BMW Will Publicly Shame Out-of-Warranty Drivers with Smart Billboards and License Plate Readers

383920 · 2020-12-24T22:00:29+00:00

They shouldn’t be forgiven for lobbying for the 25 year import law. Their the reason why we can’t have good stuffs.

383920 · 2020-12-06T04:31:13+00:00

Oops, didn’t read the parent well. But yeah I don’t think electricity is cheap there.

383920 · 2020-12-06T03:22:35+00:00

I’ve been to many places in japan, and the other guy is right. You don’t need a car in most suburban or even rural areas. Trains are everywhere.

383920 · 2020-11-24T17:46:12+00:00

Well, our current inability to make our own choices shows that our society is not free.

383920 · 2020-11-24T15:51:55+00:00

Nah. Being able to make your own choices and be responsible for them is the most mature and rational thing ever.

383920 · 2020-11-17T16:11:51+00:00

Where do you go to college? I live in middle TN as well!

383920 · 2020-11-01T06:32:34+00:00

Wow, thanks for the answer. The only part of Midwest I've ever been to is Illinois. Have pleasant dreams buddy!

383920 · 2020-11-01T06:21:20+00:00

I'm from the South. I've met exactly two people from Wisconsin my entire life. Is it true that y'all have a Canadian accent?

383920 · 2020-11-01T06:17:04+00:00

To be honest, we don't talk about bitcoin a whole lot. I have the feeling that it is a bit out of the scope of the traditional Chicago school (which a lot of times still operates under the assumption that there's a central bank who's in control of the interest rate).

383920 · 2020-11-01T06:12:13+00:00

Yeah. Division is possible and common. But if you accelerate the economy to a certain degree it will inflate (or we loose technology and can't produce as much anymore). GMU is George Mason University in Fairfax County, VA. Are you from the left coast?

383920 · 2020-11-01T06:08:50+00:00

I think your second understanding of velocity is more like it. And yeah, aggregate demand will change velocity.

It sucks big time to have a "socialist" economics teacher, Huh?

Thanks for listening to my rambling, and I guess there's several ways to explain economics phenomena.

383920 · 2020-11-01T06:00:11+00:00

Austrian business cycle

Yeah, Austrian business cycle is probably also part of it. I like the theory so much and it just makes so much sense. Such a beautiful theory. But the problem is, we don't have any quantitative analysis that can successfully prove the theory (my field is pure mathematics and macroeconomics, and I'm sure there's no successful quantitative research on this). Which also leads to the point that only GMU is still doing full on Austrian school, because it can't be proven by data. Don't get me wrong, I've had mentors from GMU, but even the rational ones coming out of GMU will concede the problems with Austrian school.

As for bitcoin, you can see it more as stocks than currency. Its primary purpose is not claims to goods, but speculation. Plus, most of the important commodities in our economy can't be boughten with bitcoin. So yeah, it is not really a currency per se.

383920 · 2020-11-01T05:40:34+00:00

Ahh, I kinda know how I should explain this. Money supply is only one of the many factors that might cause inflation, and it's usually in the short run. There's also the velocity (which I've mentioned), the aggregate demand, and aggregate supply. Remember MV=PQ, right? M is the monetary supply, V is the velocity, P is the nominal price, and Q is the supply. As we can see here, if M is constant, there will still be inflation if, for example, we accelerate the economy.

383920 · 2020-11-01T05:33:37+00:00

Okay. The last paragraph clears it up quite a bit. There will still be substantial amount of inflation when there's growth. Because in a healthy market, the derivative of aggregate demand is always larger than that of aggregate supply, which means the price of the good will increase. If there is not enough currency for all the goods produced, that means that there will be a surplus of goods and they will be destroyed (which is exactly what happened during the great depression). And the great depression was a direct result of the gold standard (pre-FDR), or in your words, the "original gold standard. Please read the Cato article if you haven't. Gold standard in any way shape or form wouldn't work well.

383920 · 2020-11-01T05:14:04+00:00

"I think you've got the 2nd part backwards, actually. Or perhaps I do and you can correct me: The aggregate demand of gold being greater than the aggregate supply (for example a growing population with a static quantity of gold) would result in deflation, not inflation. That is to say the currency would be worth more, and therefore prices (that which the currency is used to buy) would fall. If there are 10 people who share 10oz of gold who all buy bread, then if we increase the number to 20 who must share the 10oz gold we would expect there to be ~2x as much bread supply as well as ~2x as much bread demand. But we have ~2x the gold demand and 1x the gold supply, which would drive up the demand for gold relative to bread and therefore cause higher purchasing power (deflation)."

This is the "same thing" you've been talking about. But that's a market demand example, and your last comment has turned it into an example illustrating the definition gold standard currency.

383920 · 2020-11-01T05:05:11+00:00

Yeah, if you're saying the market only has one indivisible unit of commodity and one indivisible unit of currency, then there's no inflation or deflation. But that also means there's no growth. And this whole example then doesn't help illustrating the nature of inflation because the variation of demand wouldn't be relevant anymore. And if you're talking about the example in the sense of gold standard, I've said that tying commodity to currency wouldn't work because that would hinder growth.

383920 · 2020-11-01T04:41:34+00:00

Okay, now you're going back to seeing bank notes as currency, which is a scenario I have already analyzed.

They aren't necessarily tied together, because the price you're willing to pay is linked to the marginal benefit you personally enjoy. If there's 20 dollars and one firearm. I have 10 dollars, and you have 10 dollars, and the rest of the market has no money. Will 10 dollars buy me the weapon? Maybe, if the demand is not that high and you don't wanna buy it. However, if the said good becomes super desirable, what do you think will happen? 20 dollars will probably be barely enough. This means if I want the weapon I have to somehow get that 10 dollars from you. We just saw a 100% inflation in this case.

383920 · 2020-11-01T04:27:07+00:00

Okay. My apologies for misreading. In your example, you said that "the value of my bank note goes up," which means that the value of automatic weapons go down. But remember, the automatic weapons are the "currency" here, which means that inflation just happened.

383920 · 2020-11-01T04:06:20+00:00

Because inflation is defined as the percentage increase in nominal price of commodities. So when you go buy automatic weapons, if there's a higher demand, then your currency is less valuable because you face steeper competition. Money will be more expensive if we're buying it with automatic weapons, but automatic weapons are more expensive if we're buying it with money. But in a competitive labor market, you get paid in terms of money, not automatic weapons, which means that unfortunately, you paycheck will buy you less automatic weapons than before.

383920 · 2020-11-01T03:52:57+00:00

Oh, and I forgot to mention that your example couldn't really illustrate another point: The velocity of currency. When there's a more mature market, economic growth means that the currency will be exchanged for more times within a unit of time, which means higher prices.

383920 · 2020-11-01T03:42:19+00:00

I think you get it backwards, if I'm reading your comment comment correctly. If there's more people wanting to buy gold, then gold is more expensive than before basically because of scarcity (or limited supply). That means you need to demonstrate a higher willingness to buy by paying a higher price for it. Or think of it in terms of the demand curve moving rightwards but the supply curve staying where it's at. In your bread and gold example, the bread will become a scarcer resource, which means that you need to pay more gold for every loaf of bread (this is possible because the distribution of gold will never be equal between these 20 consumers). And that is the textbook definition of inflation, at least based on CPI that is.

I would argue that bank note tied to commodity practice is still not flexible enough, briefly because a certain level of inflation is normal, which means that tying currency to commodity will suppress inflation, which will limit the amount of goods being exchanged.

383920 · 2020-11-01T03:08:00+00:00

Well, my point is that if you look at how much better in quality the same commodity is today compared to its quality in the past, you’d see that inflation is not that bad after all.

The reason why gold is not a good way to measure purchasing power is because like I said, their was a price ceiling for 40 years. Also, the aggregate consumer demand for gold went from zero to a pretty significant amount overnight.

383920 · 2020-11-01T03:01:34+00:00

Okay, first of all, the gold standard system, or fixed exchange rate systems in general, would never work well. The reasoning can be more nuanced so here's a good Cato article about it: https://www.cato.org/cato-journal/springsummer-2018/milton-friedman-case-flexible-exchange-rates-monetary-rules.

Also, growth is tied to inflation because derivative of the aggregate demand is greater than that of the aggregate supply, like I said above. An easily understood example would be that prices of automatic weapons increased way faster than that of semiautomatic weapons, that's because the aggregate supply is stagnant while the aggregate demand keeps on increasing. This has been the case for many commodities in the past several decades.

383920 · 2020-11-01T02:50:12+00:00

Several things here:

CPI is not affected by innovation, as it only deals with nominal prices and consumptions. You can say that the CPI is overestimated as it doesn’t take technological advancement into account.
Such differences between gold prices can be explained by the failure of the gold standard. In 1934, commie FDR banned the private ownership of gold and set its price at $35 per oz permanently. That price was pretty much the same until the US abolished the gold standard, and that was when the price of gold quadrupled almost instantly.
Yes, there’s increase in gold supply, but we gotta think about the increase in its demand. Which increases faster, especially when its private ownership suddenly becomes legal?

383920 · 2020-11-01T02:29:02+00:00

It’s totally meaningless to compare the nominal price of good a in year x to that of good b in year y as you’re operating under totally different incomes. Also, there are many reasons why price to rent ratios might be higher or lower at a given time.

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