Because it illustrates perfectly the prevailing trend. How things change because of us. How we – collectively, change the world around us.
At first, click-bait had been used by ‘fraudsters’. ‘Publishers’ who used to cram completely useless information under some very ‘enticing’ titles.
Now… you may say that the information about our galaxy – the Milky Way, being on a collision course with Andromeda – our closest galactic neighbor, is also useless. Maybe… After all, that will only happen after 4 billion years had already passed… Anyway, this time, the targeted public is rather different than before. More ‘scientifically minded’… Which proves my point. That using click-bait has become a lot more acceptable.
The new normal…
Which brings me to the next question. How many of you are going to watch this?
Now I’ll attempt to offer an ‘alternative’ understanding of inflation. Not what it is – we all know that, but what it does. It will be a functionalist view of the matter. Evolutionary, even. As in ‘why do we still have inflation’. Why inflation continues to ‘survive’.
For most of our history, economy had been about solving needs. Regardless of the market being momentarily free or not, for things to go on a balance had to be struck. Demand had to be balanced by supply. Hence ‘price’.
Demand was mostly driven by the number of people needing something while supply was driven by the available natural resources AND by our ability to transform those resources into actual commodities. For example, the price of wheat was influenced by the number of people living in a certain area, by the amount of arable land AND by the agricultural technology used at any given time. OK, the weather also had an impact but it was mitigated by the technology.
‘But how about imports? After all, ‘international’ grain trade is three millennia old. Ancient Athenian ships had been distributing ‘Ukrainian’ wheat all around the Aegean sea since before the Trojan war…’
Yeah, and how about emigration… the Irish had gone to America to escape famine, didn’t they? We’ll get there. ‘Baby steps’, otherwise we may trip!
When population increased, they tried to add more arable land. If they could. If not – and/or in parallel, they tried to increase yield. But the process was not linear. They could not ‘fine tune’ the increase of yield – by either method, exactly to the population growth. Hence the variation of price. Hence the ‘secondary mitigation measures’ – import/export and emigration.
‘OK, I understand. But prices can go both ways. Up AND down! Inflation only goes up…’
You’re speaking about individual prices. Which, indeed, go both ways. And, yes again, inflation goes – in medium to longer time frames, only up!
You see, we have ‘price adjustments’ and (compounded) inflation.
Price adjustment is the mechanism through which the market – free or otherwise, balances the market for individual ‘items’. Encourages the consumption of wheat when the price is low and encourages the farmers to plant more wheat when the prices are high. Same thing for, say, shoe-shinning! Meanwhile, (compounded) inflation is the mechanism through which the market – again, free or otherwise, balances itself.
‘Huh?!?’ For example, if wheat becomes too expensive, consumers (and suppliers) might decide to replace it with something else. Rice. Or potatoes. Or, when grain prices become prohibitively low, farmers might abandon their plows and buy, say, shoe-shining tools.
‘But if rice – or anything else – would yield a lot more than wheat per the available arable land, the over all prices for food – and everything else, should go down, right? Not up…’
Well… in a rational world… maybe. That’s another long discussion. The short version being that we usually wait for too long before making the necessary changes. Which is not necessarily wrong but that’s yet another long discussion. Only hindsight is 20/20…
Let’s say it would be possible to grow wheat and rice on the same plot of land without making any technological adjustments. If the growers would know what kind of weather would come in the next season, they would be able to plant the right crop. But they don’t. And it takes time for people to grasp the weather patterns have changed – and adjust the pertinent technology. On top of that, adjusting technology requires money. Investment. Fresh ‘inputs’.
And who would do such a thing – plowing money into the ground, literally – without expecting an increased return? Something ‘extra’ for their effort?
In economic terms, nobody invests their money in a deflationary environment. Why would anybody do such a thing? Buy now when waiting till ‘tomorrow’ would make it possible to buy more for the same money?!?
That’s why inflation goes up. Period. Cause otherwise the whole economy would become obsolete. We’d all be waiting for ‘tomorrow’.
NB. This was a gross ‘simplification’. A bare sketch. Even in a deflationary environment, some prices do go up. For years overall prices have gone down – because of our increased technological prowess – while housing, education, healthcare and insurance have become more and more expensive. ‘Tilting’ the whole market. More about this in the next post on the subject.
Just finished reading a very interesting article on BBC.com/future. Why do we die. Authored by William Park. Just click on the picture above and read it.
Despite the “we” in the title, it’s a compendium of plausible explanations for why most individual organisms eventually die. And an interesting row of examples of species comprised of individuals which live practically for ever.
Here’s another explanation.
Charles Darwin’s Evolution was about ‘species’. Not about individuals!
Very few species have been able to survive without ‘killing’ their individual ‘members’. Hydra, the species of fresh water jellyfish pictured above, is one of those species. Each individual hydra is able to survive practically everything but total annihilation. Cut it into pieces and each piece would regenerate the rest of the organism. Allow a big enough (?!?) piece of it to survive while attempting to eat a hydra… and you may be able to eat it again! If you live long enough for the encounter to happen again…
Since when have we been observing this species? A hundred years? Two hundred? Have we had preserved an individual hydra since the start of our observations? Is is still alive? In the ‘original form’? And even if ‘yes’, so what? That would only prove that an individual hydra is able to survive for more than, say, two hundred years. Not that it would live forever…. Again, being able to regenerate a portion of an organism doesn’t mean the whole organism would be able to live indefinitely. As in live forever. Never die… The way I see it, being able to regenerate the rest of the organism is only yet another form of ‘reproduction’, not the ability to live forever. Bacteria use the very same mechanism. We the ones who use a different name for it, under the pretext that bacteria are unicellular organisms…
Now, the fact that there are so few species whose individual members are able to regenerate parts of their organisms does tell us something. And the fact that it’s only the ‘simply organized’ species – among the animal kingdom, at least – which share this ability must surely mean something. Evolutionary wise!
We need to eat. At some point, we discovered that by cooking it we got more out of the food we had at our disposal. Then we learned to cook tastier and tastier meals.
Because we’ve some how convinced ourselves that being happy trumps being alive.
Evolutively speaking, pleasure is a ‘heads up’. It tells us that we do ‘the right thing’. That the food we eat is suitable for us. Nourishing. Evolutively speaking, happiness is a heads up. That we’re on the right track. That we’re doing nothing to jeopardize our survival.
Those ‘heads – up’ were valid. Once… And they still are. When ‘used with discretion’.
The problem being that we’re currently harnessing the horse behind the cart.
We’re no longer pursuing life as a wholesome experience. We just want to be happy! We no longer eat to remain alive. We just want to have a better experience! An even better experience than the previous one…
Should we return to the Stone Age? When so many of us died of hunger? Of illness? Should we give up the ‘pursuit of happiness’ as a legitimate goal?!?
How about being happy while pursuing a meaningful life?
We’ve burned fossil fuels. For a while. Now, after figuring out that the whole planet is about to become to hot for comfort, we’re slowly replacing fossil fuel with ‘renewable power’. Solar and wind… And we’re looking for ways to store that power for when the sun is powering the other side of the planet and the wind has stopped blowing.
Lithium to the rescue! Lithium batteries are the new fad. Powerful enough for Tesla to build around them the ‘coolest’ car ever. Accelerates faster than a Ferrari at less than half the price.
But is this really wise?
Lithium – like oil, has to be dug up from somewhere. Hence it’s not ‘renewable’. Only recyclable, but at a hefty price. Lithium – like oil, is really messy. To produce in the first place and to recycle. Lithium – like oil, can be found rather far away from where its needed. Hence has to be transported over large distances. And happens to be under ‘foreign’ control. Much of it, anyway.
So how much farther are we going to go? On the already ‘paved’ road? On the other hand, I’m sure Nansen had something else in mind. Other than repeating the same mistake.
An alternative method for storing power would be to use daytime solar and ‘excess’ wind power to produce hydrogen. Which can be stored where it is produced and will be used. Or ‘loaded’ unto fuel cell powered cars.
Art is, maybe, the first form of interaction between us and the place we inhabit. The first manner in which we ‘ingest’ that place, only to regurgitate it later. The first manner in which we learn about that place and the first manner in which we express what we have just learned. Esthetics is how we make sense of art. How we organize our ‘first impressions’ regarding the ‘place’ we live in. How we ‘edit’ those impressions in order to make them more easily understandable. Philosophy is what we made out during the artistic endeavor to learn. The never finished product put together by our ‘digestive system’ out of the artistic interactions we have had with ‘reality’.
Techne is what we do. The transformations we impose unto things in order to make them capable to satisfy our needs. Or our whims… Science is the process through which we gather information. The information which becomes more and more necessary as our doings take us further and further away from the original reality. Manipulation is what we do after we consider to have amassed enough information. After we have developed a certain understanding of the world and have decided that time has come for us to ‘take what’s rightfully ours’.
You know what ‘skills’ are. What we’re ‘good at’. Technology is how we pass our skills to other people. So that we can work in concert. To coordinate our efforts. The outcome of which is Reality 2.0. The reality we have brought about. The new reality which constitutes reality 1.0 for those currently alive.
Why on Earth would anybody invest their ‘life savings’ in ‘crypto’?!? Furthermore, why would anybody who has millions of dollars to invest would use a ‘custodial wallet‘?!?
Linkedin took the trouble to inform me that Frontex is looking to hire an Executive Director.
As far as I know, the ‘marks’ for this kind messages are chosen by some ‘algorithms’. Which are supposedly driven by something called ‘artificial intelligence’.
Which makes me wonder…
Are these algorithms intelligent enough to determine that I have the slightest chance of being selected for this position? That I have the slightest intention of applying for it? Alternatively, dumb enough to bother?!? Or are these algorithms intelligent enough to, for whatever reason, attempt to pull my leg?
Quite a large number of people are complaining about how hot it is nowadays. So uncomfortably hot that they have to stay indoors until late in the evening.
And no, they are not pensioners. They work from home, earning enough money to be able to have everything delivered to them.
Which reminds me of my first job, right out of university. A big factory building where water almost froze in winter and temperatures rose to 41-42 degrees Celsius in August. Inside that building were, among other ‘run of the mill’ machine-tools, 3 top of the art automated Czech-built lathes. This story goes back to 1986 and happened in communist Romania. The lathes were very precise but couldn’t be used all the time. In winter they stopped working altogether and in summer they faltered. No amount of fine tuning could bring them back to yielding usable parts. It took a few years for the brass to figure-out what was going on. The lathes were designed to work in a ‘controlled environment’. The temperature was supposed to hover between 15 and 25 degrees for the lathes to function normally. Hence the lathes were ‘sheltered’ in an auxiliary building. A shed built inside the factory. And provided with efficient enough ‘temperature control’.
We, the people, had been left on the outside. Outside the shed but still inside the factory…. freezing in winter and sweat-drenched in summer. Still working, because we were sturdier than the top of the line machinery…
This morning I came across a FB post.
This brought about another memory.
Sometime in 1990-1991 I happened to lay my hands on a Newsweek magazine. Or a the Economist… I don’t remember exactly. Anyway… the article I was going to discuss with you was about the hard life endured by the American poor people. And was illustrated with a color picture. I’m going to make a small break here and inform you that in the 1990 Romania colored magazines – let alone glossy, were hard to get by. That picture, taken somewhere in the Bronx, contained a color TV and three pre-teen kids. All of them clad in blue-jeans and wearing ‘sports shoes’. You know, the likes of Puma/Adidas/ you name it. In those times, in Romania, bluejeans or ‘sports-shoes’ could be had mostly on the black market. Where you had to fork out the wage earned in a whole month if you wanted to buy a pair of each. Or you could buy them in a brand store. For twice the price….
You see, the communist regimes have crumbled because the leaders had lost contact with reality. The brass in the factory where I had started working couldn’t figure out – nor really cared about, the reason for which those lathes didn’t work properly. And didn’t care about the fact that the workers had a very hard life. On the factory floor and outside its premises.
The liberal-democratic and capitalist regime has created huge opportunities. People used to live incomparably better there than in the rest of the world. And continue to do so. On the other hand, in many of the ‘affluent’ countries people have lost contact with each other. The haves have no idea about how the poor live. Nor the poor have any idea about what it means to be rich.
We live in different worlds. In different realities.
Each of us on their own ‘tin roof’.
The problem being that all of them are becoming increasingly ‘hot’. And I’m not thinking ‘global warming’ now…
Communism had crumbled because the rulers couldn’t understand what was going on. Couldn’t react efficient enough to changes brought about by normal evolution. Because the rulers had gradually lost contact with reality. Which inevitably happens in all authoritarian settings.
We are currently living in different realities. In ‘bubbles’. For now, these bubble still have something in common. We are still able to talk to each other. Sometimes we have a hard time understanding what the other has to say – or don’t really care, but the dialog is still possible.
I’m afraid of the day when the dialog will no longer be possible.
The guys in the pan are so obsessed about the taxes they have to fork out that they actually don’t pay attention to anything else. The guys attempting to collect those taxes are so obsessed about what they want to do with the money that they actually don’t pay attention to anything else.
Meanwhile, the world is growing apart. The bubbles lose contact with each other. And with the hard core reality…
The cats can always jump down from the roof. Whenever it grows too hot or too cold. Where are those two frogs going to jump when things will become uncomfortable?
