I couldn't find an answer for this. I don't know if it is from Milton Friedman himself or is it a general theory that 2-3% is "good for the economy." There are many parties in an econnomy so the question it is good for whom exactly?
What is the thesis and antithesis of this theory?
Hi Anemone!
Thanks for your book recommendations! I heard about Economics in One Lesson. However I asked about deflation, not inflation. I just found this article of adequate lenght about What You Should Know About Inflation: http://mises.org/daily/2914
However, it does not mention deflation. :(
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Do you think knowing too much about economics is the end all of all social sciences? Now I feel like I want to learn more about anthropology, geopolitics and philosophy.
You mention lot productive capital. What do you mean by this is, for example a Berkshire Hathaway / Warren Buffett investment? (Even if it gained less from 200-2012 than gold, which is not an investment per definition.)
Sure, it's not an investment forum and you are not a certified investment advisor (who knows? - but there are this stupid rules regarding who can give advice, LOL) but what source can you recommend on investment advice? If you are anexpert on the topic(?). Thanks!
And how do you know your utopia turns out to be a capitalist one and not a socialist one? :D Again, I refer mack to myslef I feel like wanting to know more about other social sciences now, not only economics.
Anenome, you are leraned man. What is your take on my other topic about
LETS, Local Exchange Trading Systems, local money, the Swiss WIR system, etc.
https://mises.org/community/forums/t/32043.aspx ?
I can't believe many so smart people here and only 1 answer so far (which I don't get, by the way). Sure, it's not Austrian economics but it's out there in the world and it works. And the Austrians have nothing to say about it?
liberation: Hi Anemone! ...I just found this article of adequate lenght about What You Should Know About Inflation: http://mises.org/daily/2914 However, it does not mention deflation. :(
Hi Anemone! ...I just found this article of adequate lenght about What You Should Know About Inflation: http://mises.org/daily/2914
Here's the Austrian economics wiki entry on deflation.
And here's another Austrian article on deflation:
"Here is an article by Philipp Bagus from the Quarterly Journal of Austrian Economics that takes on the Austrians for advocating some intervention to prevent deflation. The targets are Mises, Hayek, Rothbard, Sennholz, and others. In contrast, says Bagus, deflation is a wonderful thing, a quick path to financial and monetary reform."
Seems even Austrians have varying opinions on deflation, Mises was even in favor of zero inflation. But the point remains that if we had natural money in the form of gold, or uninflateable money like bitcoin, we'd experience continual normal and ordinary deflation. See the 2nd article I link there for Rothbard's take on why deflation has positive effects and the few circumstances when it doesn't (when government deflates).
liberation:Do you think knowing too much about economics is the end all of all social sciences? Now I feel like I want to learn more about anthropology, geopolitics and philosophy.
Austrianism is inherently a polymath tradition, so such cross polinization will be useful to you. I study pretty much everything. Learn as broadly and as deeply as you can, it's very rewarding.
liberation: You mention lot productive capital. What do you mean by this is, for example a Berkshire Hathaway / Warren Buffett investment? (Even if it gained less from 200-2012 than gold, which is not an investment per definition.)
Money to invest is just capital. But productive capital are the things investments buy in order to produce goods in the economy. Thus productive capital are things like factories and machines to build things. Businesses are built physically out of productive capital. Even a trained worker can be considered productive human capital, if he has a relationship to the business, because the business has invested money in this worker and the relationship is symbiotic between them.
liberation:Sure, it's not an investment forum and you are not a certified investment advisor (who knows? - but there are this stupid rules regarding who can give advice, LOL) but what source can you recommend on investment advice? If you are anexpert on the topic(?). Thanks!
I was an investment advisor in the past when I held a series 6 & 63, not anymore however. Learned a lot in that capacity. As for investment advice, I'd say consult a professional, but in my non-professional opinion, I would just start making a habit of investing out of every paycheck right now while you do your homework.
If you're serious about investing, you'll need to do a year or two of reading and familiarization with the industry, but during that time it would be a good idea to put money monthly into a mutual fund, even if all you could spare was only $50 a month. Most families can spare say $200 a month. Look into the Rule of 72.
Investment's a broad topic tho. If you start investing now, you'll care enough to educate yourself and have funds to play with when you feel ready.
liberation: And how do you know your utopia turns out to be a capitalist one and not a socialist one? :D Again, I refer back to myslef I feel like wanting to know more about other social sciences now, not only economics.
And how do you know your utopia turns out to be a capitalist one and not a socialist one? :D Again, I refer back to myslef I feel like wanting to know more about other social sciences now, not only economics.
Here's the thing. A free society can tolerate socialist neighbors. But a socialist society generally has never been willing to tolerate capitalists within their midset.
So, if a free society comes about, what I know is that capitalism requires only one thing to exist: protection of basic property rights. After that, people will trade as a matter of course, and there's your capitalism. Capitalism arises ad hoc from a situation in which there is an absence of force. So, that's how I know.
If you want a great book on why socialism cannot ever be as economically prosperous as capitalism, read "Knowledge and Decisions" by the always awesome Thomas Sowell.
liberation:What is your take on my other topic about LETS, Local Exchange Trading Systems, local money, the Swiss WIR system, etc. https://mises.org/community/forums/t/32043.aspx ? I can't believe many so smart people here and only 1 answer so far (which I don't get, by the way). Sure, it's not Austrian economics but it's out there in the world and it works. And the Austrians have nothing to say about it?
Well, I think we're more interested in the question of bitcoin versus fiat money. Local currencies are small fry.
Thing about currencies are, the bigger they are the more useful they become, because of the "network effect." I have no real problem with regional currencies tho. There were many in the US before the Federal Reserve was formed.
Money as debt tho, dunno about that, sounds bad. And the idea of creating a local currency to increase the velocity of transactions and earn wealth that way ignores the source of wealth. Wealth comes not from the velocity of transactions in an economy, the source of wealth is production.
> Here's the Austrian economics wiki entry on deflation.
Thanks, interesting. Didn't know about that Wiki over the Mises Wiki. More competition, less synergy. I'll look more into deflation later.
> Money to invest is just capital. But productive capital are the things investments buy in order to produce goods in the economy. Thus productive capital
>are things like factories and machines to build things. Businesses are built physically out of productive capital. Even a trained worker can be considered
> productive human capital, if he has a relationship to the business, because the business has invested money in this worker and the relationship is
> symbiotic between them.
Thanks, understood!
> Look into the Rule of 72.
As the example shows (http://www.investopedia.com/terms/r/ruleof72.asp) it's accurate at 36%. :))
OK, honestly I'm more like a trader than an investor but I was not wrong to find out you are an investor. :) That's why I asked.
> If you want a great book on why socialism cannot ever be as economically prosperous as capitalism, read "Knowledge and Decisions" by the
> always awesome Thomas Sowell.
It just came out on October the 1st, interesting: http://www.amazon.com/Knowledge-Decisions-Thomas-Sowell/dp/1470808811
Actually Tom Woods explained it in 5 minutes in his video http://vimeo.com/9857126 it's deep enough for the moment. :)
> Well, I think we're more interested in the question of bitcoin versus fiat money. Local currencies are small fry.
Local currencies are big in Europe, have a 100 year old tradition. Maybe in the US too? http://publicbankinginstitute.org/ I don't know. Do you see a trend in Bitcoin or digital gold replacing local currencies or they are a completely different beast?
> Money as debt tho, dunno about that, sounds bad.
I don't know if you are familiar with the work of anthropologist David Graeber he wrote a 500 page book about the history of debt. But you don't have to read the whole thing, you can find shorter interviews, talks and articles by him. His basic finding is debt was well before money so that's just the way the economy worked so far. Interesting.
> Autarchy: rule of the self by the self.
OK, but there is no such thing as a self. Scientifically proven: http://www.burningtrue.com/2012/06/liberation-is-personal.html
By the 'self' I mean your body and the decision making capacity that it produces. Just because the mind is an intangible product of the body's physical existence doesn't mean the self does not exist. Destroy the brain, the organ that produces consciousness and identity, and your self is destroyed.
Haha. There's no such thing as self.
Sure.
OK. Actually I wanted to talk about economics with you guys but we can talk about the "no self."
>> Autarchy: rule of the self by the self.
> OK, but there is no such thing as a self. Scientifically proven: http://www.burningtrue.com/2012/06/liberation-is-personal.html
Actually if you follow the link you can find three distinct scolars from the Western tradition who have exposed it and can tell it to you better than me. (Personally I didn't follow through with Hume yet only with VS Ramachandran and Thomas Metzinger. They have TED Talks up on YouTube.)
I can give you some links but I don't want to bore you. As a starter did you do a Google search for "no self?"
OK. Back to the economics topic.
In this short video (http://www.youtube.com/watch?v=J6a10UuQFOM) Tom Woods so clearly explains what was my original question. But Anenome did it as well in the thread.
I consider signing up to his Liberty Classroom.
Look, someone claiming there is not self is about as cogent as those who claim reality is not real, who claim that material things are not really solid, saying that wall over there is not real.
Yet all such philosophers exit the room through the door.
One claiming there's no self is like a man telling you he's not able to speak. It's self-refuting.
Look, someone claiming there is not self is about as cogent as those who claim reality is not real
I take this as you expressing an opinion that "someone claiming there is not self is not cogent". I guess that depends on the definition of "self". If you mean that actions of every person are decided by something contained in the 3D volume of his body, then I am not sure what "cogent" proofs do you have. If you mean that actions of every person are decided by something... hmm, I can live with that :)