You can never fix corruption, only eliminate it and start over. And the banking system, next to government and big pharma is the most corrupt entity in the world.
Frankly everything the government has a hand in or regulates winds up bloated and corrupt. Banking, Heathcare, Mortgage Lending, Social Security, Post Office, EPA, OSHA, Intelligence Agencies, etc. They all become weaponized tools for special interests. Everything that starts out as necessary for the greater good winds up picking our pockets and putting a gun to our heads in a bid for mass obedience to a cause that curiously ALWAYS requires us to give up something precious that we will never get back.
Exactly. That is the founding principle behind the Constitution of the United States. Read the correspondence between it's framers and authors. Power corrupts and centralized power presents a single point of corruption. To limit the damage of the inevitable corruption, limit the power.
The reason I'm very concerned about ongoing efforts to merge the two largest US grocery conglomerates Kroger and Safeway/Albertson's with the latter, owned by deep state connected private equity Cerberus named after the three-headed dog guarding the gates of Hell, looking to also purchase Sprouts.
...And the massive vertical of integration of medicine going on with private practices being scooped as in the recent CVS purchase of Oak Street Health adding to their drugstores, workplace medical insurance collection company, diagnostic clinics. etc.
Lol. Personally I draw the line at my dignity which encompasses personal freedom and liberty. They can’t have that. They’ll have to kill me first. Which of course I do not think they’ll lose any sleep over.
Interesting thing to ponder: what really is personal freedom and liberty?
Are you free if you don't notice that you are not?
Erosion of liberty via incrementalism is exceedingly effective. "well that doesn't affect me because I don't do [whatever]" that is it's OK so long as I perceive it does not affect me. Objecting on principle will get you disinvited to a lot of parties. But eventually....
When incrementalism is too slow, exploit crisis. Create one if necessary.
It’s disheartening to me that we live in an age where people need to ask what is dignity and freedom? There are a myriad of ways to answer. Here’s Orwell’s lesson in 1984:
For Winston Smith, freedom means being able to challenge the Party and its totalitarian control.
In Oceania, the Party is all-powerful. It doesn't just rule the country with an iron fist; it tells people what they can do, where they can go, and even what they can think.
To secure absolute control over people's thoughts, the Party constructs its own parallel universe in which, according to the blatantly contradictory slogans put out by the Party, “War is Peace,” “Freedom is Slavery,” and “Ignorance is Strength.”
If anyone is to secure freedom from the Party's control, they need to be able to think for themselves.
This means accepting that there's a world of fact where the Party's writ does not run. In this world, two plus two equals four. It always has and it always will, irrespective of what the Party says.
But in the totalitarian dystopia of Oceania, if the Party says that two plus two equals five, then everyone is automatically expected to agree.
Winston understands that for people to have freedom, there needs to be a world of fact that is independent of what we or anyone else might think; a realm of truth that cannot be subverted by political or religious dogma.
Mathematical equations form part of this world, and the ability to assert their absolute, unwavering truth, irrespective of what the Party might say, is an essential part of what it means to be free.
Don’t overthink it. Dignity is born of the freedom to say, no.
Not meaning to dishearten anyone. My observation was that many people do not ask, nor do they really understand. They instead exist without looking carefully, at least until they can no longer ignore the injustice. "If it doesn't affect me it's just fine" enables incremental erosion of freedom and justice, and IMO you can not really have dignity without freedom and justice.
As for the math, 2+2=4 only in a particular number system (base 10 or any base > 5). We could shift our number base to base 4 and then 2+2 = 10 or to base 3 and then 2+2 = 11. The math defines only the rules which we apply to a basis to get consistent results. We can manipulate the basis to get a different answer than 4, but if we follow the rules then we will always get the same result: In base 4, 2+2 will always result in 10 because that is how we have defined the rules. What this has to do with Orwell's characters, I have no idea (the random firing of neurons in a troubled mind is the best explanation I have).
Overthinking? Well seldom am I accused of that ;-). But thanks!
yes, dignity is born of the freedom to say no. A freedom that was taken away from billions of people over the last few years. If we use Winston's definition (which is IMO a very good one), then we have the crux of the status quo: challenging The Party is no longer allowed. Do it in public and you may find yourself accused of insurrection and imprisoned for years without bail and without a trial by a jury of your peers. This is a profound thing, and it goes counter to every fundamental principle upon which our nation was founded. And it is defended by the loyal followers of The Party for no reason other than The Party has said it is just. There's your Oceania.
Thus, I conclude that Oceano was not a product of Orwell's imagination, but that in fact Orwell was a time traveler who had been to 2020-23. QED ;-).
Incrementalism creeping in for the replacement of banking as we know it. We have the introduction of private 'new' banking in a platform called "open banking" that partners with "third party providers" who use a verification system to monitor everything we do and coordinate our lives with P3 corporate run programs funded by taxpayers with govt enforcement power that monitor and reward us like trained seals. Perhaps surprisingly for those in covid dissenter circles, Steve Kirsch founded the company Token* and Digital 10 spinoff networks for this purpose and before that in 2011 founded OneID to develop a digital ID to be used online and in daily activities and for purchases.
*Note tokens and earned badges are common terms in Human Capital Markets school projects, representing the P3 technocratic takeover of schools, prisons, and healthcare.
Interesting buzzwords: "merchants will also play a bigger role in consumer education", " monetization of customers’ data", and "develop more effective personal financial management (PFM) applications that allow for actionable aggregation".
Unfortunately this is just a case of history repeating itself. Ancient Rome had a Constitution and was an all-conquering superpower until their government bit by bit began ignoring/reinterpreting it for their benefit and/or the benefit of special interests until eventually rule-of-law became whatever they said it was. They placated the masses with “free” stuff. We are falling into the same trap. Only difference is we’ve got bombs and microchips. God help us.
My motto is always: Buy guns and ammo. Lots and lots of ammo.
And it’s cheap right now, compared to two years ago.
Once the whole thing implodes, ammo WILL be the only reliable currency. It works like this:
I’ll give you three bullets for a loaf of bread, or I’ll give you one bullet, but you won’t like the speed I’m sending it.
It’s unfortunate, but once people get really hungry, there will be violence. Let’s hope it doesn’t happen, but you can always hand the guns down to your kids if it doesn’t happen while you’re on this side of the grass.
Yeah, I bought a couple thousand rounds three years ago and paid through the nose. Got a handful of high quality arms. Not near as much as most of my friends though. I like shooting but I’m not passionate about guns. I’m a car/motorcycle guy. But I see the point. Kind of like a truck, better to have it when you need it than to need it and not have it.
Exactly. But how to eliminate corruption? I think it can be reduced by introducing accountability and consequences. In today's western systems of government and public institutions, there are no, at least not many, consequences besides losing an election.
In Ontario where I live, Dalton McGuinty was the leader of the provincial Liberal party and won an election almost 25 years ago. He campaigned on 'no new taxes'. Once in office, he immediately introduced a new tax: the employer health tax. A citizen took him to court over his blatant lie but lost the case because basically the judge said 'politicians lie, no big deal'.
We’ll never eliminate corruption but its damage and prevalence can be attenuated by decentralization. Whenever an entity becomes a centralized authority the power is intoxicating. Centralized authority by its very nature creates a single point of failure. We’re always told bigger is better. Not true in every case. Too big to fail means too powerful to control. Too powerful to control means it’s above the law. The bigger they are the harder we fall. Everything needs to be splintered into small competing entities. Then when the inevitable failure happens the damage is a blip that can be absorbed by the others and the failed entity can either go quietly into the good night or face consequences. Centralization always works against us.
History is rife with massive collapses of what appeared to be brilliant, indestructible civilizations and empires, that led to, for example, the Dark Ages, and there is NOTHING that is readily apparent that this is not in the process of happening again. I sincerely hope that I am wrong...
We just recently completed the Great Courses series on the Roman Empire. It appears we are right on course and building toward a similar pathetic end. Unless there is a massive coordinated groundswell of resistance with restorative ideas and workable action plans in place to begin immediately, I’m afraid I’m on target about this bad feeling I’ve been having for the past 2-3 years. My spouse has lived a highly successful life and career making good use of his innate clear eyed optimism, and even he feels it could go south quickly without solid and legally binding disruption to the tidal wave of destruction right over our heads now. Meanwhile he fights by writing for Substack, completing his 3rd book with plans for his 4th, giving keynote speeches and facilitating innovative peer to peer network trainings. While I merely stew among my flowers and vegetable garden and care for the pets and grandchildren while constantly appealing to our Creator for miracles. (And communicating with this and other communities). What else are we all to do? I’d really like to know. As I mentioned: The Grandchildren. What better reason to fight? But how, exactly?
Great comment. You mirrored exactly the way I feel about things as they stand right now. As the older generation my husband and I are most concerned about our children and grandchildren. They are most likely the ones on whose shoulders the burden of rebuilding civilization will fall. I pray all the time for miracles too. They aren’t guaranteed, but I know whatever happens God is the one who sets things in motion and brings things to an end. If possible I hope we may be spared Rome 2.0
I am a physician and recently went to speak with our interim hospital CEO. They presently are trying to purchase our local clinic (this is physician owned and has both primary care and multi sub-specialty physicians). The hospital itself recently set up a primary care clinic, which is in direct competition with this clinic and a community health center that we have. Then they turn around and fire over 100 hospital employees. I told him that these medical monopolies are not wise. He basically told me I am ignorant in the ways of finances and that this is the way things are going around the country. How do you argue with that. I told him he is right that I am not versed in all this financial mumbo-jumbo, but that I have common sense, and when I look at the overall picture and truly after watching the tyranny from Covid, having Medical monopolies is not a good deal. Plus you watch all these banking systems that should have people that are super intelligent in finances continually collapse…🙄
Super intelligent in finance is virtually an oxymoron. These are mostly people who make money by doing nothing other than manipulating the money of those who do something. (I am in medicine and have been in finance as well -- No question as to what is productive and what is not.)
The greedy, i.e., most folks, attempt to pull up the ladder after they have ascended by installing the untalented subordinate. After the retirements who is remaining? It has always been so, oligarchies run by former imbecillic subordinates with each layer growing less talented all the way down.
Wondering how you evade the CMS diktats for Covid care protocols (requiring Remdesevir and excluding IVM and HCQ) in your local clinic and the community health center.
We did not… Our hospital was using remdesivir. Could not really get any of our clinic physicians to use ivermectin or HCQ… had some local people that were purchasing it, and people would get it from them.
You are right. [They] like the power the existing system gives them, and they will not give it up without a fight. And that's before we even start talking about 'restoring banking privacy' in a world of KYC, AML, SAR, FBAR etc.
I nearly always agree with the things you say about free markets.
The itch I never get past, which my read of this post doesn't sufficiently scratch, is monopoly.
Monopolies seem naturally emergent in the absence of regulation. Perhaps monopoly isn't the right word here- when I look at it from a consumer perspective (because, realistically, that's all I'll individually ever be), what I really mean is "price fixing."
If given a completely unrestrained climate, why wouldn't purveyors ALWAYS align behind inflated pricing, especially the largest ones that can crush competitive pricing by smaller ones? Especially goods that are difficult to opt out of, like energy?
Aren't guilds or syndicates essentially inevitable in a market that does nothing to restrain them?
What you're talking about in this post is currency, and it all makes sense. But what about that "stuff of daily life" you mention?
"Aren't guilds or syndicates essentially inevitable in a market that does nothing to restrain them?"
no. this is an inversion of fact and reality. such things evolve and sustain themselves only in the presence of government interventions. consumer sovereignty prevents oligopolistic behavior outside that from becoming predatory.
even having, say, 3-4 big companies competing in a space drives prices down and quality up to the very near approximation of perfect competition, especially when others may enter the market if there are "excess profits."
i think you have this exactly backwards.
unregulated free markets are what prevent guilds and syndicates. they are creates of regulation and rules, not emergent economics.
try naming 3 durable monopolies in free markets that have shown durable ability to extract excess profits.
I can't name a single completely free market in history, so that may be part of the problem in my thinking.
Yes, it's true that we wouldn't have the East India Company of either flavor if we didn't have a Crown behind them.
It's precisely so difficult for me to imagine the circumstance you're talking about because it seems dependent on the nonexistence of government, whether regulatory or "regulatory."
Are you describing a circumstance that can actually exist?
sure. this precise sort of banking existed in the past and was extremely successful, stable, and high function.
governments did not take it over to make it run better. they took it over to profiteer from it and use it as a means of social control.
they have built a system that is going to imminently fail and the ability to move money in non-traceable fashion and do transactions selectively by jurisdiction now exists. the time to build the systems into which we can relocate is now.
the move of money, savings, investment, and commerce to a field where government cannot see or impede it will represent the greatest shift in power between government and people in human history.
this is how we become true citizens governed with consent instead of subjects and customers not chattel.
the state will fight it, but they're going to lose control, especially as they start to severely debase currencies.
there is no inherent reason that government money is desirable. and there is too much need here to not find a solution. this is basically inevitable, it's just a question of when, where, and how
Your third paragraph from ..."the ability to move money in non-traceable fashion...now exists."
I suspect it does exist for Mexican cartels and the Biden's, but the Panama Papers exposed some of it. It would be great if PBDC's were to become viable, but the only "non-traceable" transactions I can do are with cash, and there is a limit to how much the bank will give me without reporting to Fintrac.
I agree completely with this argument as it remains focused on currency and banking thereof. But I think it's an overgeneralization to say that currency and consumer goods behave exactly the same way and have exactly the same durability. Yes, coins are just units of value and are understood to be equivalent to real goods of equal value- 3 dollars = $3 of bread.
But while I agree that your historical examples of banking worked this way, I don't see that it eliminated the presence of price fixing of commodities by syndicates or of services by guilds.
I can't think of a single moment in history where a small number of sufficiently small number large competitors didn't eventually align behind some measure of value fixing. Perhaps technology and historical circumstances change the algorithm of how much market share and how many actors are needed to create these circumstances, but they always seem to arise.
"I can't think of a single moment in history where a small number of sufficiently small number large competitors didn't eventually align behind some measure of value fixing"
i can, basically all of them.
it is stunningly hard to do this and not attract new investment/market entry. "the cure for excess profits is excess profits"
look at basically everything in the US from clothing to grocery to furniture to homebuilding. where are these "excess profits" from value fixing?
it seems like one of these "bigfoot" things, often reported but never found.
(see sweden example above)
it really takes very little to generate near perfect competition outcomes. you need to try REALLY hard to do it. not even things like telcom/cell service/internet in the US can manage it despite having literal oligopoly grants.
That what you say about monopolies is even remotely controversial and contested, even here, is a sad testament to the results of a century of progressive "education" and government propaganda.
Thinking that the State protects the people from business is among the greatest inversions of reality of our times, and that is really saying something.
"The ideal tyranny is that which is ignorantly self-administered by its victims. The most perfect slaves are, therefore, those which blissfully and unawaredly enslave themselves."
"the move of money, savings, investment, and commerce to a field where government cannot see or impede it will represent the greatest shift in power between government and people in human history."
If I remember my history lessons, before "money" , bartering was key...and apart from tithes I am uncertain that any form of "government" existed as we understand it today - feudalism for sure.
So called " digital currencies" are a scammer's delight and I do not think - but may be wrong - that blockchain technology will entirely help.
The concept of 'untraceable" in relation to any digitally based transaction to my mind is potentially wishful thinking - surely it comes down to "my algorhythmic software/supercomputer" vs "your algorithmic software/supercomputer". Digitisation of anything enables corruption and facilitates theft at 186K mph.
If the Intelligence community could monitor conversations remotely by capturing the vibrations, induced by speech, which cause surfaces such as glass to fluctuate, as the US did in the 1980's - 40 years ago - obviating the need for electronic devices to be planted "locally" by difficult covert operations, is it feasible that technological developments since then have made "non-traceable" less viable - especially if Intelligence Services (IS) keep telling us that? "Sigint" has always been "treasure" to IS and even more so now; US satellites where able to detect if Russian tanks were serviceable from space in the 1980's - does anyone really believe it when, say, WhatsApp say their software is "end to end encrypted" - what exactly do they mean?
Acting in "utmost good faith" or uberrimaie fides or the lack of it - to me that is just as big a threat as corrupt governments/central banks using fiat money in a less than honest, moral fashion.
As far as I can follow his reasoning the conditions can theoretically exist, but human nature will always sabotage them from functioning as intended.
If we were neighbours and either of us had a surplus of something, would we try to undercut the others askingprice at market?
Or would we co-operate and try to edge out the people from the other villages at said market?
Also, if you had something you no longer needed (say a pile of planks from an old shed) wouldn't you give those to a neighbour if asked, since you were going to toss or burn them any way?
It's human nature. Some of us are like that, that we will first ask around to see if they can help someone else, free of charge, since helping wouldn't cost them any anyhow.
Others are like the mother of a childhood friend, who would always ensure that anything she threw out was smashed, cut up andbroken so no-one else could use it, no matter if it was an old sofa or a t-shirt.
What you're describing are overlays to purely materialistic behavior, aka culture.
A true dyed-in-the-wool economist (which I'm not) would say that all behavior can be reduced to expressions of value- I'm altruistic because I'm getting an internal, abstract value from the behavior whereas your friend's "salt the field" mother is seeking to preserve value through scarcity.
In your neighbors with a surplus example, individual actor me would say that our behavior would probably depend on our relationship as neighbors. Personally, I'd probably come to you and say "how about we pool our honey and bottle our mead together so we save on operating costs and then not undercut each other?" but then we've created a syndicate, which I'd see as cooperation.
....if only there were some magically benevolent institution, that would protect me and mine, and always be fair, and always do the right thing, and , and, and......
Dreams of fair and equitable are just that.
The answer isn't the expectation of unattainable perfection, the key is the understanding that all functions of governance need accountability which is currently nonexistent. The current system of "bend over, trust us" and forgetting that "we've done this to you before and you didn't do anything", is why it's happening again.
I'm not misunderstanding the Sowell quote, and I'm not the one advancing any idealism here. If I'm misspeaking, please show me what policy I've advocated, if any, with the expectation of perfection.
I'm saying monopolistic market behavior is inevitable. You're saying "all functions of governance need accountability." How does this contradict my position that the absence of regulation doesn't prevent anything?
I didn't think there was a misunderstanding of Sowell, but the back and forth idealism in the thread, i saw as missing the inevitable of inequity, and being masked by the hope of some system that would remove that inequity.
Guilds etc evolved on their own as power-structures, parallell to governements.
Unregulated free markets always create monopolies, or if you prefer concentrates ownership on so few hands that said hands have what functionally amounts to monopoly. It's an inherent function of accumulation of wealth beyond the needs of the household.
Blackrock ring a bell? If you prefer a historical example, how about Marcus Licinius Crassus?
You are wrong about "...having, say, 3-4 big companies competing in a space drives prices down and quality up...". It does the opposite. What always happen is those 3-4 actors will co-operate and keep competition to an absolute nominal minimum so as not to hurt their own bottom line and profit margin for their owners, and this will happen without any open official collusion on their part: a tacit gentlemen's agreement is enough.
The food and grocery market in Sweden is the prime example: three corporations control 85% of the entire market, from raw goods to refined products, imports and stores. Prices vary less than 5% between them on average, despite the mark-up for some goods being in the hundreds of percents.
What's left of the "free market" is Lidl (about 10%, stores level only) and privately owned corner stores selling sodas, candy, chips, tobacco and such.
this is simply false. guilds were granted status by governments and became governments. they cannot persist in free markets.
you're making up facts here. look at telcom. even with so few players and so much government regulation, competition is ferocious and profits are modest despite being literally granted local oligopolies by government.
i think you are seriously misstating the case in sweden. it makes my point, not yours.
ICA is the huge share leader in sweden.
they did 136bn SEK in revs for 2022.
net income was 4.5bn SEK, a 3.3% net margin.
hardly monopolistic profit extraction
axfood AB is the other. (hemkop, willys)
they did 2.4bn net on 73.5bn in revs = 3.2% margin.
clearly, there is no ability to extract excess oligopoly/monopoly profits. these are pretty meagre margins at the edge of viability.
you'd get better cash on cash return on US treasuries.
so, clearly, the competition is sufficient that profits have been driven down to something approximating the risk free rate.
hard to see how your claims of profiteering are supportable in the face of that outcome. this is a near perfect free market equilibrium level.
Gato, you misunderstand the fundamental nature of capitalism (and i am a big proponent of capitalism).
Capitalism does NOT incentivize and reward competition. It incentivizes and rewards MONOPOLIZATION.
If you are a business you do NOT want competition. You want to be a monopoly. Hence completely unregulated free markets will end up with monopolies controlling everything.
Nice strawman, that's not close to what i said. Capitalism does not INCENTIVIZE or REWARD competition for businesses. Competition is not good for a business, lack of competition is (competition is good for consumers). And yes, when businesses reach a certain size they can absolutely keep competing businesses out of the market. Its happened over and over again throughout history. Thats why monopolies get broken up. Anticompetitive behavior...
In Finland the grocery market is even more damaged. We have TWO duopolistic chains and Lidl picking up perhaps 5-10%.
Groceries in Finland are 7.8% higher than Sweden and 15.7% higher than Germany. Sure we are a nation of lumberjacks out in the sticks but the fact that Lidl can sell for less than the two giants while having to arrange probably ALL their own distribution and importing from Germany makes me think the duopoly has artificially high prices. It would be interesting to see if one or the other will undercut Lidl on low priced items to steal customers back into the fold.
In all fairness for a CEO not to form a duopoly would be silly, the only thing that prevents it from being in your face is legislation.
There is a very high barrier to entry for micro and small enterprise and very few ever get to challenge large incumbents.
I agree that much of the problem of gaining new competitors is caused by bad legislation but eliminating all regulation will favour the largest in most battles.
Restrictions on these banks could be somewhat arbitrary and onerous. They might be forbidden to list or trade on stock exchanges (that may crash so not safe anyway) and cannot have institutional investors that will probably have links to Blackrock. They might be geographically constrained to not have branches more than two state lines apart. Limiting how big or small their trust networks are may also be prudent. Break up the Bell before it grows too big.
Bonus assignment: Someone who knows net theory and has the time might find out what is the largest number of states that are no more than two borders away in the USA and EU. Does the coast count as a single point?
Excellent points, Kalle Pihlajasaari. I replied elsewhere on this thread pointing out the largest two grocery store chains in the US are trying to merge and recently one of those chains (Safeway/Albertsons owned by private equity group Cerberus named for the three-headed dog that guards the gates of Hell) announced it would also like to purchase Sprouts, a smaller chain. Federal Antitrust regulators are nowhere to be found and a state District Attorney is feigning opposition while the media tells viewers "It would be a good thing and would likely lead to lower prices". Sadly, most Americans never learned or forgot the long history of monopolism and oligopolism.
>> Unregulated free markets always create monopolies, or if you prefer concentrates ownership on so few hands that said hands have what functionally amounts to monopoly. It's an inherent function of accumulation of wealth beyond the needs of the household.
This is exactly what I was trying to express. It is the natural function of power to organize and consolidate itself. Intelligent actors, if they're in competition with similarly powerful entities, will quickly understand that there is greater profit in stability and that their competitive energies are better directed at controlling their consumer base.
Nations rarely went to war with each other if they believed that the outcome was at all in doubt or if the cost-benefit analysis was negative. Three cattle barons are eventually going to sit down at a table and price fix instead of losing manpower to endless range wars.
Another perfect example is AWS, Microsoft Azure, and Google Cloud Platform. They all have some form of vendor lock-in and they don’t compete for the lowest possible price. Trying to do so is incredibly destructive, especially if you don’t have free money to pay for the destruction.
Are you seriously suggesting that Blackrock and Crassus are examples of free-market monopolies?
Please. They are its antithesis.
Consider the case of Standard Oil, the leftist "textbook case" for capitalist monopoly. Rockefeller managed to make petroleum products, especially including kerosene, so inexpensive that it completely supplanted candles and whale oil for lighting, thus bringing light to millions and saving the whales in the process.
At the beginning, Standard Oil enjoyed a 4% market share. At its apogee, 88% market share, which, despite leftist historical nonsense, is not actually a monopoly. By the time Standard Oil was broken by progressive mountebanks it was down to 65% and falling.
"i think you have this exactly backwards... unregulated free markets are what prevent guilds and syndicates. they are creates of regulation and rules, not emergent economics."
Monopoly is practically impossible without the force of government.
‘Monopolies seem naturally emergent in the absence of regulation.’ Wrong way round - monopolies only exist because of regulation. Regulation is always protectionist of businesses and producers. Any enterprise which produces a good valued by consumers and can produce it at a price the market will bear, and make a profit and do it better than competitors will have a dominant position. It can only become a monopoly if no other entity can produce the good and sell it for the same or lower price and make a profit. It means the consumer us getting the best deal. In a free market this is a contestable monopoly, because there is nothing external to prevent another market entrant from competing with a lower price if it can. Also the monopoly can and often is lost due to innovation. However. If regulation makes cost of production very high, it reduces or eliminates competition and prevents new market entrants. Strict regulation about ‘how’ something must be made, or what can be made, removes possibility for innovation. Regulations are written by key market players in cahoots with Government, specifically to keep competition out, particularly foreign competition - that’s what tariffs and non-tariffs are for too. In the US, poultry after slaughter goes through a chlorine wash process to kill any bugs on the skin, particularly salmonella, in Europe they have a different regularity procedure which is supposed to prevent flocks being infected with salmonella, and just few seconds immersion in near boiling water after slaughter. US poultry is banned in the EU because... regulations. Also residual chlorine on US chucks, contravene regulations. Yet I hear no reports of piles of corpses outside KFC in the US. So the EU poultry producers have a Government created monopoly... deliberately. Anywhere you see a monopoly, you will find Government created it.
In the total absence of regulation, why WOULDN'T a more powerful entity suppress the competitive ability of a rival? If someone is undercutting my widget business with an innovative lower-cost model, and I'm a bigger entity, I'll try to buy him out. In the absence of regulatory power, maybe I'll even burn his factory or threaten his friends and family.
Your examples are solid, and I don't argue with them at all- but I don't see the presence or absence of regulation diminishing the phenomenon of monopoly. I think it's simply going to exert itself by different means depending on the conditions.
Consumers make monopolies don’t they? Consumption is the sole end and purpose of all production - Adam Smith. Consumers decide what businesses thrive, what products get sold, and at what prices. They decide how many jobs in an economy and what those jobs are. Who, for example, decided DVD and put VCR out of business? Who made a one-man, Mail-order book seller operating out of a garage, into the Amazon we know and hate to love? Consumers are the market regulation, the monopoly-makers. How does a business become dominant? Isn’t it because more consumers like its products/prices v competitors? Nobody is forced to buy. Well run businesses with products consumers want become market dominant, not badly run ones who sell crap. Buying out a competitor happens, but has a cost. Easier/cheaper (why do businesses contribute to campaign funds?) to connive with Government to introduce new safety standards for widgets which puts up your costs or which you do not have the resources to implement. And in any case that still doesn’t stop another competitor entering the market. My point is in a free market monopolies are contestable, regulation makes them non-contestable because of the barriers they put up against new market entrants, or costs they put on smaller businesses which lack the money and resources to implement them.
In a capitalist system, no matter if the monopoly is state, corporate or private, perennial crises are a feature, not a bug.
(In a communist system, constant crisis is a feature.)
In a free market system where the actors voluntarily do not strive to create and control monopolies, and also voluntarily differentiates between earning a living with a little extra to set aside for the future, and maximising immediate monetary profit at the expense of all else (aka capitalism: freemarket economy made into ideology), your suggestions might work.
Now then, what are the odds you think of all actors voluntarily working to ensure that said free market doesnot evolve into private monopolies, company towns, indentured servitude where you're paid in company script, total devastation and despoiling of resources, and so on?
About the same odds of communism working as claimed, I'd argue.
This comment, sadly and somewhat ironically, reflects over a century of government monopoly of education. The economic history of the industrialised world to WWI shows why. By 1913 the world had converged on a single monetary standard that left all currencies directly convertible. Interest rates were low and stable, without being set by Central Banks. Inflation was stable at under 2%, the rate of discovery and processing of new gold. Government everywhere was small, less than 10% of GDP by tax take, with half of that going on the military it was unable to regulate everything, as it does now. Belle Epoch monopolies like Standard Oil were only emergent in industries facing government that were regulated as ‘strategic’. The idea that we would face some sort of dystopia without government is a fantasy that does not conform with reality, inculcated in government-funded and directed monopoly education.
To be clear, I use inflation in the technical (correct) sense of the term: increase in the supply of money. Consumer prices in the US fell through the 19th C, being lower in 1914 than they were in 1800. This is due to economic productivity outstripping the rate of creation of money. It shows how bad things are now that despite the productivity of the US, government is printing money so fast prices rising at over 10% annualised.
And that did not suit the Cabal, who wanted large government, big debt (to feed their interest machine) and an income tax to skim off money from the productive. The same way they've worked since basically the beginning of time.
" Antitrust laws are regulations that encourage competition by limiting the market power of any particular firm. This often involves ensuring that mergers and acquisitions don’t overly concentrate market power or form monopolies, as well as breaking up firms that have become monopolies.
Antitrust laws also prevent multiple firms from colluding or forming a cartel to limit competition through practices such as price fixing. Due to the complexity of deciding what practices will limit competition, antitrust law has become a distinct legal specialization. "
How would you characterise the concentrated market power of "Big Pharma"? If my description is accurate to some degree, and I confirm (as if you needed that...) am not knowledgeable in this, the actions of several global Pharma Cos, over several decades and despite changes in corporate identity, are demonstrably highly dubious?
You are right, but regulatory capture and anti-trust are two separate things.
Pharma does not on its face meet the definition of a monopoly. There are numerous companies, of varying sizes, and they compete with one another. They use tactics like patents to enjoy for a limited time monopolistic pricing, but the patent system makes this tradeoff intentionally, in the interest of broad publication of research and knowledge.
Pharma benefits greatly from regulatory capture. This has never been more obvious than in the C19 kerfuffle.
I suspect that pharma (and its corrupt 'regulators') will get some sort of comeuppance in the years to follow, though I have no idea what that will look like.
I can’t imagine these private tokens not falling to the same problem that private banks do, who also can already generate money in today’s system by giving out loans. Through concerted behavior they can drive bubbles and crashes, there is simply no keeping a bunch of private parties under control if they are the ones controlling money. There is no underdog to turn to because the big dogs can join together to form a cartel which suppresses the value of the tokens being issued by the underdog, etc.
You should do at least a little bit of thinking about how BTC could actually make your system/proposal *stronger* rather than writing it off. If nothing else, it can live on as the monetary policy and settlement layer. The central bank of all your private bank-like-entities. If all their shit-tokens were actually pegged to sats, then there would not be the risk of non-competitive funny business.
BTC critics have many fair points but the thing they need to remind themselves is that nothing like this has existed in history, and we should not throw it out because of boo-hoo it uses too much energy. Even if it’s a percentage of all the world’s energy, it could be something that changes the course of human history. Even if it doesn’t do a good job at payments and the Layer 2 stuff flops, it is still something incredible to have established true digital scarcity. Work that into your next proposal and see if it maybe turns out better.
"who also can already generate money in today’s system by giving out loans"
*ponders* It feels like a word like "generate" ignores the free will of the borrowers who might, by choice or otherwise, not pay back what they've borrowed, let alone the interest - the part that would be "genereated" - if the debtors settle up.
Yes it does take 2 to tango. But many loans are given between elites and even between banks or banks and governments, and are essentially favors, or bailouts, or even gray area financial crimes (there is a well documented case where IIRC a British bank had a solvency crisis, and they gave a loan to some Saudi’s, who then bought some newly created stocks that that same bank had issued. It is as illegal as it sounds but never was prosecuted).
But to be clear it’s not just the interest that is “generated money.” The principle itself is money created out of nothing. This was sort of proven empirically by economist Richard Werner around the 2000’s IIRC, and then officials started to admit that this is indeed how it works. There is a video from the Bundesbank (Germany) admitting this. They say it’s well-regulated but it is not really; it is basically what drives boom-bust cycles. Banks start lending more and more which pumps up the money supply, until the bubble bursts because the debt is worthless (cannot be collected). Then the government usually bails them out and doesn’t prosecute and the cycle repeats.
Anyways look into ”split circuit monetary system” as a search term. Many people understand this as fractional reserve banking but it is actually worse, since the banks don’t even check their reserve requirement when giving a loan. They literally just add a number to the bank account of the person taking a loan.
Also can recommend the videos on John Titus’ youtube channel (called “Best Evidence”). His videos explain very well.
The prerequisite for decentralized private bank currency would be constitutional amendments (1) banning government money and (2) forbidding government banking regulation and deposit guarantees.
Without (1), the federal or state government will simply bludgeon and force everyone to use their currency with various legislation. Without (2), the first time a private bank fails (and they most certainly will - complete with sob stories of entire life savings lost) it will become a call for deposit guarantees all over again as politicians fall all over themselves to get back into bank regulation / guarantees.
How would we get politicians in DC to agree to give up enormous amounts of power and influence and campaign donations and pass those amendments? They'd have to be forced.
I have yet to see in my lifetime any significant rollback of federal government power in any domain. Even the critics of such power seem to become awfully timid once they get sent to DC. Even the most egregious and blatant abuses like warrantless, secret court wiretaps have not even been pruned at the edges, just whined about.
The best idea I have to get anything like this done is to push hard into education and take over school curriculum to spread solid ideas about freedom and decentralization (a reverse bezmenov.) Maybe the next generation or the one after can make enough headway to get new, real limitations on government power before the authorities resort to prison camps to cover for their failed ideas.
I've been playing around with different money. In my practice, I accept dollars but also metals, Goldbacks, and BTC. Goldbacks have been remarkably durable so far - people are accepting them AND spending them, and the manufacturers keep selling out. It's fun to watch.
When a system has existed (private banking) and then we end up here, I ask myself, "how did we end up here, and can that be avoided in the future?" One argument I've heard for BTC is NOT that it is useful as a layer 1 or even layer 2 transactional instrument, but that, because it is fundamentally constrained by physical laws, it serves as a type of "trust hedge." Governments, or private banks, are constrained by the competitive pressure it creates because people can always move large sums of money from one to the other. Now, the existence of gold *should* be able to do the same thing, but the portability issue and the ability to physically control the stock has made that market too manipulable.
That the government might be able to corrupt BTC would just add to everything else that they already corrupt, and it seems more difficult to corrupt. The goal, in my mind, is dynamic decentralization that creates constant tension and naturally checks the system; a little bit of chaos is better than too much order, even in money. Too much order in money gave us the combination of sclerosis and chaos we are about to descend into.
BRICS is proposing a multi-national currency backed by a market basket of commodities, including gold, oil and wheat. Probably numerous others as well. Some sort of backing is generally required to control (prevent) inflation in accordance with Grisham's law: 'bad money chases out good.'
The solution is simple... stop fiat currency. Until Government loses its monopoly on money, then there is no fix. Whilst Government sets interest rates (Central Bank independence - don’t make me laugh) for purely political reasons, cheap money will mean mis-allocation of resources and high risk business adventures with the inevitable problems once rates go up... as they will due to Govt created ‘Boom-Bust’ economic cycle. As for Fractional Reserve Banking - it played an important part in the Industrial Revolution and still does in funding economic activity. Adam Smith favoured it, but said it was risky and lenders should stick to short-term loans. Back then there was no banking insurance and people knew the risks; today they don’t. I wonder how many people know that when they put money in the bank, they cease to own it, it becomes the bank’s property and the depositor becomes a creditor to the bank and only has a lien on the money they deposited, not a property right?
This is like “make banking great again,” without acknowledging that, even if it was better before, it evolved into what we have today. So, burden is on you to show how it won’t just repeat.
“Implies that if banks made loans everyone would honestly pay off their loans. It would be nice, but they don’t. Utopian wishful thinking”. My 80 y.o. Retired banker’s reply to this article
Did he actually read it? The premise (may or may not be correct but it *is* what the author is advocating) that the private banks would be *more* careful about loans.
I wish The Cat who runs things at our house was half as smart as you. She has your contentious nature tho. But she is still twice as smart as any Fed bureaucrat. I think your ideas are brilliant. May they catch fire🔥.
This was a good piece. So--for those of us now past the high noon of life, it ain't gonna come in time. Moreover, looking at all the people who still, for unfathomable reasons, have accounts at bastards like Wells Fargo, moving the sentiments of the populace to good ideas is gonna require quite a lot of real heavy equipment, metaphorically speaking. But we must live in hope, right?
That's been true--about control--since the cave kids snuck out when they were supposed to be sleeping. Parents began inventing tools so they could eventually build childproof-locked doors.
Everyone wants control. Our misfortune always lies with how the idiots manage to grab it and keep it somehow.
I think it's not so much that we *give* power as it is that the average normal person isn't particularly interested in power in the larger spheres, and before you know it the morons are in charge of everything.
I'm trying to get over a bad bout of guru revulsion, which is affecting my ability to tolerate even the good while avoiding the dreadful. To be sure every place I encounter a Sowell quote I'm quite impressed with the common sense.
You can never fix corruption, only eliminate it and start over. And the banking system, next to government and big pharma is the most corrupt entity in the world.
Frankly everything the government has a hand in or regulates winds up bloated and corrupt. Banking, Heathcare, Mortgage Lending, Social Security, Post Office, EPA, OSHA, Intelligence Agencies, etc. They all become weaponized tools for special interests. Everything that starts out as necessary for the greater good winds up picking our pockets and putting a gun to our heads in a bid for mass obedience to a cause that curiously ALWAYS requires us to give up something precious that we will never get back.
Exactly. That is the founding principle behind the Constitution of the United States. Read the correspondence between it's framers and authors. Power corrupts and centralized power presents a single point of corruption. To limit the damage of the inevitable corruption, limit the power.
Well, that worked for a while.
The reason I'm very concerned about ongoing efforts to merge the two largest US grocery conglomerates Kroger and Safeway/Albertson's with the latter, owned by deep state connected private equity Cerberus named after the three-headed dog guarding the gates of Hell, looking to also purchase Sprouts.
...And the massive vertical of integration of medicine going on with private practices being scooped as in the recent CVS purchase of Oak Street Health adding to their drugstores, workplace medical insurance collection company, diagnostic clinics. etc.
When it comes to everything from government to goods and services, the smaller and more decentralized the better.
“If you put the federal government in charge of the Sahara Desert, in five years there'd be a shortage of sand.”
- Some other Economist-Philopher Guy named Milt
Bonus (because I was searching for the quote above):
“Inflation is always and everywhere a monetary phenomenon.”
- That same Milt Guy, the one about whom Prez Biden thoroughly mistakenly once said was No Longer In Charge here
Lol. Personally I draw the line at my dignity which encompasses personal freedom and liberty. They can’t have that. They’ll have to kill me first. Which of course I do not think they’ll lose any sleep over.
Interesting thing to ponder: what really is personal freedom and liberty?
Are you free if you don't notice that you are not?
Erosion of liberty via incrementalism is exceedingly effective. "well that doesn't affect me because I don't do [whatever]" that is it's OK so long as I perceive it does not affect me. Objecting on principle will get you disinvited to a lot of parties. But eventually....
When incrementalism is too slow, exploit crisis. Create one if necessary.
It’s disheartening to me that we live in an age where people need to ask what is dignity and freedom? There are a myriad of ways to answer. Here’s Orwell’s lesson in 1984:
For Winston Smith, freedom means being able to challenge the Party and its totalitarian control.
In Oceania, the Party is all-powerful. It doesn't just rule the country with an iron fist; it tells people what they can do, where they can go, and even what they can think.
To secure absolute control over people's thoughts, the Party constructs its own parallel universe in which, according to the blatantly contradictory slogans put out by the Party, “War is Peace,” “Freedom is Slavery,” and “Ignorance is Strength.”
If anyone is to secure freedom from the Party's control, they need to be able to think for themselves.
This means accepting that there's a world of fact where the Party's writ does not run. In this world, two plus two equals four. It always has and it always will, irrespective of what the Party says.
But in the totalitarian dystopia of Oceania, if the Party says that two plus two equals five, then everyone is automatically expected to agree.
Winston understands that for people to have freedom, there needs to be a world of fact that is independent of what we or anyone else might think; a realm of truth that cannot be subverted by political or religious dogma.
Mathematical equations form part of this world, and the ability to assert their absolute, unwavering truth, irrespective of what the Party might say, is an essential part of what it means to be free.
Don’t overthink it. Dignity is born of the freedom to say, no.
Not meaning to dishearten anyone. My observation was that many people do not ask, nor do they really understand. They instead exist without looking carefully, at least until they can no longer ignore the injustice. "If it doesn't affect me it's just fine" enables incremental erosion of freedom and justice, and IMO you can not really have dignity without freedom and justice.
As for the math, 2+2=4 only in a particular number system (base 10 or any base > 5). We could shift our number base to base 4 and then 2+2 = 10 or to base 3 and then 2+2 = 11. The math defines only the rules which we apply to a basis to get consistent results. We can manipulate the basis to get a different answer than 4, but if we follow the rules then we will always get the same result: In base 4, 2+2 will always result in 10 because that is how we have defined the rules. What this has to do with Orwell's characters, I have no idea (the random firing of neurons in a troubled mind is the best explanation I have).
Overthinking? Well seldom am I accused of that ;-). But thanks!
yes, dignity is born of the freedom to say no. A freedom that was taken away from billions of people over the last few years. If we use Winston's definition (which is IMO a very good one), then we have the crux of the status quo: challenging The Party is no longer allowed. Do it in public and you may find yourself accused of insurrection and imprisoned for years without bail and without a trial by a jury of your peers. This is a profound thing, and it goes counter to every fundamental principle upon which our nation was founded. And it is defended by the loyal followers of The Party for no reason other than The Party has said it is just. There's your Oceania.
Thus, I conclude that Oceano was not a product of Orwell's imagination, but that in fact Orwell was a time traveler who had been to 2020-23. QED ;-).
Incrementalism creeping in for the replacement of banking as we know it. We have the introduction of private 'new' banking in a platform called "open banking" that partners with "third party providers" who use a verification system to monitor everything we do and coordinate our lives with P3 corporate run programs funded by taxpayers with govt enforcement power that monitor and reward us like trained seals. Perhaps surprisingly for those in covid dissenter circles, Steve Kirsch founded the company Token* and Digital 10 spinoff networks for this purpose and before that in 2011 founded OneID to develop a digital ID to be used online and in daily activities and for purchases.
*Note tokens and earned badges are common terms in Human Capital Markets school projects, representing the P3 technocratic takeover of schools, prisons, and healthcare.
https://www.openbankingexpo.com/insights/steve-kirsch-founder-and-ceo-token/
Interesting buzzwords: "merchants will also play a bigger role in consumer education", " monetization of customers’ data", and "develop more effective personal financial management (PFM) applications that allow for actionable aggregation".
The banking system and big Pharma is corrupt because of Government, so it really is top of the list.
Unfortunately this is just a case of history repeating itself. Ancient Rome had a Constitution and was an all-conquering superpower until their government bit by bit began ignoring/reinterpreting it for their benefit and/or the benefit of special interests until eventually rule-of-law became whatever they said it was. They placated the masses with “free” stuff. We are falling into the same trap. Only difference is we’ve got bombs and microchips. God help us.
My motto is always: Buy guns and ammo. Lots and lots of ammo.
And it’s cheap right now, compared to two years ago.
Once the whole thing implodes, ammo WILL be the only reliable currency. It works like this:
I’ll give you three bullets for a loaf of bread, or I’ll give you one bullet, but you won’t like the speed I’m sending it.
It’s unfortunate, but once people get really hungry, there will be violence. Let’s hope it doesn’t happen, but you can always hand the guns down to your kids if it doesn’t happen while you’re on this side of the grass.
Yeah, I bought a couple thousand rounds three years ago and paid through the nose. Got a handful of high quality arms. Not near as much as most of my friends though. I like shooting but I’m not passionate about guns. I’m a car/motorcycle guy. But I see the point. Kind of like a truck, better to have it when you need it than to need it and not have it.
Exactly. But how to eliminate corruption? I think it can be reduced by introducing accountability and consequences. In today's western systems of government and public institutions, there are no, at least not many, consequences besides losing an election.
In Ontario where I live, Dalton McGuinty was the leader of the provincial Liberal party and won an election almost 25 years ago. He campaigned on 'no new taxes'. Once in office, he immediately introduced a new tax: the employer health tax. A citizen took him to court over his blatant lie but lost the case because basically the judge said 'politicians lie, no big deal'.
We’ll never eliminate corruption but its damage and prevalence can be attenuated by decentralization. Whenever an entity becomes a centralized authority the power is intoxicating. Centralized authority by its very nature creates a single point of failure. We’re always told bigger is better. Not true in every case. Too big to fail means too powerful to control. Too powerful to control means it’s above the law. The bigger they are the harder we fall. Everything needs to be splintered into small competing entities. Then when the inevitable failure happens the damage is a blip that can be absorbed by the others and the failed entity can either go quietly into the good night or face consequences. Centralization always works against us.
History is rife with massive collapses of what appeared to be brilliant, indestructible civilizations and empires, that led to, for example, the Dark Ages, and there is NOTHING that is readily apparent that this is not in the process of happening again. I sincerely hope that I am wrong...
We just recently completed the Great Courses series on the Roman Empire. It appears we are right on course and building toward a similar pathetic end. Unless there is a massive coordinated groundswell of resistance with restorative ideas and workable action plans in place to begin immediately, I’m afraid I’m on target about this bad feeling I’ve been having for the past 2-3 years. My spouse has lived a highly successful life and career making good use of his innate clear eyed optimism, and even he feels it could go south quickly without solid and legally binding disruption to the tidal wave of destruction right over our heads now. Meanwhile he fights by writing for Substack, completing his 3rd book with plans for his 4th, giving keynote speeches and facilitating innovative peer to peer network trainings. While I merely stew among my flowers and vegetable garden and care for the pets and grandchildren while constantly appealing to our Creator for miracles. (And communicating with this and other communities). What else are we all to do? I’d really like to know. As I mentioned: The Grandchildren. What better reason to fight? But how, exactly?
Great comment. You mirrored exactly the way I feel about things as they stand right now. As the older generation my husband and I are most concerned about our children and grandchildren. They are most likely the ones on whose shoulders the burden of rebuilding civilization will fall. I pray all the time for miracles too. They aren’t guaranteed, but I know whatever happens God is the one who sets things in motion and brings things to an end. If possible I hope we may be spared Rome 2.0
Hmm, Glenda, we have much in common.
Is that the "educational" series you can buy on TV?
I'd be very interested in doing it.
Oh never mind I just found it
As Government and bureaucracy grow, so inevitably will bribery and corruption.
It certainly is lining up that way
I am a physician and recently went to speak with our interim hospital CEO. They presently are trying to purchase our local clinic (this is physician owned and has both primary care and multi sub-specialty physicians). The hospital itself recently set up a primary care clinic, which is in direct competition with this clinic and a community health center that we have. Then they turn around and fire over 100 hospital employees. I told him that these medical monopolies are not wise. He basically told me I am ignorant in the ways of finances and that this is the way things are going around the country. How do you argue with that. I told him he is right that I am not versed in all this financial mumbo-jumbo, but that I have common sense, and when I look at the overall picture and truly after watching the tyranny from Covid, having Medical monopolies is not a good deal. Plus you watch all these banking systems that should have people that are super intelligent in finances continually collapse…🙄
Super intelligent in finance is virtually an oxymoron. These are mostly people who make money by doing nothing other than manipulating the money of those who do something. (I am in medicine and have been in finance as well -- No question as to what is productive and what is not.)
The greedy, i.e., most folks, attempt to pull up the ladder after they have ascended by installing the untalented subordinate. After the retirements who is remaining? It has always been so, oligarchies run by former imbecillic subordinates with each layer growing less talented all the way down.
Wondering how you evade the CMS diktats for Covid care protocols (requiring Remdesevir and excluding IVM and HCQ) in your local clinic and the community health center.
We did not… Our hospital was using remdesivir. Could not really get any of our clinic physicians to use ivermectin or HCQ… had some local people that were purchasing it, and people would get it from them.
Ending this corruption will look like the beginning of war.
It will be scary as all hell.
Expectations should match reality or the battle is already lost.
You are right. [They] like the power the existing system gives them, and they will not give it up without a fight. And that's before we even start talking about 'restoring banking privacy' in a world of KYC, AML, SAR, FBAR etc.
Spot on.
I nearly always agree with the things you say about free markets.
The itch I never get past, which my read of this post doesn't sufficiently scratch, is monopoly.
Monopolies seem naturally emergent in the absence of regulation. Perhaps monopoly isn't the right word here- when I look at it from a consumer perspective (because, realistically, that's all I'll individually ever be), what I really mean is "price fixing."
If given a completely unrestrained climate, why wouldn't purveyors ALWAYS align behind inflated pricing, especially the largest ones that can crush competitive pricing by smaller ones? Especially goods that are difficult to opt out of, like energy?
Aren't guilds or syndicates essentially inevitable in a market that does nothing to restrain them?
What you're talking about in this post is currency, and it all makes sense. But what about that "stuff of daily life" you mention?
Help me see what I'm missing.
"Aren't guilds or syndicates essentially inevitable in a market that does nothing to restrain them?"
no. this is an inversion of fact and reality. such things evolve and sustain themselves only in the presence of government interventions. consumer sovereignty prevents oligopolistic behavior outside that from becoming predatory.
even having, say, 3-4 big companies competing in a space drives prices down and quality up to the very near approximation of perfect competition, especially when others may enter the market if there are "excess profits."
i think you have this exactly backwards.
unregulated free markets are what prevent guilds and syndicates. they are creates of regulation and rules, not emergent economics.
try naming 3 durable monopolies in free markets that have shown durable ability to extract excess profits.
I can't name a single completely free market in history, so that may be part of the problem in my thinking.
Yes, it's true that we wouldn't have the East India Company of either flavor if we didn't have a Crown behind them.
It's precisely so difficult for me to imagine the circumstance you're talking about because it seems dependent on the nonexistence of government, whether regulatory or "regulatory."
Are you describing a circumstance that can actually exist?
sure. this precise sort of banking existed in the past and was extremely successful, stable, and high function.
governments did not take it over to make it run better. they took it over to profiteer from it and use it as a means of social control.
they have built a system that is going to imminently fail and the ability to move money in non-traceable fashion and do transactions selectively by jurisdiction now exists. the time to build the systems into which we can relocate is now.
the move of money, savings, investment, and commerce to a field where government cannot see or impede it will represent the greatest shift in power between government and people in human history.
this is how we become true citizens governed with consent instead of subjects and customers not chattel.
the state will fight it, but they're going to lose control, especially as they start to severely debase currencies.
there is no inherent reason that government money is desirable. and there is too much need here to not find a solution. this is basically inevitable, it's just a question of when, where, and how
Your third paragraph from ..."the ability to move money in non-traceable fashion...now exists."
I suspect it does exist for Mexican cartels and the Biden's, but the Panama Papers exposed some of it. It would be great if PBDC's were to become viable, but the only "non-traceable" transactions I can do are with cash, and there is a limit to how much the bank will give me without reporting to Fintrac.
I agree completely with this argument as it remains focused on currency and banking thereof. But I think it's an overgeneralization to say that currency and consumer goods behave exactly the same way and have exactly the same durability. Yes, coins are just units of value and are understood to be equivalent to real goods of equal value- 3 dollars = $3 of bread.
But while I agree that your historical examples of banking worked this way, I don't see that it eliminated the presence of price fixing of commodities by syndicates or of services by guilds.
I can't think of a single moment in history where a small number of sufficiently small number large competitors didn't eventually align behind some measure of value fixing. Perhaps technology and historical circumstances change the algorithm of how much market share and how many actors are needed to create these circumstances, but they always seem to arise.
"I can't think of a single moment in history where a small number of sufficiently small number large competitors didn't eventually align behind some measure of value fixing"
i can, basically all of them.
it is stunningly hard to do this and not attract new investment/market entry. "the cure for excess profits is excess profits"
look at basically everything in the US from clothing to grocery to furniture to homebuilding. where are these "excess profits" from value fixing?
it seems like one of these "bigfoot" things, often reported but never found.
(see sweden example above)
it really takes very little to generate near perfect competition outcomes. you need to try REALLY hard to do it. not even things like telcom/cell service/internet in the US can manage it despite having literal oligopoly grants.
That what you say about monopolies is even remotely controversial and contested, even here, is a sad testament to the results of a century of progressive "education" and government propaganda.
Thinking that the State protects the people from business is among the greatest inversions of reality of our times, and that is really saying something.
"The ideal tyranny is that which is ignorantly self-administered by its victims. The most perfect slaves are, therefore, those which blissfully and unawaredly enslave themselves."
~ Dresden James
(Donald James Wheal (1931-2008))
"the move of money, savings, investment, and commerce to a field where government cannot see or impede it will represent the greatest shift in power between government and people in human history."
If I remember my history lessons, before "money" , bartering was key...and apart from tithes I am uncertain that any form of "government" existed as we understand it today - feudalism for sure.
So called " digital currencies" are a scammer's delight and I do not think - but may be wrong - that blockchain technology will entirely help.
The concept of 'untraceable" in relation to any digitally based transaction to my mind is potentially wishful thinking - surely it comes down to "my algorhythmic software/supercomputer" vs "your algorithmic software/supercomputer". Digitisation of anything enables corruption and facilitates theft at 186K mph.
If the Intelligence community could monitor conversations remotely by capturing the vibrations, induced by speech, which cause surfaces such as glass to fluctuate, as the US did in the 1980's - 40 years ago - obviating the need for electronic devices to be planted "locally" by difficult covert operations, is it feasible that technological developments since then have made "non-traceable" less viable - especially if Intelligence Services (IS) keep telling us that? "Sigint" has always been "treasure" to IS and even more so now; US satellites where able to detect if Russian tanks were serviceable from space in the 1980's - does anyone really believe it when, say, WhatsApp say their software is "end to end encrypted" - what exactly do they mean?
Acting in "utmost good faith" or uberrimaie fides or the lack of it - to me that is just as big a threat as corrupt governments/central banks using fiat money in a less than honest, moral fashion.
Q is coming. :)
Like John De Lancie?
You're so cultured for a Guttermouth...
Coming over the horizon..
As far as I can follow his reasoning the conditions can theoretically exist, but human nature will always sabotage them from functioning as intended.
If we were neighbours and either of us had a surplus of something, would we try to undercut the others askingprice at market?
Or would we co-operate and try to edge out the people from the other villages at said market?
Also, if you had something you no longer needed (say a pile of planks from an old shed) wouldn't you give those to a neighbour if asked, since you were going to toss or burn them any way?
It's human nature. Some of us are like that, that we will first ask around to see if they can help someone else, free of charge, since helping wouldn't cost them any anyhow.
Others are like the mother of a childhood friend, who would always ensure that anything she threw out was smashed, cut up andbroken so no-one else could use it, no matter if it was an old sofa or a t-shirt.
What you're describing are overlays to purely materialistic behavior, aka culture.
A true dyed-in-the-wool economist (which I'm not) would say that all behavior can be reduced to expressions of value- I'm altruistic because I'm getting an internal, abstract value from the behavior whereas your friend's "salt the field" mother is seeking to preserve value through scarcity.
In your neighbors with a surplus example, individual actor me would say that our behavior would probably depend on our relationship as neighbors. Personally, I'd probably come to you and say "how about we pool our honey and bottle our mead together so we save on operating costs and then not undercut each other?" but then we've created a syndicate, which I'd see as cooperation.
....if only there were some magically benevolent institution, that would protect me and mine, and always be fair, and always do the right thing, and , and, and......
Dreams of fair and equitable are just that.
The answer isn't the expectation of unattainable perfection, the key is the understanding that all functions of governance need accountability which is currently nonexistent. The current system of "bend over, trust us" and forgetting that "we've done this to you before and you didn't do anything", is why it's happening again.
Go back to the opening Sowell quote.
I'm not misunderstanding the Sowell quote, and I'm not the one advancing any idealism here. If I'm misspeaking, please show me what policy I've advocated, if any, with the expectation of perfection.
I'm saying monopolistic market behavior is inevitable. You're saying "all functions of governance need accountability." How does this contradict my position that the absence of regulation doesn't prevent anything?
I didn't think there was a misunderstanding of Sowell, but the back and forth idealism in the thread, i saw as missing the inevitable of inequity, and being masked by the hope of some system that would remove that inequity.
I reiterate: what idealistic policy did I espouse?
It existed to a large extent in the U.S. during most of the 19th century.
It is no coincidence that in the latter part of that century the U.S. enjoyed the highest rate of economic growth in history.
Then the progressives took over and yoked us all.
It's coming, hold on!
Well, it certainly sounds exciting.
It is, it's fucking amazing!
Sadly, I cannot control it.
Happily, I cannot control it.
It's a crypto coin like nothing you've ever seen...
A total replacement of the internet and currencies.
I'm trying to push them to hurry up on the mesh network side.
A mesh network is one where instead of just mining coins, you're supporting the new internet.
Let that sink in...
I'll try to contemplate it, but I admittedly have a very limited understanding of these systems. It's difficult to envision.
Guilds etc evolved on their own as power-structures, parallell to governements.
Unregulated free markets always create monopolies, or if you prefer concentrates ownership on so few hands that said hands have what functionally amounts to monopoly. It's an inherent function of accumulation of wealth beyond the needs of the household.
Blackrock ring a bell? If you prefer a historical example, how about Marcus Licinius Crassus?
You are wrong about "...having, say, 3-4 big companies competing in a space drives prices down and quality up...". It does the opposite. What always happen is those 3-4 actors will co-operate and keep competition to an absolute nominal minimum so as not to hurt their own bottom line and profit margin for their owners, and this will happen without any open official collusion on their part: a tacit gentlemen's agreement is enough.
The food and grocery market in Sweden is the prime example: three corporations control 85% of the entire market, from raw goods to refined products, imports and stores. Prices vary less than 5% between them on average, despite the mark-up for some goods being in the hundreds of percents.
What's left of the "free market" is Lidl (about 10%, stores level only) and privately owned corner stores selling sodas, candy, chips, tobacco and such.
this is simply false. guilds were granted status by governments and became governments. they cannot persist in free markets.
you're making up facts here. look at telcom. even with so few players and so much government regulation, competition is ferocious and profits are modest despite being literally granted local oligopolies by government.
i think you are seriously misstating the case in sweden. it makes my point, not yours.
ICA is the huge share leader in sweden.
they did 136bn SEK in revs for 2022.
net income was 4.5bn SEK, a 3.3% net margin.
hardly monopolistic profit extraction
axfood AB is the other. (hemkop, willys)
they did 2.4bn net on 73.5bn in revs = 3.2% margin.
clearly, there is no ability to extract excess oligopoly/monopoly profits. these are pretty meagre margins at the edge of viability.
you'd get better cash on cash return on US treasuries.
so, clearly, the competition is sufficient that profits have been driven down to something approximating the risk free rate.
hard to see how your claims of profiteering are supportable in the face of that outcome. this is a near perfect free market equilibrium level.
Gato, you misunderstand the fundamental nature of capitalism (and i am a big proponent of capitalism).
Capitalism does NOT incentivize and reward competition. It incentivizes and rewards MONOPOLIZATION.
If you are a business you do NOT want competition. You want to be a monopoly. Hence completely unregulated free markets will end up with monopolies controlling everything.
That's incorrect for one reason: no business has power to keep competing businesses out of the market...
...unless they can get the government to protect their monopoly.
Nice strawman, that's not close to what i said. Capitalism does not INCENTIVIZE or REWARD competition for businesses. Competition is not good for a business, lack of competition is (competition is good for consumers). And yes, when businesses reach a certain size they can absolutely keep competing businesses out of the market. Its happened over and over again throughout history. Thats why monopolies get broken up. Anticompetitive behavior...
In Finland the grocery market is even more damaged. We have TWO duopolistic chains and Lidl picking up perhaps 5-10%.
Groceries in Finland are 7.8% higher than Sweden and 15.7% higher than Germany. Sure we are a nation of lumberjacks out in the sticks but the fact that Lidl can sell for less than the two giants while having to arrange probably ALL their own distribution and importing from Germany makes me think the duopoly has artificially high prices. It would be interesting to see if one or the other will undercut Lidl on low priced items to steal customers back into the fold.
In all fairness for a CEO not to form a duopoly would be silly, the only thing that prevents it from being in your face is legislation.
There is a very high barrier to entry for micro and small enterprise and very few ever get to challenge large incumbents.
I agree that much of the problem of gaining new competitors is caused by bad legislation but eliminating all regulation will favour the largest in most battles.
Restrictions on these banks could be somewhat arbitrary and onerous. They might be forbidden to list or trade on stock exchanges (that may crash so not safe anyway) and cannot have institutional investors that will probably have links to Blackrock. They might be geographically constrained to not have branches more than two state lines apart. Limiting how big or small their trust networks are may also be prudent. Break up the Bell before it grows too big.
Bonus assignment: Someone who knows net theory and has the time might find out what is the largest number of states that are no more than two borders away in the USA and EU. Does the coast count as a single point?
Excellent points, Kalle Pihlajasaari. I replied elsewhere on this thread pointing out the largest two grocery store chains in the US are trying to merge and recently one of those chains (Safeway/Albertsons owned by private equity group Cerberus named for the three-headed dog that guards the gates of Hell) announced it would also like to purchase Sprouts, a smaller chain. Federal Antitrust regulators are nowhere to be found and a state District Attorney is feigning opposition while the media tells viewers "It would be a good thing and would likely lead to lower prices". Sadly, most Americans never learned or forgot the long history of monopolism and oligopolism.
>> Unregulated free markets always create monopolies, or if you prefer concentrates ownership on so few hands that said hands have what functionally amounts to monopoly. It's an inherent function of accumulation of wealth beyond the needs of the household.
This is exactly what I was trying to express. It is the natural function of power to organize and consolidate itself. Intelligent actors, if they're in competition with similarly powerful entities, will quickly understand that there is greater profit in stability and that their competitive energies are better directed at controlling their consumer base.
Nations rarely went to war with each other if they believed that the outcome was at all in doubt or if the cost-benefit analysis was negative. Three cattle barons are eventually going to sit down at a table and price fix instead of losing manpower to endless range wars.
How do they keep competing businesses out?
Cost of doing business, regulations, easier access to credit, lobbying, lawyers, the list goes on and on.
collectively referred to as 'barriers to entry...'
And that's why free-market economists oppose the regulations you propose as a solution.
In the absence of those systems, greater resources to apply force.
Another perfect example is AWS, Microsoft Azure, and Google Cloud Platform. They all have some form of vendor lock-in and they don’t compete for the lowest possible price. Trying to do so is incredibly destructive, especially if you don’t have free money to pay for the destruction.
Are you seriously suggesting that Blackrock and Crassus are examples of free-market monopolies?
Please. They are its antithesis.
Consider the case of Standard Oil, the leftist "textbook case" for capitalist monopoly. Rockefeller managed to make petroleum products, especially including kerosene, so inexpensive that it completely supplanted candles and whale oil for lighting, thus bringing light to millions and saving the whales in the process.
At the beginning, Standard Oil enjoyed a 4% market share. At its apogee, 88% market share, which, despite leftist historical nonsense, is not actually a monopoly. By the time Standard Oil was broken by progressive mountebanks it was down to 65% and falling.
https://fee.org/articles/the-myth-that-standard-oil-was-a-predatory-monopoly/
I've had this discussion with many people over the years, and I've not run into one that can actually cite a real case of a free market monopoly.
Care to give it a shot?
"i think you have this exactly backwards... unregulated free markets are what prevent guilds and syndicates. they are creates of regulation and rules, not emergent economics."
Monopoly is practically impossible without the force of government.
But who determines (or how does one determine) what 'excess profits' are--where do they begin?
‘Monopolies seem naturally emergent in the absence of regulation.’ Wrong way round - monopolies only exist because of regulation. Regulation is always protectionist of businesses and producers. Any enterprise which produces a good valued by consumers and can produce it at a price the market will bear, and make a profit and do it better than competitors will have a dominant position. It can only become a monopoly if no other entity can produce the good and sell it for the same or lower price and make a profit. It means the consumer us getting the best deal. In a free market this is a contestable monopoly, because there is nothing external to prevent another market entrant from competing with a lower price if it can. Also the monopoly can and often is lost due to innovation. However. If regulation makes cost of production very high, it reduces or eliminates competition and prevents new market entrants. Strict regulation about ‘how’ something must be made, or what can be made, removes possibility for innovation. Regulations are written by key market players in cahoots with Government, specifically to keep competition out, particularly foreign competition - that’s what tariffs and non-tariffs are for too. In the US, poultry after slaughter goes through a chlorine wash process to kill any bugs on the skin, particularly salmonella, in Europe they have a different regularity procedure which is supposed to prevent flocks being infected with salmonella, and just few seconds immersion in near boiling water after slaughter. US poultry is banned in the EU because... regulations. Also residual chlorine on US chucks, contravene regulations. Yet I hear no reports of piles of corpses outside KFC in the US. So the EU poultry producers have a Government created monopoly... deliberately. Anywhere you see a monopoly, you will find Government created it.
In the total absence of regulation, why WOULDN'T a more powerful entity suppress the competitive ability of a rival? If someone is undercutting my widget business with an innovative lower-cost model, and I'm a bigger entity, I'll try to buy him out. In the absence of regulatory power, maybe I'll even burn his factory or threaten his friends and family.
Your examples are solid, and I don't argue with them at all- but I don't see the presence or absence of regulation diminishing the phenomenon of monopoly. I think it's simply going to exert itself by different means depending on the conditions.
Consumers make monopolies don’t they? Consumption is the sole end and purpose of all production - Adam Smith. Consumers decide what businesses thrive, what products get sold, and at what prices. They decide how many jobs in an economy and what those jobs are. Who, for example, decided DVD and put VCR out of business? Who made a one-man, Mail-order book seller operating out of a garage, into the Amazon we know and hate to love? Consumers are the market regulation, the monopoly-makers. How does a business become dominant? Isn’t it because more consumers like its products/prices v competitors? Nobody is forced to buy. Well run businesses with products consumers want become market dominant, not badly run ones who sell crap. Buying out a competitor happens, but has a cost. Easier/cheaper (why do businesses contribute to campaign funds?) to connive with Government to introduce new safety standards for widgets which puts up your costs or which you do not have the resources to implement. And in any case that still doesn’t stop another competitor entering the market. My point is in a free market monopolies are contestable, regulation makes them non-contestable because of the barriers they put up against new market entrants, or costs they put on smaller businesses which lack the money and resources to implement them.
"In the absence of regulatory power, maybe I'll even burn his factory or threaten his friends and family."
This is NOT a funciton of regulation. These are alreaday illegal and immoral acts outside of the bounds of Business.
illegal = regulated, no?
*blink blink* NO
Illegal means that, even if you weren't fighting for market share, any of those same acts are punishable by law.
Again, I say *blink blink*
*fart fart*
What's a regulation, then? Is something that's illegal not regulated? What enforces regulations?
Can I do sarcastic emotes to undercut respectful discourse, too? *burp burp*
In a capitalist system, no matter if the monopoly is state, corporate or private, perennial crises are a feature, not a bug.
(In a communist system, constant crisis is a feature.)
In a free market system where the actors voluntarily do not strive to create and control monopolies, and also voluntarily differentiates between earning a living with a little extra to set aside for the future, and maximising immediate monetary profit at the expense of all else (aka capitalism: freemarket economy made into ideology), your suggestions might work.
Now then, what are the odds you think of all actors voluntarily working to ensure that said free market doesnot evolve into private monopolies, company towns, indentured servitude where you're paid in company script, total devastation and despoiling of resources, and so on?
About the same odds of communism working as claimed, I'd argue.
You need something more.
This comment, sadly and somewhat ironically, reflects over a century of government monopoly of education. The economic history of the industrialised world to WWI shows why. By 1913 the world had converged on a single monetary standard that left all currencies directly convertible. Interest rates were low and stable, without being set by Central Banks. Inflation was stable at under 2%, the rate of discovery and processing of new gold. Government everywhere was small, less than 10% of GDP by tax take, with half of that going on the military it was unable to regulate everything, as it does now. Belle Epoch monopolies like Standard Oil were only emergent in industries facing government that were regulated as ‘strategic’. The idea that we would face some sort of dystopia without government is a fantasy that does not conform with reality, inculcated in government-funded and directed monopoly education.
To be clear, I use inflation in the technical (correct) sense of the term: increase in the supply of money. Consumer prices in the US fell through the 19th C, being lower in 1914 than they were in 1800. This is due to economic productivity outstripping the rate of creation of money. It shows how bad things are now that despite the productivity of the US, government is printing money so fast prices rising at over 10% annualised.
And that did not suit the Cabal, who wanted large government, big debt (to feed their interest machine) and an income tax to skim off money from the productive. The same way they've worked since basically the beginning of time.
In the USA, that something more (imperfect since it involves the government) was antitrust laws.
https://www.investopedia.com/terms/a/antitrust.asp
" Antitrust laws are regulations that encourage competition by limiting the market power of any particular firm. This often involves ensuring that mergers and acquisitions don’t overly concentrate market power or form monopolies, as well as breaking up firms that have become monopolies.
Antitrust laws also prevent multiple firms from colluding or forming a cartel to limit competition through practices such as price fixing. Due to the complexity of deciding what practices will limit competition, antitrust law has become a distinct legal specialization. "
How would you characterise the concentrated market power of "Big Pharma"? If my description is accurate to some degree, and I confirm (as if you needed that...) am not knowledgeable in this, the actions of several global Pharma Cos, over several decades and despite changes in corporate identity, are demonstrably highly dubious?
You are right, but regulatory capture and anti-trust are two separate things.
Pharma does not on its face meet the definition of a monopoly. There are numerous companies, of varying sizes, and they compete with one another. They use tactics like patents to enjoy for a limited time monopolistic pricing, but the patent system makes this tradeoff intentionally, in the interest of broad publication of research and knowledge.
Pharma benefits greatly from regulatory capture. This has never been more obvious than in the C19 kerfuffle.
I suspect that pharma (and its corrupt 'regulators') will get some sort of comeuppance in the years to follow, though I have no idea what that will look like.
I can’t imagine these private tokens not falling to the same problem that private banks do, who also can already generate money in today’s system by giving out loans. Through concerted behavior they can drive bubbles and crashes, there is simply no keeping a bunch of private parties under control if they are the ones controlling money. There is no underdog to turn to because the big dogs can join together to form a cartel which suppresses the value of the tokens being issued by the underdog, etc.
You should do at least a little bit of thinking about how BTC could actually make your system/proposal *stronger* rather than writing it off. If nothing else, it can live on as the monetary policy and settlement layer. The central bank of all your private bank-like-entities. If all their shit-tokens were actually pegged to sats, then there would not be the risk of non-competitive funny business.
BTC critics have many fair points but the thing they need to remind themselves is that nothing like this has existed in history, and we should not throw it out because of boo-hoo it uses too much energy. Even if it’s a percentage of all the world’s energy, it could be something that changes the course of human history. Even if it doesn’t do a good job at payments and the Layer 2 stuff flops, it is still something incredible to have established true digital scarcity. Work that into your next proposal and see if it maybe turns out better.
"who also can already generate money in today’s system by giving out loans"
*ponders* It feels like a word like "generate" ignores the free will of the borrowers who might, by choice or otherwise, not pay back what they've borrowed, let alone the interest - the part that would be "genereated" - if the debtors settle up.
Yes it does take 2 to tango. But many loans are given between elites and even between banks or banks and governments, and are essentially favors, or bailouts, or even gray area financial crimes (there is a well documented case where IIRC a British bank had a solvency crisis, and they gave a loan to some Saudi’s, who then bought some newly created stocks that that same bank had issued. It is as illegal as it sounds but never was prosecuted).
But to be clear it’s not just the interest that is “generated money.” The principle itself is money created out of nothing. This was sort of proven empirically by economist Richard Werner around the 2000’s IIRC, and then officials started to admit that this is indeed how it works. There is a video from the Bundesbank (Germany) admitting this. They say it’s well-regulated but it is not really; it is basically what drives boom-bust cycles. Banks start lending more and more which pumps up the money supply, until the bubble bursts because the debt is worthless (cannot be collected). Then the government usually bails them out and doesn’t prosecute and the cycle repeats.
Anyways look into ”split circuit monetary system” as a search term. Many people understand this as fractional reserve banking but it is actually worse, since the banks don’t even check their reserve requirement when giving a loan. They literally just add a number to the bank account of the person taking a loan.
Also can recommend the videos on John Titus’ youtube channel (called “Best Evidence”). His videos explain very well.
👏🏻👏🏻👏🏻 Brilliant essay. I am all-in. The transition will be rough. So, off I go to buy more pallets of grain alcohol, cigarettes and ammo.
The prerequisite for decentralized private bank currency would be constitutional amendments (1) banning government money and (2) forbidding government banking regulation and deposit guarantees.
Without (1), the federal or state government will simply bludgeon and force everyone to use their currency with various legislation. Without (2), the first time a private bank fails (and they most certainly will - complete with sob stories of entire life savings lost) it will become a call for deposit guarantees all over again as politicians fall all over themselves to get back into bank regulation / guarantees.
How would we get politicians in DC to agree to give up enormous amounts of power and influence and campaign donations and pass those amendments? They'd have to be forced.
I have yet to see in my lifetime any significant rollback of federal government power in any domain. Even the critics of such power seem to become awfully timid once they get sent to DC. Even the most egregious and blatant abuses like warrantless, secret court wiretaps have not even been pruned at the edges, just whined about.
The best idea I have to get anything like this done is to push hard into education and take over school curriculum to spread solid ideas about freedom and decentralization (a reverse bezmenov.) Maybe the next generation or the one after can make enough headway to get new, real limitations on government power before the authorities resort to prison camps to cover for their failed ideas.
the power of the money printer incentivizes the sellouts, good luck fighting this beast
I've been playing around with different money. In my practice, I accept dollars but also metals, Goldbacks, and BTC. Goldbacks have been remarkably durable so far - people are accepting them AND spending them, and the manufacturers keep selling out. It's fun to watch.
When a system has existed (private banking) and then we end up here, I ask myself, "how did we end up here, and can that be avoided in the future?" One argument I've heard for BTC is NOT that it is useful as a layer 1 or even layer 2 transactional instrument, but that, because it is fundamentally constrained by physical laws, it serves as a type of "trust hedge." Governments, or private banks, are constrained by the competitive pressure it creates because people can always move large sums of money from one to the other. Now, the existence of gold *should* be able to do the same thing, but the portability issue and the ability to physically control the stock has made that market too manipulable.
That the government might be able to corrupt BTC would just add to everything else that they already corrupt, and it seems more difficult to corrupt. The goal, in my mind, is dynamic decentralization that creates constant tension and naturally checks the system; a little bit of chaos is better than too much order, even in money. Too much order in money gave us the combination of sclerosis and chaos we are about to descend into.
Legal tender laws prevent any widespread adoption of alternative monies, even gold...
Ah yes, again government is the problem rather than the solution. Gato's proposal would be illegal too; the laws must either be changed or ignored.
Yes, they should be abolished. But Goldbacks are a barter instrument.
BRICS is proposing a multi-national currency backed by a market basket of commodities, including gold, oil and wheat. Probably numerous others as well. Some sort of backing is generally required to control (prevent) inflation in accordance with Grisham's law: 'bad money chases out good.'
The solution is simple... stop fiat currency. Until Government loses its monopoly on money, then there is no fix. Whilst Government sets interest rates (Central Bank independence - don’t make me laugh) for purely political reasons, cheap money will mean mis-allocation of resources and high risk business adventures with the inevitable problems once rates go up... as they will due to Govt created ‘Boom-Bust’ economic cycle. As for Fractional Reserve Banking - it played an important part in the Industrial Revolution and still does in funding economic activity. Adam Smith favoured it, but said it was risky and lenders should stick to short-term loans. Back then there was no banking insurance and people knew the risks; today they don’t. I wonder how many people know that when they put money in the bank, they cease to own it, it becomes the bank’s property and the depositor becomes a creditor to the bank and only has a lien on the money they deposited, not a property right?
This is like “make banking great again,” without acknowledging that, even if it was better before, it evolved into what we have today. So, burden is on you to show how it won’t just repeat.
I initially read that as "make *bartering* great again". That's bringing the reset point back even farther - a potentially interesting idea.
“Implies that if banks made loans everyone would honestly pay off their loans. It would be nice, but they don’t. Utopian wishful thinking”. My 80 y.o. Retired banker’s reply to this article
Did he actually read it? The premise (may or may not be correct but it *is* what the author is advocating) that the private banks would be *more* careful about loans.
I wish The Cat who runs things at our house was half as smart as you. She has your contentious nature tho. But she is still twice as smart as any Fed bureaucrat. I think your ideas are brilliant. May they catch fire🔥.
This was a good piece. So--for those of us now past the high noon of life, it ain't gonna come in time. Moreover, looking at all the people who still, for unfathomable reasons, have accounts at bastards like Wells Fargo, moving the sentiments of the populace to good ideas is gonna require quite a lot of real heavy equipment, metaphorically speaking. But we must live in hope, right?
And the certain knowledge that people will be forced to wake up when TSHTF. There will be no way to stay asleep when all this happens.
Problem is the government will view this as an opportunity to take even more control...
That's been true--about control--since the cave kids snuck out when they were supposed to be sleeping. Parents began inventing tools so they could eventually build childproof-locked doors.
Everyone wants control. Our misfortune always lies with how the idiots manage to grab it and keep it somehow.
So we go back to Sowell's wisdom -- the mistake is giving power to those who fail upward.
If you've never read Sowell's 'Vision of the Anointed,' I think you'd enjoy it.
I think it's not so much that we *give* power as it is that the average normal person isn't particularly interested in power in the larger spheres, and before you know it the morons are in charge of everything.
I'm trying to get over a bad bout of guru revulsion, which is affecting my ability to tolerate even the good while avoiding the dreadful. To be sure every place I encounter a Sowell quote I'm quite impressed with the common sense.
Pretty soon, Gato, I will show you the Quantum Financial System.