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| Political Books |
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| Religious Books -- Not Fundamentalist! |
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The Fundamentalist Xtians should not be allowed to hijack the language of Christianity. They are at least as much heretics to Christianity as the Arians and Gnostics of early Christian days.
Biblical inerrancy is not possible.
The books both above and below show the limitations of language and the impossibility of Biblical Inerrancy.
How can language be misused? Using General Semantics, this book was Written to explain Nazi propaganda and still used as a textbook
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| Books - Popular Math, Post Enlightenment & Science |
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This book explains why the above books on Christian Fundamentalism are politically important in America today.
Modern Society measures risk & predicts possible futures. The book below is a higly readable history of insurance, statistics and modern financial instruments.
Compare this to religion, in which it is presumed that the perfect society was known in the past and all that is necessary to do is to return to that perfect society.
Fascinating, highly readable and fun book on modern mathematics and its limitations. If you are interested in ideas, this is your book!
This is a collection of Hofstader's Scientific American articles. Again, a very fascinationg and highly readable book, requiring no mathematical background. (Buy it used - it is one of the books that will keep disappearing.)
Older, very fascinating book on mathematical ideas. Did you know there are three kinds of infinity?
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| Sunday, May 25, 2008 |
| Is oil going up in price partly because the banks have no capital left? |
Ian Welsh at FireDogLake offers an interesting and plausible reason why oil prices are going through the roof.
Consider this. The world and especially the U.S. has spent the last three to four decades reorganizing our societies so that the extremely wealthy are able to extract money from the middle class and the poor. So what do the extremely wealthy DO with all that money? It is far beyond what they can spend on consumption, and besides, it is the basis of their exalted social status. They have to keep the wealth intact and even grow it where possible.
Investing all that money in potentially productive enterprises is simply too small scale and retail to be bothered with. Only large scale banking, far removed from the real economy and very much subject to government rules and regulations instead of economic success. Keep in mind that neither IBM nor Microsoft bothers with a market that has revenues of less than a billion dollars. They wait for someone else to prove the market and then buy them out. Entrepreneurs do not operate at the level of great fortunes. The uncertainty is too great for the investors with great fortunes to invest. They want only proven markets.
So where do the investors of great wealth invest their money?See, there's a lot of loose money floating around in the world. Not only are the rich richer than anytime since the Gilded age, but due to the miracle of leverage you can easily take one million and turn it into, no joke, 100 million worth of speculative cash through the joy of leverage. Once you've got all that leveraged cash, however, you need to find something to do with it.
In the nineties that money went mostly into stocks. And so we had the dot-com bubble and the attendant frenzy.
Since then stock prices, if you measure them in Euros, have remained pretty close to flat. There have been some rises and falls, but basically, movement has been minor and soon lost.
Instead, in the 2000's that money split largely between four types of plays.
1. Labor arbitrage plays in which you move production from the 1st world to 3rd;
2. Real Estate plays, largely through the vehicles of mortgage backed Collateralized Debt Obligations (though there are other kinds of CDOs which also got great play) and other chopped up securities packages;
3. Currency speculation; and,
4. Commodity speculation.
Labor arbitrage plays are still ongoing but they're slowing down a great deal as the US economy moves into recession and as costs in China and the core areas of India increase.
Real Estate plays are over. All types of real-estate markets are collapsing.
The other two types of plays - currency speculation and commodity speculation remain available. So you've still got your billions and trillions of money floating around, because rather than allowing deleveraging to occur properly the Fed and other central banks are sweeping the junk into trash bins, and that money is still looking for returns. There are no great new industries or technologies to invest in that can soak all that money up doing useful things. Sure, you can put a few hundred billion into alternate energy, but that's peanuts. The rest of it has no where productive to go.
But it still needs to make returns. And there's nowhere for that money to go but into currency speculation (against the US dollar, not that the US dollar shouldn't be collapsing based on fundamentals) and into commodity speculation. And since there are some fundamental reasons why food and oil supply are down, those are good places to pile that money into.
Oil and food prices, based entirely on fundamentals, would have risen. China and India coming on line is raising the demand for oil significantly. Climate instability and stupid government policies like ethanol price support are amongst the factors decreasing supply relative to demand for food.
But neither of them would have risen as fast or high as they did without speculative excess. If this is a correct explanation it carries with it proof that extremely unequal incomes carry a major social penalty. The high prices of oil, commodities and food are killing people around the world. No one's personal wealth is worth that social cost.Labels: economics, Finance, Income inequality, Oil |
posted by Richard @ 6:17 PM   |
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| 2 Comments: |
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The problem with blaming the price rise in both oil and food on speculation is that this would show up increased stocks of these commodities. Somebody buying oil on spec would need to hold that oil off the market until the price rose at which point he could sell it for a profit. This would show up increased stocks. Yet stocks have not gone up.
Paul Krugman has talked about this on his blog quite a bit.
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There are two ways to speculate in oil. One is the physical method Krugman talks about. The other is futures/options. And while in theory in a futures contract you could wind up with a load of oil, in practice you close out before that happens if you're a speculator.
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The single most important essay that I have published here is Rule of Law vs. Arbitrary Command.
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The problem with blaming the price rise in both oil and food on speculation is that this would show up increased stocks of these commodities. Somebody buying oil on spec would need to hold that oil off the market until the price rose at which point he could sell it for a profit. This would show up increased stocks. Yet stocks have not gone up.
Paul Krugman has talked about this on his blog quite a bit.