Comments on: Progress

By: VXXC

VXXC — Fri, 13 Dec 2013 20:41:22 +0000

Remember Government is the True Name of God.

Nothing must be done to take a farthing from it, except in out years [the future]. That is, never.
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Economics is War by Money. That’s all.
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In a sane world…

The money must be pegged to something real, even if it’s hours worked.

You could actually have several forms of money [for those who wish to play with it instead of produce or toil] tied to different commodities. Just as there was usually a Bi-Metallic standard [at least] in practice.

By: vimothy

vimothy — Fri, 13 Dec 2013 18:15:56 +0000

In that case, set it to minus eight percent — or minus twenty, or . . .

By: admin

admin — Fri, 13 Dec 2013 17:30:43 +0000

Two percent.

By: vimothy

vimothy — Fri, 13 Dec 2013 17:26:58 +0000

What makes zero better than two percent?

By: Kgaard

Kgaard — Fri, 13 Dec 2013 17:21:52 +0000

Well, that would seem to bring us to the topic of Seasteading. Though it’s worth noting that even monarchies such as Singapore and the Gulf States have floating currencies. It’s just hell on everybody concerned if your currency appreciates against everybody else’s in the world. The Swiss tried to maintain their gold peg for a couple years after 1971 but had to throw in the towel. All manufacturing was dying. Only the bankers were doing well …

By: admin

admin — Fri, 13 Dec 2013 17:13:42 +0000

@Kgaard — I’d agree with everything you say, except that you treat democracy as an axiom. Assuming democracy, the only policy options are horrible. So …

By: Kgaard

Kgaard — Fri, 13 Dec 2013 17:07:43 +0000

“Better honest hunger than mendacious opulence.” There was a lot of honest hunger around in the depressions of the 1870s and 1890s. Old-timers in the 1930s used to scoff, saying, “You should have seen the 1870s … now that was a REAL depression.” The problem with coming at this in a strictly moralist way is that growth requires risk-taking, and risk-taking requires credit (usually) and whenever there’s credit there is the prospect of overdoing it, leading to crashes and depressions. Then what do you do? Historically the answer was “have a reset.” But you can’t have a full reset in a democracy with fixed contracts for everything under the sun. Thus, the ONLY reasonable answer is periodic devaluations. There is no other way.

Gold and silver can still be used as quasi-currency today, and of course there is Bitcoin. But for the legal tender of nation states in democracies, it’s pretty much got to be floating currency …

By: admin

admin — Fri, 13 Dec 2013 16:52:41 +0000

If you click over to the ZH post, you can blow up the image to a more legible scale.

I’m actually quite averse to consequentialism on the gold question — it amounts to the suggestion that systematic dishonesty is OK if it delivers the goods. We wouldn’t accept that argument in science, and we shouldn’t accept it is religion (although I see a depressing amount of it in that context), so why accept it in economics — which should be rooted in honest transactions? Taking money off gold is lying. It’s reality evasion. Better honest hunger than mendacious opulence.

By: Nick B. Steves

Nick B. Steves — Fri, 13 Dec 2013 16:43:16 +0000

Hard to see on the chart, but Jim Grant has said on a couple occasions that secular CPI fell about 1%/yr between 1870 and 1910, during the halcyon years of the Real Gold Standard, and not exactly the worst time on net to have been an American. Not sure of the gold dilution rate during that same period, but historically it runs about 2%/yr.

By: admin

admin — Fri, 13 Dec 2013 15:20:54 +0000

The correct rate is zero / negative growth, reflecting productivity improvement, and distributing the benefits elsewhere than to the state.