I agree that it is very difficult to compare different countries but the Fed fairly quickly went to ZIRP and QE and avoided a double dip recession while Europe did not take those steps, went into a recession, then took those steps to try to fix the problem. Not proof, but a convincing argument to me that they probably should have done it in the first place. The reason they didn't was because of excessive independence.
And yes what I meant was bitcoin is designed to maintain it's value against a basket of goods and services better than other currencies will
*Assets* are a store of value. Currency is a medium of exchange and a medium of account. So a $20 bill is an asset, and stores value. "Dollars" are a currency because they are a medium of exchange (I can list a price of a thing in "dollars") and a medium of account (I can figure out the equivalent value of my assets in "dollars"). Neither inflationary currency nor Florida swampland are good assets that will store value very well, but a mildly inflationary currency is still a perfectly good currency because it can still be a fine medium of exchange and account. For example, in the 1970's, the US dollar was mildly inflationary, but there was little demand in America to denominate everything in British Pounds or Mexican Pesos because it was still an excellent currency - it was good for transactions and accounting of value even though holding any amount of money in that currency for a period of time was sure to lose value, thereby making dollars a bad store of value. Note that a hyperinflationary currency no longer satisfies these criteria to be a currency and can therefore be a bad currency.
But my only comment about the article itself (which of course I haven't read) is that instead of focusing on the problems with bitcoin, maybe it would be worth thinking about how one might take the best elements of bitcoin and incorporate those into fiat currencies (or a next generation of fiat currencies and central banks). And don't say it's not possible - 10 years ago if you said you wanted to make a uncounterfeitable digital currency people would have said that's not possible either.
This really goes to the main point about how one should judge a currency, and specifically the central bank when it is the monopoly supplier of the currency. I strongly disagree with using strength/value w.r.t. other currencies as the main metric for quality. Instead, one should judge the currency based on how well it reduces the risk of price instability (this is not the same as zero inflation) thereby supporting the real economy that uses it as the medium of exchange.
So the first place I look is at the performance of the real economy. Granted, non-monetary events can hurt the real economy (e.g., war, natural disasters), but decent monetary policy is a necessary though not sufficient condition for good economic performance. And on that measure, the ECB has not done as well as the US, dipping back into a recession while the US has managed positive, albeit slow, growth since the great recession ended.
And this goes back to my point about bitcoin. It is designed to maintain its value against other currencies, but there is no function that I can see that tries to counteract economic shocks and lay the groundwork for economic growth. In the US, the political structure, and yes, only quasi-independence of the Fed ensures that economic growth is a priority of the central bank. With the ECB it is less so, and bitcoin almost not at all.
One interpretation of "not governed" could be "not governed *well*". And it is fair to say that the Euro has not been governed well over the last few years. The ECB (i.e. Germany) has shown huge resistance to being a lender of last resort, and has run an overly tight monetary policy, risking deflation and only recently dropping interest rates to where the US Fed dropped them years ago (and even the Fed was not aggressive enough - witness the weak recovery).
This is the main problem with bitcoin. The decentralization and anti-counterfeiting measures (and crypto that does it properly) are, IMHO, phenomenal advances in the realm of e-money. However, the "set-and-forget" monetary policy is inappropriate for a modern economy. The "great moderation" in the US between the mid-80s to the early 2000's was a period of low inflation and generally mild recessions. However, to achieve that stability in outcomes, the Fed had to change policy inputs many times, sometimes quite drastically (e.g., 1987 stock market crash, LTCM, Asian crisis).
As you point out, there are things that China could do even better, and the question of how China is allocating the investment versus consumption decision, and whether it is depressing its own currency (making it's own people poorer) in order to export more, are all legitimate issues. But remember that the Wealth of Nations is in the productive capacity of the population, not its stores of gold (or US Treasury securities), so a lot of China's growth has come from the elimination of really bad policies that prevented its workforce from producing, rather than the adoption of a mercantilist export regime.
Americans are actually behind Europeans in the "race to the bottom": median income by country. Median household income in the US is 25% higher than Germany, 43% higher than Italy, and 70% higher than Spain. The only European countries with higher median income than the US are oil-rich Norway, or ones that benefit from "don't ask don't tell" banking sectors. So the typical American worker is doing better than the typical worker just about anywhere in the world.
To the extent that the "race to the bottom" means competing with third world nations like China for manufacturing jobs, note that China's rapid economic growth the in the last 20 years has done more to improve the quality of life and reduce worldwide inequality than just about any economic development program. While there are many in America and Germany who end up getting the short end of the stick, when comparing the additional misery of hundreds of thousands of Westerners who lost their livelihood versus the improvement in the standard of living for tens of millions of people in the third world from subsistence farming to a modicum of caloric stability, it is difficult to say that the "race to the bottom" is an entirely bad thing for humanity as a whole, or that America has not done an acceptable job of dealing with this challenge at least as well as other nations.
There is a (almost certainly apocryphal) story about an American economist who goes to an underdeveloped nation to try to help them improve their economy. The government guide shows him some civil engineering project out in a rural area (building a road or a bridge or a dam or something) with at least a hundred workers digging all over the place with shovels. The economist sees that there is a bulldozer sitting idle nearby, and assumes that it is broken and they don't have the technical skills to get it running. He tells the guide that they need to work with a technical school somewhere to get a steady supply of trained mechanics so that they don't waste resources like that. The guide assures him that the bulldozer works, but there is so much unemployment in the area that they can't afford to put all of these people out of work by using the bulldozer. So the economist recommends (facetiously) hiring hundreds more from the countryside, taking away their shovels, and giving them all spoons to dig with.
Getting things done and providing a safety net are two different (orthogonal, not opposing) things.
Further, it's not just freedom for developers, but freedom for users. There's a reason the GPL prevents one from redistributing a covered work with restrictions on use (e.g., that it can't be used by Nazis, etc.), no matter how good an idea that might seem in any particular case.
As innovators, engineers will almost always do someone harm. A new technology might (and probably will) put people out of work. Is the engineer to be held morally responsible for that? Isn't it better that engineers build new things, while society as a whole determines the morality of their use?
I think that people of the day just couldn't handle the simple truth, so they made the story complex so that it could conform to their preconceived opinions. Many people on the left were sympathetic to Marxism/Communism during the cold war, and so it was hard for them to believe that a Communist sympathizer would assassinate their icon. People on the right believed in the superiority of the West, and the successful assassination of a US president by a good old American boy who was converted to the superior ideology of Communism would be a Soviet victory that was equally difficult to accept. And people in the middle were uncomfortable believing that their leader was so vulnerable that a single person couldn't possibly have done it.
Therefore, for most people, anything else - the mob, the CIA, aliens - was preferable to reality.
The "shortage of production" is relative to what people want. The entire field of economics can be described as the study of how we satisfy infinite wants with finite resources.
This is nothing like what happens in the UK. What you are thinking about in the UK is that a business charges a higher than market value price by using some sort of bait and switch trick or complex loan arrangement. However, in this case, the stores being expropriated *are* charging a market price
The government doesn't like the fact that its mismanagement of the economy has meant that the average Venezuelan worker is not productive enough to be able to pay Chinese workers to build TV's for them. In a government store, they can charge whatever they want, but there are chronic shortages of basic food and toiletries because they set the prices to low relative to the productive capacity of the economy. Specifically, the oil wells have been used as piggybanks to be drawn upon rather than investments to keep up - like killing the goose that lays the (black) golden eggs.
Although these problems are bound to occur in any large organization, their impact is disproportionately large when a monopolist power screws up. In areas where there is competition, people at least have alternatives (even if they aren't ideal). When Apple launched a broken maps app, people used Google maps on safari until Google released their own app. Windows 8 sucks? Buy a Mac, an iPad, or Galaxy Tab. But for a federal government fail, the alternative is to, what, move to Canada?
But both conservatives and liberals can take away valid arguments from this; liberals can say that in order to get government to do all the things that we (for certain definitions of "we") want then we have to be willing to spend the money to do it right, and conservatives can say that having the government run (for certain definitions of "run") something creates a single point of failure and should therefore be avoided.
Your grandfather's trip probably averaged about 60 mph. Although he probably wasn't putting illegal gasoline tanks in the backseat, so stops were more frequent, I would guess that the "typical" driving of your grandfather on those trips was a lot slower that this guy. And your dad thought it was irresponsible, so imagine how crazy this guy must have been driving most of the time. I personally can't believe that anyone can find 3,000 contiguous miles of highway in America where you can safely drive an average of 100 mph.
Making profit (at least in America) is a right derived from basic property rights under English common law. The fact that I own the furniture in my house even when I am not there, or a shopkeeper owns the inventory in their store is a concept that was a huge advance in civilization, which throughout most of biological history defined "your property" as merely whatever you could successfully guard against the imposition of others.
Once you have the concept of property that you can use, destroy, sell, lease, etc. as you see fit, the right to profit from acquiring something and disposing of it at a higher price (to and from a willing buyer and seller) is in fact well grounded in law (albeit limited in many ways). You don't (typically) have a right to force someone to buy your stuff under terms that they don't agree to, and he doesn't (typically) have a right to take it from you under terms that you don't agree to.
Actually, gp is a little right, although most people misunderstand the Amish relationship with technology. They don't ban all technology; rather, they make a conscious decision about whether to adopt or not adopt a new technology, based upon their values. In the same way, instead of using every new technology that someone tries to sell to us, we should evaluate it using non-technical metrics to determine whether using it is really the right thing to do. Much of social media, cloud storage, and proprietary crypto would have a very difficult time passing this test, and we would probably be better off being more Amish-like and avoiding technologies that are not consistent with the way we want to live rather than jump onto every new shiny shiny that's put in front of us.
No this is still the budget crisis. You know, the one after the Syria crisis and before the borrowing limit crisis (that's scheduled for later this month). Like bad guys in a bad kung fu movie, they only come at you one at a time, but there is an endless supply of them.
I don't think your first argument is very strong, because insurance will always be required for the vast majority of construction. Every hospital, shopping mall, office park, etc. is built with borrowed money, and those lenders are never going to waive the insurance requirement. What it may do is change the location of where those get built going forward, but hardly anybody is in a position, financially or legally, to self insure against catastrophe.
As to your second point, actually I see RMS as being similar to reinsurers, in that both provide a way for insurance companies to "collude" to set rates, without actually colluding, by providing a justification to set rates at a particular, anchored, level. Of course some of those excess profits (above what you would get in perfect competition) get shared with RMS and the REs, but it's a lot better than being in the airline business, where every so often you get a price war and you can't charge enough to cover your costs so a few of you go bankrupt.
Even with that, as you know, cat insurance still goes through cycles and the only time they make real money is on the up part of the cycle. But they can only charge more when their customers think they will have to pay more, typically because a sensational hurricane hits a populated area in North America, but it could also happen because of news such as a major recalibration of the model.
I don't think you understand what RMS is. They are not an insurance company, who has to compete on premiums, they sell a model of losses to many insurance companies and they are the de facto standard (there are two or three more but RMS is the 800 lbs gorilla). So when their model says, you have to charge much more, insurance companies like that because they can all increase premiums without being perceived as colluding together in violation of antitrust laws. Although an individual insurance company cannot charge much more than what the rms model says, in aggregate the insurance companies are all quite happy when RMS says that they all have to charge more.
However, the distribution is not random; it favors those close to the source of the inflation.
To the contrary, that happens only if the the change in prices is real, not inflationary. Let's say that the central bank decides to inflate by buying huge amounts of financial assets from banks. Assuming that the supply of those financial assets is large enough such that the central bank's purchases do not have an impact on the price of those securities (a good assumption for huge fixed income markets such as Treasuries and MBSs, not a good assumption for smaller markets like individual stocks, but I'll address that later), the inflation that occurs does not benefit the banks. Think about it this way; if the central bank buys $100MM of Treasuries from a bank, then the bank is no better off because there is no difference between holding $100MM worth of Treasuries versus holding $100MM worth of cash. It's the same thing as the old joke about, what weighs more, a ton of bricks or a ton of feathers - neither, they both weigh the same.
However, if the central bank purchases do affect the price of those financial assets, then the gains to the banks is not a benefit because of the inflation being caused, but rather it is a benefit due to the increased real demand for those financial assets. In my earlier post, it is like the price of apples going up because McDonalds (or some other large purchaser) decides to buy a whole lot more apples than oranges. Apple growers benefit from the increase in price of apples, but that is a real increase in price, not inflation.
The other thing I want to mention is that your comment about "politically well-connected" benefiting is absolutely true, with a caveat. It is not so much that the well-connected benefit from the central bank purchases, again, as long as those purchases are at fair market value, you are just exchanging $X wealth for $X wealth. However, let's assume that the central bank needs to put some amount of money into circulation just to keep some even amount of inflation (you could even assume 0% inflation if you think about net injections and allow for net currency injections to be negative). But let's say that the government runs an expansionary fiscal policy, which of course, is chosen by political means, and there is no reason to believe that there is an $X for $X exchange; rather, it is likely that there are politically chosen winners who get more than $X in exchange for $X and losers who get less than $X in exchange for $X.
If the central bank a) allows the government to run a deficit, and b) does not change its original monetary plan, then there will be more inflation because there is more net currency added into circulation than the central bank had determined was "appropriate," and there are politically chosen winners and losers. But it is not the result of the central bank's purchases, rather, it is the result of the inflationary fiscal policy. Also note that even if the central bank negates the fiscal expansion by withdrawing exactly as much money from circulation as the fiscal policy adds (and therefore there is no inflation at all), the winners and losers are the ones that were chosen by the government. So the fact that politically connected groups benefit from their relationship to the government is independent of whether the central bank allows inflation or not.
It may be made to be decorative, or informative, or entertaining, or for numerous other reasons, but being "art" is not really a purpose.
In all fairness, just being "art" was pretty groundbreaking, oh, 50 or 60 years ago - a little meta that no one had ever seen before. But like patents, you can take an old idea, add "on a computer" (or even better "on a networked computer"), and it becomes innovative!
No, you are still misunderstanding. Gross Domestic Income is equal to Gross Domestic Product by construction (definition). While the change in *my* paycheck may lag or lead changes in GDP, the aggregate income of everybody must exactly match those changes at the exact same time, by definition.
What you may be thinking of is that since the increases that I see in my paycheck are nominal, there is some portion of that change attributable to real growth in income and some portion attributable to inflation. But just like the real price of objects changes (e.g., apples could get more expensive and oranges get cheaper, even though overall inflation is zero, due to actual changes in apple/orange production or changing consumer taste), changes in the real value of my paycheck relative to the real income of others can occur that make it difficult to see what inflation is really doing. If there is overall inflation, and I am not seeing an increase in my paycheck, then somebody else must be seeing that increase in their paycheck/wages/income, or else GDP != GDI which is not possible.
Good inflation is when the cost of goods and services rise, to match in increase of income of the consumers.
Bad inflation is when the cost of goods and services rise, at a faster rate then the increase of income of the customers.
In an economic sense, "inflation" is actually only the first, because inflation is where there is a general rise in the cost of all goods and services. But income to a consumer is a cost of good or service to an employer (labor cost). If more people realized that "inflation" doesn't mean that a gallon of milk costs more, it means that you will see a nominal rise in your paycheck, it wouldn't be such a boogeyman.
The source of the confusion was from the 1970's, when you had inflation combined with an oil supply shock, such that the costs of everything was going up, at the same time that the economy became less productive. People think the bad thing was the costs of things going up, when the real problem was that real incomes declined because of the oil shocks - nominal incomes were relatively flat.
I prefer to think that most people will find a balance between distractions, family, friends, religion, and providing for necessities in the ways that humans have historically managed to do so. It won't look like today's balance, but who is to say we are doing it so well now?
I am having a lot of fun with pythonista for iOS. It sounds close to what you are talking about - it allows you to write scripts in python but it has its own libraries for the iPhone's display, input, etc. Sadly I don't know of any way to add additional non-standard libraries, but for what it is it's pretty cool.
Slashdot Mirror
I agree that it is very difficult to compare different countries but the Fed fairly quickly went to ZIRP and QE and avoided a double dip recession while Europe did not take those steps, went into a recession, then took those steps to try to fix the problem. Not proof, but a convincing argument to me that they probably should have done it in the first place. The reason they didn't was because of excessive independence.
And yes what I meant was bitcoin is designed to maintain it's value against a basket of goods and services better than other currencies will
*Assets* are a store of value. Currency is a medium of exchange and a medium of account. So a $20 bill is an asset, and stores value. "Dollars" are a currency because they are a medium of exchange (I can list a price of a thing in "dollars") and a medium of account (I can figure out the equivalent value of my assets in "dollars"). Neither inflationary currency nor Florida swampland are good assets that will store value very well, but a mildly inflationary currency is still a perfectly good currency because it can still be a fine medium of exchange and account. For example, in the 1970's, the US dollar was mildly inflationary, but there was little demand in America to denominate everything in British Pounds or Mexican Pesos because it was still an excellent currency - it was good for transactions and accounting of value even though holding any amount of money in that currency for a period of time was sure to lose value, thereby making dollars a bad store of value. Note that a hyperinflationary currency no longer satisfies these criteria to be a currency and can therefore be a bad currency.
But my only comment about the article itself (which of course I haven't read) is that instead of focusing on the problems with bitcoin, maybe it would be worth thinking about how one might take the best elements of bitcoin and incorporate those into fiat currencies (or a next generation of fiat currencies and central banks). And don't say it's not possible - 10 years ago if you said you wanted to make a uncounterfeitable digital currency people would have said that's not possible either.
This really goes to the main point about how one should judge a currency, and specifically the central bank when it is the monopoly supplier of the currency. I strongly disagree with using strength/value w.r.t. other currencies as the main metric for quality. Instead, one should judge the currency based on how well it reduces the risk of price instability (this is not the same as zero inflation) thereby supporting the real economy that uses it as the medium of exchange.
So the first place I look is at the performance of the real economy. Granted, non-monetary events can hurt the real economy (e.g., war, natural disasters), but decent monetary policy is a necessary though not sufficient condition for good economic performance. And on that measure, the ECB has not done as well as the US, dipping back into a recession while the US has managed positive, albeit slow, growth since the great recession ended.
And this goes back to my point about bitcoin. It is designed to maintain its value against other currencies, but there is no function that I can see that tries to counteract economic shocks and lay the groundwork for economic growth. In the US, the political structure, and yes, only quasi-independence of the Fed ensures that economic growth is a priority of the central bank. With the ECB it is less so, and bitcoin almost not at all.
One interpretation of "not governed" could be "not governed *well*". And it is fair to say that the Euro has not been governed well over the last few years. The ECB (i.e. Germany) has shown huge resistance to being a lender of last resort, and has run an overly tight monetary policy, risking deflation and only recently dropping interest rates to where the US Fed dropped them years ago (and even the Fed was not aggressive enough - witness the weak recovery).
This is the main problem with bitcoin. The decentralization and anti-counterfeiting measures (and crypto that does it properly) are, IMHO, phenomenal advances in the realm of e-money. However, the "set-and-forget" monetary policy is inappropriate for a modern economy. The "great moderation" in the US between the mid-80s to the early 2000's was a period of low inflation and generally mild recessions. However, to achieve that stability in outcomes, the Fed had to change policy inputs many times, sometimes quite drastically (e.g., 1987 stock market crash, LTCM, Asian crisis).
As you point out, there are things that China could do even better, and the question of how China is allocating the investment versus consumption decision, and whether it is depressing its own currency (making it's own people poorer) in order to export more, are all legitimate issues. But remember that the Wealth of Nations is in the productive capacity of the population, not its stores of gold (or US Treasury securities), so a lot of China's growth has come from the elimination of really bad policies that prevented its workforce from producing, rather than the adoption of a mercantilist export regime.
Americans are actually behind Europeans in the "race to the bottom": median income by country. Median household income in the US is 25% higher than Germany, 43% higher than Italy, and 70% higher than Spain. The only European countries with higher median income than the US are oil-rich Norway, or ones that benefit from "don't ask don't tell" banking sectors. So the typical American worker is doing better than the typical worker just about anywhere in the world.
To the extent that the "race to the bottom" means competing with third world nations like China for manufacturing jobs, note that China's rapid economic growth the in the last 20 years has done more to improve the quality of life and reduce worldwide inequality than just about any economic development program. While there are many in America and Germany who end up getting the short end of the stick, when comparing the additional misery of hundreds of thousands of Westerners who lost their livelihood versus the improvement in the standard of living for tens of millions of people in the third world from subsistence farming to a modicum of caloric stability, it is difficult to say that the "race to the bottom" is an entirely bad thing for humanity as a whole, or that America has not done an acceptable job of dealing with this challenge at least as well as other nations.
There is a (almost certainly apocryphal) story about an American economist who goes to an underdeveloped nation to try to help them improve their economy. The government guide shows him some civil engineering project out in a rural area (building a road or a bridge or a dam or something) with at least a hundred workers digging all over the place with shovels. The economist sees that there is a bulldozer sitting idle nearby, and assumes that it is broken and they don't have the technical skills to get it running. He tells the guide that they need to work with a technical school somewhere to get a steady supply of trained mechanics so that they don't waste resources like that. The guide assures him that the bulldozer works, but there is so much unemployment in the area that they can't afford to put all of these people out of work by using the bulldozer. So the economist recommends (facetiously) hiring hundreds more from the countryside, taking away their shovels, and giving them all spoons to dig with.
Getting things done and providing a safety net are two different (orthogonal, not opposing) things.
Further, it's not just freedom for developers, but freedom for users. There's a reason the GPL prevents one from redistributing a covered work with restrictions on use (e.g., that it can't be used by Nazis, etc.), no matter how good an idea that might seem in any particular case.
As innovators, engineers will almost always do someone harm. A new technology might (and probably will) put people out of work. Is the engineer to be held morally responsible for that? Isn't it better that engineers build new things, while society as a whole determines the morality of their use?
I think that people of the day just couldn't handle the simple truth, so they made the story complex so that it could conform to their preconceived opinions. Many people on the left were sympathetic to Marxism/Communism during the cold war, and so it was hard for them to believe that a Communist sympathizer would assassinate their icon. People on the right believed in the superiority of the West, and the successful assassination of a US president by a good old American boy who was converted to the superior ideology of Communism would be a Soviet victory that was equally difficult to accept. And people in the middle were uncomfortable believing that their leader was so vulnerable that a single person couldn't possibly have done it.
Therefore, for most people, anything else - the mob, the CIA, aliens - was preferable to reality.
The "shortage of production" is relative to what people want. The entire field of economics can be described as the study of how we satisfy infinite wants with finite resources.
This is nothing like what happens in the UK. What you are thinking about in the UK is that a business charges a higher than market value price by using some sort of bait and switch trick or complex loan arrangement. However, in this case, the stores being expropriated *are* charging a market price
The government doesn't like the fact that its mismanagement of the economy has meant that the average Venezuelan worker is not productive enough to be able to pay Chinese workers to build TV's for them. In a government store, they can charge whatever they want, but there are chronic shortages of basic food and toiletries because they set the prices to low relative to the productive capacity of the economy. Specifically, the oil wells have been used as piggybanks to be drawn upon rather than investments to keep up - like killing the goose that lays the (black) golden eggs.
Although these problems are bound to occur in any large organization, their impact is disproportionately large when a monopolist power screws up. In areas where there is competition, people at least have alternatives (even if they aren't ideal). When Apple launched a broken maps app, people used Google maps on safari until Google released their own app. Windows 8 sucks? Buy a Mac, an iPad, or Galaxy Tab. But for a federal government fail, the alternative is to, what, move to Canada?
But both conservatives and liberals can take away valid arguments from this; liberals can say that in order to get government to do all the things that we (for certain definitions of "we") want then we have to be willing to spend the money to do it right, and conservatives can say that having the government run (for certain definitions of "run") something creates a single point of failure and should therefore be avoided.
Your grandfather's trip probably averaged about 60 mph. Although he probably wasn't putting illegal gasoline tanks in the backseat, so stops were more frequent, I would guess that the "typical" driving of your grandfather on those trips was a lot slower that this guy. And your dad thought it was irresponsible, so imagine how crazy this guy must have been driving most of the time. I personally can't believe that anyone can find 3,000 contiguous miles of highway in America where you can safely drive an average of 100 mph.
Making profit (at least in America) is a right derived from basic property rights under English common law. The fact that I own the furniture in my house even when I am not there, or a shopkeeper owns the inventory in their store is a concept that was a huge advance in civilization, which throughout most of biological history defined "your property" as merely whatever you could successfully guard against the imposition of others.
Once you have the concept of property that you can use, destroy, sell, lease, etc. as you see fit, the right to profit from acquiring something and disposing of it at a higher price (to and from a willing buyer and seller) is in fact well grounded in law (albeit limited in many ways). You don't (typically) have a right to force someone to buy your stuff under terms that they don't agree to, and he doesn't (typically) have a right to take it from you under terms that you don't agree to.
Actually, gp is a little right, although most people misunderstand the Amish relationship with technology. They don't ban all technology; rather, they make a conscious decision about whether to adopt or not adopt a new technology, based upon their values. In the same way, instead of using every new technology that someone tries to sell to us, we should evaluate it using non-technical metrics to determine whether using it is really the right thing to do. Much of social media, cloud storage, and proprietary crypto would have a very difficult time passing this test, and we would probably be better off being more Amish-like and avoiding technologies that are not consistent with the way we want to live rather than jump onto every new shiny shiny that's put in front of us.
No this is still the budget crisis. You know, the one after the Syria crisis and before the borrowing limit crisis (that's scheduled for later this month). Like bad guys in a bad kung fu movie, they only come at you one at a time, but there is an endless supply of them.
I don't think your first argument is very strong, because insurance will always be required for the vast majority of construction. Every hospital, shopping mall, office park, etc. is built with borrowed money, and those lenders are never going to waive the insurance requirement. What it may do is change the location of where those get built going forward, but hardly anybody is in a position, financially or legally, to self insure against catastrophe.
As to your second point, actually I see RMS as being similar to reinsurers, in that both provide a way for insurance companies to "collude" to set rates, without actually colluding, by providing a justification to set rates at a particular, anchored, level. Of course some of those excess profits (above what you would get in perfect competition) get shared with RMS and the REs, but it's a lot better than being in the airline business, where every so often you get a price war and you can't charge enough to cover your costs so a few of you go bankrupt.
Even with that, as you know, cat insurance still goes through cycles and the only time they make real money is on the up part of the cycle. But they can only charge more when their customers think they will have to pay more, typically because a sensational hurricane hits a populated area in North America, but it could also happen because of news such as a major recalibration of the model.
I don't think you understand what RMS is. They are not an insurance company, who has to compete on premiums, they sell a model of losses to many insurance companies and they are the de facto standard (there are two or three more but RMS is the 800 lbs gorilla). So when their model says, you have to charge much more, insurance companies like that because they can all increase premiums without being perceived as colluding together in violation of antitrust laws. Although an individual insurance company cannot charge much more than what the rms model says, in aggregate the insurance companies are all quite happy when RMS says that they all have to charge more.
However, the distribution is not random; it favors those close to the source of the inflation.
To the contrary, that happens only if the the change in prices is real, not inflationary. Let's say that the central bank decides to inflate by buying huge amounts of financial assets from banks. Assuming that the supply of those financial assets is large enough such that the central bank's purchases do not have an impact on the price of those securities (a good assumption for huge fixed income markets such as Treasuries and MBSs, not a good assumption for smaller markets like individual stocks, but I'll address that later), the inflation that occurs does not benefit the banks. Think about it this way; if the central bank buys $100MM of Treasuries from a bank, then the bank is no better off because there is no difference between holding $100MM worth of Treasuries versus holding $100MM worth of cash. It's the same thing as the old joke about, what weighs more, a ton of bricks or a ton of feathers - neither, they both weigh the same.
However, if the central bank purchases do affect the price of those financial assets, then the gains to the banks is not a benefit because of the inflation being caused, but rather it is a benefit due to the increased real demand for those financial assets. In my earlier post, it is like the price of apples going up because McDonalds (or some other large purchaser) decides to buy a whole lot more apples than oranges. Apple growers benefit from the increase in price of apples, but that is a real increase in price, not inflation.
The other thing I want to mention is that your comment about "politically well-connected" benefiting is absolutely true, with a caveat. It is not so much that the well-connected benefit from the central bank purchases, again, as long as those purchases are at fair market value, you are just exchanging $X wealth for $X wealth. However, let's assume that the central bank needs to put some amount of money into circulation just to keep some even amount of inflation (you could even assume 0% inflation if you think about net injections and allow for net currency injections to be negative). But let's say that the government runs an expansionary fiscal policy, which of course, is chosen by political means, and there is no reason to believe that there is an $X for $X exchange; rather, it is likely that there are politically chosen winners who get more than $X in exchange for $X and losers who get less than $X in exchange for $X.
If the central bank a) allows the government to run a deficit, and b) does not change its original monetary plan, then there will be more inflation because there is more net currency added into circulation than the central bank had determined was "appropriate," and there are politically chosen winners and losers. But it is not the result of the central bank's purchases, rather, it is the result of the inflationary fiscal policy. Also note that even if the central bank negates the fiscal expansion by withdrawing exactly as much money from circulation as the fiscal policy adds (and therefore there is no inflation at all), the winners and losers are the ones that were chosen by the government. So the fact that politically connected groups benefit from their relationship to the government is independent of whether the central bank allows inflation or not.
It may be made to be decorative, or informative, or entertaining, or for numerous other reasons, but being "art" is not really a purpose.
In all fairness, just being "art" was pretty groundbreaking, oh, 50 or 60 years ago - a little meta that no one had ever seen before. But like patents, you can take an old idea, add "on a computer" (or even better "on a networked computer"), and it becomes innovative!
And imagine how much more software we could release if they re-assigned marketing staff to software development!
No, you are still misunderstanding. Gross Domestic Income is equal to Gross Domestic Product by construction (definition). While the change in *my* paycheck may lag or lead changes in GDP, the aggregate income of everybody must exactly match those changes at the exact same time, by definition.
What you may be thinking of is that since the increases that I see in my paycheck are nominal, there is some portion of that change attributable to real growth in income and some portion attributable to inflation. But just like the real price of objects changes (e.g., apples could get more expensive and oranges get cheaper, even though overall inflation is zero, due to actual changes in apple/orange production or changing consumer taste), changes in the real value of my paycheck relative to the real income of others can occur that make it difficult to see what inflation is really doing. If there is overall inflation, and I am not seeing an increase in my paycheck, then somebody else must be seeing that increase in their paycheck/wages/income, or else GDP != GDI which is not possible.
Good inflation is when the cost of goods and services rise, to match in increase of income of the consumers. Bad inflation is when the cost of goods and services rise, at a faster rate then the increase of income of the customers.
In an economic sense, "inflation" is actually only the first, because inflation is where there is a general rise in the cost of all goods and services. But income to a consumer is a cost of good or service to an employer (labor cost). If more people realized that "inflation" doesn't mean that a gallon of milk costs more, it means that you will see a nominal rise in your paycheck, it wouldn't be such a boogeyman.
The source of the confusion was from the 1970's, when you had inflation combined with an oil supply shock, such that the costs of everything was going up, at the same time that the economy became less productive. People think the bad thing was the costs of things going up, when the real problem was that real incomes declined because of the oil shocks - nominal incomes were relatively flat.
I prefer to think that most people will find a balance between distractions, family, friends, religion, and providing for necessities in the ways that humans have historically managed to do so. It won't look like today's balance, but who is to say we are doing it so well now?
I am having a lot of fun with pythonista for iOS. It sounds close to what you are talking about - it allows you to write scripts in python but it has its own libraries for the iPhone's display, input, etc. Sadly I don't know of any way to add additional non-standard libraries, but for what it is it's pretty cool.