QOTD from World's Largest Currency Trader, John Taylor: "The euro is going to hell"

Here are some other highlights:

So why should the U.S. dollar appreciate in such a horrid environment? As the world's reserve currency, Taylor says, the dollar has become a reverse indicator of the globe's economic health. "Whenever things are good in the world, [the] currency goes down," since there's ample liquidity. But when the rest of the globe is doing poorly, there's no liquidity and therefore the U.S. dollar is worth more. "That is the most important thing to know about foreign exchange nowadays–it is kind of backwards," he says. 

Greece's default is more a matter of when than if, he says, as the Greek citizenry won't support the austerity measures necessary to stay in the euro zone. There will be a referendum this autumn on some of the recent changes, and the outcome could upend the fiscal cuts already decided upon, Taylor warns. 

He now sees the euro trading between $1.37 and $1 over the next 18 months—nearer to the top side "if the Fed does its best at ruining our currency, and the euro manages to survive somehow." The world is pretending the European debt crisis is fixed, he adds—necessary if you are trading short term, but "long-term, a debt deal isn't going to work. The euro is going to hell. Every time they do things to fix it, it gets deeper and deeper." 

Are there any other currencies worth paying attention to? Taylor is positive on the commodity-based ones, such as the Australian and New Zealand dollars, despite their run-up. "We use commodities to forecast currencies," he notes. For instance, Norway's krone is a function of the price of oil, which he thinks is a solid long-term bet on the next growth cycle. In five years, he says, "we could see oil at $500 a barrel. I would be a buyer on dips of oil." 

Among Taylor's influences is the 1991 book, Generations, by historians William Strauss and Neil Howe, which identifies longer-term cultural and demographic cycles in American life. "Every 80 years, we go through a deleveraging cycle," he says. "It's hard to measure, but that's where we are now. It has to do with the period 2010-20, compared with 1930-40." The so-called Millennials, who were born between 1980 and 2000, "will be the ones to save us, but they'll have no money, no entitlements," says Taylor.

Full article here. 

Evil on Display: Anders Brievik and Insane Acts Committed by Sane People

Perhaps it would be easier to understand the horrific Norwegian killings if they were committed by someone with a history of mental illness and/or violence.

Or perhaps we could more quickly file away this tragedy into a tidy, little mental compartment if the killing was conducted by someone with far less skill and fewer economic advantages.

And perhaps over time more details will emerge to reveal a picture of someone with a history of hate or unsound mind.

But early portraits painted by people who knew him suggest a rather disturbing alternative, which is that Anders Brievik was a seemingly 'normal' Norwegian.

From one of his classmate friends of four years:

I do not know what drove Anders. But, unfortunately, I do not think he is crazy. It would have created a comfortable distance between us if I thought he was. Nothing I know about him from our school days or what I have read in his so-called manifesto suggests that. Rather, he is cold, intelligent and calculating. The Anders I knew was not a monster. 

And as the saying goes, he was not an island. He was product of our society. He was one of us.

Sadly, There is Nothing New Here

If in fact he is a sane, even likeable person as some suggest, who also can kill without concern for those he slaughters, what are we to make of Anders Brievik?

Any student of history is well aware of the unfortunate reality that people like Brievik are nothing new. Many, particularly here in Europe, had hoped the ideologies which fuel Brievik-like personalities, capable of inflicting immense harm to a great number of people not personally known, had been buried decades ago. But the carefully orchestrated supernova of violence conducted by Brievik reminds us that this flame has not in fact gone out yet.

In the wretched corner of history occupied by the Brieviks of the world resides Nazism, which, for better or for worse, has received the lion's share of attention. I say for better or worse because the Nazi-like crimes committed under Stalin, Mao, and others often do not receive the same level of emphasis as those committed under Hitler.

Some who studied the Nazi leadership on trial at Nuremberg stated that the single most important personal quality which contributed to the ability of these humans to try and exterminate Jews (and others) was a lack of empathy. In place of a sense of caring about individuals and collective humanity, which exists in varying degrees in the vast majority of us, instead resided a bottomless black hole devoid of the ability to feel what others feel.

Harm-justifying venom can be easily poured into such minds. Rather than rejecting ideas which you and I would find unconscionable, harming others can seem logical. Seemingly sophisticated moral philosophies, justifications, and ends-means rationalizations enable such people to shoot kids "not just once, but twice, to be sure".

The Anti-Change

Brievik's bomb and gun shots were basically an attack on change. Put simply, Brievik didn't like the way things were going in Norway and decided to effectively sacrifice his freedom of movement for at least 20+ years-to-life (Norway doesn't have the death penalty) to let the world know about it.

For those who don't have the time or inclination to read his 1,000+ page 'manifesto', the change he lashed out against goes by the name of globalization. Brievik would probably prefer that we refer to it as multiculturalism, but globalization and multiculturalism are inextricably linked. Reductionist arguments which try and isolate multiculturalism from globalization are idiosyncratic and counter-productive.

The purpose of this post is not to debate the merits of globalization, but it was interesting to note the stark contrast between Brievik's hate for Norway's immigrants with a recent talk on the contribution of immigrants to Britain's intellectual history. One quarter of Britain's Nobel prize winners were born abroad, as were a large number of America's. Is freedom of movement what the Brieviks of the world would have end, or are they ok with allowing just the Albert Einsteins in?

What is Evil?

Norwegians are hurting badly from this heinous crime and asking how one of their own could commit such an act. Some would like to see the whole episode go away and also deny Brievik the publicity and attention he seeks. From the lack of headlines of late on the BBC and other respectable news agencies it would seem that some clearly understand the essential role of the media to his carefully calculated plan. Hats off to media leaders who recognize this and have taken appropriate action. But what about those who are still trying to gain more information and understand why this happened?

Outside of the religious world people often scoff at whether the imprecise, black-and-white concept of 'evil' is useful. But what other word comes close to giving this its proper name?

Leave it to the shrinks to classify and rationalize empathy-devoid personality types. For the rest of us 'normal' people the word evil will suffice.