I've had this stewing for a while, and it once again came to a head when I got in a twitter argument culminating in "real capitalism has never been tried"
I run into these conversations a lot, either viewing or participating, ultimately dealing with "real socialism/capitalism/ X" has never been tried, addressing something as a fiscal/monetary policy ONLY, or some other type of "no true scotsman" argument when related to markets/economics.
The biggest recurring frustrations I see, specifically in market/econ/trading podcasts (and tell me if this sounds familiar):
- "I want to talk about SPX catalysts/ trades coming up this week, WITHOUT BEING POLITICAL"
- "I don't want to get into the Fed POLITICALLY, but lets discuss the fomc bulletpoints"
- "Without talking about the POLITICS of MMT, lets look at this gold chart..."
Thus comes the Elephant metaphor-
I see a world of people specifically setting out to put on the blindfold:
- Looking at valuation fundamentals without acknowledging the global liquidity/monetary regime
- Talking about pure political power/influence and not the real dollar amounts/paper trail flows behind it.
- Never following incentives all the way up the chain in any policy/financial structure.
So when we talk about liquidity, those are the tusks, "fundamentals" are legs, political influence on these markets are ears...
I just don't have a name for the whole elephant... the system? I don't think that reflects the specificity I'm trying to get at.
In the meantime just remember when you see an article on any of these bulletpoints, it is not looking at the whole. Any micro-level inefficiency is explained by at the macro level.
Until then, we are dealing with the whole elephant...
