tag:blogger.com,1999:blog-7820485130017459619.post2050272269416227228..comments2023-10-24T01:46:47.151-07:00Comments on CynicusEconomicus: Economics and Power - The Loss of US PowerUnknownnoreply@blogger.comBlogger45125tag:blogger.com,1999:blog-7820485130017459619.post-85414258982667510382009-04-02T08:15:00.000-07:002009-04-02T08:15:00.000-07:00Hi Cynicus,I would love to here your analysis on t...Hi Cynicus,<BR/><BR/>I would love to here your analysis on the new IMF plan.<BR/><BR/>http://news.bbc.co.uk/1/hi/business/7979484.stm<BR/><BR/>I hope your not too busy to write another post.Unknownhttps://www.blogger.com/profile/09934576840321607988noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-90004539689587134742009-04-02T06:06:00.000-07:002009-04-02T06:06:00.000-07:00Mark, we haven't heard from you for a while. I hop...Mark, we haven't heard from you for a while. I hope everything's OK? <BR/><BR/>I'm looking forward to reading your take on the G20 summit. From the World at One this lunchtime it sounds as though the crisis is over and Gordon has saved the world again.Lemmingnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-76021345963476925842009-04-02T04:10:00.000-07:002009-04-02T04:10:00.000-07:00Hi again,perhaps this video from Peter Schiff woul...Hi again,<BR/>perhaps this video from Peter Schiff would prove interesting:-<BR/>http://www.youtube.com/watch?v=3AlD6U7O1pEcoshbrewnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-78424429093959869792009-03-31T14:33:00.000-07:002009-03-31T14:33:00.000-07:00Anonymous...As I see it, there is a third possibil...Anonymous...<BR/><BR/>As I see it, there is a third possibility with regards to the price of copper - <BR/><BR/>That China is, as other contributors to this blog have suggested are 'playing the long game' - copper is a commodity with a vast aray of fundamental applications. At the same time, they will be trying to hedge against the possibility of a collapse in the $US, and other contingencies such as war.Rednoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-83241455018590346402009-03-31T12:26:00.000-07:002009-03-31T12:26:00.000-07:00Please ignore that - I must be loosing my marbles....Please ignore that - I must be loosing my marbles. Thanks.fiunarynoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-79781542781897478132009-03-31T12:23:00.000-07:002009-03-31T12:23:00.000-07:00Thanks for your reply Cynicus. Here is the last p...Thanks for your reply Cynicus. Here is the last post that went astray. <BR/><BR/>On the face of it the West has lost power but the arguments only really hold if there is a maintenance of the status quo. The whole financial system is a big mirage which is coming up against some big obstacles. You discuss the issue of resources in earlier blogs. Inflationary pressure due to resource shortages (energy, food, metals etc) were almost certainly part of the trigger of the current crisis. Once we get any sort of recovery, these will rapidly come to the fore again and cause another downturn. The reality is that the whole consumption paradigm we have been living in (at least since the advent of the industrial revolution) is coming to an end. Add to this population growth, environmental degradation, global warming etc and the picture is not pretty. The international financial system and free trade will not survive these changes.<BR/><BR/>Put this in the context of the excellent points made by MattInShanghai and we have all the makings of conflict. China’s situation may look good on paper but it has a huge population most of which is living at a subsistence level. It needs to keep economic growth going to maintain social cohesion. It is suffering from water shortages, pollution, loss of arable land. Geographically, it will be an early victim of global warming. The path it has chosen requires huge resource inputs from outside the country. Once the financial rules begin to break down (and China pulling the plug of the USD might well trigger this) there is going to be a massive scramble to control resources (China is working hard at this already).<BR/><BR/>The West’s interests lie in thinking long term, coveting its resources and getting out of the clutches of the short termers who have dominated. We need to recognise our self interest and that other player’s play by different rules. The likelihood is that this will be an ugly process. In an ideal world we would all come together to tackle the “problematique” which threatens to swamp us.fiunarynoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-83373712497799504982009-03-31T08:16:00.000-07:002009-03-31T08:16:00.000-07:00China appears to be buying up loads of copper.Eith...China appears to be <A HREF="http://uk.reuters.com/article/businessNews/idUKTRE52U4JU20090331" REL="nofollow">buying up loads of copper</A>.<BR/><BR/>Either the recession will be short lived, or war is on the horizon.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-38947827243357266652009-03-30T10:47:00.000-07:002009-03-30T10:47:00.000-07:00Can Cynicus, or anybody, unpick the knotted logic ...Can Cynicus, or anybody, unpick the knotted logic behind this article from today's Guardian:<BR/><BR/>http://www.guardian.co.uk/commentisfree/cifamerica/2009/mar/30/us-economy-china-debt<BR/><BR/>Thanks in advance.laganhttp://laganblog.blogspot.com/noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-33834121092327169562009-03-30T04:56:00.000-07:002009-03-30T04:56:00.000-07:00on the similarity of the US tax-payer funded 'bail...on the similarity of the US tax-payer funded 'bailout' to fraud, this is interesting:<BR/><BR/>http://www.nakedcapitalism.com/2009/03/guest-post-banks-were-profitable-in.htmlRHCDhttps://www.blogger.com/profile/16233377796645510987noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-24302853938734114162009-03-30T02:15:00.000-07:002009-03-30T02:15:00.000-07:00Hmm... some "interesting" comments from the "white...Hmm... some "interesting" comments from the "white is best" crowd. Are you guys trying to get us placed on the ADL list of "hate sites"?<BR/><BR/>I didn't want to engage in the thread of the discussion started by "Alf" and picked up by a few "anonymous" commentators, but here are a few brief points I'd make.<BR/><BR/>This is an **economics** blog, which deals with current economic events (sometimes venturing into geopolitics) giving some insight into the workings of the global economy and discussing ways of dealing with the problems we face. It doesn't seem to be an appropriate forum for discussing the issues of race, multiculturalism, superiority/inferiority of various ethnic or racial groups. There are many other sites dealing with such matters for those who take an interest in them.<BR/><BR/>But economics (properly conceived) is more than simply balance of trade numbers and foreign exchange rates. So politics (domestic and international) is sometimes relevant, together with wider issues of social organization, customs and culture. Living in the Far East for many years has given me a deep appreciation of the qualities of my own European heritage. Despite its many faults, western civilization has been extremely successful in providing for the welfare of its citizens and achieving a quality and dignity of life and level of development unmatched by any other in the history of the world. Many of the more attractive features of our culture are quite unique and have little to do with "modernity", which is quite a recent development in our history. I would certainly not want to see it disappear. But we are seeing an erosion, not due to external causes, but internal ones, and it is necessary to be aware of the fact, unless we want to continue on our descent. Commentator "Fiunary" put it very well:<BR/><BR/>"The West’s interests lie in thinking long term, coveting its resources and getting out of the clutches of the short termers who have dominated. We need to recognise our self interest and that other players play by different rules."<BR/><BR/>The tragedy is that there is very little political space between the short-term, Happy Clappy globalists who believe everything should be "opened up" and put up for sale, that there is no such thing as national interest, that Mr. Market will lead us all to an Eden on earth and that we will all look like Americans, and their white supremacist opponents, with their attachment to "Blood and Soil". Anyone holding more nuanced views is immediately labeled one or the other. <BR/><BR/>Finally, the danger of the "racially blessed" argument is not that it is false, but that it tends to breed complacency and unwarranted arrogance. As Japan, Korea and China have shown, modernity is no longer a monopoly of Western societies and cultures, despite the fact that western civilization was historically the first one to become "modern". The genii is out of the bottle, and it is irrelevant now whether our "discovery" of modernity was simply a fortunate coincidence of favourable circumstances (as "Matt" said) or an innate emanation of our racial spirit.MattInShanghainoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-45435720834377426202009-03-29T23:42:00.000-07:002009-03-29T23:42:00.000-07:00"while the Chinese were creating the Terracotta ar..."while the Chinese were creating the Terracotta army and writing down complex philosophy over 2000 years ago, white northern europeans were still a primative race running around the forests".<BR/>If they were able to do it 2000 years ago,how come they are not able to do it today? Why did they need the Western science to create contemporary China.Is not that weird? Discontinuity of civilization?<BR/>This book may give some explanation<BR/>http://www.white-history.com/Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-74197001789952319602009-03-29T21:47:00.000-07:002009-03-29T21:47:00.000-07:00@LemmingVery good question! To understand the answ...@Lemming<BR/><BR/>Very good question! To understand the answer you need to be aware of the shift that occurred in economic thinking between the "classical" school of A. Smith (Ricardo, J.S. Mill, Marx, H. George) and the "neoclassicals" (Menger, Jevons, Walras, Marshall) regarding the category of "value".<BR/><BR/>The classical economists were concerned with "wealth" - its production, distribution and exchange. They called their science "political economy", and it dealt with a much wider range of issues than modern "economics".<BR/><BR/>The framework they adopted is called the "labour theory of value". In short, things are valuable in proportion to the amount of human work that needs to be expended in their production. So to give a simple example, if it takes (on average) five times as much effort to catch a deer as it does to catch a rabbit, then the value of a deer will be equal to the value of five rabbits.<BR/><BR/>Now, while the labour theory of value seems to capture much of the "essence" of what we understand by "wealth", it suffers from numerous practical problems. Particularly problematic is the relation of "value" to "price". In principle, the "price" of a commodity should closely track its "value", but in reality that is not what happens. Prices seem to be set mostly by the law of supply and demand, not by the "intrinsic" values of commodities. Secondly, some things (e.g. virgin forests) can command very high prices, even though strictly speaking they have no "value", since no human effort was expended in producing" them. All the classical economists struggled with these difficulties, with varying degrees of success.<BR/><BR/>The neoclassicals (starting with the marginalist school) decided that the classical concept of "value" was redundant. They introduced another category called "economic value". Something is an "economic value" if it can be exchanged for something different. In other words, an economic value has two properties:<BR/><BR/>1. It has some utility<BR/>2. It is scarce<BR/><BR/>This greatly simplified matters, and opened the door to the now familiar microeconomic mathematical framework of equilibrium, supply/demand curves, etc. etc. Unfortunately, by overly simplifying matters, they threw the baby out with the bathwater...<BR/><BR/>This is because the new "scientific" concept of "economic value" no longer corresponds to our intuitive concept of wealth. To see why this is so, look at the two features of "economic value" listed above. It is obvious that "economic value" can be created by:<BR/><BR/>A) Increasing scarcity.<BR/>B) Creating new needs.<BR/><BR/>So enclosing public lands, limiting access to water etc. immediately "creates" new economic values (or as the proponents of such actions would term it "wealth"). Same goes for the creation of needs - e.g. addicting people to new drugs, brainwashing them with advertising campaigns etc. Now, to common sense, such actions do not benefit communities at all, i.e. they do not contribute to "community wealth", but according to standard economic teaching they **do** create "wealth" and increase GDP (remember that GDP only measures the amount of economic activity, **not** wealth creation)<BR/><BR/>So to answer your question, it is obvious what the IMF would recommend: sell the water rights to the highest bidder, and let him squeeze every last dollar of "value" from the local population. In practice, the highest bidder would be a conglomerate of foreign capital, local prominent families and political elites. The latter could then enjoy holidays in their villas in the south of France.<BR/><BR/>Adam Smith was far less doctrinaire and he would doubtless recommend the building of the water infrastructure by the government for the benefit of the entire population, since that would certainly increase the "wealth of the nation". In fact, Smith spoke in favour of infrastructure investment (canals, bridges, roads) by governments in many passages of his book.<BR/><BR/>Hope this helpsMattInShanghainoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-12603768018213610912009-03-29T03:32:00.000-07:002009-03-29T03:32:00.000-07:00Mark, I have a challenge for you:Can you design a ...Mark, I have a challenge for you:<BR/><BR/>Can you design a system of capitalism which doesn't rely on economic growth to function? (Or is this simply a contradiction in terms?)<BR/><BR/>Is it possible to make a fully functioning economy (with concepts such as 'saving') which can handle, for example, a declining population?<BR/><BR/>And here's a question regarding the free markets:<BR/><BR/>Supposing a poor country with a desperate need for water suddenly discovers an underground supply which could meet all its needs. At significant cost the government could build the necessary pumping and distribution equipment to supply it to the people for free. The government might feel that supplying ample water to its people is an 'investment'. <BR/><BR/>Or, at an actual profit to the country, it could sell the rights to the water to the highest bidder (without any restrictions which might distort the correct functioning of free market mechanisms). The purchaser could then sell a restricted supply of water to the people, setting a price that they could just afford, and use the remainder for some other purpose such as a very profitable Waterworld theme park for Americans. <BR/><BR/>Which of these scenarios would Adam Smith approve of?Lemmingnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-81913749503971695612009-03-28T10:08:00.000-07:002009-03-28T10:08:00.000-07:00Have just read "the ascent of money" after you men...Have just read "the ascent of money" after you mentioned it. Found it dissapointing. It seems like he he fit the stories to conclusions he had previously made, rather than it being genuine exploration. He has his ideology, but tries to pass the book off as an independnet history. Very poor logical thinking at times: his dismissal of "the economic hitman" because Ecuador's ecoomy is too small to warrent murder is pathetic. A far inferior work to Nassim Taleb's last two - which he mentions. <BR/><BR/>I thought you got the aristocrat idea from Peter Schiff's book where the US economy is likened to a "philandering playboy". <BR/><BR/>Still awaiting the collapse of the dollar :)Lord Sidcupnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-706314409182750352009-03-28T01:53:00.000-07:002009-03-28T01:53:00.000-07:00Anonymous said:"While the Chinese were creating th...Anonymous said:<BR/><I>"While the Chinese were creating the Terracotta army and writing down complex philosophy over 2000 years ago, white northern europeans were still a primative race running around the forests."</I><BR/><BR/><A HREF="http://www.amazon.com/Britain-BC-Ireland-before-Romans/dp/000712693X/" REL="nofollow">Francis Pryor</A> might disagree with you.Alfnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-1140101955700002992009-03-27T14:41:00.000-07:002009-03-27T14:41:00.000-07:00"The idea that we are racially blessed is hilariou..."<BR/>The idea that we are racially blessed is hilarious."<BR/><BR/>I can't understand why any white people would think this. While the Chinese were creating the Terracotta army and writing down complex philosophy over 2000 years ago, white northern europeans were still a primative race running around the forests.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-67687765477387342322009-03-27T02:08:00.000-07:002009-03-27T02:08:00.000-07:00Here it is again ... On the face of it the West h...Here it is again ... On the face of it the West has lost power but the arguments only really hold if there is a maintenance of the status quo. The whole financial system is a big mirage which is coming up against some big obstacles. You discuss the issue of resources in earlier blogs. Inflationary pressure due to resource shortages (energy, food, metals etc) were almost certainly part of the trigger of the current crisis. Once we get any sort of recovery, these will rapidly come to the fore again and cause another downturn. The reality is that the whole consumption paradigm we have been living in (at least since the advent of the industrial revolution) is coming to an end. Add to this population growth, environmental degradation, global warming etc and the picture is not pretty. The international financial system and free trade will not survive these changes.<BR/><BR/>Put this in the context of the excellent points made by MattInShanghai and we have all the makings of conflict. China’s situation may look good on paper but it has a huge population most of which is living at a subsistence level. It needs to keep economic growth going to maintain social cohesion. It is suffering from water shortages, pollution, loss of arable land. Geographically, it will be an early victim of global warming. The path it has chosen requires huge resource inputs from outside the country. Once the financial rules begin to break down (and China pulling the plug of the USD might well trigger this) there is going to be a massive scramble to control resources (China is working hard at this already).<BR/><BR/>The West’s interests lie in thinking long term, coveting its resources and getting out of the clutches of the short termers who have dominated. We need to recognise our self interest and that other player’s play by different rules. The likelihood is that this will be an ugly process. In an ideal world we would all come together to tackle the “problematique” which threatens to swamp us.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-63001170221810659732009-03-26T18:07:00.000-07:002009-03-26T18:07:00.000-07:00Hello all - can anyone suggest why this story has ...Hello all - can anyone suggest why this story has not been higher up the agenda? Neither the BBC nor Sky mention it! Is this not the most visible political intervention of the Queen's reign?<BR/><BR/>What does this say about the state of the national purse? And, perhaps Her Majesty's frustration at Mr. Brown's reluctance to answer certain questions?<BR/><BR/><A HREF="http://www.timesonline.co.uk/tol/life_and_style/court_and_social/article5970954.ece" REL="nofollow">Queen invites Mervyn King, Bank of England Governor, to palace."</A>Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-72078046852724176942009-03-26T13:30:00.000-07:002009-03-26T13:30:00.000-07:00Fiunary: All comments are published excepting thos...Fiunary: All comments are published excepting those that are spam etc. The comments are not published immediately, as I need to check them for spam before publishing, so I am wondering whether your concern has arisen as a result of the delay. <BR/><BR/>If you have had a problem with publishing, let me know and I will try to ensure that whatever has not been published is included. Your comment is the second time I have had a similar concern, so I think that there may be an occasional bug in the blogger system. <BR/><BR/>Please accept my apologies if something has gone wrong. I chose blogger as a service because it is well established but it does appear to have a few quirks. I am sorry that you have been inconvenienced, but hope that this will not prevent you from continuing to comment. <BR/><BR/>If all else fails, try the email address given at the top of the comments section, and I will ensure that your comments are published. <BR/><BR/>As a note, I publish everything outside of spam, even if highly critical of my own posts.Markhttps://www.blogger.com/profile/14983165364072918091noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-28309136752398369172009-03-26T13:01:00.000-07:002009-03-26T13:01:00.000-07:00Have I said something? You don't seem to publish m...Have I said something? You don't seem to publish my comments. Does this mean we are getting pre-selected comments only?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-55518394607461566932009-03-26T12:37:00.000-07:002009-03-26T12:37:00.000-07:00@AlfSo where did all that science and military tec...@Alf<BR/><BR/>So where did all that science and military tech come from? Did it just fall out of the sky in the places european caucasians happen to be?<BR/><BR/>Read Guns, Germ and Steel by Jared Diamond for a full answer, but a whole combination of factors, some religious, weather, some key technologies, how close Europeans are as nation states leading to constant conflict, blah, blah, blah<BR/><BR/>The idea that we are racially blessed is hilarious. The Islamic countries were miles ahead of us on mathematics for years, the Chinese on almost everything else for years. The Egyptians were the epitomy of civilisation, building the most awe-inspiring monuments, whilst farming and architecture in Britain was incredibly basic - that'll be technologically superior black people then, for hundreds and hundreds of years.<BR/><BR/>This is hardly the forum for long discussions on the benefits or otherwise of colonialism but read some history before reaching for simple 1+1=2 solutions.Matthttps://www.blogger.com/profile/05619808342670772745noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-14107904414082768982009-03-26T05:11:00.000-07:002009-03-26T05:11:00.000-07:00MattInShanghai wrote:"Yes, pretty much that's what...MattInShanghai wrote:<BR/><I>"Yes, pretty much that's what happened. But we squandered this advantage,"</I><BR/><BR/>!!!<BR/><BR/>So you REALLY DO believe science and technology just falls out of the sky then. Hilarious.<BR/><BR/><I>"If the "Chinese top brass" had plans for "world domination", you would think they would tell someone about it."</I><BR/><BR/>No I don't think they would, not the public at large anyway. I'm not saying the Chinese are aiming to 'dominate the world', but if that was the plan I would expect them to keep fairly schtum about it being as the other would-be attempts you mentioned failed.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-44853192288927176422009-03-26T05:03:00.000-07:002009-03-26T05:03:00.000-07:00Every now and then an empire will fall and another...Every now and then an empire will fall and another will arise. This happened with all past empires and now we face a waiting situation with the Chinese and the Indians asserting itself into the geopolitical sphere.<BR/><BR/>Where would the Americans be at that point? It remains to be seen where the American would find themselves be once the Chinese start to make moves into the real politik game. What about the Indians? Would we find ourselves facing a situation with 2 upcoming superpowers in the arena of geopolitics? Hmmm....this is rather tricky. <BR/><BR/>There is ofcourse the Japanese and let's not forget that they would be concerned of an awakened dragon right on their doorstep. Maybe the question should be asked of where would the Americans be once China and India begin to asset itself.<BR/><BR/>Then again, the US might have its first Asian American President. Again the ball game might change and we might that American may find itself playing the political pivot game between India and China. This sounds familiar coming from the fact that China played the ball with the US against the former USSR back in the 20th century. <BR/><BR/>Regime change is always interesting innit? Then again regime changes always evolve in violent fashion, look at the World Wars in the 20th century.theALBERTUShttps://www.blogger.com/profile/05240663064800955208noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-65655731086057093592009-03-25T22:16:00.000-07:002009-03-25T22:16:00.000-07:00The author of the Rolling Stone article was interv...The author of the Rolling Stone article was interviewed about it yesterday by Amy Goodman on "Democracy Now" . You can read a transcript of the interview on their website (democracynow.org)Anonymoushttps://www.blogger.com/profile/11979607671826391515noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-16223329849440830962009-03-25T21:47:00.000-07:002009-03-25T21:47:00.000-07:00@ Alf"So where did all that science and military t...@ Alf<BR/><BR/>"So where did all that science and military tech come from? Did it just fall out of the sky in the places european caucasians happen to be?"<BR/><BR/>Yes, pretty much that's what happened. But we squandered this advantage, by having our industrial and technological base destroyed, and transferred to China and other places by parasitic finance capitalism in search of a quick buck.<BR/><BR/>"How do you know? Are you close friends with all the Chinese top brass then?"<BR/><BR/>(This is a question for Anonymous, but since I raised this point also, I might as well answer it). <BR/><BR/>If the "Chinese top brass" had plans for "world domination", you would think they would tell someone about it. After all, they would need to have at least some of their people "on message". In fact, to my knowledge every expansionist power in history has been quite explicit about its goals. Think imperial and Nazi Germany, imperial Japan, the soviets, and in recent times, the good ole US of A (PNAC, foreign policy documents, etc.). But from the CCP - not a squeak. Regardless of the "cultural argument", why on earth would someone want to stick up a poker game in which they are by far the biggest winner? Do you really think that the PRC would go toe-to-toe against the strategic forces of the US? Anyway 'nuff said.Anonymousnoreply@blogger.com