re. "GREEN IS GOOD, USUALLY"

My recent post entitled "Green is Good, Usually" at SolidGroundNews has received some interest. If you're following this topic, about the Dec 2011 NJ Commission of Investigation report "Industrious Subversion", you may want to also read The Mob Goes Green - Organized Crime Profits With New Jersey Recycling and N.J.'s Solid Waste and Recycling Industry is an Eco-Friendly Mob.

ENCOURAGE AVARICE

A Revolutionary Answer for Occupy

In recent musings, my family confirmed that Capital Extraction lay at the heart of our recession's tenacity. If Capital is not allowed out to exercise its muscles, the result is economic atrophy, as we all know so well.*

This being so, we then decided that the key to economic recovery, and the answer to Occupy's voluble cant, must lie in Private Equity.

Private Equity, in stark contrast with the trend in other sectors, is enjoying a rebirth. In fact, September 2011 angel and seed VC activity was up 172% since January 2010, and at their highest levels in the last seven quarters (CB Insights). Given enough reason, Holders who now sit on their capital will emerge from the sidelines to drive an economic Renaissance. It happened with dot.coms and it happened again with subprime mortgages. Today's Holders only need another sensational new "engine", and they will jump in with both feet.

Avarice simply will not be denied; ask any of those recently imprisoned for stepping over the line. Give Private Equity an arena to play in. Enough of public equity - put it back in the coffers where it belongs - I will not have my tax money vaporize in some "initiative" run by sleepy-heads.

Herein lies the answer - encourage avarice, and natural cupidity will do the rest. Drive Private Equity to the extreme boundaries it so loves and desires. Encourage Private Equity - this is the answer. A few will shine, many will die on the vine, and our economic ecosystem will thrive.

To learn more about the new dynamic in business development, go to EEexchange.net.


* "Capital Extraction - The Root of All Evil" ExchangeNotes, Nov 12, 2011

CAPITAL EXTRACTION - The Root of All Evil

...and the foundation of the Wall Street backlash.

When productive capital, the real key to stimulus, is extracted wholesale from the economy, the result is malaise, the debilitating economic ennui we now know so well. Where is the economic muscle, the economic engine of productive capital; where does it now reside? It once dwelt in the hands of capitalistic giants like Carnegie, Macy and Ford, who knew how to apply their capital muscle where it mattered, in the factories and selling floors that drove our country to greatness. Those individuals created and sold Value, in a market driven by value-creation.

What now? Now we have "derivatives" and a class of derivative-driven wealth that drains the heartwood of its sap. Some trading house now dreams up a "derivative" that bundles the wealth of some real asset into some paper concept, with all the illusion of substance. This derivative is drummed and wheedled into the mainstream, until it reaches the point of saturation, then collapses, only to be replaced by some new sensational abstract.

So too an ever-widening circle of wealth Holders is created, individuals ever farther removed from productivity; the extraction not only complete but permanent, since the Holder has no idea how to put the intrinsic muscle of capital to use. This new group, not "old money" but rather "new money", walks away with a massive chunk of capital, and places it wholesale in some safe place. Here it must remain, as the happy Holder hasn't the slightest notion how to put capital to productive use, how to create Value. Another massive extraction has taken place, and sadly, a permanent extraction.

So the capital extraction goes on. Those who drew out their capital from subprime mortgages move on to Euro-bonds, until that too must collapse; all our powerful capital now bound in the hands of the economically atrophied, those without the slightest notion how to use its universal muscle. So it goes on; ever more exotic derivatives, ever further removed from the productive reuse for which capital was invented, and once exercised its great strength.