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Showing posts from 2014

Counterfeiting is the health of those who rule us

I found this re-posted on a Facebook page today, having originated from End the Fed

This is not so much posing a question as making a point.Nevertheless, how might a contemporary economist (i.e., an inflationist) address such a query, assuming it was serious?Here’s how I imagine she might go about it in an offhand manner.
In the US, counterfeiting is illegal only when some person or organization other than the Federal Reserve Open Market Committee practices it.  When politically-appointed bureaucrats print money, it's not only legal it's essential to the health of the economy.  If you don't believe me read the textbooks.  It turns out that what’s true on a micro level — that counterfeiting is theft — isn’t true on the macro level.  Only those committed to the principles of the Austrian school would disagree.  And the world today little resembles the teachings of the Austrian school.
Without the Fed and its fiat machine we would have to rely on the market to provide the m…

Think small — very small — incredibly small

Do you have forebodings about the future?  I do, which is why I’ve been looking closer at the transformations technology promises to bring us.
First, a brief review.  I’ve previously written about the rapid pace of technological development (here and here) and Ray Kurzweil’s point that though technology is growing exponentially, we experience it linearly, and we tend to base our expectations on our linear experience.  (See his essay “The Law of Accelerating Returns” for details.)

Here’s an example. When the Human Genome Project began in 1990 he predicted the project would be completed in 15 years.Almost no one believed him.After a year of work, biochemists had succeeded it transcribing one ten-thousandth of the genome.Seven years later a mere one percent had been finished.One imagines the laughing was well underway.But the project actually finished ahead of schedule, in 2003.
In The Singularity is Near Kurzweil explains how this happened: Scientists are trained to be skeptical, to speak c…

Who rules? Information Technology

Natural systems show us only lower bounds to the possible, in cell repair as in everything else.— K. Eric Drexler, Engines of Creation, p. 105Our ability to create models— virtual realities—in our brains, combined with our modest-looking thumbs, has been sufficient to usher in another form of evolution: technology. That development enabled the persistence of the accelerating pace that started with biological evolution. It will continue until the entire universe is at our fingertips. — Ray Kurzweil, The Singularity Is Near: When Humans Transcend Biology (Kindle Locations 9409-9412; all subsequent references in this format refer to this source) The combination of nanotechnology and advanced AI will make possible intelligent, effective robots; with such robots, a state could prosper while discarding anyone, or even (in principle) everyone. — K. Eric Drexler, Engines of Creation, p. 176
Along with the massive money printing and debt-laden economy our overlords insist we need, there is ano…

From the Big Bang to the Internet — to the Singularity?

The future will be far more surprising than most observers realize: few have truly internalized the implications of the fact that the rate of change itself is accelerating. - Ray Kurzweil, “The Law of Accelerating Returns
It’s only one man talking, making projections about the future of technology and not coincidentally the future of the human race.  Yet many of Ray Kurzweil’s predictions have hit the mark.  In 2009, he analyzed 108 of them and found 89 entirely correct and another 13 “essentially” correct.  “Another 3 are partially correct, 2 look like they are about 10 years off, and 1, which was tongue in cheek anyway, was just wrong,” he added.  If he can maintain this rate of success, many of his other predictions will happen within the lifetime of most people alive today.  And almost no one is prepared for them. 
Author, inventor, successful entrepreneur, futurist, and currently head of Google’s engineering department, Kurzweil is enthusiastic about the technology explosion that’…

Did gold cause the Great Depression?

The culprit responsible for the Crash and the Great Depression can be easily identified: government.To protect fractional reserve banking and (later) provide a buyer for its debt, government in 1913 created the Fed, putting it in charge of the money supply.From about July, 1921 to July, 1929 the Fed inflated the money supply by 62%, with the result being the Crash in late October, 1929.Government, following an aggressive “do something” program for the first time in U.S. history, intervened in numerous ways throughout the 1930s, first under Hoover then much heavier under Roosevelt. The result was not an easing of pain or an acceleration of recovery, but a deepening of the Depression, as Robert Higgs explains in detail.
The preceding is not, of course, the generally accepted explanation.  In conventional discourse, one of the main culprits for causing or at least exacerbating the Depression was the international community’s adherence to the gold standard.  Economist Barry Eichengreen pop…