Economists gone mad

For the second time (and perhaps there was more than twice already), some inept, insane, inane, irresponsible, incorrigible, incorrect and immoral (I wanted to use the word inhumane, considering that he is obviously desperate trying to protect his wealth, but still, yeah, he is inhumane to not consider for other human lives) economist suggested that interest rates should be negative.

First, that will be uberinflation, since everyone needs to dump currency. Second, he pointedly said that people should put money into other instruments, which is...? (This creates an uber asset bubble which is the precursor of uberinflation. Third, he actually recommends to have an expiring legal tender exchangeable at the central bank. (I like having only 3 points of attack, not that I can't find more...But this g?y actually suggested such an )

The first two points are directly self defeating. Uberinflation kills all sorts of productivity and renders trade to only barter trade. Now, since he offers no useful skill other than talk, he has not value in the society he proposes.

The third is tricky. Banks can exchange the tender for you, but what about people who use cash? What about people who counterfeit money? There is a lot of administrative issues, but technically, there is a finite supply of money, and it will then be held by "elites". Yes, he is suggesting protectionism and elitism (indirectly of course). By forcing people to spend, ahem...the correct word is "invest" in useful assets, the point shoots back straight to the idea of creating an asset bubble. Basically, he is targeting savers, which defies logic to begin with.

This former central banker fail to understand economies in general. It's like a human being, it grows, it matures in whatever teachings it had from past experiences. It falls sick and gets well throughout the business cycles. And last but not least, it is indirectly dependent on its population. He should take geography 101 to know that we only have so much land space, so much useful land, resources. Oh, moral education 101 is probably needed just for him and Mankiw too.

That is why developed nations should view their socio-economic policies carefully and regularly so that the economy does not overheat badly while staying in the front end of science. It is tough, but it does not take a PhD to realise the problems. Rather than "fix" the problem to his (and many bankers') favor, why not just let the problem fix itself, like the news-less now? Is he so afraid that he will become poorer because he is wrong?

I'm not a rocket scientist, but my heart goes to people who suffer through this while myself and many of my friends are not badly affected. Printing more money is NOT a solution. It is THE destruction.

If I can survive the cold in Antarctica, I would raise my own farm there and show him what the right way of life is. Money, at the end of the day, is just paper. It has no value pre and after life. Money is the means to an end, not the end itself, and substituting it with land, gold, silver or any asset as an item for hoarding is not the correct way to live life.