“There was one additional dissenter for the September statement. Philadelphia Fed President Charles Plosser voted against the position in July, and he was joined this month by Dallas Fed President Richard Fisher.

‘President Fisher believed that the continued strengthening of the real economy, improved outlook for labor utilization and for general price stability, and continued signs of financial market excess (my emphasis), will likely warrant an earlier reduction in monetary accommodation than is suggested by the Committee’s stated forward guidance,’ the statement said.”

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http://www.blackrockblog.com/2014/08/07/great-deleveraging-happened-debt-problem/

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I usually have a negative knee-jerk reaction to anyone who says “it’s different this time” and true to form, I disagree with Sufi’s argument that capital can replace labor completely. His is a Luddite argument that has been made since the industrial revolution and never materialized. Capital can only replace labor when (if?) we reach the Singularity and machines can reproduce themselves. (By machines, I mean both mechanical and electronic.) Until then, back-breaking labor will be replaced by machines that, in order to propagate, will need engineers and programmers and maintenance workers and chip makers, and entrepreneurs who can employ machines in purposeful activity, etc.  That reminds me; I also added Ray Kurzweil’s website to the blogroll.

http://blogs.cfainstitute.org/investor/2014/07/23/debt-and-secular-stagnation-amir-sufi-discusses-the-us-recovery-video/

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A lot of truth here.

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Guess what I “predict” for 2012? Years highlighted in orange relate to the Great Depression; blue relates to the credit crunch. Notice that there were many more extreme years during the Great Depression than recently.

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I love browsing the mathematics section of book stores. Yesterday I found a book on complex adaptive systems written by Len Fisher that so far is outstanding; I suspected as much after I bought it and noticed that Michael Mauboussin offered suggestions for the manuscript. The Kellogg’s creation/discovery of Corn Flakes is but one example of economic evolution at work.

http://www.bloomberg.com/news/2011-12-15/the-accident-that-started-the-breakfast-cereal-business-echoes.html

The brothers developed breakfast flakes by accident in 1893, when Will abandoned a pot of cooking wheat to attend to business matters. He returned to find a mixture with a stale and hard consistency. Unwilling to waste the food, the brothers forced it through rollers with the hope of forming long sheets of dough. Instead, they created wheat flakes, which they toasted and served to the San’s patrons as a breakfast cereal.

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On another note, George Mason University has quite an impressive number of thinkers in their economics department.

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Another example of the beauty of free markets in the spirit of the famous: I, Pencil.

We rarely examine sufficiently the counterfactuals to the success of free markets, which allows anti-capitalists such as Michael Moore (as big an exploiter of capitalism as ever existed) and the OWS movement to win public relations campaigns. As I, Pencil has aptly demonstrated, private property rights and free markets have created remarkable wealth for EVERYONE, so much so that we take it for granted.

“We are perishing for want of wonder, not for want of wonders.” –GK Chesterton

Michael Moore should pledge a food boycott until he is capable of creating a cheeseburger from scratch; “eat local,” and all that…

http://waldo.jaquith.org/blog/2011/12/impractical-cheeseburger/

A few years ago, I decided that it would be interesting to make a cheeseburger from scratch. Not just regular “from scratch,” but really from scratch. Like, I’d make the buns, I’d make the mustard, I’d grow the tomatoes, I’d grow the lettuce, I’d grow the onion, I’d grind the beef, make the cheese, etc.

It didn’t happen that summer, by the following summer, my wife and I had built a new house, started raising chickens, and established a pretty good-sized garden. I realized that my prior plan hadn’t been ambitious enough—that wasn’t really from scratch. In fact, to make the buns, I’d need to grind my own wheat, collect my own eggs, and make my own butter. And I’d really need to raise the cow myself (or sheep, and make lamb burgers), mine or extract from seawater my own salt, grow my own mustard plant, etc. This past summer, revisiting the idea, I realized yet again that I was insufficiently ambitious. I’d really need to plant and harvest the wheat, raise a cow to produce the milk for the butter, raise another cow to slaughter for its rennet to make the cheese, and personally slaughter and process the cow or sheep. At this point I was thinking that this might all add up to an interesting book, and started to consider seriously the undertaking.

Further reflection revealed that it’s quite impractical—nearly impossible—to make a cheeseburger from scratch. Tomatoes are in season in the late summer. Lettuce is in season in spring and fall. Large mammals are slaughtered in early winter. The process of making such a burger would take nearly a year, and would inherently involve omitting some core cheeseburger ingredients. It would be wildly expensive—requiring a trio of cows—and demand many acres of land. There’s just no sense in it.

A cheeseburger cannot exist outside of a highly developed, post-agrarian society. It requires a complex interaction between a handful of vendors—in all likelihood, a couple of dozen—and the ability to ship ingredients vast distances while keeping them fresh.  The cheeseburger couldn’t have existed until nearly a century ago as, indeed, it did not.

 

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I think Jobs would have been impressed…and probably would have spent hours trying to figure out how to build a robot that could kick this one’s ass.

H/T Marginal Revolution

Mona Simpson’s Jobs Eulogy Here: http://www.nytimes.com/2011/10/30/opinion/mona-simpsons-eulogy-for-steve-jobs.html?_r=2&pagewanted=all

H/T: Cafe Hayek

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