tag:blogger.com,1999:blog-1457698585523817721.post7004370947120099447..comments2023-09-29T15:14:07.424+02:00Comments on The WOLUWE INDEPENDENT: The Economic Freedom of Today - (and the henceforth lack of one)Keinarahttp://www.blogger.com/profile/15205553107276901578noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-1457698585523817721.post-77210099523985862712015-11-05T15:48:54.002+01:002015-11-05T15:48:54.002+01:00An interesting read & strong conclusion!An interesting read & strong conclusion! Anonymoushttps://www.blogger.com/profile/12306222108125743935noreply@blogger.comtag:blogger.com,1999:blog-1457698585523817721.post-2675329528304668702015-11-04T23:18:00.571+01:002015-11-04T23:18:00.571+01:00Hi, thanks for your feedback, in reply to the comm...Hi, thanks for your feedback, in reply to the comments you made:<br /><br />1. The point I was trying to make about debt is that, in the case of the U.S for example, it has become an essential part of the economy since the country was built on debt, literally. <br />2. I did not (or at least did not intend to) say inflation is bad. Central banks should excise their power to maintain inflation low and stable. The argument I tried to pass through is that artificial inflation, i.e. trying to drastically change inflation rates by dumping a huge amount of money in the economy, is highly ineffective as you explained (Yes I am aware that most if not all economic processes are artificial, i.e. man-made since economics is a study of human behavior, I am referring to extreme cases of human interference, so point taken regarding terminology)<br />3. When talking about artificial intervention regarding the free market, and in relation to the second point you made, I was referring to monetary policy intervention, and in particular the way it can be exploited, like for example through open market operations, which although should be dictated by the will of the Central bank, are sometimes operated by private banks (like the lead-up to the Housing bubble collapse of 2008 for instance). A few lines further, I proposed government intervention through increased public spending in support of Piketty's (left) views, i.e. utilizing fiscal policies that should not be interfered with by private entities. <br />4. Again, point taken regarding terminology.<br />5. As said in response to your third point, I am mainly criticizing the role of the Central bank in today's economy, as well as (some of) the monetary policies it puts in use. I am, however, in support of the idea that governments should fiscally impose SOME regulations on the market, as explained in the stated interview. Suggesting that monetary and fiscal regulations are the same is... interesting?<br /><br />In relation to the last point, I would also like to say that Smith, although innovative and for the most part right in his theories, failed to acknowledge the true nature of people. The one major flaw in his work is that he assumes people do what is in everyone's interest and fails/misses to take into consideration the fact that individuals pursue personal gain (this can be explained through a variety of examples and theories, namely the Tragedy of the Commons). This is where governments should intervene in order to insure that no individual is capable of exploiting others/the market by chasing their own interest. The main point of the article is that it fails not in what it seeks to achieve, but in how it seeks to achieve it.<br /><br />Thanks again :)Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-1457698585523817721.post-29327858764679579522015-11-04T22:34:18.797+01:002015-11-04T22:34:18.797+01:00Nicely written, but theres some comments to be mad...Nicely written, but theres some comments to be made.<br />1. All money, by definition, is debt. Debt isnt inherently bad, on the opposite, without debt our monetary system would cease to function.<br />2. Inflation is essential in promoting economic growth. Inflation is only bad if its excessive which is what happens in a hyperinflation scenario like in germany 1923. As to create economic growth, central banks aim to create an inflation rate of 2% to keep the economy going. What happened in the economic crisis was that the rate of inflation was too low and that banks and businesses were reluctant to spend money as a consequence as it retained to much value over time. The ecb tried to solve this by devaluating the euro, inflation basically, by injecting loads of money into the economy (q.e.)<br />3. You say that quantitative easing is bad since it artificially interferes with the market. Besides thw fact that a free market is a neoliberal myth (which you imply in the last paragraph) and that capitalism has always strongly depended on very strong regulating states, a few lines further you propose that the government should intervene with subsidies and increased public spending which, from a neoliberal perpective, would again be a gross artificial intervention by the state into the free market and from a rational perspective logically not a step towards a freeer market.<br />4.The law of gravity is a natural law, the thermodynamic principles are natural laws, economic principles are not natural laws. Economics is still a social science and markets are social constructs. They seem to obey to certain laws, but those are more social than natural. <br />5.Saying that government and central bank intervention in the market are articficial and dangerous to the economy, all while citing an article whose title is "Why Markets Need Regulation" is.......Interesting? (at best)<br /><br />Nicely readable though Anonymousnoreply@blogger.com