Of Two Minds

When competence, transparency and accountability are all punished, the Race to the Bottom accelerates. Race to the Bottom describes the process of competitive devaluation, where value is gutted to remain competitive with those who are grabbing market share by stripping out quality, value, durability, transparency, accountability and competence.

One of the great fictions about money is that it is neutral. It isn’t. It’s either designed for the elites or for the citizenry. Many proclaim a desire for “sound money,” but “backed by X” currencies are not “sound money” unless they can be converted directly into X.

If we don’t bother measuring national well-being, the health of the nation’s commons and resources and advances in the public’s interests, then we foolishly call a decade of tremendous advancement “stagflation.”

Rather than cheer the concept of a new currency, we’re better served to look at the velocity of that currency and the cycles of investing that currency in assets denominated in that currency for a low-risk return.

Should the wealth effect reverse as assets fall, capital gains evaporate and investment income declines, the top 10% will no longer have the means or appetite to spend so freely. Soaring wealth-income inequality has all sorts of consequences.

We need a new iteration of economics that advances beyond the obsolete, misleading statistical measurements of bygone eras. Let’s focus on a largely forgotten history, one within living memory of everyone born in the 1950s, a history of signal importance to our understanding of the forces that will dominate the next decade.