I dont do them. But this year I thought what the heck and make one, and truth to tell I have postponed this one for so long and Im kicking myself in the butt -- Im that flexible -- for allowing it to fester unattended. For 2009, I resolve to eliminate all my credit card debt. All of it, so help me God. I havent really formulated a plan on how to do that, but I suppose it'll involve a lot of not-spending on stuff we dont need (and here I insert a prayer of thanks for those intrepid free market capitalists who hawk pirated DVDs, and those internet rebels who make books available on-line for free -- way to stick it to The Man!)
Money, money, money. That's what 2009 will be all about, now that the US economy is tanking. 2008 was one hell of a year. A lot of excitement was generated by the election of Barack Obama as president of the US, but none of that excitement was contributed by me. Sure I was glad to see George W. go, but all I saw in Obama was another US president. Sure he's good looking and actually speaks English, but I didnt see him embodying any significant change in the way the Yanks do things. They will invade whom they wish to invade. The only silver lining in their economic woes is that invading another country would be more difficult, but if they think the ROI on another invasion is favorable...
The big news for 2008 is of course the recess-, no we'll call it what it is: the Depression. Over the years, the word depression has been replaced by various euphemisms like recession, slowdown, sideways movement, etc. What we have now is a depression. It's amazing that the heretical economists of the Austrian school have been warning about this for years. The boom-bust cycle is caused primarily by govenrment interference in the money supply. Economics is really a simple subject made complicated by economists who think that what theyre doing is a science. I think only the Austrian school believes that economics is too complicated to be managed; lots of variables and subjective valuation of goods and services -- for example, if I trade the fish I caught with vegetables from your garden, I value your vegetables more than my fish, and you value my fish more than your vegetables. The best way then is to let the market determine the value of goods and regulate itself with no government intervention apart from its usual role as police, protecting citizens' property, enforcing contracts, going after those who trade using fraud, etc. I myself have very limited understanding of the whole thing. But what I do understand are the fundamental laws of nature. The first law of thermodynamics state that matter cannot be created nor destroyed, which means you can only make something from something else, or put more simply, you can't make something out of nothing. The governments of the world, by decreeing that the pieces of paper their central banks print is money and that citizens are obligated to honor it, have created something out of nothing. For example, let's look at money as units of matter/energy, because at its most basic level, that's what they are. We are paid in money for the useful physical and creative energy we expend. But the money the government issues isnt backed by anything. They were created from nothing, hence the term fiat money: 'Let there be money, and there was money, and the State saw that the money will have to do.' Fiat money then violates the law of nature, and it is doomed to fail, destroying us in the process. On top of this money created from nothing is fractional reserve banking, in which a bank makes available money that it doesnt have to the market. In a world that obeys the laws of nature, banks can only make available money that they have. In fractional reserve banking, they are allowed to create credit out of nothing. For example, they only have 1 million pesos as reserve, they can make available as credit 10 million pesos on a 10% fractional reserve basis. Anyone who has gone through a high school economics course will see that increasing the supply over the demand tend to push the value of the money down, thereby requiring more money to purchase goods, that is, prices rise. Fiat money and fractional reserve banking is creating a hole that gets pushed further and further into the future until it is too big we can't ignore the hole anymore because it will suck everything up.
With that, I bid you a happy new year, which, according to Chinese astrologists, is the Year of the Cow starting January 26, a year in which we will be milked for all we're worth. (Yes it's the Year of the Cow, and not the Year of the Ox. 2009 is the year of a female ox, which is to say, a cow. Moo.)
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By the way, I found this quiz over at the Ludwig Von Mises institute: Are you an Austrian? It'll tell you what school of economics your answers belong to in the 25 questions of the quiz, then it'll rate you according to your overall adherence to the Austrian school of economics. (Im 91% Austrian.) Take the quiz then browse the site. I discovered the Mises Institute this year when I learned that they -- the Austrian school, most notably Ron Paul -- have correctly predicted the financial crisis. Lots of good stuff in there for any freedom-loving individual. I dont know however how those ideas will work in the Philippine setting where we have a very well-entrenched, state-backed oligarchy and the people prefer an interventionist government.
Money, money, money. That's what 2009 will be all about, now that the US economy is tanking. 2008 was one hell of a year. A lot of excitement was generated by the election of Barack Obama as president of the US, but none of that excitement was contributed by me. Sure I was glad to see George W. go, but all I saw in Obama was another US president. Sure he's good looking and actually speaks English, but I didnt see him embodying any significant change in the way the Yanks do things. They will invade whom they wish to invade. The only silver lining in their economic woes is that invading another country would be more difficult, but if they think the ROI on another invasion is favorable...
The big news for 2008 is of course the recess-, no we'll call it what it is: the Depression. Over the years, the word depression has been replaced by various euphemisms like recession, slowdown, sideways movement, etc. What we have now is a depression. It's amazing that the heretical economists of the Austrian school have been warning about this for years. The boom-bust cycle is caused primarily by govenrment interference in the money supply. Economics is really a simple subject made complicated by economists who think that what theyre doing is a science. I think only the Austrian school believes that economics is too complicated to be managed; lots of variables and subjective valuation of goods and services -- for example, if I trade the fish I caught with vegetables from your garden, I value your vegetables more than my fish, and you value my fish more than your vegetables. The best way then is to let the market determine the value of goods and regulate itself with no government intervention apart from its usual role as police, protecting citizens' property, enforcing contracts, going after those who trade using fraud, etc. I myself have very limited understanding of the whole thing. But what I do understand are the fundamental laws of nature. The first law of thermodynamics state that matter cannot be created nor destroyed, which means you can only make something from something else, or put more simply, you can't make something out of nothing. The governments of the world, by decreeing that the pieces of paper their central banks print is money and that citizens are obligated to honor it, have created something out of nothing. For example, let's look at money as units of matter/energy, because at its most basic level, that's what they are. We are paid in money for the useful physical and creative energy we expend. But the money the government issues isnt backed by anything. They were created from nothing, hence the term fiat money: 'Let there be money, and there was money, and the State saw that the money will have to do.' Fiat money then violates the law of nature, and it is doomed to fail, destroying us in the process. On top of this money created from nothing is fractional reserve banking, in which a bank makes available money that it doesnt have to the market. In a world that obeys the laws of nature, banks can only make available money that they have. In fractional reserve banking, they are allowed to create credit out of nothing. For example, they only have 1 million pesos as reserve, they can make available as credit 10 million pesos on a 10% fractional reserve basis. Anyone who has gone through a high school economics course will see that increasing the supply over the demand tend to push the value of the money down, thereby requiring more money to purchase goods, that is, prices rise. Fiat money and fractional reserve banking is creating a hole that gets pushed further and further into the future until it is too big we can't ignore the hole anymore because it will suck everything up.
With that, I bid you a happy new year, which, according to Chinese astrologists, is the Year of the Cow starting January 26, a year in which we will be milked for all we're worth. (Yes it's the Year of the Cow, and not the Year of the Ox. 2009 is the year of a female ox, which is to say, a cow. Moo.)
=======================
By the way, I found this quiz over at the Ludwig Von Mises institute: Are you an Austrian? It'll tell you what school of economics your answers belong to in the 25 questions of the quiz, then it'll rate you according to your overall adherence to the Austrian school of economics. (Im 91% Austrian.) Take the quiz then browse the site. I discovered the Mises Institute this year when I learned that they -- the Austrian school, most notably Ron Paul -- have correctly predicted the financial crisis. Lots of good stuff in there for any freedom-loving individual. I dont know however how those ideas will work in the Philippine setting where we have a very well-entrenched, state-backed oligarchy and the people prefer an interventionist government.
3 comments:
Hitler was Austrian. Austria caused 2 world wars. 'nuff said.
Nice recap here, Jego!
I thought Hitler was just Austrian-born but is really Bavarian (western German).
Could it be that everything is being manipulated by a grand conspiracy, to usher in a new world order, a One-World Government? Makes you think.
Well one of the goals of Keynesian economics -- the orthodoxy used by governments -- is the creation of a World Central Bank.
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