Impossible, you say? Not at all. We now have a new form of symbolic capital called cryptocurrencies–“money” that can easily be created in the accounts of people doing useful work, as opposed to being created in the accounts of the already-obscenely wealthy, as we do now.
Rather than trickle down, money would trickle up the pyramid, if the wealthy actually produced goods and services of value.
So what would a labor-centered economy look like?
1. New money would be created at the bottom of the pyramid, in the accounts of people doing useful work in their communities. (The usual global corporations would continue making billions of dollars in profits from doing whatever highly profitable work was available.)
2. Being productive in terms of creating and sustaining cultural and infrastructure capital would be compensated; consumption of corporate goods and services would take care of itself without subsidies like guaranteed basic income.
3. Labor would be paid for being productive, and capital would serve labor.”
Economists and Madmen
“The problem in economics is that not only economists but politicians and people in general take economic models and the academics who create them seriously. After all, the people offering these dictums are the best and brightest among us. They give each other degrees and go to conferences where they confirm their brilliance. Sadly, they are often what Nassim Taleb describes as “intellectuals yet idiots.” Seriously, how do you argue with a PhD economist, especially when he has a Nobel prize to back up his pronouncements? He looks down on you as a naïve child who doesn’t have the understanding of a mature adult.
How can the very people who claim to understand how the economy works be so bad at predicting and managing it? The quick answer is that the real economy is far more complicated than they’re willing to admit. I can imagine this is hard medicine to swallow when you have spent years trying to simulate an almost infinitely complex system with computer models that are necessarily limited as to inputs, variables, and algorithmic sophistication. But if your model tells you very little about reality, what good is it?”
“Then we come to the concept of general equilibrium. Pretty much every economist accepts some variant of the concept of general equilibrium. I have come to the point where I completely reject the notion: it’s utterly false. There is no general equilibrium of any kind.”
“Post-Real Economics. Eventually, evidence stops being relevant.”
“The conditions for failure are present when a few talented researchers come to be respected for genuine contributions on the cutting edge of mathematical modeling. Admiration evolves into deference to these leaders. Deference leads to effort along the specific lines that the leaders recommend. Because guidance from authority can align the efforts of many researchers, conformity to the facts is no longer needed as a coordinating device. As a result, if facts disconfirm the officially sanctioned theoretical vision, they are subordinated. Eventually, evidence stops being relevant. Progress in the field is judged by the purity of its mathematical theories, as determined by the authorities.”
Profound significance of understanding how debt drives everything
1. The whole system only functions in a highly deformed way and is clearly unsustainable.
2. Classic Economic Fundamentals and Value won’t help you in the short term.
3. It will be very difficult to tell when the system has begun to break down, let alone forecast when it will happen.
4. Risk is completely mispriced as never before.
5. An optimal investment plan needs to be automatically adaptive, preferably with multiple dynamic systems.
It is highly unlikely, otherwise, that investors will be able to react in a timely and effective manner.