Speculation, Human Action and Financial Markets


Speculation, Human Action and Financial Markets

By Duncan Whitmore

Within the past two weeks, retail investors congregating on the social media site Reddit bid up the stock of ailing company GameStop at the expense of large Wall Street hedge funds, all of whom had significant financial stakes reliant upon the price of the stock falling rather than rising. Several of these hedge funds were thrown into serious financial difficulty as a result of the price rocketing from around $20 a share to a high of nearly $400 in the space of only a few weeks. At the time of writing, the day traders have apparently turned their attention to the manipulated silver market, which is also starting to see significant gains. Fed up with a rigged casino market in which all of the spoils go to large Wall Street banks and financial firms, the amateurs appeared to have beaten the latter at their own game – at least, that is, in terms of having forced them to reveal the corrupt nature of the system if not in monetary profit.

This latest round in the battle of the populists vs the elitists is part of the ongoing collapse and rejection of inflationary state corporatism (the Western form of socialism that was birthed by World War One) and political globalism. Every blow that is dealt to this odious, oligarchic system – such as by Brexit and Trump – is one to be welcomed. However, whereas outright socialism (such as that practised in the former Soviet Union) entails direct state ownership over the means of production, the corporatist system operates through capitalistic facades such as nominally private businesses, free trade and exchange, stock markets, and so on. As a result, the socialised elements of our economic system have, for too long, been able to get away with offloading the blame for the problems they cause onto “capitalism” or “too much freedom” instead of the root cause which is state privilege and state interference with genuine private property rights. Indeed, that was exactly what happened after the housing market crash in 2008, with the whole fiasco being blamed on “greedy”, private bankers instead of the state induced, inflationary financial system. The long run result of our failure to identify the state as the true source of the problems has been that state failure has been rewarded with state growth.

Unfortunately, therefore, it is not enough for libertarians to simply cheer on the demise of the current, rotten system. In addition, we have to ensure that the proper enemy is identified and outed as state force and fraud, not the capitalistic institutions through which they operate. We must keep an eye not only on the current crop of elites, but also the circling vultures of popular, hard left politicians such as Bernie Sanders, Elizabeth Warren and Alexandria Ocasio-Cortez, who will be poised to blame everything indiscriminately on “capitalism” before advocating for total economic socialism as the answer.1 It would be a complete disaster if we were to allow one form of tyranny to be succeeded by another. Indeed, even the so-called “Great Reset” – which, far from being any kind of “revolution” or “renewal”, is actually a repackaging and rebranding of the present system in a far more potent form – is being sold as a reset of capitalism, the latter of which has supposedly failed us. Continue reading

Money – the Key to Freedom?


Money – the Key to Freedom?

 By Duncan Whitmore

In a previous essay concerning the freedom of speech, we noted that, although liberty as a whole is justified by reference to the non-aggression principle, specific freedoms can and should be promoted in their own right. Equally and oppositely, so too should individual examples of state intrusion into freedom be criticised and condemned on their own two feet. In other words, it is possible, and indeed vital, for us to explain the value of free speech, to oppose taxation, to defend against any possibility of forced vaccination and medication, to press for abolition of all forms of state funded medical care, to argue for the freedom of association, to advocate for the legalisation of vices, to promote free trade, and so on. Such arguments are likely to win us at least partial victories in the fight for freedom, victories which may not be achievable simply by repeating the non-aggression principle.

Many of these individual freedoms are enunciated also in bills of rights and charters of so-called human rights, notably the first ten amendments to the US Constitution. Here we find, amongst others, the protection of the right to religion, to speech, to bear arms, to the security of property against searches and seizures, to silence and due process when accused of a crime, and from “cruel and unusual” punishments. The defence of many of these freedoms has now become especially crucial as Western governments have continually sought to dilute them, sometimes in response to crises and calamities such as Islamic terrorism, and other times as a natural consequence of the growth of the state. It has been recognised that the freedom of speech, in particular, has been subject to a grave assault from identity politics and “cancel culture”.

However, a notable omission in many of these schedules of rights and freedoms is the freedom of money. Money is mentioned in the US Constitution, but it is buried in Section Ten of Article One, which limits the rights of the states. It has no prestigious place within the more memorable Bill of Rights, and fails to illicit the kind of passion that surrounds the First and Second Amendments. Freedom lovers today, similarly, will complain about the loss of our freedom of speech and the seemingly sudden transformation of the country into a police state as the result of the government’s reaction to COVID-19. But they will rarely turn their attention to the fact that the state has the power to print its currency, a power which has only existed in its entirety since 1971 when US President Richard Nixon severed the final tie of the US dollar to gold. Continue reading