HAUNTED BY WHITE DEVILS, PHILOSOPHY PROFESSOR GEORGE D. YANCY SHARES HIS BLACK STRUGGLES WITH RHETORIC AND REALITY

Jeremy Egerer at the American Thinker wrote a critique of an essay titled Dear White America, published by the New York Times and written by an academician, George D. Yancy,  who works as philosophy professor at Emory University.



Yancy's essay is little more than a mindless exercise that fails at persuasion in propaganda precisely because Yancy tries to lecture and scold readers whose ancestry might be Caucasian Western Europeans. It seems so odd that a college professor in the field of philosophy would not have learned from Aristotle's Rhetoric and Cicero's De Inventione before trying his own hand at persuasion.

One of Yancy's pseudo-intellectual gems found in his lame essay is this:

"If you are white, and you are reading this letter, I ask that you don’t run to seek shelter from your own racism. Don’t hide from your responsibility."

Yancy assumes far too much and he doesn't understand racism at all. If you are not denying to trade with anyone based on his ethnicity in purchases and sales of property (right of ownership) for property, you are not living by racism. To be racist, you would need to stop "blacks" from entering into contracts for work, for housing, for eating and so forth.

Elsewhere, Yancy writes, "accept all of the truth about what it means for you to be white in a society that was created for you." As Yancy reveals he does not know what racism means, so too does Yancy reveal that he does not know what society means.

Society means a friendly association among some who engage in voluntary interaction. Society consists of strangers who engage in trade of property. A society of property is the only kind of society that can arise among strangers, each who pursue self-interested goals. Society exists independently from government.

No one can create society for you. You must create society with others. Those who came before you did so and those who come after you who want society must do the same.

Until blacks ditch their subculture / counterculture and embrace individualism, they will continue to struggle. It is impossible to be in society — free association — with all who seek that when some organize into a group, a cult — in this case blackhood — in an exclusionary manner.

Racism is a horrible political doctrine instituted by lawgivers. As long as lawgivers grant rights to some based on their status and impose duty upon others because of that status, liberty is lessened for all all. Congress engages in discrimination through laws that establish agencies to support all kinds of racism — subsidy for EOP education, preferential treatment for skin-colored minority-owned businesses and so forth.

Racism devalues every individual and turns persons into monsters as they join groups. All other ways to talk of racism is done the racists themselves to mask their own agendas.

Since the 1960s, so-called blacks have put themselves on the path of American Indian. They have isolated themselves. They continue to attack the mass of individuals, wrongly labeling each of us as racist.

Racism will end when racists ditch their respective racist groups — blacks, Hispanics, gays, feminists — and when individuals pressure politicians as law givers to stop giving extra rights to those who become part of these racist groups.

Before Yancy attempts to lecture, Yancy should demonstrate to the world that he did not receive admission to any of his academic programs based on skin-color quotas. After all, all laws on the books of Congress that promote anyone deemed a member of a designated race at the expense of all others is racism expressed legally.

What all should want to know if Yancy as a talking shop academic has real job skills. Can Yancy rap? Can Yancy breakdance? Can Yancy sling drugs? Can Yancy pimp?

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THE 2010-2015 GREEK LAWGIVERS' CRISIS, THE EURO AND CURRENCY AREAS. SHOULD THE EURO ZONE BREAK APART?

So today, editors at Forbes published yet another train-wreck of flawed thinking by Tim Worstall. In The Cause of the Eurozone Crisis Was the Euro: The Solution Is Abolition of the Euro, Worstall tries hard to call for an end to the Euro by blaming its existence for the cause of a what he calls the Eurozone Crisis, which likely he means the the Euro Banking Crisis of 2008 the Greek Lawgivers' Debt Crisis of 2010-2015.




Seriously, I don't understand why Worstall doesn't find another line of work besides trying to write about economies and economics (see more on Tim Worstall right here on Bizarro Theater),

"Even a cursory glance at the economics of this field, optimal currency areas (founded by Robert Mundell) tells us that over such disparate economies a single currency just isn’t going to work." ~ Tim Worstall

Worstall seems not to understand Mundell's Optimum Currency Area Theory at all. Mundell included his theory in a textbook titled International Economics, (1968, pp. 177-186).

Mundell's Optimum Currency Area Theory is one where an authority can stabilize employment and prices over a well-defined region. According to Mundell himself:

• "If the case for flexible exchange rates is a strong one, it is, in logic, a case for flexible exchange rates based on regional currencies, not on national currencies. The optimum currency area is the region."
• "If the world can be divided into regions within each of which there is factor mobility and between which there is factor immobility, then each of these regions should have a separate currency which fluctuates relative to all other currencies."
• "The argument works best if each nation (and currency) has internal factor mobility and external factor immobility."
• "But if regions cut across national boundaries or if countries are multiregional, then the argument for flexible exchange rates is only valid if currencies are reorganized on a regional basis."

In the work, Mundell cites two who he believes has captured the essence for defining the optimum currency area — Meade and Scitovsky.

• "In both cases [Meade's; Scitovsky's ] it is implied that an essential ingredient of a common currency, or a single currency area, is a high degree of factor mobility;"
• "...neither writer disputes that the optimum currency area is the region-defined in terms of internal factor mobility and external factor immobility-but there is an implicit difference in views on the precise degree of factor mobility required to delineate a region."

According to László Andor, European Commissioner for Employment, Social Affairs and Inclusion, in his speech titled Labour Mobility in the EU: Challenges and Perspectives for a Genuine European Labour Market, Europeans have the necessary ingredient of labor mobility.

Free movement of workers began in 1968. Today, it encompasses the labor markets of 28 Member States of the EU and every Eurozone country.

EU nationals have the right to look for work and take up employment in another Member State and to receive assistance from the employment services in the host country when looking for a job.

Countries experiencing the highest increase in labor outflows to other EU countries in 2011-12 were Greece, Spain, Ireland, Hungary and Latvia. Labor outflows went mostly to Germany, Austria and the UK.

So according to Mundell and his theory, the European Central Bank (ECB) ought to make more credit available in Germany, thus pushing up prices in Germany to remove the demand of Greeks from buying German products.  With Greek demand for German goods cut by being priced out, Greeks would then produce the alike, substitute goods on lower prices (lower wages), thus taking up unemployment slack in Greece.

But the problem has been the lawgivers in countries like Greece. As wages are prices, they have kept wages up through massive fake-work, make-work government programs, pensions and welfare. Greeks had been living through a credit bubble, a public sector credit bubble and not a private sector. When that bubble burst — Greek lawgivers couldn't borrow without bailouts — Greeks suffered at the hands of lawgivers rather than commercial bankers.

For those who doubt that Greek lawgivers haven't been the source of the problems for the Greeks, have a look at GREXIT IS NO EXIT. Nigerians export more than three times as much as the Greeks, but only import 1.34 times as much as the Greeks.

So how do the Greeks do it? How do the Greeks pay for those imports? Their lawgivers have borrowed year after year to pay for government agency workers, pensioners and welfare collectees who, in turn, take their Euro borrowings and buy imports from those of other Eurozone countries.

In the countries hit hardest by the Euro Banking Crisis, their problems have been caused by lawgivers borrowing to keep afloat phony economies and thus hampering price discovery. As well, by Mundell's theory, those countries within the Eurozone experiencing trade surpluses need to have their regional central bankers rediscount more and thus pump more credit into those countries, which presumably would jack up prices relative to the Eurozone trade deficit countries. By Mundell's theory, it doesn't matter if Germany and Greece are separate countries as long as the countries operate under the same exchange rate and have factor mobility.

Mundell also said, "Similarly, if factors are mobile across national boundaries, then a flexible exchange system becomes unnecessary, and may even be positively harmful, as I have suggested elsewhere." 

The Euro is a "gold" standard - one rate for an internal common market with factor mobility that requires lawgivers to adjust policy to that standard. The price of that Euro "gold" standard relative to the outside world (other banking systems' cash) fluctuates.

Mundell wrote at a time when countries had fixed exchange rates with bank cash convertible to gold while many called for floating exchange rates with irredeemable cash. Mundell proposed his theory as an attempt to explain international disequilibrium caused by balance-of-payments crises under fixed exchange rates and price fixing by legislators (rigid wage and price levels).

Mundell believed that countries with trade surpluses whose leaders capped bank credit caused unemployment for those living in trade deficit countries because leaders of trade deficit countries had to shrink their economies to restore the imbalance.

Whether one banking system shared among a few countries or countries each with their own banking systems, according to Mundell, the fix for regional disparities is for trade surplus countries to inflate (add bank credits) —

• "In a currency area comprising different countries with national currencies, the pace of employment in deficit countries is set by the willingness of surplus countries to inflate."
• "Unemployment could be avoided in the world economy if central banks agreed that the burden of international adjustment should fall on surplus countries, which would then inflate until unemployment in deficit countries is eliminated"
• "But in a currency area comprising many regions and a single currency, the pace of inflation is set by the willingness of central authorities to allow unemployment in deficit regions."

Under floating rates with irredeemable bank cash, those living in the trade deficit countries would need to pay more for foreign cash of trade surplus countries until BOP equalized. Thus, all inflation would be unneeded as is the fix for disparities between regions under the same banking system.

So, absent the will to inflate by region in the Euro zone, the Euro zone ought to break up and let floating exchange rates do their work — force prices up of foreign goods as expressed in one's own bank cash.

At the end Mundell concludes, "...the optimum currency area is the world, regardless of the number of regions of which it is composed." By that Mundell means there should be one money and balance of payments would adjust regional difference. In short, Mundell means something like gold as money would be the ideal for the world over.

Legally, Europeans have labor mobility. Culturally, whether they move or not is another matter (see: On the Move, The Economist).



Hordes of illegal aliens, many claiming to be refugees, don't seem to have a labor mobility hang up. For more on the horde invading Europe, check out 2015 EUROPEAN REFUGEE CRISIS. FLEEING THE FAILURES OF TOTALITARIANISM, BUT FAILING TO EMBRACE BETTER WAYS.

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"REAL" GDP IS FAKE, BOGUS, CRAP. AMERICANS AND SCHOOL CHILDREN HAVE BEEN HOODWINKED FOR DECADES.

The formula for "real" GDP taught in schools:

nominal GDP ÷ base year GDP × 100

This yields "real" GDP in what was called "constant dollars." Supposedly, this "real" GDP is a measure goods and services of the current year deflated to the prices of a base year GDP. Base year GDP is merely the nominal GDP of the year chosen to be the base.

You can watch Sal from the Khan Academy teach the difference between nominal and "real" GDP on YouTube and then you can watch Sal teach the Constant Dollar method to calculate supposedly "real" GDP also on YouTube.

Under logical scrutiny, the concept gets exposed as mere hokum, bunko. Think about it. The base year GDP is inflated by whatever the inflation was for that year.

Before 1996, the BEA used the school method. From 1996, the U.S. Department of Commerce has used the chained-dollar method (see: BEA's Chain Indexes, Time Series, and Measures of Long-Term Economic Growth).

The BEA method for real GDP, though complicated, is hardly much different that school-method GDP. The new method uses the average of two successive periods of GDP. So year two of a chained-dollar average becomes the year one of the next chained-dollar average. The minions at the BEA believe this removes distortion that any year might cause owing to changes in composition of goods and services.

The math looks something like this:

"real" GDP = nominal GDP ÷ implicit price deflator

where the implicit price deflator = (current-dollar ÷ chained-dollar) × 100

and a chained-dollar = base period current-dollar measure × (chained-type quantity index number current period - chained-type quantity index number base period)


Anyway, chained-dollar "real" GDP is still as bogus as the chain consists of an averaged succession of already inflated GDP as the basis to deflate current dollar GDP.



Could you measure a length of a distance with a ruler that changes in size the farther you go? That is what academicians and the minions at the BEA claim you can do with their bogus method.

And today, that academician economists can't see this plain truth reveals how stupid they are, how weak their intellects are, how indoctrinated they are. Worse are the millions of idiot-like parroters who parrot the false belief of "real" GDP when they report on it.

Men were much smarter about money and banking from the years of the late 1870s through the 1920s. One such man was Edwin Walter Kemmerer who was known as "the money doctor." This is what Kemmerer had to say about inflation:

 

Kemmerer goes on to say:

Anyway, there is a method to deflate away inflation, which uses a metaphorical measuring stick kept at a constant length. That method is my method — the True Dollars™ method. It is the only real, true, legitimate method.

Both the constant-dollar method or the chained-dollar method rely on prices. Prices are an effect and not a cause. It's impossible for an effect to be its own cause.

It's impossible to deflate prices with past inflated prices.


Economists are idiots to believe otherwise. And guess what? They believe otherwise.

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AUSTRALIAN ECONOMIST STEVE KEEN CONFUSES CASH WITH MONEY. NO ONE SHOULD LISTEN TO ACADEMICIAN ECONOMISTS AND THEIR FALSE DOCTRINES.

Today, I read this silly work published by Forbes and written by Ph.D. economist from Australia, Steve Keen, who seems to have become a darling among anti-banking conspiracy theorists in the blogosphere. Keen claims that a recent-dead Italian economist Augusto Graziani is the only guy ever who figured out what money is.

Graziani’s own words reveals he had no idea what money is. Graziani revealed himself to be wrong on the subject of money, thoroughly.

Graziani mixed up bank credit with money and in so doing, confused himself, embarrassingly so. Stupidly, Graziani said, “So money is fundamentally the promise of a bank to its customer, and a monetary payment is the transfer of that promise from one customer to another.”

For the entire history of commercial banking, every banker worth his salt would call that credit. Never in the history of commercial banking by anyone who engages in banking and commerce would anyone confuse credit with money as Graziani has.

Money is coined metal by weight and fineness. There is no other definition of money. The Romans said so. It's their word.

It's easy to know what could be money and what isn't money. Money can exist without banking and without legislators.

Cash, which is evidence of deposits circulating in perpetuity, requires banking. Without banking there can be no cash. 

Legal tender is anything legislators deem legal to settle taxation and debt to legislators. Without legislators and their agencies of enforcement, there can be no legal tender.

It should be clear that legal tender cash, which is all that anyone has these days, couldn't be money because it requires both banking and government and it fails to settle debt. Cash is liability of bankers, the same as deposits.

Money, if it were to exist, could discharge debt in payment fully. Contemporary cash cannot do this precisely because it is irredeemable. That means, you cannot demand money (coined metal by weight and fineness) from a banker. There is reason why the technical phrase, demand deposit, exists in commercial banking.

Graziani and Keen get wrong the concept of currency as well. Currency means that which has bearer negotiability. It has never meant anything else. So if a thief buys milk from a grocer using stolen cash, the grocer gets to keep the cash by currency.

Academicians like Steve Keen and Antonio Graziani live in a fantasy land of false definition and fanciful bogus theory that fails to comport with reality. They preach a false doctrine, economics, which is quite pseudo-science.

If academicians like Keen only knew about trade, commercial banking and the jurisprudence with respect to trade, they wouldn't accept false theory such as the one perpetrated by a rather clueless Graziani.

Keen errs in the worst way that anyone could when he foolishly claims, "Banks create money by issuing a loan to a borrower; they record the loan as an asset, and the money they deposit in the borrower’s account as a liability." Heed my words: Bankers never, ever create money nor do bankers lend money.

First, no one has money. All anyone has is either cash or deposits, which can be traded through negotiable instruments like personal checks and ATM cards. Even if there were money, through the entire history of commercial banking, no banker ever lent money.

In the days of money, a banker was a merchant who bought money and debt and sold bank credits. Today, a banker is a merchant who buys cash and debt and sells bank credit. All loans are merely advances of bank credits.

About the only bit Keen gets right is his claim that “banks must be part of your economic analysis.” Of course, all regular readers of Bizarro Theater who have read The Theory of Trading Property for Profit know this.

It turns out that Keen once bet Rory Robertson, who worked as banker for Macquarie Bank. Keen bet Robertson that Australian house prices would collapse. Unsurprisingly, Keen lost.

The terms of the bet had Keen walk from Canberra to Mt. Kosciuszko — 224 kilometres — wearing a T-shirt that read: “I was hopelessly wrong on house prices”.

Long ago, beginning in the mid-1850s, the brilliant banking lawyer Henry Dunning MacLeod worked out the principles of money, credit, currency and the like. MacLeod could do so because as a lawyer and not a university theoretician, he understood property (the right of ownership) and the effects upon property through trade. MacLeod wrote excellent works debunking academician economists with their silly false theories like JS Mill and even Adam Smith.

Here is a later edition of MacLeod's Theory of Credit (1893), which many in America can read free.

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MIKE "MISH" SHEDLOCK VS ROBERT "THE SHILL" SHILLER; ALSO, THE REALITY OF PROFIT, PROSPERITY, DOOM, AND CRISES

Today I read that Ph.D. economist Robert Shiller who works at Ivy League Yale believes the average work week in manufacturing is an trustworthy indicator of recessions. Shiller is best known for the Case-Shiller residential realty index. 

The chart looks quite a bit like any stock index chart. Whenever the average hours failed to hit a new high following an interim low, recession soon followed. From a look at the chart, the time to recession seems to have come no later than two years from the failed peak.



Without doubt, the average hours worked in manufacturing is not an indicator related to trade expansions, trade recessions or trade depressions. An average of 42 hours worked a week signals nothing.

All trade crises arise from lost confidence in forthcoming profit. By lost confidence it is meant that bankers no longer believe they can get paid.

Without banking and bank credit, there could not be any crises and attendant panics. Many have posited many theories in effort to explain the causes of crises and panics. At the root of all crises leading to reckonings is the undue expansion of credit for which no profit shall be forthcoming.

As I explained in WHY IS THE ECONOMY SO HORRIBLE? BECAUSE ACADEMIA ECONOMICS IS FAKE, trade, which is what any "economy" is all about depends on two factors — property and profit. Without profit from effort, anyone would lack buying power to buy anything else. Without property, no one can trade. 

Though credit is indispensable to advance trade, often, credit becomes priced too cheap and thus too easily acquired. What results is inflation until a bubble bursts and panic arises.

Before crisis and subsequent panic, there must be prosperity. Employment, the state of hiring workers, shows most reliably the presence or absence of prosperity. Signs of prosperity include high prices, high wages, everyone being optimistic, people spending with ease. 

The march toward crisis arises when the profit squeeze hits. The further into prosperity, when profit margins in all lines of business narrow, many no longer can afford to accept losses from others. Thus, avenues of credit to such unworthy ones get closed disabling them from the means to service debt. 

In prosperity leading to crisis, production of new property as wealth traded by purchase and sale slows while estimates of future prices rise for extant property that could become wealth.

As the number of new firms and new securities listed increases, the danger of a crisis followed by a panic increases. When politicians award big municipal boondoggles at an increasing rate, the peak has come. When orders rush in, competitors work overtime, prices rise, these are the siren sounds of pending doom.

Signs of doom include the following. The riskiest stocks sell at the highest prices. Bankers-to-consumers and bankers-to-firms interest rates have risen. Bond prices have fallen. Bond yields haven risen consistently. Commercial paper yields have risen consistently. Commodity prices have risen consistently.

Prices of merchandise continues to rise because excess consumer credit puts buying power in the hands of consumers while available merchandise falls. This fall in merchandise arises from the credit squeeze hitting sellers.

Crisis is the pivot point between Prosperity and Reckoning. It is when all those who have undertaken too much credit for trade find themselves lacking income to service debt and ongoing operation from extant capital structure.

The further credit gets stretched, the worse is the break when it comes. Through the agency of credit, a great number of duties payable in cash get created. If the call for liquidation of outstanding credit becomes widespread, panic follows.

During a crisis, enterprise-undertaking adventurers pressure bankers to accommodate with easy credit.

When it becomes necessary to adjust the whole industrial machinery to a level of capitalization for net profits to yield ample return, the name for such adjustment is reckoning. Forced liquidation results in declining prices of assets and reveals ever more who can fail to meet debt obligation outstanding. When speculative gains from a credit expansion fail to meet the demands of credit liquidation reckoning, a period of trade depression arises.

Every crisis has the panic part. Panic is the scramble for the exits. Panic is the rush to exit credit positions. Crisis is the storm. Panic is the scuttling.

The word shill entered into English in 1916 meaning one who acts as a decoy for a gambler, auctioneer. 

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SAVINGS EQUALS INVESTMENT? OH THAT CROCKERY FROM ACADEMIA ECONOMICS

If the savings identity were true, then there would be perfect correspondence with these curves.

As I wrote in, MIKE "MISH" SHEDLOCK vs MICHAEL PETTIS, OR THE UNREALITY OF SAVINGS, INCOME INEQUALITY AND ECONOMICS, 
savings is mere rhetoric. 

People don't put savings in a savings bank or any other kind of bank. Depositors buy bank credits and sell cash, other bank credits or debt in property trades each known as a purchase and sale. 

In a purchase and sale, a customer, known as a depositor sells property in cash or receivables to a banker and buys property in bank credits. With property in bank credits, the bank customer has a right of action to demand an amount of cash from a banker at a future date. Evidences of such right includes checking account bank statements and passbook savings books. 

A bank is a firm that seeks profit through the business of selling its own credit. A bank transmutes property into a form, which can get traded. A bank facilitates the trade of merchant credit for bank credit, the trade of cash for bank credit and the trade of property in future profit for bank credit by holding lien against extant property.  


A bank stands as the medium of exchange by making credit negotiable from one holder to another so that credit might work the same as money once did and as cash does now. Thus, a bank is a refinery for credit. As a refiner of credit, bankers transform the credit of depositors. In so doing, the guaranty of bankers upon this transmuted credit lets depositors trade upon this guaranty. 

Enjoy the latest bickering between Mish and Pettis here: Michael Pettis Responds; Fantasyland Thesis vs. Reality; Counter-Challenge!

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THE UNREALITY OF SAVINGS, INCOME INEQUALITY AND ECONOMICS

Recently, I came across an interesting piece about academic Michael Pettis, which exposed Pettis' false beliefs about savings and income inequality. Pettis spews gobbly-gook. There is no such thing as savings. There is no such thing as income inequality.

Savings is mere rhetoric. People don't put savings in a savings bank or any other kind of bank. Depositors buy bank credits and sell cash, other bank credits or debt in property trades each known as a purchase and sale. 

In a purchase and sale, selling cash or perhaps other bank credits and buying an interest-bearing account, a bank customer becomes a capitalist who buys a share of future bank profits, which gets called interest. It's mere deceptive rhetoric to call such a capitalist "a saver" or one "who has savings" even when the bank customer capitalist is a wage earner. 

Depositors get deposits as evidence of their right of action against bankers when in a purchase and sale, selling their cash, other bank credits or debt. Bankers become owners of said cash, bank credits from other bankers and debt bought in a purchase and sale from depositors. 

Bankers and other capitalists deal in property with confidence in forthcoming profits, transmuting property that lacks saleability into property that does, enabling the adventurer-entrepreneur to transmute property as capital of production into property as wealth for trade. 

There is no such thing as "savings." There is only profit and loss. 

People work to get profits. People don't work and produce to make savings. To believe that people work for savings rather than profits is to reject reality. 

Anyone produces property in hopes of the gain of profit in a purchase and sale. Property always means the right of ownership and never what is owned. 

People trade property in stuff because before people can enjoy stuff, they must own it. People pursue profits to buy chattel, services and rights of action. Without profits there can be no purchase of another thing. Cash and bank credits are means to ends. 
  
Profits provide buying power because people seek buying power to buy the things they want from the surpluses they produce owing to efficiency. Otherwise, people would live at bare subsistence content to make little of a few things they need to survive. Under such a state, trade would not exist, nor would credit.  

People trade their property in chattel, services and rights of action (credit). People don't trade biens (goods) as the Physiocrats called them nor do they trade utilities as the Mill from Bentham utilitarians called them. 

Pettis errs again when he claims income inquality exists and is causal for anything. Income inquality does not exist and thus cannot be causal.

In THERE IS NO SUCH THING AS INCOME INEQUALITY, I use Robert Downey, Jr., to reveal that truth. If someone earns more than another, that is so because those paying for the one earning more pay higher bids than those who pay others less. 

Comparing the wages between a brain surgeon and a fast-food drive-thru cashier is deceptive, false comparison.

In both BUT IT IS FOR INEQUALITY! AT WHAT POINT DO PEOPLE STOP EXPONENTIALLY DOUBLING DOWN ON STUPIDITY?, and SPREADING WEALTH, INCOME INEQUALITY AND OTHER MANURE, I reveal crony politics keeps people poor through minimun wage and welfare subsidy and how it is impossible to spread wealth. 

Whether as individuals or in tandem for a firm, people work to get profits. And to get those profits, people work to make property in surplus. 

In trade, all get governed by infrangible, inescapable law of trade, the Law of Prices. All get constrained by the Axiom of Profit. The Law of Prices holds the winning bids of purchase and sale in the face of what is on offer set the price. The Axiom of Profit holds the sum of sales must at least equal the cost of production, otherwise the producer goes to run.

For workers, profit gets measured by the difference of wages less living expenses. For firms, profits gets measured by the difference of sales less outlays. For a given productivity of property made at surplus, if living expenses and outlays rise faster than wages and outlays, profit falls.

If living expenses rise above wages, workers live at loss. If outlays rise above sales, firms operate at loss. 

Prices have been rising owing to reckless cash accretion and reckless cash accretion has arisen owing to quantitative easing. 

Since cash are bank credits circulating in perpetuity, with cash anyone only can pay taxes, buy goods or buy bank credits. Residual bank credits become reserve against more bank credits traded in a purchase and sale. 

When bank credits grow faster than output, prices rise. Individuals caught in such a profit squeeze cannot buy vacations in the Bahamas, music lessons, dinners eaten at upscale restaurants, tailored suits and so on.

In YOU LIVE AT THE MERCY OF A CLOWN-CAR DRIVEN BY MEN AND WOMEN OF THE FEDERAL RESERVE, I reveal how those at the Federal Reserve continue to err because they believe in economics rather than trade. 

Pettis is quite wrong when he babbles that there can be excess thrift as well as insufficient thrift. That is akin to saying there can be degrees of prosperity. 

Pettis fails to understand what thrift means, conflating thrift with savings. In THE WEALTHY PEOPLE EFFECT AND WHAT IT TRULY SHOULD MEAN TO YOU, I explain the word thrift as a Middle English word from about 1300 meaning "thriving, prosperity" and comes from the Old Norse meaning the same. 

In prosperity, anyone who wants to work can find work. Profit abounds. Wages increase faster than living expenses. Sales increase faster than outlays. The creation of property grows at an increasing rate.

Pettis errs again when he quotes Eccles who spews silliness about distribution. 

The whole mythology of production and distribution comes from the Physiocrats and their effort to support false claims that only farmers and the land produces while all other classes are unproductive and thus should be the ones upon whom taxes should be borne.

It's no wonder why Pettis doesn't get reality. Pettis parrots much of what gets taught by academicians and their economics mythology. Academia economics mythology fails to comport to reality. 

Academia economics, regardless of neoclassical school, fails to deal with the phenomena of trade — property and profits. Instead, academia economics focuses upon utility and scarcity, both of which have nothing to do with commerce, which is also called trade.

Trade, which is the purchase and sale of property as wealth made from property put to production, which is capital, to produce property in surplus, is the only reality. 

Here are three more must-reads on Bizarro Theater to help you disabuse yourselves from the unreality of economics and income inequality:

1. GREEDY CAPITALIST COMPLAINS ABOUT UNEMPLOYMENT INSURANCE EXPENSE AND QUITS HIS BUSINESS
2. WILE E. COYOTE, CAMPGROUND BUSINESSMAN SUPER GENIUS
3. LIVING IN THE AGE OF IDIOCRACY

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SUCCESS! AT LAST!

Hubby and wife eggheads at Yale have penned a work together, The Triple Package: How Three Unlikely Traits Explain the Rise and Fall of Cultural Groups in America in which they claim three traits of individuals somehow translates into collective successes. These eggheads do not seem to know what success means. 

Success means getting what you want, when you want it and in the way you want it. That is all it means. Success isn't relegated to the measure of money.

Success is the end point, the effect from a string of other causes to effects that we call action. You get to success through focusing your action (causal chain efforts).

Having a driving, idealized purpose, focusing on that purpose to the exclusion of all else, having expectation of achievement, seeing oneself as a leader, catching glimpses in the mind's eye of what are intermediate steps contribute to success and experiencing those steps. 

Success is mostly about independence, the combo of  self-assertion and self-expression, being the one who does not succumb to peer pressure, who ignores the call of being one of many and instead rises above the peer group.

To outsiders, this drive to an idealized purpose, this self-assertion and this self-expression gets wrapped up in one word, ambition. 

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WHY IS THE ECONOMY SO HORRIBLE? BECAUSE ACADEMIA ECONOMICS IS FAKE.

FIRST, THE REAL

Trade, or Commerce, or Buying and Selling, or Real Economics, which is what I teach, is all relevant matters of mankind regarding the purchase and sale of property. Said another way, it's the theory of trading property for profit. 

The entirety of trade, or commerce, or real economics ties up with two words — property and profit. Without profit from effort, anyone would lack buying power to buy anything else. Without property, no one can trade. 

At less than break even, anyone would stop trying to produce property. No one works at a loss.

In trade, or commerce, or real economics, there is but one law and one axiom, the Law of Prices and the Axiom of Profit. The Law of Prices holds the winning bids of purchase and sale in the face of what is on offer sets the price. The Axiom of Profit holds the sum of sales must at least equal the cost of production otherwise a producer goes to ruin.


Though most think of property as things possessed, property always has meant the right of ownership and never the thing owned. Only when property gets created, can trade arise between two persons. 

The name for property put to making stuff is called capital. The name for property put to purchase and sale for cash and credit is wealth. The name for property that can be sold to satisfy debts is asset. The name for property pledged against a debt is collateral.

Profit is the name of sales at prices set by winning bidders less the outlay spent to acquire property for those sales. Profit signals potential return to increasing capitalization to gain efficiency and thus higher profit, lest competitors come to the party with better capitalization.

Trade, or commerce, or real economics is about acquisition of rights to own stuff. No one can derive satisfaction until that one owns. All talk about pleasure, pain, satiation, utility and the like is irrelevant until acquisition.

A trade is a purchase and sale for cash or credit, which can be settled by cash. Today, because of the legal tender designation for cash, cash lets anyone settle contracts straightaway. 

Cash is printed, circulating bank credits. Cash consists of banknotes issued by a centralized authority. Cash represents deposits circulating in perpetuity. 

Anyone who possesses cash has bearer negotiability, also said as currency. Bearer negotiability means the right of ownership in a thing gets passed along with honest possession in every sale or every exchange. The property and the possession are inseparable.

Cash stands as a money substitute. Cash exists as a money substitute precisely because politicians have decreed legal tender status for cash. Gresham's Law reveals why cash has crowded out money.

Money is coined metal by weight and fineness. Each coin by weight gets a unique name called denomination.

Money does not exist anymore and hasn't for decades. In the days of money, money extinguished both cash and credit.

Today, Americans, Canadians, Australians, Europeans, Japanese, and all others have cash and token coins. Any token coin has denomination higher than the sum of street prices of the metals which constitute it.

In spite of shopworn fallacies, never was money "a medium of exchange" or "a store of value". Instruments of banking are the media of exchange. It is bankers who do the exchanging, today, buying cash and debt through discount and selling credit, transmuting property of lesser saleability into property with more saleability.


Without doubt, doing the work of money does not make something money. Credit does the work of money and no one would ever say credit is money.

Price is an objective ratio that expresses a rate of trade of an economic quantity for cash or credit denominated in cash. Value is an objective ratio of exchange in swap, which most know as barter. Price and value arise from the same concept, except one has cash as one economic quantity for another. Both are rates of trade, of exchange.

By objective, we mean that someone not a party to a trade can observe the swap. There isn't anything subjective about it. 

Prices get set by double auctions. In most job markets, inter-employer competition has employers engage in English auctions (highest bidder wins) for workers, while inter-worker competition has workers engage in Dutch auctions (lowest bidder wins) for jobs.

Where the winning bidders of employers and winning bidders of work seekers intersect, that is the clearing price, which, when it involves work, we call it a wage.

In credit-as-capital markets, inter-lender competition has lenders engage in Dutch auctions (lowest bidder wins) for borrowers, while inter-borrower competition has borrowers engage in English auctions (highest bidder wins) for jobs.

Where the winning bidders of lending and winning bidders of borrowing intersect, that is the clearing price, which, when it involves credit, we call it a interest.

Labor absent capital is living at bare subsistence. It is to capital that profit can arise owing to efficiency of surplus output. 

Both rent and interest to the capitalist are shares of profit paid in parts as a hedge against loss. 

Trade, or commerce, or real economics has correspondence with both practical and theoretical civil jurisprudence as well as accounting.

Occam's razor is on my side. 

AND NOW, THE FAKE

Academia economics is wrong, thoroughly wrong. Neo-classical economics is fraught with fallacy. It's a sham. It doesn't matter if it is preaching from the Austrian School or the Keynesian School. Being logically consistent against wrong premises still leads to wrong conclusions. 

Everyone who lives in the real world knows this. If academic economics were correct, the political policies based upon it wouldn't lead to banking, and credit crises and high unemployment.

Academicians preach a false dogma surrounding scarcity and utility (usefulness), often calling economics the science of scarcity. 

Academicians cite examples to justify their false beliefs. They say that though useful, air is abundant and thus can't be an economic good. They say that though useful, water is abundant and thus can't be an economic good. They say that in the desert though, where it is scarce, water becomes an economic good. 

Yet, anyone who puts air into cans turns abundant air into potential wealth and thus an economic good. Anyone who puts water into bottles, turns abundant water into potential wealth and thus an economic good, whether in a desert or in a big city surrounded by aquifers. Putting air into cans and water into bottles creates property. 

And what of monopoly patents, seemingly which are useful and scarce to have the right to be exclusive producer? Many firms buy monopoly patent not to produce, making such not useful, but to exclude competitors from doing the same. 

The firm which buys monopoly patents gains property in those patents and restricts trade by control of property. Such action reveals that property, or right of ownership, is what counts.

Thus, neither scarcity nor utility gives rise to economic goods. It's property. Until one gains property, one can't do anything, including experience satisfaction.

Since neo-classical economics is predicated on scarcity and utility rather than property, academia economics begins with false premises. Thus, all conclusions arising from the alleged faux science must be rejected as false.

Neoclassical clowns preach that value arises from utility. Value is not a quality, that is, it is not an aspect of a thing residing absolutely within it. Nor does value arise from utility, nor the cost of production, nor any other claimed intrinsic quality, nor scarcity.

It's a specious claim that utility stands as the cause of value. Holding that utility makes the cause of value forces the belief in intrinsic, absolute value owing to some quality inherent in a thing. While the qualities of a thing remain the same, such a thing can be useful during some times and yet not during others. 

Contemporary economists believe that the amount of utility derived from consumption of a good declines with each additional unit; and thus, a person maximizes his utility when he distributes his income among various goods so that he obtains the same amount of satisfaction from the last unit of each good.

The idea of marginal utility is the pseudo-scientific claim that one derives 100% satisfaction from the first unit of a thing and less than 100% satisfaction from each subsequent unit.  It is from the foregoing that economists claim what gives rise to value and hence prices.

Academia economists would have the world believe that if someone sold a house for $400,000 but only spent $300,000 from the proceeds and never touched the $100,000, then the buyer overspent by that $100,000 and the seller should have sold for only $300,000. Yet, never in the real world would find the seller years later sending back to the buyer $100,000.

Marginalism is a crock, bunk, hokum. Utility does not impute value. Marginalism is pseudo-scientific psychology. Academician economists have assumed marginal utility as true without any proof, taking it as axiom and have built sandcastles of mischievous theory upon it. 

The bogus concept of marginal utility deals with satisfaction, and specifically with satiation. Marginal utility is pseudo-science satiation psychology never proven through the scientific method in psychology much less for economics. Academicians enter the realm of conjectural, pseudo-scientific psychology when they attribute motives and cognitive processes to prices. 

Cournot was right when he said: 

"... accessory ideas of utility, scarcity, and suitability to the needs and enjoyments of mankind ... are variable and by nature indeterminate, and consequently ill suited for the foundation of a scientific theory." 

There can not be a "Law of Supply and Demand" because exceptions need elasticity to explain why such exceptions exist. A law of science governs the relation of phenomena, of all facts. If exception must be made, there can't be a law. 

Academicians preach the fallacy that producers sit on supply, offering up supply only through an imaginary supply schedule. They spin an alike bogus story about a demand schedule.

Yet, in the real world, inventory gets to the shelves once produced and gets put on offer. It's winning bidders who set the price, regardless of cost of production. If some producers sell at loss, those producers either get forced into efficiency, reducing costs or those producers must exit. Winning bidders must bid higher to gain the remaining inventory of sellers who can at least break even on costs. 

While guys like Paul Krugman might understand academic economics, be expert even, they do not get trade, or commerce, or buying and selling, or real economics, you know, the actual economics that exists from manifest phenomena of the real world.

Krugman's brand of academia economics is built on all of the fallacies of Adam Smith, David Ricardo, Thomas Malthus, J.S. Mill and Jeremy Bentham, while rejecting the few lucid thoughts those foregoing had. And then their brand doubles down with more jokers like Stanley Jevons, Leon Walras, Francis Edgeworth, Alfred Marshall, all of whom accepted pseudo-scientific psychology never proven and totally unneeded. Jevons was so crazy that he claimed that sun spot activity created the cycles from boom to bust, from depression to prosperity.

Inauthentic, false, academia economics continues the parade of errors by adding erroneous thought of Throstein Veblen, Irving Fisher, John Maynard Keynes, John Kenneth Galbraith, Paul Sameulson, Kenneth Arrow, Robert Solow and Robert Mundell.

Economic theory espoused by all of the major universities suffers from significant flaws, even though there are kernels of truth is some thought here and there. Like all academicians, academic economists join a priesthood, receiving Ph.Ds, and became anointed to sermon on academic economics. Every Ph.D conferred in economics has been given to someone who has learned a false doctrine.

Even the Nobel Prize in Economics is little more than back slapping to the guy or gal who can remain logically consistent with the illogical house of cards that is academic economics.

Academic economics exists to justify political action of one kind or another, which means action against individuals and their respective property. Scarcity and utility are chimera faux concepts to justify political action of confiscation of output and redistribution to those of favored groups. Those who parrot the false belief that economics has anything to do with scarcity and utility have accepted rhetoric and have become indoctrinated.

 Every law crafted from economic theories of academia is a bad law. Every law that interferes with profits and impairs someone's property is a bad law. 

Full Disclosure

I earned a degree in economics from what was once a highly selective university. All my profs who taught me their false doctrine earned their Ph.Ds from Harvard, Yale, UC Berkeley and the like. 

For More

For those seeking a slightly more formal treatise, enjoy The Theory Of Trading Property For Profit.

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PH DUH, A NEW ABC TV COMEDY

Scene 1 INT - FACULTY LOUNGE - EVENING

ACADEMIC LIVING ON THE PUBLIC DOLE #1

Evil consumers cause global warming!

FELLOW ACADEMICS
Hear! Hear!

ACADEMIC LIVING ON THE PUBLIC DOLE #2
Consumers. Mother earth wreckers. Let's stop 'em.

ACADEMIC LIVING ON THE PUBLIC DOLE #1
Let's get taxpayers to pay for a ship. We can live it up as if were on a cruise. We'll head to the Antarctic.

ACADEMIC LIVING ON THE PUBLIC DOLE #2
Right! And take pictures of melted ice, dying animals. Victory is ours!

ACADEMIC LIVING ON THE PUBLIC DOLE #3

Let's invite a journalist to party with us.

Scene 2 EXT - SHIP'S DECK - AFTERNOON

ACADEMICS (SHOUTING IN UNISON)
We're saved!

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WHO WORRIES ABOUT THE FALSE CONCEPT OF CLIMATE CHANGE?

The left end of the graph reveals intense peer pressure and hyper indoctrination through public education, mostly mass media.

In spite of minor heat variances each year, climates the earth over have been steady for thousands of years. More so, there isn't one, monolithic climate, there are thousands upon thousands of climates. Thus there isn't any such thing as a global climate much less one that can "change".

Interestingly, of the countries whose peoples are most worried, the South Koreans and the Japanese have high elderly population. The elderly get scared easily. When told about anything that could threaten their taxpayers-funded welfare "pensions" and medicine, the elderly become quick to comply.

Until recently, Argentinans, Chileans, Filipinos, Ugandans, Bolivians and El Salvadorians have been subjugated by dictatorial types. The Lebanese who once could claim the Paris of the East now live in squalor. Even the Spaniards spent most of the 20th century under dictatorial rule, not having  democratic parliamentary elections until 1977. 

Not until you get to the Germans and the Canadians on that chart do you get peoples who have had democratic governments. Once you hit these peoples on the chart, the numbers show only slightly more than 50% believe the man-made global warming faux story. ?




Interestingly, it's land forms and their altitudes with respect to sea level along with proximity to big bodies of water that shape climate for any environment.

And of course, all of that is driven by the rotation of the earth as well as insolation, both of which are driven by the sun.

AGW is foolery. Manmade Global Warming is a spook story sold and told by immoral high priests of academia to garner popular support for deleterious political action that enriches some at the expense of many.

AGW alarmists claim that manmade CO2 causes heat as recording by rising surface temps.

Every month, a new record gets set for man-made CO2 output and CO2 concentration in the atmosphere. SO, if CO2 were causal, that is, if CO2 causes temps to rise, and thus adds heat energy to the atmosphere, then whenever the next period of CO2 exceeds the previous period, temps must rise, ipso facto.

Yet, if in any period it is seen that CO2 has risen above a previous level and temperatures (measured heat) fall, then CO2 cannot be causal for heat. Lo and behold last spring, mankind witnessed RECORD CO2 and temps that fell to FIFTY YEAR LOWS.

Global means pervasive, everywhere found, the earth over. Yet, what happened in Europe disproves both the concept of global warming and the concept of CO2 as causal for heat.

As well, recent results from the North Greenland Eemian Ice Drilling (NEEM) project, managed by Denmark’s Centre for Ice and Climate, show that during the Eemian inter-glacial, the climate in North Greenland was about 8°C (14°F) warmer than today. In that last inter-glacial period, there might have been 70,000 humans alive versus the seven billion humans (7,099,881,350) alive today. Yet, evidence now says that seas were 13 to 26 feet higher then than today and temperatures were much higher as well (7.8°C / 14°F).

So now comes the thorny problem of explaining how a pre-industrial mankind, an almost non-existent mankind of much fewer in head count — billions upon billions fewer — caused much higher sea levels and much higher temperatures, that is, if man-made CO2 global warming as a theory is to be believed.
Facts trump flawed computer models every day of the week, 365 days of the year, year after year after year into decades upon decades. The story of man-made CO2 causes global warming is a profoundly wrong story, a false story conjured by people with a vested interest and targeted against the most easily manipulated in effort to gain their political support.

It would be silly for someone to claim in all other inter-glacial times, one force caused global warming, but in this one, another force has caused global warming. Nowhere in the universe do we see exceptions in physics.

In this interglacial period, global warming began 11,400 years ago. At that time, mankind lived as hunter-gatherers, in nomadic groups. Population was only seven one-hundreths of what it is today.

If CO2 is causal in heat as man-made global warming alarmists claim, then what caused global warming in all of the other interglacial periods when mankind did not exist? Certainly, there must be one force, the same force that sets off all global warming during inter-glacial periods, whether or not mankind exists.

It seems a stretch to get anyone to believe that only several million hunter-gatherers, a scant seven one-hundredths of one percent of today’s overwhelming population of SEVEN BILLION could have generated enough CO2 to kick of a several thousands of years inter-glacial period.

Whatever this force is, this force governs both the intensity and the duration of the inter-glacial period. Since this force has operated in the absence of mankind, no one of sound mind can believe mankind is the creator of this force.

Already, we have seen the coldest spring in FIFTY YEARS in the face of RECORD CO2 output. Thus, it is clear that CO2 cannot be causal for surface heat and thus elevated temperatures during global warming. In short, there isn’t any such thing as man-made global warming. There is global warming, but mankind has nothing to do with its creation, intensity or duration.

This interglacial period isn’t even as warm as the last one, and the seas are far lower. Yet, there is a record number of mankind living on earth (nearly 7.1 billion) creating record CO2 output every month.

The idea of man-made global warming, from where did it come? The idea did not originate in most anyone.

It was told to most and because most have been conditioned already to accept ideas without resistance, so too did most readily accept the false concept of man-made global warming.

Even right now, most fail to realize that they are the owners of themselves, that each one of them are living their one and only lives, owing nothing to anyone.

Others who have realized this long ago, want all the luxuries available without having to work and thus exchange for those luxuries honestly. Instead, they want others to do the work from which they can reap the rewards.

So, they focus on gaining power, by force, if necessary. Their preferred method is rhetorical trickery. It's cheaper and more effective, with fewer people needed to be given a cut of the bounty.

Once having gained power, those with power focus on creating voluntary compliance rules, unseen chains of voluntarily servitude. Oh so quickly do the easily tricked shackle themselves with these rules, readily complying because of inculcated false beliefs.

The purpose of these rules is to get others to work on behalf of these rhetorical masters now holding power, which transfers earned buying power to them. Once that transfer happens, readily they live the life of luxury without having to put themselves at-risk, exposed to the vagaries of market competition, which through technological innovation, could render obsolete their capital structures within days.

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