Just what is in a title? Apparently, a mouthful when you are dabbling with the sometimes relevant, always painful world of economic theory. Luckily, I've engaged the help of Dr. George Cooper, a former fund manager at Goldman Sachs who coined the brilliantly militaristic phrase above.

So what is pre-emptive asymmetric monetary policy? It's a strategy employed by a central bank to artificially combat an anticipated wrinkle in the monetary equilibrium, mostly due to the potential pressures of political downfall should the economy collapse prematurely (ie. right before voters hit the polls). On the surface, if one trusted the "wisdom" of their national central bank, this theoretically would be a good thing : after all, no one wants to suffer through a recession or depression if it could be avoided with a little fiscal massaging.

In reality, things are never that easy. We really don't need to play "fact-checking" with each other as if this were a presidential debate : recent and not so recent history and the collective consciousness of the American people all point to evidence of dramatic economic crises, and the management of such events have arguably led to an even more tenuous situation.

But the real irony to pre-emptive asy...eh...can we just call it P.A.M.P.?  is that it should by default never be necessary. That's because most economists, and more importantly, central bankers throughout the world, ascribe to Efficient Market Hypothesis, that is, today's market prices, no matter what they are, correctly reflect assets' true values, based on both current economic conditions and the best estimate of how those conditions will evolve in the future (Dr. George Cooper, The Origin of Financial Crises).

Given that all assets are priced correctly at all times, there should be no need for any kind of intervention, inflationary or deflationary. After all, if markets are truly efficient as the name of the theory suggests, then whatever is occurring at any particular moment is the most ideal condition. Any intervention by human hands is sure to be less efficient and therefore, under the inverse principle of arbitrage (I'll explain this in a future blog), wholly undesirable.   

Of course, this would not be a popular slogan for the bankers and thus they give us our medicine, even if it's just a placebo.

There's something distinctly un-American about layoffs : we are a brash, unapologetic nation that has a heritage of not just mere growth, but an excess of it. While perceived by others as arrogance, America simply laughs off her critics, a behavior that is seemingly modeled from a bottom up approach.

While flaws are inherent in this and any other country, we've made one thing clear : we don't give up on each other. That "come what may" attitude has changed in a quite pronounced manner over the last two decades as America has become a disposable society. Corporate leaders prance around with talks of the necessity of making "hard decisions" when they damn well know that any decision is an acceptable one, so long as it doesn't affect their wallets.

I wish more people understood the numbers and the truth that is inherent in the outwardly tedious details. Without going too granular, these "cost-cutting initiatives" simply don't work because they merely address the nominal aesthetics of The Problem, but do not address The Problem itself.

Two big companies that are in the media spotlight today, J.C. Penney (NYSE : JCP) and Best Buy (NYSE : BBY), are prime examples of executives not understanding how to run a business in an evolving ecosystem. It may have been great to be the big, bad, Tyrannosaurus Rex, but the race has now shifted to the leverage of the more nimble raptors. The dilemma is not the size of the T-Rex because let's face it : no matter how much that puppy goes on a diet, it ain't getting much smaller!

Yet management across a plethora of industries buy into the cost-cutting madness : by being smaller and weaker, they reason, they would be able to compete with the speed of the raptors. But by artificially reducing the infrastructure, the T-Rex has given up one of its advantages for a questionable and partial benefit. In the meantime, the raptor has given up nothing, thereby increasing its pound-for-pound capabilities against a weakened T-Rex.

Sometimes, a company absolutely has no choice but to cut for the sake of its survival : everyone understands that. But to make that decision, the entire business strategy must incorporate the cut into its plan. An amputation of a badly rotting organ has to be both precise and complete ; a lapse in either category will inevitably create more serious, likely fatal problems later.

Layoffs are serious business. They have long running consequences that may not be appreciated during the stark emotions of the moment, but consequences care not about the intentions of the jettison. Because of this, they should be absolutely avoided if at all possible, but if nothing can be done about the inevitable, an overhaul of the business model must align with the hard decision to give the company's future a chance.

It is the American thing to do...