wealth – William Dare

A Case for Economic Equity and Long-Term Growth

Framework: Examine macroeconomic policy issues as well as the theoretical assumptions underpinning their conclusions within a political Liberalism framework that ensures and upholds the democratic values of liberty and equality inherent to the constitution. The complexity of economic development requires a holistic empirical approach that accounts for the historical, political, sociological, and business factors contributing to the makeup of society when crafting and recommending economic policy.

Overview: Economic growth is the aim for any society. Inequality is a product of increased bargaining power resulting from increasingly powerful institutions in the business, financial, and governmental sectors. Research has repeatedly confirmed growing inequality globally and domestically. Inequality, manifested as widening income and wealth disparity, contributes to domestic and global account imbalances, consumer debt, and economic stagflation, i.e. inflation and unemployment. In addition, inequality is linked to key social variables such as political stability, civil unrest, democratization, education attainment, health and longevity, and crime rates. Greater economic equality always results in greater long run economic prosperity for the whole.

Thesis: Bargaining power inequalities causally contribute to economic and socioeconomic inequality due to path dependency, organizational inertia, and habit formation. Bargaining power inequalities increase proportionally with capital accumulation, concentration, and centralization. Restoring bargaining power will rectify financial and labor market imperfections and spur economic growth.

The Problem

Increasing debt, unequal capital accumulation, stagnating wages, and increasing inflation are responsible for the steadily rising economic inequalities experienced the past several decades. The habit formation of conspicuous consumption has compounded the impacts of income inequality.

Inequality has deleterious effects on social well being and long term economic growth, and is the source of a host of cultural ills, affecting education, healthcare, political corruption, etc. It also affects entrepreneurship, creativity, and technological innovation in the long run.

The Cause

Historical monetary policy, financialization, and financial liberalization (deregulation) have directly contributed to exacerbating economic inequality by negatively affecting business cycles through the misdirection of short term economic incentives and failing to consider the long-horizon. In addition, credit market imperfections, due to asymmetrical preferences and institutional constraints, causally contribute to inequality, in both physical and human capital accumulation.

Bargaining power increases with capital accumulation, concentration, and centralization both domestically and globally, establishes organizational inertia in business and legal exchanges, and further compounds the effects of inequality. Avoiding full employment decreases labor demand, in turn decreasing wage bargaining power, leading to wage stagflation.

The Solution

Increasing economic equity yields the highest long term economic growth, improves social well-being, facilitates creativity and innovation, and empowers society to resolve its cultural ills.

Economic equity can be achieved by restoring bargaining power, regulating financial investment activities, incentivizing real-asset investment, and implementing a single structured tax policy on the wealthiest.

A Prediction

To pay off our $15.5 trillion national debt the government will continue monetary expansion and quantitative easing, i.e. printing money. Inflation will rise. Prices Increase. Income/ real wages will stagnate and unemployment will increase as businesses look for ways to cut costs. Since businesses possess bargaining power, wage labor markets will suffer. The cost of living will be so great that people will be forced to reign in consumption and cut spending. If you have debt (financed by wealthy private domestic lenders), you will have difficulty paying it off because cost of living has left you with less money to live on. If you can’t pay it off and file for bankruptcy, they will not only repossess your assets, you’ll still be in debt, thanks to recent revisions in Chapter 7 and 13 Bankruptcy laws. What’s left of the middle class will continue getting squeezed until the income disparity is so large that poverty will be the norm. Meanwhile the wealthy will get richer as they continue cashing in on your debt.

A word of advice: get out of debt, fast.

Now, I have to ask myself: if income drops and consumption decreases, and if credit and loans are more difficult to obtain, what will sustain the domestic demand that drives economic growth? Simplified: if 90% of the country has no money, how will they buy things, and how will businesses make money?

Data indicates that our GDP has continued increasing and is back to pre-recession rates.

What if I said GDP is a worthless measure of the economy? What about exponential growth in inequality? What if I said real wages were a better determinant of economic prosperity and success?

Wealth Disparities and Debt

Despite a steady increase in aggregate output/ GDP over the past several decades income inequality has risen exponentially. From the 1970’s to present, earnings of the top 5% of citizens have risen steeply while earnings of the bottom 95% have stagnated (adjusted minimum wages is lowest in history). As it stands a small fraction of citizens own the vast majority of capital assets, liquid or illiquid, while the other 80% of the US population owns 7% of the wealth. Compounding multiple decades of real wage stagnation has been a continual rise in the adjusted consumer price index. Due to stagnating wages and rising prices, the savings rate for citizens– specifically the low and middle class– has seen a chronic decline and historical lows. As a result of these financial pressures the US population has accrued massive consumer debt to maintain consumption, of which 33% is revolving credit (such as credit cards) and 67% is comprised of loans (such as mortgage, car, student, etc).

Due to the dollar’s position as the worlds reserve currency, the past several decades have seen rising global account imbalance as foreign investment in the US steadily increases. Most of this foreign investment wealth originated from gains in the emerging Asian markets and increases in commodity, energy, and oil prices. With the US leading the world in developed financial markets, foreign investors are attracted to the financial liquidity of US markets. In addition, they perceive US assets as safe investing due to its reliable historical growth and stable government.

In the years following the tech bubble collapse, many believed that the low interest rates post 2001 would cause a run on the dollar. Instead foreigner investors looked for other American safe-assets. This high demand, combined with competitive greed and lack of regulation, led to the development of debt markets and their financial instruments and securities such as CDO’s and CDS’s. (Financial institutions placed additional pressure on mortgage lenders to find borrowers to meet demand. With rising real estate prices, this wasn’t difficult. These debt markets had exceptional yields and were thought to be reliable and safe assets.)

Due to bargaining power imbalances and habit persistence over income, lower class wage inequality has risen with increases in aggregate output. The rise in income inequality has been much greater than the rise in consumption inequality due to borrowing and taking on debt; that is, despite low and middle class income income/ wage stagnation, borrowing has allowed their consumption to increase, fueling domestic demand. However, because the lower class does not have access to international financial markets, they must borrow from wealthy domestic lenders. (From 1998-2008 private credit from other financial institutions, i.e. credit cards, loans, etc., rose from 37% to 150% of GDP, whereas private credit from deposit money banks rose marginally from 55% to 65%.) The sustained increase in consumption from borrowing has kept domestic demand high and increased aggregate output. It also created a deficit as domestic lenders acted as intermediaries for foreign investors who sought financial safety in the dollar in the form of liquid financial assets. Over the years this system has exacerbated inequality as lower class consumption and income decreased to the benefit of the wealthy as their consumption and investment assets increased.

Income Inequality and Financial Liberation

I’ve been thinking a lot about what’s going on in the US economy. Every time I hear someone talking about how to fix it, I feel that they have it horribly wrong. They just aren’t looking at the facts. They aren’t asking themselves where these facts point. This includes my robotic peers and my calcified professors. Everyone one wants to speculate with their platonic definitions and abstract calculations and no one wants to look at the facts, the actors, to data, the trends, and it’s really disconcerting.

That being said, I’ve just read several journal articles on this topic and one struck me most poignantly, titled Income Inequality and Current Account Imbalances by Kumhof Et Al of the IMF. Not only did their hunches and conclusions resonate with me beautifully, they happened to address the exact questions I’ve been wrestling with in my own journals and writing. It was a relief.

In sum, I believe the that the major source of our problems revolves around global account imbalances. More specifically, the global account imbalances and the low world real interest rates were the primary source that fueled financial instability leading up to the 2007 financial crisis. I believe that the perception of foreign investors that the US was a haven for ‘safe-asset’ investments, compounded by low interest rates post 2001, fueled financial recklessness leading to the financial crisis and our current recession. Before I explain…

Let’s establish the facts– basic facts– and ask ourselves some more questions regarding how these facts came to be (we can get into details later):

Rising Income Inequality

Top 5% earnings have risen steeply
Bottom 95% earnings stagnated

High Unemployment: recently between 8-9% (Severe demographic variability)
Wealthy own majority of capital assets, liquid or illiquid

80% of US population owns 7% of wealth
Wage Stagnation: Real wages have not risen in 30 plus years

Consumer Price Index has risen during the same period
US Savings rate: Historical Lows; downward trend since early 1980’s

Current consumer savings rate 3.75%

Massive Consumer debt Increases

33% revolving credit (credit cards)
67% loans (mortgage, car, student, etc)

Massive Private Lending Increase

From 1998-2008 private credit from other financial institutions, i.e. credit cards, loans, etc., rose from 37% to 150% of GDP
From 1998-2008 private credit from deposit money banks rose marginally from 55% to 65% of GDP

Rising Global Account Imbalance

Rise in Foreign Investment in US
US Current Account deficit 3.3% as of Dec. 2011

US is the worlds reserve currency: Safe bet for investing
US has most developed financial markets

High liquidity assets: investing is attractive

Debt yields good returns: Debt markets are lucrative and considered “safe assets” (more the case in the past; not so much as of recent)
Expansionary Monetary Policy: Federal Interest Rates 0% (Open Market Operations, Quantitative Easing, etc)

Buy bonds from banks, Increase bank reserves supply
Increases money supply

Increase inflation
Increases consumer prices (CPI)

Lowers interest rates

Increase lending/ borrowing

Scarcity value: Increased scarcity (decrease supply) drives up prices
Bargaining power: the concept related to the relative abilities of parties in a situation to exert influence over each other

Wage bargaining: caused wage stagnation
Thorstein Veblen describes the manifestation of this sociological phenomenon in his book The Theory of the Leisure Class

These are some basic facts regarding the current state of things. Let’s cite some facts relating to economics, finance, human behavior, and the like:

Compounding Interest: Returns are exponentially proportional to investment; the more money you have to invest, the greater the return
Investment requires surplus capital, and surplus capital requires saving
‘Wealthiest’ possess vast majority of all surplus (investment) capital and therefore investment power

Investment power is concentrated to a very small fraction of the population

When investment capital begins to concentrate in one investment area, that investment’s value will begin increasing as the price is bid up (scarcity value), fueling reflexive expectations, which causes speculation, drawing in more (and smaller) investors and more reflexivity, leading to an eventual bubble and collapse when the largest investors begin pulling their money and running.

Consider the following: High domestic account deficits indicate high income inequality.
Why?

The poor and middle class do not have access to international capital markets, they rely on borrowing from the wealthy
When Aggregate Output increases and lower class receives smaller share, i.e. decreased income/ wages because lack of bargaining power, they are forced to borrow from wealthy.

Due to this borrowing, the lower class’ drop in consumption is less than their drop in real income, while upper class consumption and assets increase along with aggregate output

Domestic demand continues to rise, which fuels current account deficit, as wealthy increase their domestic lending and supplement their lending with foreign savings
Income inequality is exacerbated.
Domestic Political Interventions increase in an effort to alleviate those suffering from stagnant real wage

Typically symptomatic treatment through Cheap Borrowing/ Financial Liberalization

Short-term success in preventing drop in consumption from lower class.
Long-term increases in domestic debt levels, higher debt services, and therefore lower consumption.

The authors of Income Inequality and Current Account Imbalances look at how income inequality is exacerbated by domestic lending of the rich. As rising aggregate output/GDP is coupled with rising income inequality and stagnating wages, poor/ middle class consumption is less than their drop in income due to domestic lending of the rich. (Prices go up, they get more credit/ debt, buy more, fuels domestic demand, aggregate output increases, current account deficit widens).

The typical short-term political fix is to target policies that allow for cheaper borrowing/ financial liberation (Hence the fed is keeping rates at 0% to increase borrowing). But long-term financial liberation only leads to higher domestic debt levels, higher debt services, and lower worker consumption: it generates increases in workers’ consumption, yet slows down capital accumulation as investors prefer financial over real assets (less value-added investing, more speculative investing, i.e. financial securities, real estate, etc, eventually leads to economic stagflation…. current situation?).

The article continues by discussing historical economic trends and the global repercussions if new policies are not sought to address these systemic issues. They project that the issue of domestic indebtedness will spread globally as the income inequality gap widens and financial liberation continues.

Income Inequality and Financial Liberalization

I’ve been thinking a lot about what’s going on in the US economy. Every time I hear someone talking about how to fix it, I feel that they have it horribly wrong. They just aren’t looking at the facts. They aren’t asking themselves where these facts point. This includes my robotic peers and my calcified professors. Everyone one wants to speculate with their platonic definitions and abstract calculations and no one wants to look at the facts, the actors, the data, the trends, and it’s really disconcerting.

Let’s establish the facts– basic facts– and ask ourselves some more questions regarding how these facts came to be (we can get into details later):

Rising Income Inequality

Top 5% earnings have risen steeply
Bottom 95% earnings stagnated

High Unemployment: recently between 8-9% (Severe demographic variability)
Wealthy own majority of capital assets, liquid or illiquid

80% of US population owns 7% of wealth
Wage Stagnation: Real wages have not risen in 30 plus years

Consumer Price Index has risen during the same period
US Savings rate: Historical Lows; downward trend since early 1980’s

Current consumer savings rate 3.75%

Massive Consumer debt Increases

33% revolving credit (credit cards)
67% loans (mortgage, car, student, etc)

Massive Private Lending Increase

From 1998-2008 private credit from other financial institutions, i.e. credit cards, loans, etc., rose from 37% to 150% of GDP
From 1998-2008 private credit from deposit money banks rose marginally from 55% to 65% of GDP

Rising Global Account Imbalance

Rise in Foreign Investment in US
US Current Account deficit 3.3% as of Dec. 2011

US is the worlds reserve currency: Safe bet for investing
US has most developed financial markets

High liquidity assets: investing is attractive

Debt yields good returns: Debt markets are lucrative and considered “safe assets” (more the case in the past; not so much as of recent)
Expansionary Monetary Policy: Federal Interest Rates 0% (Open Market Operations, Quantitative Easing, etc)

Buy bonds from banks, Increase bank reserves supply
Increases money supply

Increase inflation
Increases consumer prices (CPI)

Lowers interest rates

Increase lending/ borrowing

Scarcity value: Increased scarcity (decrease supply) drives up prices
Bargaining power: the concept related to the relative abilities of parties in a situation to exert influence over each other

Wage bargaining: caused wage stagnation
Thorstein Veblen describes the manifestation of this sociological phenomenon in his book The Theory of the Leisure Class

These are some basic facts regarding the current state of things. Let’s cite some facts relating to economics, finance, human behavior, and the like:

Compounding Interest: Returns are exponentially proportional to investment; the more money you have to invest, the greater the return
Investment requires surplus capital, and surplus capital requires saving
‘Wealthiest’ possess vast majority of all surplus (investment) capital and therefore investment power

Investment power is concentrated to a very small fraction of the population

When investment capital begins to concentrate in one investment area, that investment’s value will begin increasing as the price is bid up (scarcity value), fueling reflexive expectations, which causes speculation, drawing in more (and smaller) investors and more reflexivity, leading to an eventual bubble and collapse when the largest investors begin pulling their money and running.

Consider the following: High domestic account deficits indicate high income inequality.
Why?

The poor and middle class do not have access to international capital markets, they rely on borrowing from the wealthy
When Aggregate Output increases and lower class receives smaller share, i.e. decreased income/ wages because lack of bargaining power, they are forced to borrow from wealthy.

Due to this borrowing, the lower class’ drop in consumption is less than their drop in real income, while upper class consumption and assets increase along with aggregate output

Domestic demand continues to rise, which fuels current account deficit, as wealthy increase their domestic lending and supplement their lending with foreign savings
Income inequality is exacerbated.
Domestic Political Interventions increase in an effort to alleviate those suffering from stagnant real wage

Typically symptomatic treatment through Cheap Borrowing/ Financial Liberalization

Short-term success in preventing drop in consumption from lower class.
Long-term increases in domestic debt levels, higher debt services, and therefore lower consumption.

The Great Dichotomy: Passionate Power

Random musings.

Money to get power, and power to guard the money.”
~Medici family motto

Dichotomies are interesting. Many are none other than existential paradoxes: mind and body, thought and matter, possibility and necessity, spiritual and physical, and the list goes on. Kierkegaard, as well as Nietzsche and other agents of enlightenment, was a literary guru when it came to expounding upon how to live with these irreconcilable realities. Over the years I’ve learned to cope with the resulting blindness of these realities, the otiose character of life and the recondite disunion of body and soul. I’ve compromised with myself and learned to live with one eye pointed inward and the other pointed outward so as to balance introspection and aspiration.

In recent years I’ve faced a dilemma of deciding what to do with my life and career. It’s not like I didn’t see this crisis coming, but I guess I didn’t realize how many times I would be wrestling with my conclusions and convictions. Despite the temporary setbacks and failures mottling my youth, I’ve orchestrated my education beautifully over the years, exploiting a multitude of disciplines of thought and growing ever cognizant of how achievement is actualized. I’ve gone to great pains to realize the context of my condition and the contingencies of my aspirations.

Out of my experience grew two concentrations of study, economics and philosophy, each representing the broader dichotomies encompassing life. One satisfies my intuitions about what I perceive other people to value, the other regards what I value in my heart. I’ve tried to reconcile these over the years and explain why this dichotomy exists, whether a balance can be achieved, or what direction I should favor. For a long time I decided to refuse to sell out. But this clashed with the omnious system that I would face upon entering the workforce: success seemed tantamount to abiding to the myriad of expectations laid out by others. As I have no trust fund to lean on for support, no assets to buy my way into fortune (compounding investment: you must have money if you wish to accumulate more money), I faced the reality that no upper echelon would endorse my musings, my art, my thoughts, unless I belonged to them, to their network or, by chance, satisfied their criterion of worth.

The citizen of the world in me refused to conform to the ‘system’, to the authority that dictates standardized achievement and propagates worldly values. The autonomy within me bucked as I studied philosophy and developed the tools and methods for critical inquiry, tools I used to ridicule the backward nature I learned to see in the world. The pragmatic element of my spirit recognized the utility of conformity and uptook various preoccupations that would fashion my mind according to them, such as the study of economics and finance.

But I ask myself: what does it take to be successful? I always like referring to the context in question. I’m American. I live in a ‘democratic’ country where the few rule the many. The few in this case are not the parasitic politicians (although in many cases, when it’s convenient, they are one in the same). The politicians are figureheads, merely the arm or scepter of power, not the head of governance. The true source of governance and power resides in the wealthy, the capitalists, the business owners, the stock holders. These are the greats that arbitrate the economic and political atmosphere. They embody the will to power. They pass the laws, set the wages, orchestrate the commerce, conduct the symphonious marketplace we’re lead to believe is free and open. The current sentiment is that if governance is left to the people, we’ll be in a real mess. The populous is simply a bewildered herd, uneducated and incapable of self-rule. (The Wagner Act of 1935 was the last real effort of the masses to mobilize. Since then these efforts have been squashed. Unions are ‘evil’ and communist.) This is why we live in a ‘democratic republic’ where we elect a small group of ‘leaders’ to instruct the masses on which policies they should live by.

To be successful you must be a sycophant. More specifically, you must possess utility for those in power. If you cannot help these people achieve more power, you are worthless and will amount to nothing more than a cog, expendable and interchangeable. But the wealthy will not extend a job or opportunity to just anyone with ample capacity and a strong will. No. They must be familiar with you. You must possess some wealth, influence, charisma, intelligence, talent or power that they can leverage for their own gain. Posterity is as empty as truth. Rationality is an instrument of the powerful: they dictate the rules of the game, the vernacular, the premises and logical structure of your success.

“All things are subject to interpretation whichever interpretation prevails at a given time is a function of power and not truth.” (Nietzsche)

Rationality is a function of motives, of intention. Pin-point desires and motivations and you can construct a cathedral of reason to leverage against those in power to mutually achieve independently contrived ends.

The questions that have wracked my mind most over the years: Do I follow my heart or my mind? Do I follow my passions or my prudence? What it’s come down to is that, given the current state of affairs, given my context as a young American, passions are prized only in youth, as is freedom. With the coming of age what is most prized is security, with the passions left to fantasy much like the irrealism of dreams are left to enamoring vagaries. We discard our passions and convictions, our fantastical visions of grandeur for a better world, in favor of a ‘realism’ scented with a dark cynicism that dispels illusion, that acquiesces under the ‘system’ that we obey out of sheer necessity grown from our will to survive. What has been trampled is our will to power, but it is never too late to revive this urge.

The artists, when they are not lining the capitalists pockets with profits, are simply muses in the most passive sense of the term. These artists are no longer concerned with inspiring as much as they are fixed on entertaining, or ‘amusing’, for their agenda is the same as the capitalists: money. They render the audience as docile and facile as possible, getting them in a blurred frenzy, caught up in emotion, totally distracted from the realities that oppress their sad existence. The poorest, the most impoverished left with only their intangible dreams, love these entertainers the most. Since they cannot live through possessions and materialism they escape through fantasy, artificial emotions induced through hollow emotives.

I’ve decided I want to sell out, for a time. I want to master the system so I can one day create the system. Considering my background, I’ve played my cards right up until now: the best university, the best internships, solid degrees, great grades. What is necessary now is to capitalize on these achievements instead of forfeiting them for the preponderances of my heart, the longings of my spirit, the existential conundrums I unravel in my reflections.

What I need to do is exploit the source of power for my ends: finance. I need to get into the industry where all the wealthy have a mutual stake. Wealth is the common denominator of power. Investment banking, wealth advising, asset management.

I need to toss these ephemeral thoughts about passion, about right and wrong, about selfless creation, to the garbage. They are fruitless. If I want to succeed, I must capitalize on my strengths: people skills, smooth talking, will-power, vision, charm, intelligence, good nature, pleasant appearance. I can be obedient. My rebellious nature was resistant to obey arbitrary authority, and my attitude throughout school and to my superiors proves this. But this needs to be corrected if I am to succeed and dominate. I must fawn these superiors in order to advance. There are many who wish to succeed, but only those who stroke the ego’s of those holding the keys to power will allow be to ascend to their true potential. I look around me and I see so much talent. Young automatons do everything right, except they haven’t a clue that doing everything right has a ceiling. You must not only serve the interest of your superiors, you must also create value for them, you must learn to hijack and supplant their vision with yours in order to aid them in their accumulation and concentration of capital. In this way achievement is guaranteed.

Morality does not exist. There are no facts, only interpretations. You cannot have a universal moral conscience as a businessman, as a ruler of wealth: only a fabricated justification that accepts the inequality of man as a rule. Nietzsche said, “The reasons for which ‘this’ world has been characterized as ‘apparent’ are the very reasons which indicate its reality; any other kind of reality is absolutely indemonstrable.” Those in power dictate these reasons. Their are the moral clergymen.

It’s interesting to consider the influence of media control. The media is the mouthpiece of the powerful. As Chomsky said in his book Media Control, “Propaganda is to democracy what the bludgeon is to a totalitarian state.”

Who rules the world? The powerful, the elite. These are the American ruling class. We elect proffered politicians which have been paid for by these elite with the single agenda of taming the bewildered herd, of keeping the masses complacently compliant.

Slavery was replaced by share cropping, which has been replaced by credit and loans: all of these forms of debt rob the citizens of equality, life and liberty, and it’s legal. Bankruptcy laws. Capital gains taxes. Trickle down economics. Sub-prime mortgage lending. Failed education reforms: No child left behind. The war on drugs. The rise in pharmaceutical psycho-therapeutics. Currency manipulation: Coinage Act of 1972. Foreign wars and fear mongering, communism, creating enemies like Russian and terrorists as a means of keeping the populous paralyzed and fearful, of keeping their attention turned outward instead of inward. All creating fear. All manufactured to suit the ends of the elite. All propaganda.

Truth and lies are one in the same. They condemn or praise according to which subjective end you are most vested.

Aging and Poverty: Longevity and Wealth

So I e-mailed a group of my more thoughtful and opinionated friends the following link:

DNA test links ageing and poverty: Scientists in Glasgow develop a new test of the ageing process, which confirms it is linked to social factors.

They responded to the article back and forth in typical jesting fashion (see below). These are my abridged thoughts:

I’d like to add my psychoanalytic interpretation: In the American capitalist culture, wealth and materialism are some of the most prized values. The failure to achieve success in their acquisition, as typified by the vast majority of people, may be the cause of the depression and anxiety we identify as being so prevalent.

Think about it: If you existed in a culture where the value of a person was measured in terms of wealth and material possessions, and you lacked these things, what would that do to an individual’s psyche? My guess: it would result in a profound neurosis, something like the collapse of the ego, due to the failures to live up to these societal indicators of value. The duress of this failure would undoubtedly cause a physical stress to manifest in all sorts of ailments.

Of course, our society doesn’t only see the value of a person in wealth and material accumulation, but mainstream media and pop-culture definitely over inflate how important these values should be perceived. Depending on your cultural influences, anything could cause a neurosis like depression if you were to fail to live up to a societal standard of value and success. Most other cultures value family, community, altruism, intelligence, religion, etc. In some parts of China culture academics seems to be the trump value, in South American cultures we find family, in Middle Eastern cultures we find piety and devotion. The list goes on. Failure to live up to these values in their respective culture would be a major blow to the ego.

My point is this: in a culture that emphasizes values such as wealth that inherently operate as a result of scarcity, it’s no wonder we have so much ‘mental illness’ such as anxiety and depression. It is impossible for everyone to possess a value that by definition is reserved for few. Yet, capitalism relies on our desire to live out this fantasy in order to consume and possess by any means possible, even if it means selling ourselves as slaves to debt.

The remedy exists in realizing that these values are culturally dictated and that your value as a person can and should be self-generated and dictated from within; and this is by no means an easy task. We navigate our world through symbols and the symbolic meanings attached to them are typically inherited from our culture: community, family, peer group, etc. It’s extremely difficult to overcome this conditioning, and I’d say that only the most genius in a society ever successfully create a system of values and meanings that are original to them and them alone.

I’ll end by saying that stress is a major cause of physical aging. The more money one has, the less one has to worry about. You may argue that accumulating that wealth may cause even greater stress, but I’d defer to a Bible verse to counter: “For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs” (1 Timothy 6:10).

Now, I’m not a religious person, but I mine for wisdom where I can find it. Having money and loving money are two different animals in my book. If you can accumulate money without getting absorbed in a romance with it, I believe you will not only live longer, but you will live happier!

Continue reading “Aging and Poverty: Longevity and Wealth”

Alfred Marshall and the Growth of Wealth: A Short Microeconomic Analysis of Wealth Accumulation

Alfred Marshall was a pioneer in economics, even by today’s standards. In 1890 he published Principles of Economics which, compiled from years of study and contemplation, proved to be his magnum opus on economic thought. The work was so fastidiously compiled that it served as a standard in which all economic thought over the next century would respectfully consider. This essay will delve into the concept and history of the growth in wealth. A brief outline of Marshall’s descriptive analysis of wealth accumulation will provide a basic framework that can be used for comparing Marshall’s thoughts to that of other economists.

Continue reading “Alfred Marshall and the Growth of Wealth: A Short Microeconomic Analysis of Wealth Accumulation”

Richest 2% own ‘half the wealth’

People live in a box. They refuse to look past the limited belief system that the world lives by. Or they just don’t know how to look beyond. Read this article . & Read this article. It will open your eyes.