Well, it was the time anyway.
This year, I shall continue to work on the wiki and have some Big Plans for its expansion. One is to have at least 100 article pages (Stubs count, too, but have to have decent size... like most of the already existing Stubs). As that isn't as hard, I have another plan - but that shall not be revealed, not yet at least. Might take a few months to get there.
The wiki has been quoted in a few blog posts in the mean time, so it is slowly acquiring some notoriety. Making it more popular is a general plan as well.
But the real reason why I'm writing here is, that someone has just updated a page and created another... page with the name "Cashola" and the content "money as zeke percieves it". Simple vandalism, was deleted immediately.
But do you, my non-existent readers, understand what it means? The wiki is finally known enough to be vandalized! Woot!
Wednesday, January 13, 2010
Monday, December 14, 2009
Time for a holiday
It's time to give the Wiki a break. Change is needed: while you can learn a lot with all the research, it is very dry and exhausting. While at it...
I declare the Austrian Economics Wiki version 1.0 to be complete. It is the time, and it is pretty much all I wanted for a first version. 60+ pages, some initial points on the ABCT, could be always better, but there is already a huge amount of stuff inside. More work is to be done. Of course I have big plans for the Wiki, but they can wait till next year. Some recommending etc. may still happen, but the holidays will be devoted to other things.
See you around next time!
I declare the Austrian Economics Wiki version 1.0 to be complete. It is the time, and it is pretty much all I wanted for a first version. 60+ pages, some initial points on the ABCT, could be always better, but there is already a huge amount of stuff inside. More work is to be done. Of course I have big plans for the Wiki, but they can wait till next year. Some recommending etc. may still happen, but the holidays will be devoted to other things.
See you around next time!
Monday, December 7, 2009
The Stuff Business Cycle Theory
(This is a simplification of the ABCT, created to emphasize an aspect, that sometimes seems overlooked. Let me know how it brings the point across.)
People produce stuff. There are many different types of stuff, which are not freely interchangeable, but let's keep it simple, and call it stuff.
So what is this stuff for? Why do we make it?
First off, we want to consume some of the stuff. We have to eat something, we have to live somewhere and we want that life to be good. To that effect, we need a lot of stuff, from food to computers to read articles on the Internet - to cover all the essential needs.
But to make all this stuff, you need to expend quite a lot effort - and a lot more stuff. The people making the stuff also need to be taken care of. To build those complicated things, you need parts and raw materials, you need factories and mines and all the infrastructure around, and you need shops and a lot more to get the stuff to the consumers. To maintain a certain structure of consumption, you need a massive structure of production - the difference between the visible part of the iceberg and what lies below. It needs to be built and then kept in shape. (I, Pencil is but one illustration of it.)
All this effort and stuff needs to be expended just to stay in one place, without changing anything.
But we don't like to stay in one place, we want to have a better life, make the world a better place, achieve more - or simply change our taste now and then.
To do this, to change the structure of production, requires more effort and more stuff. It has to come from somewhere. And no matter how you turn it (using your own stuff, somebody lending you theirs, or giving you a gift), some people have to sacrifice part of their lifestyles, and effort and stuff have to be invested. We may be better off tomorrow - and we hope so - but today we will have to do with less.
Assuming those investments work out, the production structure will be upgraded and produce more (better, different) stuff. That means you can enjoy it more in consumption, invest it to produce more, or do some of both. This is that famed "natural growth". And it takes time.
If it comes to the business cycle, people mostly look at the bust - businesses crashing, unemployment, an overall slump in production and standards of living. The Austrian Business Cycle Theory explains this with the practice of Fractional Reserve Banking and the expansion of credit, the lowering of interest rates, which misinforms entrepreneurs into wrong investments lines. In the boom, we waste a lot of stuff on things we can't really afford yet.
Some critics(1)(2) argue, that this cannot be the case, because if people are investing too much, shouldn't they also be forced to limit their consumption? A boom is characterized by an increase in investment AND consumption, after all.
So what is wrong about the boom? What can be wrong about having more stuff?
To produce more and different and better stuff, people need to consume less first. If they all of sudden invest more and produce more while consuming more, they
a) miraculously have more stuff from somewhere, or
b) they forgot something
What is often overlooked, is the existing structure of production the boom is supposed to run on. If it was a house, it would be like starting to build an additional story or five on it, moving more people to live inside and perhaps building a factory on the top of it... ignoring any structural supports and foundations. Since there isn't really more stuff around, the new projects can't be finished, or run effectively - at least not without affecting the existing functions of the house. And since much of the construction material is torn out of the existing structure, the house might just collapse one day and bury all those enthusiastic builders.
A lot of stuff will be wasted. Worse yet, you will need more stuff and effort just to rebuild the original structure.
And that is what happens in the bust.
People produce stuff. There are many different types of stuff, which are not freely interchangeable, but let's keep it simple, and call it stuff.
So what is this stuff for? Why do we make it?
First off, we want to consume some of the stuff. We have to eat something, we have to live somewhere and we want that life to be good. To that effect, we need a lot of stuff, from food to computers to read articles on the Internet - to cover all the essential needs.
But to make all this stuff, you need to expend quite a lot effort - and a lot more stuff. The people making the stuff also need to be taken care of. To build those complicated things, you need parts and raw materials, you need factories and mines and all the infrastructure around, and you need shops and a lot more to get the stuff to the consumers. To maintain a certain structure of consumption, you need a massive structure of production - the difference between the visible part of the iceberg and what lies below. It needs to be built and then kept in shape. (I, Pencil is but one illustration of it.)
All this effort and stuff needs to be expended just to stay in one place, without changing anything.
But we don't like to stay in one place, we want to have a better life, make the world a better place, achieve more - or simply change our taste now and then.
To do this, to change the structure of production, requires more effort and more stuff. It has to come from somewhere. And no matter how you turn it (using your own stuff, somebody lending you theirs, or giving you a gift), some people have to sacrifice part of their lifestyles, and effort and stuff have to be invested. We may be better off tomorrow - and we hope so - but today we will have to do with less.
Assuming those investments work out, the production structure will be upgraded and produce more (better, different) stuff. That means you can enjoy it more in consumption, invest it to produce more, or do some of both. This is that famed "natural growth". And it takes time.
If it comes to the business cycle, people mostly look at the bust - businesses crashing, unemployment, an overall slump in production and standards of living. The Austrian Business Cycle Theory explains this with the practice of Fractional Reserve Banking and the expansion of credit, the lowering of interest rates, which misinforms entrepreneurs into wrong investments lines. In the boom, we waste a lot of stuff on things we can't really afford yet.
Some critics(1)(2) argue, that this cannot be the case, because if people are investing too much, shouldn't they also be forced to limit their consumption? A boom is characterized by an increase in investment AND consumption, after all.
So what is wrong about the boom? What can be wrong about having more stuff?
To produce more and different and better stuff, people need to consume less first. If they all of sudden invest more and produce more while consuming more, they
a) miraculously have more stuff from somewhere, or
b) they forgot something
What is often overlooked, is the existing structure of production the boom is supposed to run on. If it was a house, it would be like starting to build an additional story or five on it, moving more people to live inside and perhaps building a factory on the top of it... ignoring any structural supports and foundations. Since there isn't really more stuff around, the new projects can't be finished, or run effectively - at least not without affecting the existing functions of the house. And since much of the construction material is torn out of the existing structure, the house might just collapse one day and bury all those enthusiastic builders.
A lot of stuff will be wasted. Worse yet, you will need more stuff and effort just to rebuild the original structure.
And that is what happens in the bust.
Tuesday, October 13, 2009
Quietly rising
Been on holiday, but did some decent work on the wiki, so didn't have much time to post here. The wiki does grow nicely, from the basic historical posts to more theoretical affairs, which is good.
Speaking of growth... I keep an eye out on my Google rankings over time, and there is indeed a slow rise noticeable over the few months I have been working with the wiki. Despite minimal outside links and attention, it seems the constant updates are appreciated by some of Google's mysterious internal workings. And irony is never far. These days, if one searches for "Austrian economics", the wiki is on place 46, and the venerable Mises Economics Blog of THE Mises.org is on the lousy position of 57.
And thus novelty prevails over experience and content! Woohoo!
Speaking of growth... I keep an eye out on my Google rankings over time, and there is indeed a slow rise noticeable over the few months I have been working with the wiki. Despite minimal outside links and attention, it seems the constant updates are appreciated by some of Google's mysterious internal workings. And irony is never far. These days, if one searches for "Austrian economics", the wiki is on place 46, and the venerable Mises Economics Blog of THE Mises.org is on the lousy position of 57.
And thus novelty prevails over experience and content! Woohoo!
Sunday, September 13, 2009
Obama fun
There's countless jokes on Obama, but you've gotta give it to Onion making this:
White House Reveals Obama Is Bipolar, Has Entered Depressive Phase
Rhymes with the economical Depression quite nicely.
White House Reveals Obama Is Bipolar, Has Entered Depressive Phase
Rhymes with the economical Depression quite nicely.
Tuesday, September 1, 2009
Done with Ethics
At last, the posting of material from the Ethics of Money Production (pdf) into the wiki is over!
That is not to say that more won't follow, but at least the sequential processing is done. A big thanks belongs to Jörg Guido Hülsmann, his book, while concentrating on a very specific topic contained much information of general interest. While probably unintended, for some it might even serve as an introduction to (Austrian) economics and a quick guide to the relevant parts of history.
Woohoo!
That is not to say that more won't follow, but at least the sequential processing is done. A big thanks belongs to Jörg Guido Hülsmann, his book, while concentrating on a very specific topic contained much information of general interest. While probably unintended, for some it might even serve as an introduction to (Austrian) economics and a quick guide to the relevant parts of history.
Woohoo!
Saturday, August 22, 2009
The new Gold Standard
This was just lovably cruel:
Good News/Bad News from the Daily Show.
In the last few days, the results of a research made the news: 9 out of 10 dollar banknotes are tainted with cocaine.(source)
And then it is all summarized in this sentence, for all fans of gold:
"We're not on the Gold Standard, people, we're on the Columbian Gold Standard!"
Good News/Bad News from the Daily Show.
In the last few days, the results of a research made the news: 9 out of 10 dollar banknotes are tainted with cocaine.(source)
And then it is all summarized in this sentence, for all fans of gold:
"We're not on the Gold Standard, people, we're on the Columbian Gold Standard!"
Saturday, August 15, 2009
The Ethics of Money Production, Conclusion
1. If capitalism is to be judged, then it should be pointed out, that there are two conceptions to consider. One is the free market model of respect to private property rights. Here, says Hülsmann, is the Catholic church positively inclined to capitalism. And here is also a link to Austrian economists, that have for long held, that as an economical system it provides the best chances for the full development of man and society.
Then there is the other, 'actual' capitalism of the West, that markedly differs from the ideal. Both groups are again in accord, that many of its aspects are worthy of critique - not the least in the production of money. There is no justification for the current system of paper money and fractional reserve banking, be it economical, legal, moral, or spiritual. They affect the lives of millions, and cause excesses for which is capitalism too often blamed.
These institutions were made not out of necessity, but because they gave politicians and bankers an easy income source, tapping the wealth of others. This is not a matter of conspiracy, but of a relentless drive to gain more money for the states - and paper money with fractional reserve banking merely turned out to be very efficient ways to do so.
2. A reform of our monetary institutions is badly needed and this book tried to present one alternative. Despite all the possible objections, the return of sound money is in the end a matter of will. It has been done before and can be achieved again.
Let us hope we won't have to wait too long.
Then there is the other, 'actual' capitalism of the West, that markedly differs from the ideal. Both groups are again in accord, that many of its aspects are worthy of critique - not the least in the production of money. There is no justification for the current system of paper money and fractional reserve banking, be it economical, legal, moral, or spiritual. They affect the lives of millions, and cause excesses for which is capitalism too often blamed.
These institutions were made not out of necessity, but because they gave politicians and bankers an easy income source, tapping the wealth of others. This is not a matter of conspiracy, but of a relentless drive to gain more money for the states - and paper money with fractional reserve banking merely turned out to be very efficient ways to do so.
2. A reform of our monetary institutions is badly needed and this book tried to present one alternative. Despite all the possible objections, the return of sound money is in the end a matter of will. It has been done before and can be achieved again.
Let us hope we won't have to wait too long.
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