Diluting Self Restraint: A View from Lombard Street

At the Library of Law and Liberty Dalrymple searches for a reason for the recent outbreak of banking scandals:
And if, after an extra glass of wine or two, I were forced to answer the question Why now? I would answer two things.
First there has been a profound cultural shift in the direction of the abandonment of self-control as a virtue. Thanks to the cultural revolution of the 50s and 60s (of which I am a product), people have fewer self-patrolled boundaries than they once would have had. Managers who once would have felt ashamed to deprive shareholders of their funds no longer do so. One sees this loss of self-control in all walks of life. In the public sector, for example, in which I have spent much of my adult life, the public purse is now shamelessly looted by those who work in it in a way that was inconceivable when I started my career (inefficiency is another question entirely). I could give many other examples, from obesity to gambling to drug-taking and binge-drinking.
A second factor that I think has been much underestimated in the promotion of the most naked self-seeking is the now more-or-less permanent unsoundness of money as a store of value. No one can trust a dollar – or any other currency – to hold its value, bearing in mind that asset inflation is inflation like any other. Therefore, in order to secure ourselves against future impoverishment, we need to accumulate vastly more than we should if money were a real store of value. We must all speculate if we do not want to condemn ourselves to poverty. The unsoundness of money shifts the bell-curve of greed to the right, so that more people become what would formerly have been thought of as extremely greedy; while even the other-worldly now fall into the category of speculator.

One thought on “Diluting Self Restraint: A View from Lombard Street

  1. Jaxon

    Very interesting, though I feel I’ve already read this article, more or less, several times – it’s a message worth repeating.

    I would say though that, perhaps naively, I’m not a speculator… at least not in a way that Dalrymple seems to be describing. Why would people put their money in Icelandic accounts? Because they offer’ed higher returns? Simple?

    To me there is absolutely nothing surprising about the recent scandal (shocking yes) we are utterly immersed in a ponzi (I’d say pornzi) scheme… were the financial habits of the average person even on tenth as dubious as the currently ( or in recent years) have been I think there would still be cause for alarm.

    I’d have never put my money in Icelandic accounts in fact some years back I transferred most of my money to Cooperative bank. I don’t know that much about Coop’s perse, I’m a bit lazy about these things, I don’t assume them to be without problems (maybe they have problematic socialistic tendencies) one thing that was obvious to me; they made by far the more clear declaration of ethical practice than other banks.

    On a digression – the year before last I was briefly in Bari, south of Italy, awaiting a train. I walked into the town. Something I noticed was for a town with so many fashion clothes stores (that looked depressed, gloomy – saving power, or closed for siesta type thing perhaps – I don’t recall) What was obvious is that a lot of the young women dressed in trashy tight faded jeans; people quite generally didn’t seem to have very good fashion sense.

    Pornzi scheme – it’s obvious to me that pornography is a huge problem, globally that is – what the comportment and dress of many of these young women said to me was that they simply did not agree – if they could appeal to and manipulate that part of the male brain that is spending more and more hours glued to online porn then all to the good – if voting for Berlusconi helps, then all to the good.

    It was obvious to me that this was a country in dire straits so I’d be very wary about their banks also.
    The fact that someone threw themselves under the train I later caught seemed to pretty much sum things up.

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