Life Money and Illusion Part 1

I am currently reading Mike Nickerson's book, Life, Money and Illusion. As I've been inconsistent in updating this blog. I've decided to simply write my thoughts at various points in the book.

Nickerson's undelying message in the book is that the essential problem with the global financial system is that money has stopped being a highly liquid holder of real value, and has become, in itself, a perverse form of phantom capital which was condemned as sinful in antiquity. He shows that because currency is created from nothing, speculation becomes commonplace.

I encourage you to read the book and could talk about his conclusions ad-nausium. However, I will settle to say, it is well worth a careful read.

Amongst other things, Nickerson points to the prevalence of the media and advertising industries in western culture. He points to the fact that as a result of their constant influence, they are able to "create" demand by instilling the thought that certain products are necessary. He suggests that naturally, people will work until they have enough money to meet their needs and then stop working. He notes that this point was reached in North America in the 40s and 50s as wages increased enough to merit discussion of a 30 hour work week.

In economic terms, individuals decisions to work is based on how much they value the things they can buy as opposed to how much they value their leisure time. Advertising makes the percieved value of things one can buy go up and therefore the amount of time one spends working.

IF we were to begin to value our leisure time differently, we would see a shift in waste and, I believe, and increase in our ability to enjoy life.

RE: The Fed Can’t Serve Two Masters

http://www.cato-at-liberty.org/fed-cant-serve-two-masters/#utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+CatoHomepageHeadlines+%28Cato+Headlines%29

While I was always taught that the Phillips curve is a woeful fantasy that has brought about significantly bad policy. It does beg the question, if stimulus isn't effectively increasing employment, and monetary policy CAN'T increase employment...what is the US to do about its most significant of economic woes?

I will develop this thought a bit more in the future, but consider this. Jobs are created when people engage the demand for products and services. Production expands, business start up and jobs are created...currently, there is insufficient domestic demand to support US production enough to increase jobs. Perhaps, then, one of the most globally linked economies in the world needs to focus on encouraging development elsewhere enough so that global demand bouys up policy.

By this I mean a foreign policy that is concerned about developing other countries...rather than fighting currency wars with them.