Lending into Larceny

Providing liquidity in the form of credit protection can result in larceny.

Every state in the US recognizes gaming in the form of late-order effects resulting in larceny to be criminal activity.

Market mechanics can be gamed (organized) to have a larcenous effect in late order, and diversification is the identity element. Since the detriment occurs by means that derive the “market risk” (which is the fully assumed risk of loss in a free market), the reward is said to legitimately derive form “taking” the risk. What really happens, however, is the risk is organized to transfer, known as structuring and restructuring the debt for protection (referred to as diversifying the risk). It transfers to the future, assigned to a counter-party (the mark) in late order, known as “making markets” (securitizing the debt, for example) and “mark-to-market accounting” (booking the reward today that is realized–derived from–the risk in the futures).

These vehicles for transferring risk (or RTVs) appear to be the result of market mechanics, derived from diversification of financial products. What it really is, however, is a scheme to turn lending into larceny. It is a frontrunning scheme (marked to the market), and Wall Street gets away with it, arguing it is free-market mechanics, providing liquidity in late order, diversifying financial products for credit protection.

“Let Me Entertain You”

The ontological argument used to exculpate the risk-value (the credit-default premium) is supported by popular works of art like “The Big Short.” The movie portrays the best-and-the-brightest people on Wall Street having no idea of creating a catastrophic risk dimension. Again, this is a con game (and notice the organized, dysfunctional psychopathy I write about, “intending to” interpret the transaction as having the element of “natural identity”).

Lending into larceny (the late-order game) is an old trick, but the interpretation of the transaction is new. It has been “modernized” (the CFTMA).

Pop art tends to trivialize the problem to be solved. The works of Andy Warhol can seem banal, like the soup cans, for example, but the real meaning is realized when really rich people buy it, turning it into a commodity fetish, existing on demand. The perversion is a diversion, diverging the real from the actual, just like when the free market liquidates your home and later sells it back to you at a profit, raising the rent, with the force and legitimacy of public authority, transacting the interpretation in the form of private property, protecting the credit that buys cans of soup in the form of a commodity fetish.

If Wall Street isn’t Main Street, where do these identity elements actually converge?

What actually happens is no artifice. The values are naturally convergent (like the connection of “the soup cans”–the work of art–to “objective reality”)–not disconnected!


About griffithlighton

musician-composer, artist, writer, philosopher and political economist (M.A.)
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