reason why it is useless, of course, is that nobody knows what the future holds.

    Do we all agree that nobody knows what the future holds? Or do I have to prove it to you? I ask this because there are some well-studied media effects which suggest that a simple appearance in media provides credibility. There was a well-known series of excellent studies by Stanford researchers that have shown, for example, that children take media literally. If you show them a bag of popcorn on a television set and ask them what will happen if you turn the TV upside down, the children say the popcorn will fall out of the bag. This effect would be amusing if it were confined to children. The studies show that no one is exempt. All human beings are subject to this media effect, including those of us who think we are self-aware and hip and knowledgeable.

    Media carries with it a credibility that is totally undeserved. You have all experienced this, in what I call the Murray Gell-Mann Amnesia effect. (I call it by this name because I once discussed it with Murray Gell-Mann, and by dropping a famous name I imply greater importance to myself, and to the effect, than it would otherwise have.)

    Briefly stated, the Gell-Mann Amnesia effect works as follows. You open the newspaper to an article on some subject you know well. In Murray's case, physics. In mine, show business. You read the article and see the journalist has absolutely no understanding of either the facts or the issues. Often, the article is so wrong it actually presents the story backward-reversing cause and effect. I call these the “wet streets cause rain” stories. Paper's full of them.

    In any case, you read with exasperation or amusement the multiple errors in a story-and then turn the page to national or international affairs, and read with renewed interest as if the rest of the newspaper was somehow more accurate about far-off Palestine than it was about the story you just read. You turn the page, and forget what you know.

    That is the Gell-Mann Amnesia effect. I'd point out it does not operate in other arenas of life. In ordinary life, if somebody consistently exaggerates or lies to you, you soon discount everything they say. In court, there is the legal doctrine of falsus in uno, falsus in omnibus, which means untruthful in one part, untruthful in all.

    But when it comes to the media, we believe against evidence that it is probably worth our time to read other parts of the paper. When, in fact, it almost certainly isn't. The only possible explanation for our behavior is amnesia.

    So one problem with speculation is that it piggybacks on the Gell-Mann effect of unwarranted credibility, making speculation look more useful than it is.

    Another issue springs from the sheer volume of speculation. Ubiquity may come to imply a value to the activity being so assiduously carried out. But in fact, no matter how many people are speculating, no matter how familiar their faces, how good their makeup and how well they are lit, no matter how many weeks they appear before us in person or in columns, it still remains true that none of them knows what the future holds.

    Some people still believe that the future can be known. They imagine two groups of people that may know the future, and therefore should be listened to. The first is pundits. Since they expound on the future all the time, they must know what they are talking about. Do they? The now-defunct magazine Brill's Content used to track the pundit's guesses, and while one or another had the occasional winning streak, over the long haul they did no better than chance. This is what you would expect. Because nobody knows the future.

    The second group that some people imagine may know the future are specialists of various kinds. They don't either. As a limiting case, I remind you there is a new kind of specialist occupation-I refuse to call it a discipline, or a field of study-called futurism. The notion here is that there is a way to study trends and know what the future holds. That would indeed be valuable, if it were possible. But it isn't possible. Futurists don't know any more about the future than you or I. Read their magazines from a couple of years ago and you'll see an endless parade of error.

    Expertise is no shield against failure to see ahead. Paul Erlich, a brilliant academic who has devoted his entire life to ecological issues, has been wrong in nearly all his major predictions. He was wrong about diminishing resources, he was wrong about the population explosion, and he was wrong that we would lose 50% of all species by the year 2000. His lifelong study of these issues did not prevent him from being wrong.

    All right, you may say, you'll accept that the future can't be known, in the way I are talking. But what about more immediate predictions, such as the effects of pending legislation? Surely it is important to talk about what will happen if certain legislation passes. Well, no, it isn't. Nobody knows what is going to happen when the legislation passes. I give you two examples from the left and right.

    The first is the Clinton welfare reform, harshly criticized by his own left wing for caving in to the Republican agenda. The left's predictions were for vast human suffering, shivering cold, child abuse, terrible outcomes. What happened? None of these things. Child abuse declined. In fact, as government reforms go, it's been a success; Mother Jones predicts dire effects just ahead.

    This failure to predict accurately was mirrored by the hysterical cries from the Republican right over raising the minimum wage. Chaos and dark days would surely follow as businesses closed their doors and the country was plunged into needless recession. What was the actual effect? Basically, nothing. Who discusses it now? Nobody. What will happen if there is an attempt to raise the minimum wage again? The same predictions all over again. Have we learned anything? No.

    But my point is, for legislation as with everything else, nobody knows the future.

    The same thing is true concerning the effect of elections and appointments. What will be the effect of electing a certain president, or a supreme court justice? Nobody knows. Some in this audience are old enough to remember Art Buchwald's famous column from the days of the Johnson Administration. Buchwald wrote a “Thank God we don't have Barry Goldwater” essay, recalling how everyone feared Goldwater would get us into a major war. So the country elected Johnson, who promptly committed 200,000 troops to Vietnam. That's what happens when you choose the dove-ish candidate. You get a war. Or you elect Richard Nixon because he can pull the plug on Vietnam, and he continues to fight for years. And then opens China.

    Similarly, the history of the Supreme Court appointments is a litany of error in predicting how justices will vote on the court. They don't all surprise us, but a lot of them do.

    So, in terms of imminent events, can we predict anything at all? No. You need only look at what was said days before the Berlin Wall came down, to understand that nobody can predict even a few hours ahead. People said all sorts of silly things about the Communist empire. I can't quote them, because that would mean I had looked them up and had facts at hand, and I have promised you not to do that. But take my word for it, you can find silly statements 24 hours in advance of the fall of the Russian empire.

    So I say again: NOBODY KNOWS THE FUTURE.

    Now, this is not new information. It was Mark Twain who said, 'I've seen a heap of trouble in my life, and most of it never came to pass.”

    If speculation is really worthless, why is there so much of it? Is it because people want it? I don't think so. I speculate that media has turned to speculation for media's own reasons. So now let's consider the advantages of speculation from a media standpoint.

    1. It's incredibly cheap. Talk is cheap. And speculative talk shows are the cheapest thing you can put on television, They're almost as cheap as running a test pattern. Just get the talking host, book the talking heads-of which there is no shortage-and you're done! Instant show. No reporters in different cities around the world, no film crews on location. No research staff, no deadlines, no footage to edit, no editors…nothing! Just talk. Bullshit. Cheap.

    2. You can't lose. Even though speculation is correct only by chance, which means it is wrong at least 50% of the time, nobody remembers and therefore nobody cares. People do not remember yesterday, let alone last week, or last month. Media exists in the eternal now, this minute, this crisis, this talking head, this column, this speculation.

    One of the clearest proofs of this is the “Currents of Death” controversy. This fear of cancer from power lines originated with the New Yorker, which has been a gushing fountainhead of erroneous scientific speculation for fifty years. But the point is this: all the people who ten years ago were frantic to measure dangerous electromagnetic radiation in their houses now spend thousands of dollars buying magnets to attach to their wrists and ankles, because of the putative healthful effects of magnetic fields. They don't remember these are the same fields they formerly wanted to avoid. And since they don't remember, you can't lose with any future speculation.

    Let me expand on this idea that you can't lose. It's not confined to the media. Most areas of intellectual life have discovered the virtues of speculation, and have embraced it wildly. In academia, speculation is usually dignified as theory. It's fascinating that even though the intellectual stance of the pomo deconstructionist era is against theory, particularly overarching theory, in reality what every academic wants to express is theory. This is in part aping science, but it's also an escape hatch. Your close textual reading of Jane Austen could well be wrong, and could be shown to be wrong by a more knowledgeable critic. But your theory of radical feminization and authoritarian revolt in the work of Jane Austen-with reference to your own childhood feelings-is untouchable. Similarly, your analysis of the origins of the First World War could be debated by other authorities. But your New Historicist essay, which includes your own fantasy about what it would be like if you were fighting in the first war…well, that's unarguable. And even better, how about a theory of the origin of warfare beginning with Paleolithic cave men? That's really unarguable.

    A wonderful area for speculative academic work is the unknowable. Religious subjects are in disfavor these days, but there are still plenty of good topics. The nature of consciousness, the workings of the brain, the origin of aggression, the origin of language, the origin of life on earth, SETI and life on other worlds…this is all great stuff. You can argue it interminably. And it can't be contradicted, because nobody knows the answer to any of these topics-and probably, nobody ever will.

    Then there is the speculative work of anthropologists like Helen Fisher, who claim to tell us about the origins of love or of infidelity or cooperation by reference to other societies, animal behavior, and the fossil record. How can she be wrong? These are untestable, unprovable, just so stories.

    And lest anyone imagine things are different in the hard sciences, consider string theory, for nearly 20 years now the dominant physical theory. More than one generation of physicists has labored over string theory. But-if I understand it correctly, and I may not-string theory cannot be tested or proven or disproven. Although some physicists are distressed by the argument that an untestable theory is nevertheless scientific, who is going to object, really? Face it, a untestable theory is ideal! Your career is secure!

    In short, there is now widespread understanding that so long as you speculate, you can't lose.

    Now, nowhere is it written that the media need be accurate, or useful. They haven't been for most of recorded history. So now they're speculating….so what? What is wrong with it?

    1. Tendency to excess. Mere talk makes drama and spectacle unlikely-unless the talk becomes heated and excessive. So it becomes excessive. Not every show features the Crossfire-style foodfight, but it is a tendency on all shows.

    2. Crisisization of everything possible. Most speculation is not compelling because most events are not compelling-Gosh, I wonder what will happen to the German mark? Are they gonna get their labor problems under control? This fact promotes the well-known media need for a crisis. Crisis in the German mark! Uh-oh! Look out! Crises unite the country, draw viewers in large numbers, and give everyone something to speculate about. Without a crisis, the talk soon degenerates into debate about whether the refs should have used instant replay on the last football game. So there is a tendency to hype urgency and importance and be-there-now when it's really not appropriate. Witness the interminable scroll at the bottom of the screen about the Queen Mother's funeral. Whatever the Queen mother's story may be, it is not a crisis. I have even watched a scroll of my own divorce roll by for a couple of days on CNN. It's sort of flattering (even though they got it wrong.) But it is surely not vital breaking news.

    3. Superficiality as a norm. Gotta go fast. Hit the high points. On to our next guest. Speculation adds to superficiality.

    4. Endless presentation of conflict may interfere with genuine issue resolution. There is evidence that the television foodfights not only don't represent the views of most people-who are not so polarized-but may tend to make resolution of actual disputes more difficult in the real world. At the very least, they obscure the recognition that we resolve disputes every day. Compromise is much easier from relatively central positions than it is from extreme and hostile, conflicting positions: Greenpeace vs the Logging Industry.

    5. Interminable chains of speculation pave the way to litigation about breast implants, hysteria over Y2K and global warming, articles in the New Yorker about currents of death, and a variety of other outcomes that are not, by any thoughtful view, helpful. There comes to be a perception-convenient to the media-that nothing is, in the end, knowable for sure. When in fact, that's not true.

    Let me point to a demonstrable bad effect of the assumption that nothing is really knowable. Whole word reading was introduced by the education schools of the country without, to my knowledge, any testing of the efficacy of the new method. It was simply put in place. Generations of teachers were indoctrinated in its methods. As a result, the US has one of the highest illiteracy rates in the industrialized world. The assumption that nothing can be known with certainty does in truth have terrible consequences.

    As GK Chesterton said (in a somewhat different context), “If you believe in nothing, you'll believe in anything.” That's what we see today. People believe in anything.

    But just in terms of the general emotional tenor of life, I often think people are nervous, jittery in this media climate of what if, what if, maybe, perhaps, could be…when there is usually no sensible reason to feel nervous.

    Like a bearded nut in robes on the sidewalk proclaiming the end of the world is near, the media is just doing what makes it feel good, not reporting hard facts. We need to start seeing the media as a bearded nut on the sidewalk, shouting out false fears. It's not sensible to listen to it.

    We need to start remembering that everybody who said that Y2K wasn't a real problem was either shouted down, or kept off the air. The same thing is true now of issues like species extinction and global warming. You never hear anyone say it's not a crisis. I won't go into it, because it might lead to the use of facts, but I'll just mention two reports I speculate you haven't heard about. The first is the report in Science magazine January 18 2001 (Oops! a fact) that contrary to prior studies, the Antarctic ice pack is increasing, not decreasing, and that this increase means we are finally seeing an end to the shrinking of the pack that has been going on for thousands of years, ever since the Holocene era. I don't know which is more surprising, the statement that it's increasing, or the statement that its shrinkage has preceded global warming by thousands of years. The second study is a National Academy of Sciences report on the economic effects to the US economy of the last El Nino warming event of 1997. That warming produced a net benefit of 15 billion dollars to the economy. That's taking into account 1.5 billion loss in California from rain, which was offset by decreased fuel bills for a milder winter, and a longer growing season. Net result 15 billion in savings.

    The other thing I will mention to you is that during the last 100 years, while the average temperature on the globe has increased just .3 C, the magnetic field of the earth declined by 10%. This is a much larger effect than global warming and potentially far more serious to life on this planet. Our magnetic field is what deflects lethal radiation from space. A ten percent reduction of the earth's magnetic field is extremely worrisome.

    But who is worried? Nobody. Who is raising a call to action? Nobody. Why not? Because there is nothing to be done. How this may relate to global warming I leave for you to speculate on your own.

    Personally, I think we need to start turning away from media, and the data shows that we are doing just that, at least from television news. I find that whenever I lack exposure to media I am much happier, and my life feels fresher.

    In closing, I'd remind you that since we're awash in this contemporary ocean of speculation, we forget that things can be known with certainty, and that we need not live in a fearful world of interminable unsupported opinion. But the gulf that separates hard fact from speculation is by now so unfamiliar that most people can't comprehend it. I can perhaps make it clear by this story:

    On a plane to Europe, I am seated next to a guy who is very unhappy. Turns out he is a doctor who has been engaged in a two-year double blind study of drug efficacy for the FDA, and the study may be tossed out the window. Now a double-blind study means there are four separate research teams, each having no contact with any other team-preferably, they're at different universities, in different parts of the country. The first team defines the study and makes up the medications, the real meds and the controls. The second team administers the medications to the patients. The third team comes in at the end and independently assesses the effect of the medications on each patient. The fourth team takes the data and does a statistical analysis. The cost of this kind of study, as you might imagine, is millions of dollars. And the teams must never meet.

    My guy is unhappy because months after the study is over, he is in the waiting room of Frankfurt airport and he strikes up a conversation with another man in the lounge, and they discover-to their horror-that they are both involved in the study. My guy was on the team that administered the meds. The other guy is on the team doing the statistics. There isn't any reason why one should influence the other at this late date, but nevertheless the protocol requires that team members never meet. So now my guy is waiting to hear if the FDA will throw out the entire study, because of this chance meeting in Frankfurt airport.

    Those are the lengths you have to go to if you want to be certain that your information is reliable. But when I tell people this story, they just stare at me incomprehendingly. They find it absurd. They don't think it's necessary to do all that. They think it's overkill. They live in the world of MSNBC and the New York Times. And they've forgotten what real, reliable information is, and the lengths you have to go to get it. It's so much harder than just speculating.

    And on that point, I have to agree with them.

    Oh-and by the way? Almost none of the speculation in that story about Bush steel tariffs proved true.

    http://www.crichton-official.com/speech-whyspec…

  • HOD

    #1: While analysts might have been correct in their recent predictions about gold, in the long term, gold has a terrible rate of return. According to economist Thomas Sowell (winner of the National Humanities Medal, among other honors) “a dollar invested in bonds in 1801
    would be worth nearly a thousand dollars by 1998, a dollar invested in stocks that same
    year would be worth more than half a million dollars. All this is in real terms, taking
    inflation into account. Meanwhile, a dollar invested in gold in 1801 would by 1998, be
    worth just 78 cents. The phrase, “as good as gold” can be misleading as the phrase
    “money in the bank”, when talking about the long run.” (Basic Economics: A Citizen’s Guide to the Economy, 2003)

    #2: Speculation. I recommend you read Michael Crichton's essay “Why Speculate?”

    #3: Speculation. I recommend you read Michael Crichton's essay “Why Speculate?”

  • http://www.chinagreenelvis.com chinagreenelvis

    Good post, HOD.

    The fact is that fear gets attention, fear makes money, fear gains power.

    On another note, I'm fucking sick of hearing those two little words that everyone just loves to shove into their apocalyptic visions of the future: Martial Law. You're almost guaranteed to not be paid attention to when you try to play that card.

    • http://www.chinagreenelvis.com chinagreenelvis

      You know what, fuck me. It's another asshole trying to spread panic and sell gold. Fucking gold salesmen. Just another wannabe Glenn Beck.

  • http://disinfo.com Majestic

    Want more: http://www.marketwatch.com/story/crash-is-dead-…

    Correction? New crash imminent, worse than 2008

    More proof: Earlier economist Gary Shilling said price-to-earnings ratios are at a “nosebleed 22.5 level.” The Dow was around 11,000. Money manager Jeremy Grantham recently said the market's overvalued 40%. That could mean a collapse to 6,600. Last week in Reuters' “Markets Could Be Derailed Again,” George Soros echoed a “game over” warning with a “stark warning … that the financial world is on the wrong track and that we may be hurtling towards an even bigger boom and bust than in the credit crisis.”

    Now Dow Theory's Richard Russell is warning the public of an imminent crash: “Sell … get liquid … by the end of this year they won't recognize the country.”

  • http://disinfo.com Majestic

    Want more: http://www.marketwatch.com/story/crash-is-dead-…

    Correction? New crash imminent, worse than 2008

    More proof: Earlier economist Gary Shilling said price-to-earnings ratios are at a “nosebleed 22.5 level.” The Dow was around 11,000. Money manager Jeremy Grantham recently said the market's overvalued 40%. That could mean a collapse to 6,600. Last week in Reuters' “Markets Could Be Derailed Again,” George Soros echoed a “game over” warning with a “stark warning … that the financial world is on the wrong track and that we may be hurtling towards an even bigger boom and bust than in the credit crisis.”

    Now Dow Theory's Richard Russell is warning the public of an imminent crash: “Sell … get liquid … by the end of this year they won't recognize the country.”

  • Wreckingball

    Insurance policies have a terrible rate of return, but most people have at least one. Gold, by and large, isn’t used as an “investment” (except by the likes of Warren Buffet, central banks and the World Bank – and what do THEY know…), it is used as insurance against falling markets, economies and currencies, and quite successfully at that. For investors who are trying to survive and move forward in our current environment of massive corpo-governmental looting, gold has been working very well. No speculation there.