Arbitrary Government

Marc Faber: "I think gold will be a relatively good investment under any kind of scenario until the US government bans the ownership of Gold in the United States. They are very good at changing the rules of the game - now banning short sales [of financial and other US equities]."

There is a loss of faith in government that seems to be spreading. For instance John Hempton: "Creditors now face confiscation of their rights by the US Government without oversight or audit or even process. ... The trust needed to make capitalism work has been removed."

And the Cunning Realist: "If all that proves insufficient, expect literally anything: national bank holidays, market shutdowns, restrictions on gold ownership, and capital controls."

It is doom and gloomish but the Bush Administration has governed on exception and as if the constitution, conventions and political mores do not apply to them. Governance has been particularly bad under the Bush Administration for a multitude of reasons; of which this capacity to act arbitrarily is a significant one.

The Bush Administration is the worst in US history in my opinion. It lacks legitimacy despite being backed by the democratic process. It is a shame, the US is a wonderfully politically spry and capable country which deserves better.

Bush has proven excellent at getting elected but he, and his administration, couldn't govern their way out of a wet paper bag.
Permalink, Arbitrary Government, Oct 2008, cam

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