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Tue, Jul 7th 2009, 16:56

Member deleted

One sees a progressive decline of the "western" world. It probably would get over-taken by protestant ethics - should the terms protestant and ethics be adequately understood. One earlier wondered about it. However, one progressively begins celebrating it. For in the decline of the "western" world - one sees the decline of a certain pathological illness that does disrepute to humanity as well as life itself.
Better have the Harems of the Middle East filled with "western" imports than have "western" people run those Harems. What gives forth to such a radical view? France comes across as the first state, after the United States in North America.
Given certain tendencies that one is seeing - the only major crises to humanity has been the so-called "west" in its crusades and crusades and crusades. The attempts of it to export its dark ages (usually mistaking its bloody history as human history) to other parts of the world - still carried out in third world banana republics like India under the assumed aegesis of Christianity - apparently started by some people after some Romans first tortured and then nailed someone on a wooden cross - some centuries ago or so! Just like the word protestanism that is said to have come from some person by the name of Martin Luther King - who, it is said, nailed his thesis on the Church Door one day!
However, both the locations were not in South Asia - hence a few observations about one's changing opinions about what it really means when one speaks of global crises or world crises!

Tue, Jul 21st 2009, 02:49

Jeff Hathor

Thank you Ralf! That was brilliant.

Saving Factors
Economists believe in savings for both the Individual and the Corporation. The problem you are pointing out is that One person or One corporation employing saving strategies is fine and may have a positive effect. However when many people and corporations employ these same saving strategies simultaneously a negative effect is the result.

Ancient China said the following: It is not how much you make. It is how much you save. With this in mind I have created an analysis of Individual and Corporate saving strategies and how these have a greater effect when performed collectively.

Corporation Savings
• Refuse to upgrade equipment, slows production.
• Lay off non production personnel Tech, HR, Finance, Maintenance (all support functions).
• Lay off one department then transfer that work to double the workload of another department.
• Lay off workers and outsource to another cheaper country. Learning curve slows production.
• Stop preventive maintenance on equipment, causes unexpected malfunction and delays.
• Loss of so many personnel causes multitasking overload by untrained people, creating mistakes which have to be corrected causing more delays.
• So many laid off workers from all corporations collectively, now without a pay check do not buy products from any corporation, causing more layoffs.

Individual Savings
• Buy only necessities, no extras.
• Buy only things that are on sale.
• Minimize travel.
• If you are out of work do not buy anything.
• Buy only what you can afford, no financing.

Deterrents to Saving
Hyper Interest Inflation
0 payments and 0 % interest 1st 6 months. If you do Not start payments before that sixth month ends, you will be charged 24 % interest on the total amount financed, back dated to the 1st day. This increases the price of the item by 24 %. If this is a new laptop you are out about $200 or more.

Late payment penalties.
If you make a payment after the due date, instead of the normal $10 late fee, the interest on your loan is increase by 5, 10, 15, or 20 %. If this is a house you can no longer afford to pay and lose your house.

Increased prices on base materials with no notice.
Say you work for a chemical company. Most chemicals have been made from oil since the ancient Sumerians discovered chemistry and this process. Say you get a big sales contract and agree to sell at a given price per barrel. Now suddenly the price of oil goes up 50 % causing your base materials to be more expensive than your finished chemical. You must now sell at a loss for the next year (standard duration of your corporations price agreements). This causes the chemical corporation where you work to go millions into dept. It takes out a loan from the bank to cover operating expenses and now must pay interest to the bank, losing more profit.

Conclusion
Classical Economist do indeed believe that as our civilization evolves / advances solutions that worked in the past do not work in the present and principles must be advanced to create new solutions to fit the new problem. We are at such a point in history at this time.

We are faced with some dilemmas
Time is money versus Production is money. This is in conflict as workers are paid a set price by the hour (this often increases to deal with annual inflation of 3 to 4 %, and the product is given a price which fluctuates based on supply and demand or how much the average customer will pay for a product.

Hidden Interest is not tracked or reported.
The standard inflation rates of a country are reported and tracked and openly talked about with great efforts to minimize inflation increases. Penalty interest is not reported or tracked and has an equally negative effect on regional and global economics. This results in the problem gaining tremendous momentum before anyone even knows it is happening.

Interconnected Collective
Workers and Corporations are interdependent in a new way with the global economy expanding. We cannot do without each other. Products made by workers in one factory must be bought by workers in another factory. Money must be spread around and constantly moving like water irrigating the crops in a field. Remove the water or isolate the water in a reservoir, then the crops will not grow.

Jeff Hathor
Evolution Theorist
www.engfuture.com

Wed, Aug 12th 2009, 04:51

John Hadjisky, Blogger, Platinum Contributor (324)

For a short summary of a complex event, this summary is one of the best I've seen on this question. It correctly avoids obsessing over technical explanations that may tend to obfuscate the issues at hand. Refreshingly, it also avoids yet another claim to the end of capitalism -- how many times have we heard that dull tune, the condescending, wishful thinking of tenured Marxists and crypto-Marxists.

The free market didn't suddenly stop functioning in the Fall of 2008. The massive fiscal and montary interventions by the world's governments certainly altered the trajectory of things, but capital would have continued to flow (albeit in perhaps less desirable ways) even without those interventions. Free market theorists have long warned about moral hazard, and the markets for the most part behaved in ways entirely consistent with the traditional neo-classical understanding of public choice theory.

One of the main changes was simple: quasi-private, quasi-public institutions such as Fannie Mae and Freddie Mac were now simply recognized as fully public i.e. taxpayer supported, to big to fail. Another important change was to overturn most of the dominant financial risk management paradigms. These were problems of probability theory being incorrectly understood and incorrectly applied; these were not major problems with neo-classical economic theory.

Sadly, the problem passes through Max Weber and proceeds all the way back to Juvenal's lament about "panem et circenses".

We have now burst various asset and derivative bubbles, and this is a good thing. We have yet to burst the largest bubble of them all -- the sovereign debt bubble. Read any economics textbook carefully to see that the theory, that governments cannot default on sovereign debt, is no theory at all (meaning, it is not testable); rather, it is simply assumed to be true. In cases were it fails, such as Africa, it is assumed to have no lessons for the developed world. "That cannot happen here," it is said.

How often in 2007-8 did we hear about things that cannot happen here? But they did happen.

Bursting, or (hopefully) deflating the sovereign debt bubble will require acknowledging the core problem -- that no modern country has funded its entitlement promises in a manner that is both actuarially and demographically sound. Until that problem is addressed, the sovereign debt bubble will continue to inflate, until...

Wed, Aug 12th 2009, 05:40

John Hadjisky, Blogger, Platinum Contributor (324)

Some additional points:

-- "pump capitalism" is a good phrase. But this problem didn't originate with lightening-fast, complex derivatives trading. It goes back at least as far as the Keysians, the first major revision to classical Western capitalist economic theory to gain traction in the political sphere. Here, on a much slower and smaller scale than the mega-derivatives of 2007-8, we see the beginning of the end of the traditional Protestant ethic to only spend what you have and abhor long-term debt. The Keynesian disease was on particularly clear display in the 1930's, when American New Dealers committed the first instance (in modern times) of massive, inter-generational theft, a transfer of wealth from children not yet born to retirees. This theft was compounded many times over with the Medicare and Medicaid programs. Similar generational theft happened in post-War Europe and Japan. In the next couple of decades, a staggering bill will come due, with fewer and fewer productive workers available to pay it. The size of this bill makes even the recent trillion-dollar bailouts seem manageable.

Today's Keynesians have started to admit, even if their theories about counter-cyclical spending were correct, that the political process has utterly failed to muster the will to implement them. Instead, we get "stimulus" spending when the economy is down, and then just plain spending when the economy is flush. The debt that is run up during bad times, does not get run down during good times.

-- The economic downturn has done more to reduce global carbon emissions than all the climate treaties in existence. There's really only one sure-fire way to meet the goals the science suggests, which is to massively reduce all economic activity worldwide. What's wrong with a century or more of poverty if it "saves the world"?

-- Global warming believers present themselves as a group dedicated to correcting the market's alleged failure to think of the long term. These same believers are engaging in short-term, opportunistic thinking. All global warming proposals fail to make difficult choices in the near term.

We used to talk about X percent reduction in CO2 below 1990 levels, to be accomplished by 2010; now we talk about X percent reductions below 2004 levels, to be accomplished by 2050. But the science hasn't changed during that time; so why have the goals become more modest (but no less dire)? Isn't this like lightly touching the brakes when the allegedly real problem is, the car is headed in the wrong direction?

Also, note the cherry-picking of the dates -- the reference dates (1990 and 2004) are near the peaks of economic activity, so that credit can be claimed for declines that would have happened even without a change in policy. Worse, the agreements are back-loaded -- all the serious reductions happen in future decades, not in the current one. Any agreements based on these formulas will require no serious reductions in the short term...and in the long term, they will be ignored, just like Europe and Japan ignored their self-imposed commitments under Koyoto (back in those heady days when we pretended we would actually get below 1990 levels).

How could so many global warming proponents be doing such short-term thinking? What if they are just trying to create another artificial, government-controlled market that they can manipulate? Sound familiar?