The Hardship of Assuming the Risk

The Hamiltonian model of political-economy is designed so that the non-elite assume the risk.

As more and more Americans "take" a hardship withdrawal from their savings accounts, they have effectively taken the risk the "market makers" avoided.

Remember that capitalism does not define savings as capital--it is private property. It does not become capital until it is put to work, and in the current case--conforming to the classical, Hamiltonian model--to consolidate the wealth.

The risk taken by consolidated, economy-of-scale firms like Goldman Sachs and Bank of America is the gamma risk--the risk that accumulates with the capital, causing a redistribution of the wealth (that evil thing that conservatives say is a moral hazard), but from the bottom to the top (what conservatives say is a moral imperative).

Wealth does not have to accumulate at the top to be transformed into capital. It can be managed from a plurality of savings accounts owned by The People (the capital).

The capital can be managed for the benefit of, rather than the detriment (the risk) to, The People's accounts.

Too big to fail, economy-of scale firms that consolidate the risk, and redistribute that risk to do economic harm for their benefit, are a public menace! Their assets need to be liquidated and retributed to the source of the value accumulated. That is what is required to stop and reverse (resolve) the source of the current crisis, and future crises which the framers of financial reform--the Democratic faction of "the party"--have assured The People will occur (see the article, "Recursion of the Risk" at griffithlighton.blogspot.com).