Depressions are not Acts of God: on the Lords of Finance

Ahamed, in this book, lays out just what happened in the time period covering the run-up to the First World War to the run-up of the second. The subtitle of the work speaks of the bankers who broke the world, and I can imagine it felt something like that, both for the workers, the reinters and the capitalists. There’s a good bit of economic history here but a paucity of the political history – you need to know that for context. What you get here is the economic driver of that context that happened (If you believe in economic determinism).

Anyway:

Late in the book, the author quotes the newly-sworn-in president, Franklin Roosevelt in context of temporarily unpegging the dollar from the gold standard. He supposedly joked that reporters can ask all they want about the gold standard because no one in the public knows what the gold standard is. (Broadly, it is keeping a fixed exchange rate between a currency and gold. Naturally it becomes more complicated in practice.) The gold standard is the center of this book. In this book, it is the devil – once the central banks allow for floating exchange rates economic prosperity starts to work out. In fact, where at one point the French central bank’s gold holding made it the strongest developed country economically and politically, once everyone started going off the gold standard the holdings became a liability and the Franc was too strong.

I may be a little reductive here (because thick book > short review) but the author’s insistence is that the central banks were too stuck on the gold hoarding orthodoxy and too slow to listen to the genius that was J. M. Keynes (and even Irving Fischer). Ahamed even draws the parallels to contemporary situations. It’s an imperfect parallel – there’s no large economy suffering under the yoke of reparations. However, we may be able to learn from past history and correct our policies even at this late date in our generation’s depression. Central Banks are not a Panacea, but our Federal Reserve System is not a monster from Jekyll Island either. It could use some more oversight, but it can be a powerful tool in policy. Those who love the idea of hard money should read this, at least for a little context – especially since the global population and economic growth have boomed in the last 80 years and the gold supply has not. Inelastic supply stays that way.

an ounce of prevention is a pound of cure.

I’ve been trying to do some preventative maintenance on the automobile, so that we can avoid having some big hits on auto bills. In December, I got an estimate of different things that need to be done with the car. There was enough stuff that just the preventative stuff was going to be almost seven hundred dollars. This is smart, as the car was my wife’s before we were married and she wasn’t that good at keeping up on the regular stuff. When we had the brakes done at about 65,000 miles she had to admit that she had never had the brakes looked at. Then recently, the precipitating incident for the recent car-consciousness, the battery was dying and she want to ignore it. The old battery died on the day we bought the new battery (but before we were able to get it through a painful install).

So- doing some basic things on the car, like alignment and tire rotation and an oil change and nothing should be the problem. I wanted to get the cheap and easy stuff done. However, one tire had been having trouble holding air. Nothing easy here; the problem was bigger than I though. My rim was bent.

My mechanic said we should be able to have the thing fixed, so we took the wheel off. Unthankfully, the wheel is a special kind of aluminum. Aluminum is hard to work with because it is not as flexible as steel, but this wheel is covered in a special kind of plastic glaze that gives it a chrome look. The downside is that you can’t tool the metal without a chance of it breaking and the machine shop must have some sort of insurance reason not to do the work.

Even the fixing of the wheel would have been expensive. It was estimated for about two hundred at first for the fix. But without being fixed I have to buy a replacement wheel. I could buy one from the junkyard, an aftermarket place, or a dealership. Each choice was about a hundred-dollar step up. I’m waiting on a junkyard to call be back so that I can pay three hundred on top of hundred I paid for the earlier stuff. The lesson: sometimes an ounce of prevention is a pound of cure.

My Biography

One day early in the year the first space shuttle reached orbit, a singular sperm reached a human egg and fertilized and grew. I was born crying into this world on October 17, 1981. In the course of the years, many things happened. I enjoyed most of them, and most of them were solitary. I liked to build models and read books. When I did thing socially, I liked to be in charge unless I didn’t know the power relations between the individual members of the group then I was quite and reserved.

I went to school. I did well.

I moved around and made new friends. I moved more and lost touch with them. I learned early how to lose friends. I learned to not make friends too closely.
I got a job. I did well. I got more and did well at times and worse in other aspects.

I went back to school. I fell in love. I got a job. I got married. I got another job.

I lost a job.

I continue to read a lot. I have stopped reading fiction and instead read nonfiction and worry about the world. I am now learning and happy to be in a professional situation with adults .