Re: Peter Thiel’s 4 Theories on the Bubble and Bust Economy

Zlatko — Thu, 04 Dec 2008 01:21:20 -0000

Yeah, sure, that's exactly it. How about we stick to proper theories that hold up historically and theoretically. Thankfully, there's only one of those, so our search isn't too long. I am of course referring to the Austrian Business Cycle Theory

My short summary:
When growth isn't backed by real savings, but rather by the illusions of savings that come about through an artificial lowering of the interest rate through credit expansion*, the end result can only be an eventual liquidation of the newly started projects at a loss along with an increase in the price level.

For a more thorough explanation of why it must be so, here's a concise article: http://mises.org/story/672

*hopefully I must not explain to the educated public that the tools the Fed uses to lower the interest rate, open market operations, result in an increase in the money supply. This is not even a theory, but a fact.

Re: Are the trading bots taking control?

Zlatko — Mon, 20 Oct 2008 06:53:30 -0000

How can one be "against" technology in general? Technology is just the science of how to use available means to achieve desired ends. If one concedes that mans actions are ends-driven, then there can be no human action at all without the use of technology, for if man didn't have a "recipe" on how to achieve his ends, we could observe no action at all. In which case, we would say that the object in question is not a living being but an inanimate object.

As for being against specific technologies, I guess it is possible. But where does one draw the line? One can have clothes, but not antibiotics? One can construct houses, but not use computers? It seems arbitrary to me. But I guess, as long as you don't aggress against me or anyone else, you can use or refrain from using any technology you like.

And as for the rest of the article, it is a shame when the economic knowledge in general is so absent that instead of a rational and scientific explanation of the boom-bust cycle, you get crackpot theories such as this one. Ignoring the one and only aspect that is common to all recessions, which is credit expansion by the money monopoly that is government, is either ignorant or willfully misleading.

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Re: Peter Thiel’s 4 Theories on the Bubble and Bust Economy

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