Saturday, 10 February 2018

Job Guarantee, Universal Basic Income, Taxation of Economic Rents

UBI would get rid of the means-tested bureaucracy & the time spent in the bureaucratic gauntlet, the stigma that comes with it, would increase social mobility (ppl are not discouraged to seek other income generating activities) & it would directly improve labor's bargaining power.
The JG fulfills what UBI can't (in and of itself), integrating the long term unemployed into the job market (you can't integrate ex-cons without a JG program), provides employment when the market can't or won't, it indirectly improves labor's bargaining power.
These 2 policies (JG and UBI) need to come alongside legislation to capture economic rent (in all its forms). Without the latter, all the gains will slowly get eroded by the rent seekers via (land rents, finance & insurance rents, technological rents, political rents (cronyism)).

Wednesday, 7 February 2018

The Rate of Return on Everything

The Rate of Return on Everything

Serban V.C. Enache

A new working paper – conducted by Óscar Jordá, Katharina Knoll, Dmitry Kuvshinov, Moritz Schularick, and Alan M. Taylor – reveals the aggregate real rate of return in the economy between 1870 and 2015. Data was used from sixteen advanced economies over a span of 150 years. The countries are Belgium, Australia, the US, the UK, Japan, Italy, Germany, France, Denmark, Finland, Switzerland, Sweden, the Netherlands, Spain, Portugal, and Norway. The study analyzes three types of returns: investment income (yields), capital gains (price changes), and total returns (the sum of the two). The calculations were done for four major asset classes, equities and housing (classified as risky), and government bonds and short-term bills (classified as safe).

Unfortunately, the authors make no mention of “rent seeking” or “economic rent,” nor do they attempt to make any distinction between capital and land (man-made things and natural monopolies), or between rent and non-rent earnings. Such distinctions are necessary to gage the amount of economic rent, which acts as a surcharge on the real economy, making production and consumption unnecessarily more expensive. Economic rent, understood as income obtained without any enterprise, without any cost of production, stems from four sources: land values, the mark-ups of the financial and insurance sector, patents, and political lobbying.

On risky returns, the paper could only focus on available data from equity markets. Total returns on residential real estate and equities on average was at about 7 percent per year. Housing outperformed equity before WW2. Since then, equities outperformed housing on average, but only at the cost of much higher volatility and synchronicity with the business cycle. Housing returns are similar to equity returns, yet considerably less volatile. Diversification with real estate is admittedly harder than with equities. Before WW2, the real returns on housing and equities (and safe assets) followed remarkably similar trajectories. After WW2 this was no longer the case, and across countries equities then experienced more frequent and correlated booms and busts. Someone holding the two asset classes would see significant aggregate diversification gains. Ideally, the investor would like to hold an internationally diversified portfolio of real estate holdings, even more so than equities.

On safe assets, the paper finds the real return has been very volatile over the long-run, more so than initial expectations, and often even more volatile than the real returns on risky assets. Each of the world wars was a moment of very low safe rates, well below zero. So was the 1970s inflation and growth crisis. The peaks in the real safe rate took place at the start of the interwar period, and during the mid-1980s. Viewed from a long-run perspective, the authors judge the real safe rate as normally fluctuating around the levels that we see today, making it not unusual. Instead of asking why the safe rate declined since the mid-80s, the authors ask why was the safe rate so high during those years. I would venture an answer: new government policy to issue gilts to back private pensions. Indexed-linked gilts were issued by the Thatcher administration in ’81 with the express purpose of managing the risk profile of private pension funds – and indeed they served that purpose. While some might label this policy a triumph of monetarism, it’s also clear evidence the private sector cannot manage the risk profile of pensions without government assistance.

Safe returns have been low on average, falling in the 1–3 percent range for most countries and peacetime periods. While this combination of low returns and high volatility has offered a relatively poor risk-return trade-off to investors, the low returns have also eased the pressure on government finances, in particular allowing for a rapid debt reduction in the aftermath of WW2.

International evidence on the decline of the natural rate of interest since the mid-1980s is consistent with the paper’s rich cross-country sample. According to the authors, this observation is compatible with the secular stagnation hypothesis, whereby the economy can fall into low investment traps. The possibility that advanced economies are entering an era of low real rates calls into question standard monetary policy frameworks based on inflation targeting. Orthodox monetary policy has been credited for the Great Moderation, until the Global Financial Crisis arrived. Since that turbulent period, the prospect of long stretches constrained by the effective lower bound left commentators wondering whether inflation targeting schemes are the still the right approach for central banks.

In my opinion, secular stagnation is a farce. It’s not some inexorable phenomenon, driven by demographic shifts or changes in business-consumer behaviour. By employing a stock-flow consistent approach, we find it is the result of high inequality, high private debt, and pro-cyclical, regressive fiscal policy. The concept of secular stagnation first entered the economics debate in the late 1930s, when economies were still caught in the Great Depression. The problem in the ’30s was dramatically overcome by the onset of WW2 as governments increased their net spending (fiscal deficits) substantially. Commitment to full employment after the war’s end maintained growth and prosperity for decades until monetarist ideas came to prominence. As for inequality, let’s look at the USA. In 1929, the richest 5 percent received 34 percent of total national income. In 1951, they received only 18 percent of the total. Currently, inequality is vastly greater than it was in 1929. The cure to the slow growth and the real unemployment we see today is government deficit spending, with the precise target of employing people to produce output and paying them good wages, not deficit spending to increase the idle savings of the opulent minority.

Over the very long run, the paper finds the risk premium has been volatile. A vast literature in finance has typically focused on business-cycle co-movements in short span data. In contrast, the paper’s richer data sample uncovered four dramatic swings in the risk premium at lower frequencies (that sometimes endured for decades, and which far exceed the amplitudes of business-cycle swings). In most peacetime periods this premium has been stable at about 4–5 percent. But risk premiums stayed curiously and persistently high from the 1950s to the 1970s. However, there is no visible long-run trend. Curiously, the bursts of the risk premium in the wartime and interwar years were mostly a phenomenon of collapsing safe rates rather than dramatic spikes in risky rates. In fact, the risky rate has often been smoother and more stable than safe rates, averaging about 6–8 percent across all eras. Recently, with safe rates low and falling, the risk premium has widened due to a parallel but smaller decline in risky rates. These shifts keep the two rates of return close to their normal historical range. Whether due to shifts in risk aversion or other phenomena, safe rates seem to absorb almost all of these adjustments. The authors conclude it is a puzzle in need of further exploration and explanation.

Thomas Piketty argued that, if the return to capital exceeded the rate of economic growth, rentiers would accumulate wealth at a faster rate and thus worsen wealth inequality. Comparing returns to growth, the paper finds that Picketty’s claim holds true for more countries and more years. In fact, the only exceptions appear in very special periods – the years in or right around wartime. The fact that returns to wealth have remained fairly high and stable while aggregate wealth increased rapidly since the 1970s, is clear evidence capital accumulation contributed to the decline in the labor share of income over recent decades. Instead of being unequivocal about it, the authors only suggest that capital accumulation may have contributed to labor’s fall.

The paper concludes that returns to risky assets, and risk premiums, have been high and stable over the past 150 years, and substantial diversification opportunities exist between risky asset classes, and across countries. Arguably the most surprising thing is that long run returns on housing and equity look remarkably similar. Yet while returns are comparable, residential real estate is less volatile on a national level, opening up new questions about risk premiums. The research speaks directly to the relationship between the rate of return on wealth and the growth rate of the economy, a seminal figure in the current debate on inequality. Across most countries, the weighted rate of return on capital was twice as high as the growth rate in the past 150 years.

Tuesday, 6 February 2018

Defending The Free Market

Defending The Free Market
Serban V.C. Enache

I have spent a lot of my youth criticizing Free Market ideology and its proponents. This time, however, I will attempt to write (to the best of my ability) a defence of it. Supply and Demand are easy concepts. The way they interact and consequences born of those interactions are also simple to understand. The problem is to confuse theory with reality – to ignore empirical data when it is at odds with our assumptions and aspirations. Most proponents of the Free Market are willing to disregard all criticism regarding their assumptions and assign any other element of blame for the undesired outcome produced. The laziest defense is to employ the No True Scotsman argument. What? It failed? Well, that’s not a real free market set of policies. Worry not, adepts of socialism and communism employ the No True Scotsman as well. But for the purposes of this article, I will give Ayn Rand as an example.

According to her objectivist philosophy, a true concept must be observed before it is thought. If there is no example in the real world, the mental concept is false and invalid. She maintains that concepts represent classifications of observed referents, that there are invalid concepts (those without referents), and that truth means identifying the facts of reality – the logical recognition of the facts of experience. Ayn Rand maintains that capitalism is an “unknown ideal.” A capitalist economic system has “never yet existed, not even in America.”

So let’s see the logical implications of this. If concepts must be observed and capitalism has never been observed, then capitalism is not a concept. If truth is real and capitalism has never existed, then capitalism is not true. If truth must be experienced and capitalism is unknown, then capitalism is not true. If concepts without referents are invalid and capitalism does not have a referent, then capitalism is an invalid concept.

Before I can actually attempt a defense of the Free Market, I need to define it – and I define it in a manner that most of its adepts wouldn’t agree with. The market is a creation of the state. In order for it to work, it requires an independent party capable of settling disputes, enforcing and protecting contract laws, and property rights. In the real world, supply and demand are not the only forces at work. The state element lies between them, and it’s not an intermediary agent. In fact, it is the prime creator of demand in money terms. By imposing an obligation on the public, extinguishable only in state currency, the state creates unemployment of money paying jobs. Then, the state spends in order to provision itself with the necessary labor and materials for its purposes (the military, the court system, the police, roads, bridges, etc).

It gets more complicated in practice, but in theory, if too few people show up to take government jobs, the state increases the tax – if too many people show up, the state reduces the tax. Why do people accept to do work in exchange for government currency, which they need to pay taxes, fees, and fines owed to the state? Because there are legal repercussions if they don’t – (temporary loss of freedom, confiscation of property, community work, etc). The state is a vehicle of coercion. Coercion works. Coercion is efficient. Persuasion is not efficient. Show me a surplus-producing society based solely on voluntarism that has survived the ages up to the present. There is none. Efficient societies rely on a certain measure of coercion; and the most efficient employ taxation in money, not in commodities. One example will suffice. This year is the 150th anniversary of Japan's Meiji Restoration, one of the most important modern revolutions of the non-European world. Key elements of the Meiji Restoration reforms was to end taxation in grain. The government placed a money tax on land, calculated on the land's potential, instead of the actual crop yield – and landowners were made responsible for the tax, not the farmers.

So that’s the market, but what about the free market? Freedom is an ideal, but in the real world, we have to work with laws and with deeds. The vast majority of Free Market advocates will claim that the state needs to keep out of the market, in order for the market to deliver positive results. Laissez-faire doctrine means ‘leave it (the market, the economy) alone.’ This belief is pure superstition. More often than not, the market fails to deliver results mid to long term precisely because the state is being masterfully inactive. Capitalism runs on sales. Sales are a function of spending, both public and private spending. The nongovernment sector has periods of leveraging and de-leveraging – and this doesn’t happen in a void. The government impacts the cycle greatly. The state should be active in capturing economic rent, active in combating the formation of cartels, active in fostering public investment (projects which benefit the country as a whole and that are too large for private agents to engage in on their own), and the state should pursue a counter-cyclical fiscal policy agenda to achieve and maintain price stability and full employment.

Without a doubt, Free Market advocates will shout at at me, “This is socialism! This is statism!” If they choose to apply those adjectives to the above, they should label Carl Menger, founder of the Austrian School of Economics a socialist too. Let’s see what he had to say about government’s role in his lectures to Crown Prince Rudolf of Austria.

“Government thus has to intervene in economic life for the benefit of all not only to redress grievances, but also to establish enterprises that promote economic efforts but, because of their size, are beyond the means of individuals and even private corporations. These are not paternalistic measures to restrain the citizens’ activities; on the contrary, they furnish the means for promoting such activities; furthermore, they are of some importance for those great ends of the whole state that make it appear civilized and cultured.

“Important roads, railways and canals that improve the general well-being by improving traffic and communication are special examples of this kind of enterprise and lasting evidence of the concern of the state for the well-being of its parts and thereby its own power; at the same time, they constitute major prerequisites for the prosperity of a modern state.

The building of schools too is a suitable field for government to prove its concern with the success of its citizens’ economic efforts.”

Why am I attempting to defend the Free Market? Because markets cannot be free so long as rent seeking is allowed to go unchecked. One of the principles of classical liberalism was that property should belong to he who best makes use of it. The rentier class doesn’t make use of it in an efficient manner. By not capturing the entire value of land, the state leaves the biggest free lunch in the hands of a few at the expense of the real economy. Everybody works, but the rent seeker. His profit is unearned increment made possible by the presence of communities and the enterprise of their people. Profits made without labor, without risk, without investment, without a cost of production by simply owning that which was provided by nature and slapping a private surcharge on it.

Indeed, complex and unfair government regulations hinder the market’s activities, but the solution to bad and thick regulations is not an end to all regulations, but simple and sound rules. If you ever played a game with someone, you will be frustrated if you end up losing because you followed the rules, and they didn’t. You will also be frustrated to see people (who did not labor or invest) reap major profits, which were obtained from the efforts of those like you. Whatever rent-of-location the state relinquishes is available freely not to be pledged as government taxes, but to property owners as rent, or to money lenders as interest. This shrinks your disposable income and makes the price of consumption higher. The rentier excess charge is slapped on top of the capitalist’s mark-up, which is on top of the actual cost of production.

Looking back at history, Thomas Malthus, for all his imperfections, his mathematical model not only incorporates land as a component, but it couldn’t describe production without it. Y=F(N,L) where Y is output and N is labour and L is land. In contrast, what does Robert Solow’s model give us? Land is replaced with capital. Y=F(N,K) Tragically, modern macro-economics is based on the latter.

The marxist stance is that capitalists can’t turn a profit without exploiting labor. What about net profit? The net profit in the nongovernment sector ((I-S)+(X-M))? Where does it come from? It comes from the government sector (G-T), from its fiscal deficit. Profit is a flow. Flows can be negative or positive (deficits or surpluses / debits or credits), just like stocks (negative financial capital, positive financial capital). We know that people like to save for rainy days. And in the aggregate, net saving can only happen if the government allows it. Firms and households who are in net profit (who are net saving), are they exploiting the government?

It frustrates me when I see marxists today focusing on what I believe to be trivialities, ignoring to make a distinction between land and capital, and forgetting about rent. Marx’s theory of rent has witnessed fewer comments and developments, by followers and critics alike. He talked about differential rent and absolute rent. Marx’s theory of land and mineral rent should be brought up today, for it’s applicable to all segments of production where great difficulties of entry limit mobility of capital for long periods of time. Marxists today shouldn’t lump all profits together. They should focus on attacking land rents, cartel rents, and technological rent.

To sum up, we can’t talk about the ‘free market’ when the market is not free of rent seeking – just as we can’t talk about ‘democratic control’ over the means of production, when all decision making happens at the top. Humans think in language. If we don’t define the meaning of the words we employ, we will never get our points across. We will always misunderstand other points of view, and we will always be misunderstood. That’s why I felt the need to defend the notion or ideal of the Free Market while properly defining it, because as commonly understood it’s slavery being sold as freedom. It’s feudalism being sold as meritocracy. A market free of economic rent and government corruption is a worthy thing to champion.

Thursday, 25 January 2018

Bulgaria and the Euro

What can Bulgarians expect from the single currency? Less sovereignty, self-determination, and democracy. They’ll discover the dictatorship of private mark-ups and supra-national executive bodies. During the boom phase, things will look great. The bust phase will be harsher than it has to be, and the surplus states will demand concessions. Under the euro, the Bulgarian government should pursue any unorthodox avenue regarding public finances. Mosler Bonds, named after economist Warren Mosler, are one example.

Read more here

Saturday, 20 January 2018

Math serves White Interests?

This type of rhetoric is not only unhelpful, it's insulting for non-whites.

Three British professors recently claimed that statistics “serve white racial interests” because “numbers are neither objective nor color-blind.” In the abstract of their paper—QuantCrit: education, policy, ‘Big Data’ and principles for a critical race theory of statistics—David Gillborn, Paul Warmington, and Sean Demack outline their tenets for using the QuantCrit method with the ultimate aim of “disrupting racism in research.” Let’s take a look at those tenets.

Read more here

Thursday, 28 December 2017

The Tragedy of Big Pharma

Modern medicine’s been a boon to mankind. Diseases like chicken pox, diphtheria, measles, malaria, HIV, and polio—all but eradicated in the past century by pharmaceuticals. So what went wrong?

Sunday, 17 December 2017

The Life and Death of King Michael of Romania

I wrote this 5 days ago and didn't publish. I tried to get it up on an online platform that has a bigger audience. Needless to say, the editor wasn't interested. But as they say, it's never too late to correct an error. Hope you'll enjoy.

Michael was born in Sinaia, Romania, the son of Prince Carol the second and Elena of Greece. Grandson of King Ferdinand and Queen Maria, on his father’s side – and grandson of King Constantin of Greece, from his mother’s side. Some of Michael’s ancestors include Nicholas the first of Russia, Alexander the second of Russia, and Queen Victoria of Great Britain.

King Michael’s first years of rule were between 1927 and 1930. Because he was only six years of age at the time, a regency was formed. The National Liberal Party backed Michael, the regency, and quickened the military oath of allegiance toward the king, not wanting to risk carlist influences within the army. In contrast, The National Peasants’ Party desired the return of Carol the second (Michael’s father, who had abandoned the throne for his paramour Elena Lupescu).

In 1930, however, amidst the economic crisis, Carol returned. The Government of Iuliu Maniu obtained Carol’s pledge that he will leave Elena Lupescu and resume his marriage with Elena of Greece. The Parliament named Carol king, and designated Michael as successor to the throne. Carol exiled Michael’s mother to Florence, imposing a cruel visiting program of only a couple of weeks per year between the two. Carol the second’s rule between 1930 and 1937 ushered in 14 governments. He presided over political turmoil and political assassinations. At the end of March 1938, Carol signed a decree that abolished all existing political parties. In December that year, he created a sole state political organization called The National Renaissance Front.

In 1940, Field-marshal Ion Antonescu forced King Carol to abdicate in favor of his son Michael, and grant him (the Field-marshal) discretionary powers. At 18 years of age, Michael was proclaimed king. By that time, Romania had joined the Axis powers against the Soviets. Though Michael was the king, Antonescu had full power in his quality as ‘leader of the Romanian state’. Through the use of a legal technicality and elements of coercion, four years later, Michael managed to arrest Antonescu (through an internal coup) and appoint a new prime-minister.

In August 1944, faced with the Soviet invasion, Michael sided with political forces hostile to Nazi Germany (the Allies and the Communists). The British, the Americans, and the Soviets offered a truce and Michael agreed to it. Given the geopolitical context, the Western powers didn’t intervene against the Soviet invasion. About 130.000 Romanian soldiers were captured and sent to labor camps inside the USSR. The peace negotiated by Michael’s people was seen by some as a national betrayal and capitulation to the Soviets. Romania had to pay 300 million dollars in war reparations to the USSR and accept unconditional surrender.

Still, peace with the Soviets allowed the Romanian army to liberate northern Transylvania from Hungarian occupation. At the war’s end, King Michael was decorated by Harry Truman with the Legion of Merit in highest rank and by Joseph Stalin with the Order of Victoria for ‘the courageous act of decisively turning Romania’s policy away from Hitlerist Germany and joining the Allied Nations in a time where Germany’s defeat was not certain.’ The Albanian communist leader Enver Hodja considered that Michael was awarded the Order of Victoria for his capitulation to the Soviets, when that was the only thing he could have done. Some people consider that Michael’s coup against Antonescu hastened the advance of Stalin’s troops across Romania and Europe, to the detriment of Allied forces. The absence of invitations throughout the years for Michael at Western events commemorating Victory Day is seen by some as a tacit condemnation of his coup d’etat. Michael was not invited by any Western state at the 60th anniversary of Victory Day. He was only invited in Russia and at certain events in the Czech Republic and Slovakia. The truce or capitulation, however one chooses to look at it, did save many lives.

The Soviet military occupation of Romania ended in 1958. But eastern Bessarabia still retains Russian troops to this day. Molotov’s pledges (made in ’44) to allow the country to choose its own government through democratic vote and retain its status as a constitutional monarchy were never honored by the Soviets. King Michael was forced to recognize a pro-soviet cabinet, with Petru Groza as the prime-minister. Seeing the abuses committed by the Groza government, King Michael demanded his resignation and Groza refused. His refusal was a stark violation of the country’s constitution, which gave the monarch the power to name and dismiss ministers. Michael attempted a ‘royal strike’, in which he refused to sign and promulgate government decrees. According to the 1923 Constitution, an act could become law only with the approval of the Upper and Lower houses, and with the approval of the monarch, and he could very well refuse to sign it into law.

In the end, through arrests, intimidation, and trickery the communists managed to get their way. On December 30th 1947, they launched a coup d’etat and forced the king’s abdication. That spelled the end of the monarchy and the beginning of the so-called people’s republic. In an extraordinary session of cabinet on that same date, Petru Groza concluded, “We’ll make sure that the ex-king shall leave in peace of mind, as is proper, so that none may bring any offence to him who, understanding the voice of our times, chose to retire.” There are critics who insist that Michael was not only blackmailed into abdicating and leaving the country, but that he was also encouraged (bribed) to do these things in haste – the communists, allowing him to leave with paintings of high value, gold, and jewels. Confidential documents from the British Foreign Office reveal that when he left Romania, Michael had only 500.000 Swiss francs on him. Claims to greater wealth taken out of Romania with him are typically dismissed as “communist propaganda.”

In January 1948, Michael began to call himself prince de Hohenzollern, using for the first time a name denied to his house by the Hohenzollern family in Germany, during the first world war. Through this, Michael was admitting that he was no longer king of Romania. However, in March that same year, Michael denounces his abdication as illegal and squeezed from him under duress. In June 1948 he married Ana de Bourbon-Parma, who would later give him five daughters. The Romanian communist government retracted Michael’s citizenship that same year. They lived in Italy (Florence), Great Britain (London), and finally Switzerland (Versoix), where they spent most of their years. In ’58, Michael started a company named Metravel, which produced railway mechanisms, alarm systems, and occasionally sold airplanes. Five years later he sold it. Michael also sponsored the Romanian National Committee, an organization meant to defend Romanian democratic interests in the West. It was formed in Washington DC by the General Nicolae Radescu, Romania’s last constitutional prime-minister. It collected data and wrote reports on the People’s Republic of Romania, it tried to organize in exile a communist resistance, and lobbied for Western sanctions against the communist authorities on the basis of human rights violations. Its activities proved to be unsuccessful. A major factor in this outcome was the new American policy (beginning with the 1960s) to ‘build bridges’ with the governments of Eastern Europe.

Decades later, on December 25th 1990, Michael and other members of the royal family arrived in Bucharest under a Danish passport, with a 24 hour visa to visit the Curtea de Arges Monastery. He wanted to visist the tombs of his ancestors there and attend the Christmas religious service. On his way toward Curtea de Arges, however, he was stopped by the police and escorted back to the airport and made to leave the country. In an interview in 1991 with Philippe Viguie-Desplaces, Michael said about the Romanian revolution, “[...]As much as I argued and shared at the beginning this formidable eagle of hope that was the Romanian revolution, we doubted later that this impulse had been spontaneous. To be honest, I do not believe it anymore. But even if the trigger was artificial, the popular rise against communism was very real.[...]Today, I think it is very possible, as some say, that the KGB's structures have guided these overturnings. It remains to be seen, however, what the exact aim of Moscow was. I see only one plausible explanation. The Russians felt that Ceausescu’s edifice was beginning to crack. The Latin spirit of the Romanians risked to catch fire and throw communism overboard. To avoid such a radical overthrow and still hoping to save their system, the Russians decided to sabotage Ceausescu.”

Three years after the 1989 revolution, the new government allowed Michael to enter the country during the Easter celebrations. Over a million souls took to the streets of Bucharest to see him. This gravely consternated the government of Ion Iliescu, and Michael was subsequently banned from entering the country for the next five years. In 1997, after Iliescu’s electoral defeat, the new president, Emil Constantinescu, lifted the ban and reactivated Michael’s citizenship. As a key note of interest, in 2001, due to legal disputes over the name Hohenzollern-Veringen for his son-in-law Radu, as well as fearing the pretensions of the German Hohenzollerns over the royal house of Romania, Michael broke off the historical ties with the Hohenzollern-Sigmaringen family. He became known as King Michael of Romania.

On the 5th of December 2017, at 13:00, the former sovereign died in his private residence in Aubonne, Switzerland. He suffered from chronic leukemia and metastatic carcinoma. He is succeeded by Princess Margareta of Romania, custodian of the Romanian Crown, while the Princesses Elena, Irina, Sofia, and Maria are next in line. His coffin will arrive in Romania on December 13th. The burial took place on the 16th, in the new Archdiocesan Royal Cathedral in Curtea de Arges, just a hundred meters away from the Monastery. King Michael was the last monarch of Romania and the last monarch in Eastern Europe.

Monday, 11 December 2017

Radu Tudor, defending rent seeking

@RaduTudorA3 just made the most moronic comment about why banks in Romania practice higher markups than elsewhere (he referenced Spain in particular), because, he said, Romania's GDP is smaller. #MMT

Banks change numbers on their own ledgers when they issue loans & they do settlement payments with reserves (which are checking accounts at the Central Bank). Fees are one thing, interest is just unearned income. It's pure rent seeking.

The reason why the banking sector in Romania, as well as other sectors of the Romanian economy, practices higher markups than elsewhere is due to a LACK in competition. Cartels = price gouging. Competition = you raise your price, I don't, and I eat into your market share.

But continue to make the apology for the corrupt European and American interests inside Romania. Continue to lick their ass as you lament the lack of Romanian sovereignty.

Thursday, 7 December 2017

Economic Lessons From Dead People

Friedrich List, Adolph Hitler, Kenneth Boulding, and Carl Menger

"I don’t wish to go at length about this mass delusion, which is ingrained in our collective conscience (no matter what country we’re from). Instead, I’ll invoke the wise words of a few dead people who didn’t regard money as an obstacle to getting things done."

Read more here:

Thursday, 30 November 2017

Lessons from History, Romania & Iran, austerity & regime change

My 5th piece for Splice Today is up

"... Instead of negotiating debt rescheduling, as other countries did who faced the same financial troubles, Ceausescu simply decreed that the entire external debt would be paid off. Shock therapy commenced at his whim..."

Read it all here:

Sunday, 19 November 2017

The Purity of the Wild ISN'T Nirvana

Next time some idiot tells you that animals only kill to eat & in self-defence, show them this