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OPINION
Monday, October 30, 1989
The Michigan Doilysl
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Edited and managed by students at The University of Michigan
Not just a
Vol. C, No. 39
420 Maynard St.
Ann Arbor, MI 48109
Unsigned editorials represent a majority of the Daily's Editorial Board. All other
cartoons, signed articles, and letters do not necessarily represent the opinion
of the Daily.
Market mani pulati ons
ON OCTOBER 13, the Dow Jones In-
dustrial Average dropped 6.9 percent.
After the traders lost confidence in the
New York Market, the ramifications
were felt around the world. Soon after,
stock prices fell by 12.8 percent in
West Germany and by 8 percent in
Great Britain. Three days later, prices
on the Dow miraculously went up 3.4
percent. A primary cause of this seem-
ingly indecipherable economic fluctua-
tion is the profession of speculation it-
self.
The corporations involved in the
Dow Jones industrial average did not
decrease their real value 6.9 percent in
one day and increase it by 3.4 percent
on another. What changed was the
monetary value of certain pieces of pa-
per that represent shares of ownership
in companies. The cost of owning
these often-times infinitesimal pieces of
a corporation can change by that
amount quite easily thanks to the bro-
kers and traders who buy and sell
them.
These speculators generally try to
justify their profession in two ways.
First, they claim to analyze the econ-
omy to determine how money should
be invested. Second, they claim to
protect the stockholder by making
management responsible so that the
corporation is run efficiently. If this is
not done, the brokers and traders can
facilitate a corporate takeover.
These arguments are largely falla-
cious. If the real value of these com-
panies, and the value of their produc-
tion, didn't drop drastically on Friday
and increase again on Monday, then
there should have been no drop and
rise in their paper value. A sound anal-
ysis by the power brokers, in the inter-
est of the average investor, would not
have permitted this speculation.
Additionally, these "financial wiz-
ards" are in no way protecting the in-
terests of their clients. Most investors
on Wall Street and other stock markets
have little capital. A loss of this amount
- 6.9 percent - can wipe out all their
holdings in one day.
The work of these brokers, traders,
and their support network of lawyers
and computer analysts has grown by
leaps and bounds in recent years as
more and more people spend time try-
ing to figure out how to gamble with
paper to make money. For example,
between 1964 and 1985, while interna-
tional production, excluding Eastern
Europe, multiplied by a factor of eight,
international banking activity in those
markets grew by a factor of 130
(Monthly Review, May 1989).
Unlike a farmer who grows grain, a
machinist who works in a factory, a
doctor who cures the sick, or a teacher
who educates people, these paper ma-
nipulators produce nothing of tangible
valuable to society. They can increase
the value of a stock while workers in
the corporations whose stock is traded
are laid off at the same time. Clearly,
those in this parasitic profession can do
as much or more to hurt the economy
as they can to help it.
While the public has become accus-
tomed to thinking that socialism as in-
efficient because of the bureaucrats
who are ineffective in planning their
economies, it is clear that capitalists
have paper shufflers of their own.
Michele Kassarjian
This letter is addressed to three men
whose conversation I happened to overhear
in the Betsey Barbour cafeteria on Wed.
Oct 25. They were making fun of an ad-
vertisement for a sexual assault prevention
workshop:
I was outraged when I heard what you
said. I couldn't believe the girls sitting
with you didn't say a thing. They just sat
there with confused smiles on their faces. I
was furious because what you said under-
mined all that the men and women of
SAPAC have been trying to teach us this
past week, that date rape is more of a
problem than people realize. What you
said makes everyone's efforts to educate us
about date rape (and ultimately stop it) in
vain, as if you never heard a word they
said.
Let me ask you this: Do you think any
of your friends has ever been raped? Or,
even more importantly, do you think any
of your friends (or even you) has ever been
guilty of rape? I would bet the answer to
women's
first question is Yes, even if they in the sh
r told you. Likewise, I would say Yes room, in
ie second question; for every person It's no
1 there is someone who did it. the imps
xonder how one of you women sitting public, t
you would have reacted, had she been might of
d. I know that if I were her I would free spec
been deeply hurt by your insensitiv- this is n
Well, I was hurt by what you said. you to u
>ecause I have been raped. Your words may fee
Jeep. They said to me that you didn't with the
much stock in what we've been say- Some dc
Your words said you weren't willing who is s4
issue
adows of the Arb, but in his dorm
his bed.
)t that I want to get across to you
rtance of watching your words in
because you don't know who you
ffend. You do have the right to
ch. I want you to understand that
ot just a woman's issue. I want
nderstand that although you now
A that you have no need to deal
issue of rape, some day you will.
ay you will be holding a woman
creaming in anguish, whether she
0
'Your words hit deep. They said to me that you didn't take
much stock in what we've been saying. Your words said you
weren't willing to care much about your friend's pain, a
stranger's pain, my pain.'
to care much about your friend's pain, a
stranger's pain, my pain. My guilt, my
suffering. You weren't willing to care
about the crime that was committed
against me, something that didn't happen
be a dear friend, a cousin, a sister, a daugh-
ter. Or maybe worse. If you don't hear
these words and understand what they
mean, the next rape committed on this
campus may be caused by you.
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Meaningless takeovers
01
THE STOCK MARKET crash of Octo-
ber 13 and its subsequent recovery re-
vealed the power structure in the econ-
omy of the United States. An examina-
tion of these events shows who the big
players are, and how the ordinary citi-
zen is a victim of economic manipula-
tions beyond his or her control.
The precipitating cause of the stock
crash was the failure of bankers to loan
money to pilots and managers trying to
buy the United Airlines Corporation
(UAL). Wall Street was stunned, and
UAL stock crashed. Bankers and stock
analysts became nervous when they
realized that attempts to acquire stocks
similar to UAL might also fail to re-
ceive bank support.
Takeovers, and the threat of
takeovers, have become such a crucial
factor on Wall Street that the whole
market was forced to react negatively
when the UAL deal fell through.
Speculators who held stocks in other
companies, hoping to cash in on future
takeovers, sold their stocks when they
found out that the bankers were unwill-
ing to back the UAL deal.
Finding a way to get one company to
buy another has become a distinctly
1980s job. People in their twenties
make fabulous six-digit incomes doing
it. Their efforts usually accomplish
nothing more than a change in name
and a change of leadership. When the
dust clears, nothing has been pro-
duced, but someone has made huge
profits.
The central bank of the United States
government - the Federal Reserve -
is also a key player in these acquisi-
tions. The Reserve's president is ap-
pointed by the U.S. president, but in
practice the Federal Reserve is quite au-
tonomous and largely politically unac-
countable. The Fed people are bankers
themselves - experts in playing by the
rules of the profit-driven system.
After October 13, a handful of
bankers in the Federal Reserve decided
to make $2 billion in cash available to
the public. They did this apparently to
stop the stock market from dropping
further, and they succeeded.
By assuring speculators that the Fed
would allow large loans for stock pur-
chases to continue, the Fed gave them
the confidence they needed to push
stock prices back up 3.4 percent on Oc-
tober 16.
Due to a lack of capital, small in-
vestors are less able to take advantage
of sudden drops in stock prices, while
large speculators get bargain-basement
prices before the market goes back up.
Those who can afford to take a loss
make a killing at the expense of the lit-
tle stock-holder.
The so-called free enterprise system
and free market in the United States is
not an entirely random affair. Collusion
between the government and large-
scale speculators serves only to make
the rich richer.
Letters to the editor -
Sexual orientation is not an ideology
To the Daily:
The following comments are
in response to Brian Taylor's
article in the Opinion section
on October 25 entitled "Change
the recognition clause." Mr.
Taylor's complaint was directed
against the clause in the All-
campus Compiled Code, Chap-
ter 42, paragraph 13, which
specifically prohibits registra-
tion by the Michigan Student
Assembly (MSA) of student
groups which discriminate on
the basis of sexual preference.
In Mr. Taylor's words, this
clause "needlessly jeopardizes
the integrity of every ideologi-
cal group recognized by the
MSA." He argues further that
"the clause achieves noth-
ing...when it prohibits mem-
bership discrimination on the
basis of ideology."
As well as I can remember,
an ideology is defined as the set
of ideas reflecting the needs and
aspirations of a social group or
organization. I suppose you
can dress discrimination in less
harmful clothes by calling it an
"ideology," but if the ideas that
reflect the aspirations of a so-
cial group in any way threaten
or exert the potential to
threaten the civil rights, equal-
ity and dignity of any other
groups the necessary right to
qualify membership on accep-
tance and practice of their
creed." Should this be under-
taken unconditionally, regard-
less of the nature of the creed?
The policy of this university
(albeit interim) states that dis-
crimination based on race, reli-
gion, ethnic group, creed, sex,
age, ancestry, marital status,
sexual orientation or physical
handicap is unacceptable.
Unacceptable, whatever it's
called.
-Mary Lassaline
October 27
and discrimination. This is not
a matter ideology, any more
than being Black or Jewish is
matter of ideology. The Uni-
versity of Michigan commu-
nity has chosen to protect gay
men and lesbians along with
other minority groups. MSA's
discrimination clause simply
reflects this fact. Most funda-
mentalist Christians do not ap-
prove of this, just as most
members of the Klan do not
approve of civil rights protec-
tion based on race.
To some ears that sounds ex-
treme and perhaps unfair, but it
of "ideological differences."
Gay men and lesbians are
not ideologies, we are real peo-
ple who live and study on this
campus. Unfortunately the ma-
jority of us are not out of the
closet and known to other peo-
ple. We hide due to fear of ha-
rassment and persecution,
which is all too common at the
University. Dozens of us walk
by Preacher Mike each time he
stands on the Diag shouting
his attacks against our
"homosexual lifestyle." Be-
cause we are less visible than
other minorities, it is easier to
dehumanize us into an abstract
concept of a lifestyle or politi-
cal ideology.
Mr. Taylor is absolutely
rights when he claims that a
"monster" has reared its head
on our campus. He errs when
he states that it was once
asleep in the form of MSA"s
discrimination policy. This
beast is not some MSA rule,
and surely it has never slept; it
is the specter of hatred harass-
ment, and even murder that has
come upon thousand s of gay
men and lesbians in our soci-
ety. Now it comes to us again,
tie ter% ...-r a :- i ra :meo,
MSA discrimination
policy should stand
To the Daily:
Brian Taylor, in his Opinion
column of October 25, has
presented an argument that is
little more than an attempt to
justify anti-gay bigotry on this
campus. "Kill the beast," he
urges us, referring to MSA's
discrimination clause. He states
that "people of all natures
should be able to participate in
any facet of the forum," and he
is not. Homophobia (the irra-
tional fear and hatred of Gay
Men and Lesbians) is as deeply
rooted in our culture as racism.
We have progressed as a soci-
ety to the point where very few
people espouse overt racism,
yet sadly this is not the case
for homophobia. What if
Cornerstone Christian Fellow-
ship had refused to allow
Blacks full membership in its