Time Value is a Leap of Faith

We know that we can create value from our time - not just for ourselves, but for others as well. Why, then, is this so difficult to express monetarily in the present? It's an important issue: not just because of the economic responsibilities we hold in common, but because of the identities we assume through production and exchange. There is no separation of economic activity from our aggregate participation, even if the world of finance tries to make it so.

In other words, economic growth rises to the aggregate level of our actual production and consumption, and the money we print for that process. What's more, we're kidding ourselves whenever we put a stop to multiple means of production, and yet still expect everyone to be financially responsible for their own circumstance. Some in power may think it's possible to define wealth outside the perimeters of actual human participation. But in the long run, economic equilibrium always knows the difference.

Ongoing learning is a primary investment; skills sets and the mental spaces we inhabit, our calling cards. And yet, these forms of capital still end up outside the realm of economic activity that became the early 21st century. Presently, we are actually working harder to keep knowledge use out of the marketplace than we would be, if the tide of knowledge flowed around the barriers that have been placed in its path.

How do we know the tide is being held back? Think about the locations where knowledge and important information are "allowed entry". That is, for what society has deemed important enough to actually consider with randomly mined time value (i.e. not necessarily accomplish). It's an overwhelming environment, where everything of significance that needs to be happen, is trying to materialize along the same channels and limited time frames. From Shane Parrish (Farnam Street):

I'm hard pressed to think of an environment less conducive to rational decisions than that of the modern office worker...Environments play an important role on individual and collective abilities to make decisions and yet most organizations spend zero time thinking about this.

Of course the problem here is that organizations can't really remedy the problem on their own. What this really comes down to is that we have not yet learned to think of many important services in a true market based sense. Even monetary policy can miss this to a degree, in that additional stimulus also has the capacity to add to the service product options (and participants) that gain entry into the marketplace, before translating into higher prices. Or said another way, tight money can also lower divisions of services differentiation in a quantitative sense.

Services have mostly been provisioned in three ways: government redistribution, individuals with high discretionary income, or else randomly mined by institutions in general. That is, even though our time is a fixed scarcity, it came to be used in the 20th century as a random scarcity. Other service utilization remains cultural, religious, or outside of the bounds of rationality (i.e. near slavery or prisoner like conditions). That means we haven't really been free to coordinate services with one another as individuals: a reality which puts many men, women and young adults into compromised realities. Until services are recognized as a valuable form of product in their own right, their status as real wealth remains in jeopardy. When we think about substantial supply shocks, it becomes apparent that services of all kinds are disrupted - not just in depressions but recessions as well.

Today, governments are implored to reduce their budgets, and institutions of all kinds tend to the bottom line by reducing services needs to a bare minimum. Consequently, individuals with discretionary income are the only ones expanding services needs in a relative sense. Even if knowledge use is being funded, the purpose of that use may be different from the perspective of those who contribute time value. Thus in the aggregate - even with private substitution - knowledge use for multiple areas continues to decline in a monetary sense.

In the 20th century, even though we were making investments to improve the quality of our time use, we were still - unfortunately - moving away from the concept of our time as holding intrinsic worth outside of institutional structure. Prior to mass employment, time use took place primarily in managerial terms. That is, time value was structured so as to be responsible for a wide variety of resource combinations in one's immediate environment.  Home economics was just one aspect of this reality, and management didn't necessarily mean status just as it doesn't necessarily mean so now.

Even though the 21st century strongly suggests a return to general environment management, it has become difficult to break away from the idea of time use as secondary to hierarchy. For many groups, boss and employee structures are all they've ever known. What's more, management models suggested in the present exist in conjunction with highly evolved technology, as well as the evolved skills sets of others. Institutions were only the first stop for skills evolution. Today, important patterns for economic activity occur within flexible teams and individual matches, rather than random elements within closely held institutions. This is as true for small communities, as for any city.

Significantly, it is the new technology that calls us back to a (now) earlier form of environment and resource management paradigm - the same evolution of which the 20th century asked us to temporarily reverse course. That is, the technology of the 19th and 20th centuries needed us to subsume identity into divisions of labor that were determined outside of ourselves, when technology could only provide simpler functions of labor provision alongside us.

This is why the reclamation of our time value would be an immense leap of faith. We are quite literally being asked - as fully participating individuals - to coordinate the needs of society, the needs of ongoing production and the needs of local community at the same time, if in fact these vital tasks are going to be done at all. What's more, we need to make this responsibility an understandable part of our monetary framework. Governments have taken these tasks and gone as far with them as they possibly can. Indeed, it is a wonder they have been able to advance knowledge use to the degree that they have.

Recall the earlier time management, before specific division of labor. In this environment, by way of property holdings, we moved between value in use and value in exchange. Generally, value in exchange was the additional product separate from our time. However in today's environment, our time is the very element that has greater value than what the robot or economy of scale can contribute. Often the product (separate from time) is our value in use tool, while the value in exchange marketplace to be created is one of ideas and negotiation.

Because it is impossible to assign contrasting value to complex aspects of knowledge use, lateral time becomes the plane in which we lever arbitrage. Here, time products are decisions, check-ins, verifications, acknowledgements, assistance, encouragement, maintenance, exploration, comparison, contrast, elucidation, validation or simply hearing one another. In other words, we highly value personal time for the kinds of things most of us really don't want robots to do for us. But when no one leaves room or recognition for time value in society, social elements tend not to happen anywhere near the degree they are needed in the aggregate.

There is no denying the missing element of time value today: it can be readily seen in the growth potential of nations, as that growth potential falls away from earlier long term trajectories (aptly illustrated by Marcus Nunes). And yet, sometimes there are glimpses of hope for better outcomes, such as the recent posts on respect. In one, Bryan Caplan suggests we can grow the respect pie (I like that term). Just as Bryan saw a beneficial addition instead of zero sum, the knowledge use pie need not be zero sum, either. Instead of letting knowledge use and valued services wither away because the old methods of funding no longer work, we can put real value back into time use. By doing so, services can once again take on added dimensions, renewed purpose and social meaning.

Services wealth has the capacity to smooth business cycles, bring economic diversity back to local economies, and reorient our time use as the primary intersection for resource use of all kinds. Services and knowledge use are valued product in their own right, even if they never had the chance to be thought of in those terms. Even though our time is fixed scarcity, knowledge use has the capacity to follow an ever growing trajectory. That is, when we refuse to let knowledge diversity be shut down by institutions or economic instability.

Technology allowed us to overcome the problem of land as fixed scarcity, and that was the very definition of real progress. However, in order not to default back to land use for survival, we have to evolve skills use so that technology can continue to work for us. By returning time use to the status of a fixed economic element, we can manage and coordinate knowledge use, just as we once managed and coordinated the resources of land holdings.

Overcoming Land Use and Knowledge Use Scarcities

There has been interesting discussion about two subjects of late: "inequality" and "optimal" land taxation (yep, scare quotes). Since my notes for both were a bit jumbled, it seemed appropriate to consider them together in this post. Certainly, optimal land use is a random (i.e. not fixed) scarcity. That's a reality which can eventually dash dreams and tax schemes alike. It's too easy to forget that when economic participation becomes limited, land use and land valuations can also suffer. What's more, some of the most problematic aspects of apparent inequality, primarily stem from limits in knowledge use.

Often, what appears to be insurmountable inequality and scarcity, are little more than the restrictions we collectively impose upon ourselves - something that rising income does not really address. The more that wages rise, the more tempting it can be to place further restrictions on overall land use and related assets. This makes us co-conspirators with the governments that restrict our options, and it also contributes to the land use scarcity which now makes homelessness a more difficult default position than ever, to maneuver.

This same lockout effect contributes to knowledge use scarcities, in that there is less overall economic participation to fund needed services on the part of everyone. One of the problems in using land taxation to generate services, is the fact that no one can predict whether many locations can generate a continuous wealth equilibrium. Communities often make the same mistakes as individuals when it comes to erroneous calculations. That is, they attempt to maintain certain levels of wealth redistribution through income capacity and exclusivity, rather than by continuous adaptation and multiple choice options for economic progress.

It's easy to lampoon governments for not being willing to start over, when it comes to the fiscal adjustments that are needed in the present. But governments' desires to make choices based on what generally worked before, are echoed by communities which will use the same economic strategies over and over - as long as possible. When we look around us now and say, "Egad...inequality!", what we're really seeing is a long term result of society's natural instinct to put up walls against economic inclusion, as wealth creation strategies.

Many varying paths have resulted - and converged - from that basic instinct. The fact that people have used exclusion tactics for far too long, has also led financial adjustments which distort monetary policies, savings and investments in general. This happens in numerous ways, especially at local levels where other options for economic activity and wealth creation have been closed off. Just the same, the time has arrived that these arbitrary walls need to be torn down. And it is best to do so with creativity and imagination, instead of war and pointing fingers at the supposed enemies.

Fortunately, land use aspects of scarcity is not as difficult to visualize as knowledge use scarcity, thus they are receiving a fair amount of consideration in the present. Still: forced, ad-hoc and otherwise reactionary land use "solutions" are no way to approach the matter. How to think about the kinds of options people need? First, all possibilities need to be presented in simple and recognizable forms. Otherwise, people would invest time, energy and effort in them, only to be disappointed that there was not enough common vision to sustain the process. What's more, this is not just a matter of walling off higher income communities from lower income communities as people are politically tempted to do in the present. Not only would complete separation of income levels create economic instability, but those static formations would not be sustainable.

So in a nutshell: how to approach what the title of this post suggests? Equality of opportunity means equality in time use, alongside accessibility in resource use. Services access has mostly become a problem for those who do not have middle upper to upper level incomes. What this also means is that anyone who has adequate income to pay for needed services, does not need to utilize systems that generate equality in time use. Just the same, these systems could coexist in the same places and environments, if it is widely recognized what the differences between them actually consist of. What's more, secondary systems of lateral knowledge use are capable of providing vital back up systems for knowledge use preservation. This issue becomes especially important, whenever knowledge use systems that rely on upper income levels become threatened by negative supply shocks or other problems.

Plus, accessibility in resource use does not mean the same kind of endogenous coordination structure, that lateral time use depends upon. Local resources would rely on the same pricing mechanisms as they would anywhere in the world. Any difference in wealth creation for product, lies in the degree to which local community can add value to those local resources before they ever leave the area. However this is an opportunity which far too many local economies have not been able to capitalize on: the combination of (price exogenous) commodity use alongside local endogenous coordination and relevant education. In other words, local pricing (through voting) optimizes services, while global pricing optimizes product and resources separate from our time.

With this understandable separation, many local economies would no longer be forced to maximize wealth creation through asset formations or bare bones commodity prices, just to pay for needed services formations. Problems of apparent inequality would fall away, as people start to produce and consume services that were once associated primarily with either formative years or upper level incomes. What's more, varied combinations of production and consumption formations in multiple use spaces can serve to break down land use scarcities. This can happen in part by loosely formed associations which coalesce for specific and variable needs.

3D printing technology will make it easier to encourage, what previously took place mostly through creative destruction in city locations. How so? There will not be such significant cost for capital, at risk for specific product formulations. That also allows individuals to claim small projects as their own. Because of this, economic activity would also shift back towards knowledge use, in that more knowledge will be required for short runs of product. This in turn makes it easier for those involved in services formations to maintain direct links to production cycles as well. Consider Lee Billings, in an article about architecture:

Architecture will eventually enter a more biomimetic phase as the need grows for more energy-efficient building. Agent-based optimizations could become commonplace, along with new construction technologies such as 3D printing, which would allow unprecedented architectural experimentation and innovation. A revolution may occur in how humans construct and live within their homes. Boxy, self-similar houses and office buildings could give way to a wild profusion of easily produced and altered organic forms.

Snap together and pull apart building components could also allow greater flexibility in working relationships, as well as living arrangements. None of this is to suggest these are "preferable" to solid construction, long term commitments or fixed property purchases for that matter. Rather, land use flexibility provides choices that allow real respect for anyone with "handicaps" of any nature. By creating multiple definitions for economic access, individuals have the chance to survive occasional "steps back" (instead of forward) when necessary, and yet still be able to strive for their life's goals. Indeed, legal rules in the U.S. once gave individuals the ability to either start over or start out incrementally, when they were unable to do so in the Old World.

Flexible land use and building components also make one's personal income less important for economic mobility. Think of the race between the tortoise and the hare. When property and knowledge use take the tortoise into account, far more wealth is ultimately created in the process. That means less financial risk as well, when the world quits struggling to fit everyone into the same mold.  Our ongoing efforts to survive and thrive deserve to be a greater determinant of our life options than they presently are. Consider for example, this advice about our future from the above link at HBR,

What will drive a more "optimal" decision framework? It will require emancipation from fundamental assumptions such as employment and organization.

What's more, ongoing local skills and services proposals could also receive "keep trying" votes of confidence, whenever communities do not have room for them in the present. This is an important indicator, because it's one that many businesses which failed, never really had. Often businesses are missed when they close their doors, and former customers wish there were ways to somehow bring them back.  A "keep trying" vote of confidence, not only indicates what people still want to be able to experience,  it also allows them to get used to new concepts and thought processes that might otherwise act as unsettling disruptors, if introduced too quickly. Ongoing variations on proposals (in local activity calendars) allow people to get familiar with service offerings and how they can work.

Knowledge use and land use scarcities can be overcome. How so? By creating economic time and space for multiple participants over the long run, rather than expecting individuals or institutions to be the sole provider every day of the week or not at all. Monopolies in scarce resources are one thing, but monopolies in services only make people forget how to negotiate with one another for their most basic life needs. Worse, knowledge monopolies make people forget the immense value of knowledge itself. When the differences between real scarcities and false scarcities are not well understood, the idea of "affordable" or "not affordable" is meaningless. By using environment integration and getting to the root of unnecessary time scarcities, it becomes easier to determine optimal choices for our finite time.

What's Important - People, Results, or Both?

In the real world of course, the quick answer is people and results. And yet, many people have difficulty approaching dialogue in this way. Results tend to be about rationality instead of emotions, even though both are part of the process. Turns out it's not easy to engage both at the same time, which explains why leaders (for instance) who happen to be adapt at both, turn out to be the most highly valued leaders of all. So...how might this question get answered for Market Monetarism? Or, when we think of optimal action for economic stability, how does one also express this in personal terms?

This morning I found some links that also continue a few thoughts from yesterday's post: a good thing as economic uncertainty is still very much on my mind. This link suggests it's not "just me" as 70 percent in a recent U.S. survey indicated they didn't feel the economy was truly on the way to recovery. Pus, what I refer to as the forgotten rural areas, are where this lack of confidence is most keenly felt. Small wonder, as some people with little choice but to live in rural environs, despair over whether they can keep the car running so as to continue the job an hour away in the city.

If it's tempting to snicker at presidential candidates re their lack of ability to empathize with average voters, sometimes economists have trouble relating to the average citizen as well. How so? For one thing, economists tend to hone in on aspects of the economy, which don't necessarily reflect the average person's ongoing and daily challenges, in community. This is particularly true if the economist sees government or business in general as the only means of positive action, rather than the coordinated actions of individuals. Plus whatever inferences the economist makes, tend to be the ones that are going to gain the most public consideration as well. Unfortunately, that means a lot of second guessing occurs, as to the circumstances people are actually trying to work with to improve their lives.

For instance, Paul Krugman recently complained that "...high unemployment has greatly weakened workers' already weak position in the relationship." i.e. the power relationship between employer and employee. While this scenario might well be observable at times, unfortunately it has little to do with what actually needs to be done in the present. In other words, it gives not a clue how anyone might approach the present dilemma of economic uncertainty.  Of course it never hurts for employers to be more considerate of their employees!  But how does that meaningfully correlate with the fact that far too few of us have workplace participation in the present - especially in areas which have been economically forgotten?

Or sometimes, thought processes that would be conducive to economic progress get lost in translation, because of the limited academic environments where they take place. Indeed, political adherents on the left and right don't always listen to the more important elements of economic discussions. Thus the most important and substantive arguments are often made on the behalf of people who don't understand their significance. An overt political stance in particular, can obstruct the economic reasoning that people need the most. As for those power relationships Krugman is fond of speaking of, my readers already have a sense how I feel about this.

Power relationships exist mostly in our lives to the degree we lack the confidence (or the imagination), to take part in coordinating ongoing patterns for production and consumption. No one gets real economic results by keep seeking out villains and ransacking their village in yet another morality war. Why does anyone think that is the best way to appeal to people and emotion? Instead of looking for the "right villages to burn", why not consider increasing total economic participation instead. That's the way to put jobs back on the agenda.

The fact that we still don't have adequate passageways for knowledge use and services, also holds back the technologies that can support them. This partly accounts for the fact that 3D printing remains a somewhat "iffy" proposition, in terms of what it will be able to do in the next few years. Not so long ago, the news was full of debate in the U.S. as to 3D printing of guns, whilst in Iran (HT Mark Perry, AEI), 3D printing is already being used for medical purposes. Meanwhile, some states here are putting their primary efforts towards getting rid of the burden of Obamacare, with (???) to replace it. Has anyone noticed that some medical people are even having to take second jobs lately because they aren't getting paid on time by the government?

Clearly, there has to be a positive turnaround in local economic formation, before 3D can be utilized where and how it is actually needed - for production and services of all kinds. I will feel we have arrived when recyclables can be used in efficient, low cost and flexible production, for local building components and by all local citizens. No small community will need to be completely dependent on governments, cities or even auto transportation in the future, once it is allowed to utilize knowledge and resources for production needs locally.

Think about these changes on the horizon: with a bit of effort, we could already be preparing for local manufacturing which adapts to specific needs of all kinds. If we can do this, it also means things can change for the better, before millions of people fall away from the ability to participate economically. What's more, we don't know how those changes in local production capacity will affect overall costs for more basic living requirements of all kinds. Still, there are many legal hurdles to be cleared out of the way first.

How to think about the near future in monetary terms? For one thing, I see long term growth potential as a possible beneficiary of good deflation trends. Just the same, nothing realistic has been done to clear the way for them presently. That is why I am so set against a strong taper on the part of the Fed any time soon. Our local communities have to be permitted to take care of themselves in production and services based terms, before the stimulus levels of the present are no longer needed.

Presently, people in power are still acting as though little of significance has to change structurally, in spite of the realities. Or some power holders give structural needs "lip service" as an excuse to do absolutely nothing. By so doing, everyone ends up ignoring the reasons why so much additional stimulus was needed in the first place: to support the kinds of lifestyle expectations which special interests don't want to change now. So to just take away the stimulus because "it's gone on long enough", yet refuse to do anything to change the environments which required those infusions of money, would be like an ostrich putting its head into the sand.

Future generations need living and working environments that are better tailored to their needs. If ignoring that reality isn't enough, attempts to force them to live by the standards of earlier generations only invites more "bubbles" for asset formations. Meanwhile, government debt loads are the inverse of the "bubble" problem, in that they try to cover societal expectations which go well beyond what many family incomes actually represent.

Hopefully, we can find our way to dialogues that include emotional appeals and results oriented action in the same argument. But until we do, it would be most helpful to maintain the environments we presently have, to the best of our ability. That also means printing as much money as necessary, for total spending capacity. Building societies up only to knock them down again when no one agrees on anything, is no solution.

U.S. - Monetarily "Boring" Already? Perhaps Not!

Word has it that monetary policy in the U.S. might even be so "good" (relatively speaking) that it could become boring soon...Say it isn't so! (Lars I'm not picking on you personally) To be sure, in some respects it appears as though monetary issues are headed back towards "normalcy", as statistics and bottom lines continue to improve. Might this state of affairs even be reminiscent of the Great Moderation in the U.S.? Okay I'm being a bit melodramatic, but then I'm not quite yet ready to sing "Happy Days are Here Again".

Fortunately I'm in good company with plenty of Market Monetarists, who remain concerned whether greater economic stability is a certainty in the years ahead. Still, 2013 was a year for progress and not just in the U.S. by any means. Indeed, there has been enough improvement in the economy that Scott Sumner anticipates Market Monetarists will no longer expect further monetary stimulus in a year's time, give or take some wide variances in opinion among MMs!

In a sense the ongoing challenges come down to a one word question: Why? That is, why is Market Monetarism embraced by its advocates, and what they believe it can accomplish. Reasons - of course - vary. Yet individual positions will matter more, as the conversation moves forward. To a degree, advocacy for Market Monetarism came about as a somewhat impartial observation, regarding indicators that appear most capable of providing monetary stability. That basic premise of course continues to be the case. But behind the premise, also lie the millions of lives that have been affected by long term unemployment. What's more, this strict focus, which does not really include an active (symbolic) "why" except in terms of statistical efficacy, is frequently challenged on its face by those who doubt its capacity. This is true not just of economists but by observers in general.

And even though a nominal level target can provide economic stability, there is not yet a symbolic explanation for its rationale in anyone's mind. That means nominal targeting remains susceptible to misinterpretation or misapplication - even when people don't necessarily realize that this is happening. In the process of reaching out and attempting compromise with the concept itself, I've seen Market Monetarists ridiculed too many times because they allowed the conversation to take place solely in measurement based terms. Something is still missing here. We need to be able to indicate why this measurement can provide stability, beyond the economic language itself. What is it specifically about the level target that has this capacity? Can this stability still happen even if money no longer operates under recognizable circumstances?

It's not good if I question the continuing premise of IOR, for instance. Whether or not I believe normalcy is possible with IOR, laypeople have to be able to relate to the answers to these questions or they will not find reason to back the Market Monetarist framework. After all, we need all the support we can get, when in fact bureaucracy, business and academia obstinately stand in the way. In the 20th century, seemingly it would have been enough for central bankers to be convinced of the applicability of a nominal target rule. Even if central bankers were open to nominal targeting now, that alone might not be enough to create overall agreement in the 21st century. Certainly the political realm is not ready to provide productive input at the moment or any time soon, and we need to craft a broader appeal that reaches to the heart, not just the mind.

The gains of a nominal targeting rule - while they may appear to be about one institution, really are nothing of the sort, for the economic gain they represent goes well beyond the idea of institution itself - even if the action is something embodied by an institution that represents economic activity. Therefore the discussion of Market Monetarism suggests the possibility of reaching beyond institutions for solutions in general. What's more, a Market Monetarist solution to unemployment problems that is fully integrated with economic participation at all levels, is much preferable to an MMT solution for instance that would attempt to provide a base income with no true ties to consumption and production capacity.

To be sure the fact that I don't live in a "bustling" city has some bearing on my personal viewpoint.  Not much here appears truly different than the days of the recession, re what is observable on a daily basis. Indeed, more shops and restaurants around the nearby downtown area have continued to close, in spite of oil production capacity gains. None of the recent stimulus efforts have changed my basic outlook. I remain convinced  that rural areas especially need domestic summits at a national level, so as to find greater coordination for economic participation as government roles decrease over time. And, I'm frustrated that nothing is happening on the supply side in terms of organized action for economic coordination, in spite of the incredible possibilities that exist. Let alone the time that has passed that something - anything could have been tried at a national level. Instead we've gotten mostly diatribes against economic activity in general, and little more than theatrical reactions to the diatribes!

Seeing as how much of the economic discussion remains mired in political think tanks, prominent publications and academic environments - economics blogs notwithstanding, the debate is stuck. It's not accomplished what I thought it could, and I apologize for the scattered confusion of thoughts in this post as I worry about this problem. Something about these formats is apparently still not ready for the widespread national discussion which needs to happen. Nor have these debates inspired anyone to take to the road to bring about economic momentum across the country. Taking to the road to talk to people instead gets totally wasted on political elections. Believe me I would take to the road and talk to everyone who would listen, if I could, right now.

Many cities in the U.S. do not feel that they have reliable strategies to move ahead in the future, in spite of the recession in the rear view mirror. Plenty of cities would be glad to take part in domestic summits as well: cities and rural areas likely have more in common for new services strategies than they realize. Supply side services issues such as this are still not connected in anyone's minds to monetary stability, but they really need to be. While economists can sometimes support public efforts for economic revitalization and also help with such efforts when asked directly, it really is up to individuals outside of institutions to take up these vital economic issues on their own. Even though they are in the interest of city and country alike, domestic summits are outside the purview of specific institutions.

What's more, the services we capture through economic coordination are a major part of what our government cannot provide for us, though it would if it could. None of us can afford to continue leaving our Main Streets and neighborhoods devoid of real life, anymore. If we focus on this and make plans for the growing reality of economic transformation, these are positive actions for the future that our government will eventually be able to support.

Before Obama was even elected, it bothered me to hear him speak of change because I just didn't think he had a way to make it happen. Not then, not before the economic situation overall had become so desperately obvious. To his credit, I have heard him say that it is all of us that need to make a better reality. One only hopes that he - or whoever follows him in the White House, will give us the chance, if and when we come forth with potential solutions of our own. Until we do, nothing about our monetary reality will be boring - or certain, for that matter.

Each of Us, a Filament

 

Electricity, from where sparks are born,
And there's reason to celebrate on Christmas morn,
Even if we know not, the reality
That just deepens the meaning, of the mystery

Each of us a filament, on interconnected strings,
Multi-colored lights for the tree of life.
There's this moment in time, to pause from the strife,
Feel the energy,
as it courses through cold dark night

From the distance, great brightness from many strands
of light from the fire which was given to man
Somewhere, past the pain, confusion and fear,
He waits with gift of calm, surely he still hears

After each fury,
The wind whispers down
There's stories yet to tell, another storm settles
Do we still know how to make this special
Who collects our wishes, who travels to tell...

Who watches us gain courage
Every time we stand tall
Or waits outside when we're broken and small
Who wants us to remain
On the dry side of the bridge
Yet holds the river of unknowing,
Even as we climb, back up the ridge

This could be what forever feels like
light from each filament for a path in the night
Can we remember why you brought the fire
Will we remember how you brought the fire

Midweek Market Monetarist Links and Summaries - 12/ 25/13

(David Beckworth) Meanwhile, the Eurozone staggers on defiantly without monetary crutches:  http://macromarketmusings.blogspot.com/2013/12/the-qe-block-versus-emu-block.html
Broad money growth in Japan is recovering: http://macromarketmusings.blogspot.com/2013/12/how-is-abenomics-doing.html

How many women in the U.S. stay out of the workforce because of the marriage penalty? (James Pethokoukis) http://www.aei-ideas.org/2013/12/why-slowing-us-labor-force-growth-is-bad-for-us-economic-growth/

Of Milton Friedman and the k-percent rule (Josh Hendrickson): http://everydayecon.wordpress.com/2013/12/19/yellen-optimal-control-and-dynamic-inconsistency/
David Glasner responds: http://uneasymoney.com/2013/12/20/milton-friedmans-dumb-rule/

Interest rates still tell us very little about the stance of monetary policy (Marcus Nunes): http://thefaintofheart.wordpress.com/2013/12/19/extended-insurance/
Marcus considers monetary policy reaction to oil shocks in the 70s by the U.S., Japan and Germany: http://thefaintofheart.wordpress.com/2013/12/20/the-great-inflation-is-being-revisited/
The CBO measure of potential NGDP can be misleading: http://thefaintofheart.wordpress.com/2013/12/23/not-so-fast-ed/
Some additional NGDP perspective for important Fed graphs: http://thefaintofheart.wordpress.com/2013/12/23/right-before-christmas-100-years-ago/
Benjamin Cole takes a closer look at QE3
World trade volume is still falling away from trend
Marcus considers six countries in a continuation of the previous post

Britmouse provides recent UK numbers: http://uneconomical.wordpress.com/2013/12/20/uk-2013-q3-quarterly-national-accounts/

Peter Sisko (Money Mischief) provides a brief overview of the work of the Fed, for the past 100 years: http://moneymischief.blogspot.com/2013/12/100-godina-fed-a.html (Just use Google translate)

Lars Christensen asks, how might a nation's resources be privatized? http://marketmonetarist.com/2013/12/18/some-inspiration-for-matt-zwolinski-my-suggestion-for-a-venezuelan-citizen-account/

For someone who indicated he might be too busy to post much during the holidays...(!)
(Scott Sumner)
how important is finance for RGDP or the path of NGDP?
...where we learn that even Google has "institutionalized" confirmation bias! The "stance" of monetary policy
The Fed has "edged" closer to Scott's October recommendations
The Fed wasn't quite happy with QE but didn't want to tighten...
How difficult is monetary economics? Somewhere between rocket science and quantum mechanics
Some clarification for John Carney on the monetary base
Britmouse also responds - "For reasons not clear" Krugman ignores aggregate supply
How is it useful? Krugman on the Phillips Curve
Two quick comments on taxes turned into quite a discussion.
John Cochrane could be confusing "money supply model" with monetarist model
In response to Nick's post, Nick Rowe on Cochrane and Williamson
Good post: How many economists can answer this question

Nick Rowe - "You get barter because the quantity of medium of exchange is too low"
In response to the recent finance/macro theme - Does finance need money/macrofoundations?
Nick in response to John Cochrane
and - Enough with announcing targets for nominal interest rates already
Correlations between nominal interest rates and inflation rates involve Long run, medium run and short run Fisher curves

Some helpful clarification from Bill Woolsey - How Important is Shadow Banking?

Whatever we have to worry about, Evan Soltas suggests U.S. savings rate isn't in that category
Evan wants to know - http://esoltas.blogspot.com/2013/12/how-did-we-miss-swiss.html

(Lorenzo) Central Banks fighting the threat of rising productivity?
http://skepticlawyer.com.au/2013/12/23/what-is-it-about-money/

Also of interest:

Uwe Reinhardt's healthcare viewpoints are always worth taking the time to consider: http://economix.blogs.nytimes.com/2013/12/20/the-economics-of-being-kinder-and-gentler-in-health-care/?_r=0

Bart Wilson's last post for Econlog (for now), A Literary Theoretical Treatment of Prices

Wishing all my readers the Season's Best, whether "young" or "old" - near or far!

When Competition Yearns to Breathe Free

What might be the result? Jonathan Finegold's quote of the week was sufficiently inspiring that I am compelled to start this post with these words by Armen Alchian here (from Economic Forces at Work, 1977)

In every society, conflicts of interest among the members of that society must be resolved. The process by which that resolution (not elimination!) occurs is known as competition. Since, by definition, there is no way to eliminate competition, the relevant question is what kind of competition shall be used in the resolution of the conflicts of interest. In more dramatic words designed to arouse emotional interest, what forms of discrimination among the members of that society shall be employed in deciding to what extent each person is able to achieve various levels of his goals? Discrimination, competition and scarcity are these inseparable concepts.

Regular readers know, that I feel we don't have enough marketplace passageways to make adequate inclusion possible. To this blogger at least, that means a lot more elimination (of potential competition) happens than Alchian's words seem to suggest! What's more, arbitrary limitations for economic entry (in business starts and services) are easy for special interests to capture and define, because they appeal to some very basic psychological motives on our part. While the scarcity of space is nonetheless real in physical terms, the scarcity of mind capacity in terms of relative aggregate need, is but a discriminatory fiction.

This results in limitations of a physical or environment defined nature, as well as the knowledge use realm: albeit in quite different capacities. Still, both "handicaps" appeal to one's desire to either reach beyond present status or prevent others from accessing our "perch", as captured by environment requirement (regulation, zoning, strict product or service definition). This generalization goes exponential if our perch costs a lot.

Also, knowledge use limitations often stem from the fear of being taken advantage of or subjected to substandard service in some way. Of course this is something that happens in any event, thus individuals in today's special status quo can pay dearly, when the problem becomes them. Or maybe certain individuals in question weren't really the problem, but were the only ones that could be easily flogged to make up for the special privilege bestowed upon them.

Plus, it becomes tempting to tighten up the rules of the game, creating "forced stretches" on everyone's part, during times of material abundance and gain. This leads to expectations re how flows of goods and services are "supposed" to happen for the rest of infinity, even if the good times don't remain so great. Alternative flows therefore become frowned upon...

Just one aspect of the economies of scale problem, is the present challenge in food preparation by food trucks. Food trucks allow economic entry through lighter financial obligations and overhead: all of which allows nimble adaptation not really possible at the restaurant level. Certainly the restaurant owner may feel threatened. However, it's uncertain how long some cities can hold back the tide of young people who do not have jobs at the ready and are compelled of necessity to create their own. What if a city arbitrarily decides to commit to greater economic inclusiveness, over the cries of its established businesses anyway? How might it approach the matter?

Let's consider that seemingly automatic take-advantage-of-psychology aspect, re how we as a society unwittingly circle back, creating our own unhappiness. It's that legal thing we do which allows five steps forward, no steps back, and then the real possibility we lose control over our lives. By financially maxing out our aspirations and distaste of "inferior" services, every time! What's more I have a good post from Bryan Caplan for the illustration of our subsequent quandary. Here's Caplan, in his goodbye to Bart Wilson:

Bart points to an experimental resolution: People like being in control of their own lives - and gladly accept lower-quality outcomes to avoid being under other people's thumbs.

To paraphrase a bit further from Caplan's post, even though people systematically make bad decisions, they value their right to do so.

But...but..that's not what we've been doing! (No kidding) Well...at least we've been giving the illusion of "allowing" only the "right" decisions and perfectly respectable suitable environments. Oh my when I think of the relative freedom (in terms of overhead responsibilities) of flea market booths and the relative degree of "mistakes" they allow as compared to the inviolability of some building lease agreements. Sure, you can buy respectability just so long as you never fail. Hello legal? We would have accepted a less than perfect outcome. Sorry we didn't indicate that to you sooner...

Even so: who - with the seeming capital equivalent of a flea market booth - doesn't want a real environment to interact with the public? What we do know is that the business and financial folk will accommodate that wish much of the time, with pleasure. Except: buying "respect", whether one actually needs it or not, isn't cheap. And if respect doesn't pan out there's not much left to sell. Which leaves me with one question: Why don't we count business losses in unemployment statistics? Okay, one more question. How much of a stretch would it be to take Alchian's discrimination dig, as discrimination against ourselves? In the game of life, we and our business partners allow ourselves the right to step ever forward but not to step back even lightly - only the right (?) to fall back in the hole for what it's worth.

Another question I asked recently also seems relevant here: why can't we approach our economic environments a bit more like some of our challenging and inclusive games ? After all, most games don't say one or two strikes and you're out - they encourage us to keep playing. Whereas our legal and bureaucratic system isn't fond of economic games, thus has become quite a stick in the mud. Except, it doesn't realize how many lonely and desperate people now exist in the world - all because of short sighted arrogance.

Some time ago, the cost of entering economic games became unnecessarily high on Main Street for those who provide (relatively) marginal needs. Yet when marginal needs end up assigned to larger interests, they often lose "interest" in carrying them. There's many ways to create fun and greater choice with economic activity, and no good reason why Main Street should remain exempt from a plethora of possibility. How might occasional, or "not constant" needs and consumer desires, be reintroduced? Most importantly, how can they reside in places that don't constantly go empty in between.

For every person who wants to "beat" everyone else into submission - and whatever institutional ilk they belong to, I'd "submit" there are probably at least ten more who have much more fun keeping the game going (paging legal...paging legal...). Hmm there's bound to be some studies on that. For our purposes here, these are the people who will keep their doors open to the public until every last dime is spent in the effort to stay economically alive. Even if the hapless entrepreneur didn't have enough left over to give to all the charity drives this year. Who loves the game? Say aye!

Where is the Starting Line?

...To a more sensible economic future, that is. I've been fighting a head cold recently, brought on perhaps by a house that got too chilly lately. My ability to concentrate has been somewhat impaired, so hopefully this post will make some sense! At least I've been able to find some interesting links to tie in with today's thoughts: finding our way to a better economic future, is a topic that weighs heavily on many minds.

The other day, Tyler Cowen asked, why is liquidity flowing through economies in such a non neutral fashion? For me, this question can be answered by the fact that special interests force many to accept product formations that are simply not appropriate for their present resource use capacity - thus the monetary disequilibrium that follows. However, the fact that both finance and governments are determined to keep hammering square pegs into round holes, makes it difficult for macroeconomic (monetary) measures to work as effectively as they otherwise could. Let alone the ongoing confusion between statistics and numbers, versus how money needs to be able to flow through economies.

What's more, it's not hard for finance to insist on center stage, when mathematical functions remain front and center in economics departments. For instance, I was of the belief that history of economic thought was poised to become a more important element of higher education requirements. But according to Gavin Kennedy it looks as though some economics departments are instead heading in the opposite direction. Think about this as a striking example, of worthy issues that never even make it to school curriculums for any number of reasons. How many communities and educational entrepreneurs would be able to provide worthy "homes" or destinations for knowledge (homes that can be shared online), whenever educational institutions cannot? That's why I believe in opening up education at all levels to educational entrepreneurs, in local economies willing to start anew.

Because of institutional limitations, many thoughtful and hard working students don't learn about important aspects of life, that could have considerable effect on the way they approach the world. For a student, great teachers mean many things. Does it matter if a teacher says I am not going to teach X (something that may seem central) if the student would do better to learn about X at a different time or even in different context? Institutions of learning haven't adapted to the subjectivity of our fixed time scarcity. Yet each student has a unique time and place for learning, and that matters.

It was an HBR post "Great Entrepreneurs Pick Great Markets" a couple of days back, which nonetheless reminded of the vast marketplace which most still assume to be off limits in the present. Institutional knowledge based wealth capture is so taken for granted that many now think of labor time as non scarce, instead of the finite scarcity it represents both for overall economic stability and the reality of our own lives. That much diminished accounting of human time is a huge mistake. After all, when we don't calculate aggregate economic time participation in direct terms, our economy is forced to make adjustments indirectly: adjustments which cannot maintain equilibrium for the long run.

Rob Go (HBR) speaks of the moats that exist in some marketplaces, acting as effective barriers to entry. For me, the problem is that they interlink with multiple "castles" which in turn rely upon one another for their strength. Those moats cannot be approached head on. Instead, they will need to be actively questioned through limited first mover measures and economic examples over time, which prove capable of removing the negative externalities of undirected personal time.

These moats are precisely why it is hard to find a starting line for economic entry in any normal sense. For instance, Kurt Schuler in this recent post, looks at the fact that nations are used to government being the monetary "go to" for educational purposes in general. He wants to know - is that really necessary? My thoughts: Some start up knowledge use systems, as they are adopted, might want to experiment with monetary printing by more direct means, for educational entrepreneurs at local levels. Such printing could still readily integrate with larger monetary systems.

At the very least, some realize that the desire for a basic income is not as simple as waving a magic wand, as this guest post by Max Sawicky at Next New Deal indicates. For one thing, conservatives are not so anxious to alleviate poverty as they are to keep special interests from benefiting at the expense of lower income levels which do not have their own adequate political representation. Just the same, special interests would not give up their mostly unnoticed gains so easily. Again, first mover problems such as this are why focused economic efforts (and experiments) at local levels could point the way to new integrated economic practices. Not only would these work to benefit lower incomes in the long run; people from all income levels can learn to play more direct roles in the broken down production and consumption functions of the present.

Understanding is key now, to keep urban and rural economies from splitting apart. A complete separation of regional economies into political factions would not help anyone. This is especially evident in ideas of peer to peer economies that revolve around sharing of resources, goods and "slow economy methods" which are intrinsically fine. Just the same, alternative economic measures can be pursued with the understanding that they need to be choices - not life crippling necessities which also translate into low income poverty. That means making the limited capacity of our own time use a central element. To do so, strong links to production efficiency alongside services coordination, need to be maintained locally in monetary terms.

With today's technology, sometimes it seems as though one could put together better functioning  knowledge use systems and set them down anywhere, but that isn't really true. How prosperous is the area that is being considered for knowledge use systems? Do they still have good employment prospects and if so, of what nature? Or, has the area declined too far, for anyone to be compelled to initiate complex undertakings? There seem to be "sweet spots", where people would be willing to relocate and start over, yet still have a base to work from in terms of possible growth. What kinds of companies are in the area? Remaining traditional services? How many who live there actually work, and if they do, do they work nearby or commute elsewhere. When domestic summits are taken on, these are important considerations.

Most important here perhaps, is a link Tyler Cowen posted from a Ryan Holiday post that I find myself compelled to respond to. So I'll do a bit of a "take down" re the words that Ryan framed for his wall. Scarcity...hmmm. Now I know exactly why Tyler's latest book bothered me so much.

Yes, of course quality land and related resources are scarce. Oftentimes we can visit special places such as this, yet know that living there isn't really an option. Plus, those that do stay will make more money in relative terms because it costs more to live there - hence local wages can be an entirely different matter from national wages. Still, people have the capacity to increase wage value over time, by making places desirable to live which don't necessarily have geographic advantages. Land can be made quite attractive, when people care about it and for it. One's desire to improve land use should be just as surely a skills attribute for community, as one's pocketbook. After all, that particular initiative is too important to ignore.

Intellectual quality or "good ideas" what to produce, entirely depend on the passageways and destinations that people create, so that knowledge in all its magnificent diversity might have the chance to enjoy the accolades it deserves. What's deemed as "good", also depends on income infrastructure needs. Knowledge only appears scarce when we start to think that human worth in the aggregate is scarce, because primary value is supposedly caught by those castles and moats we'd rather call stagnation, than face up to. Being told that we can't use knowledge to help ourselves or our neighbors, is like being told we can't garden our own little plot (of scarce time), simply because our soil is not as good as the soil in the garden up the road!

In other words, our willingness to support one another in a framework for widespread and diverse knowledge use, creates value for knowledge use and innovation which otherwise would not be possible.  I'm sorry but when Tyler says things like intellectual property is scarce, he aggravates me no end. Does he really want the future he portrays?

It would be one thing if institutions had roped off an inhabited area of economic potential that actually held life of its own, but they roped off wealth potential in such a way as to pretend it doesn't even exist. And yet, everyone is sick and tired of the taxation to fight off the endless demons that  come out of that forgotten place. Some people now think money is worth little because it has no choice but to also represent that forgotten place!  If our institutions refuse to budge now, the rift between productivity and those who can't take part in productive economic endeavor, will only grow.

Institutions of course continue to grab up the "quality" labor we like to call scarce, but that particular definition is one of defeat, in terms of knowledge use potential. Meanwhile the negative externalities of "low quality" labor continue to expand, to such a degree that the random capture of high skills use potential has finally become a false victory. All the while our institutions are forced to somehow support the rest - a responsibility they don't want. I can't say it enough, no one wants to pay for the ones that have been left out...or feels like they should be the ones "stuck" doing so.

When people get left out, there is no direct way to tend to their condition humanely and we end up with private prisons and other horrible conditions. Therefore, the only humane solution is let people help themselves through applied, recorded and measured knowledge use - through their own time use arbitration. If we face up to our "stuck in the mud" institutions on this issue, I think they will eventually get the point. It is better in the long run to let everyone prosper.

And until we do, our financial realm is going to look like one giant monstrous pretzel, trying to figure out how to financially account for the forgotten without anyone noticing, who could have just been allowed to tend to their own affairs. Safe assets are about letting everyone use resources to create wealth. Safe assets are about understanding what the potential of technology actually holds for us personally - not just about devices to hold in one's hand, to communicate with the world. That means allowing technology to create environments that don't constantly overwhelm us with needless complexity.

This is where the starting line is: the scarcity of our time use which is paramount and has to be taken care of before anything else even matters. If money is not allowed to represent the potential of our economic participation in the game of life, the use of money may not have the chance to regain normalcy again in our lifetime or indeed the generations after us. Domestic summits, now. Nominal targeting for our own, very real fixed scarcity, now. Nations can thrive again when nations learn to give their own citizens a real chance to help themselves.

Midweek Market Monetarist Links and Summaries - 12/18/13

An interesting email exchange between Miles Kimball and Scott Sumner, who grew up less than a mile from one another: http://blog.supplysideliberal.com/post/69666430753/miles-kimball-and-scott-sumner-monetary-policy-the

Scott Sumner provides a post response along with some more memories: Miles from home
Both David Beckworth and Paul Krugman agree with Scott that "helicopter drops" are not a cure-all for AD shortfalls
John Carney misrepresents Scott on QE: Pay attention to the theoretical world
Scott points out a few positives and negatives: Stanley Fischer to the Fed?
More on Fischer, and some thoughts on the Jewish ethnic group: Failure is an option
Scott receives some hopeful links: Is the Eurozone beginning to wake up to reality?
It's the ECB policy that is awesomely destructive: A note on "awesomely destructive" fiscal policies
Never mind foreign countries...what about the bizarre activities closer to home? We are the freak show
Reviewing the editor's proofs of his Depression manuscript, Scott remembers The "Lehman Moment" of 1931
Tight money causes... How to prevent an epidemic of Reckless Lending
Will growth remain low in the years ahead? It's not about inflation
Rationale for inflation has changed in recent decades: Yes, raise interest rates. But how?
And, Income is meaningless, example #388

Lars Christensen is encouraged by Stanley Fischer: http://marketmonetarist.com/2013/12/12/stanley-fischer-this-guy-can-keep-ngdp-on-a-straight-line/
Keynesians agree with Market Monetarists when it comes to weak demand: http://marketmonetarist.com/2013/12/15/christopher-pissarides-is-europe-working-the-answer-obviously-is-no/
UK labor market improves: http://marketmonetarist.com/2013/12/18/imagine-that-us-non-farm-payrolls-were-growing-by-400kmonth-that-is-how-strong-the-uk-labour-market-is/
Seriously, who would think this is a good graph? http://marketmonetarist.com/2013/12/16/european-horror-graph-of-the-day-the-greek-price-level-collapse/
Actually, someone likes this graph just fine... http://blog.supplysideliberal.com/post/70165552384/econlolcats-the-price-of-stability-is-eternal

This post continues "Turgot's land beating Samuelson's money" (Nick Rowe)
http://worthwhile.typepad.com/worthwhile_canadian_initi/2013/12/we-know-the-economy-needs-a-bubble-but-how-big.html
Average unemployment of the last few years isn't necessarily the natural rate: http://worthwhile.typepad.com/worthwhile_canadian_initi/2013/12/natural-rate-trend.html
Nick wants to put people back in the model: http://worthwhile.typepad.com/worthwhile_canadian_initi/2013/12/microfoundations-for-peoples-sake.html

Izabella Kaminska contributes to the comments section (David Glasner)
http://uneasymoney.com/2013/12/13/does-macroeconomics-need-financial-foundations/
David provides a link for his recent paper: http://uneasymoney.com/2013/12/17/my-paper-on-hawtreys-good-and-bad-trade/

Where might Steve Williamson's model have an element of truth? (Bill Woolsey)
Does Quantitative Easing Cause Deflation?
"Suppose a single bank in a competitive banking system wanted to expand its lending": Private Money and Quantitative Easing

"You can't judge a monetary policy by nominal interest rates; you can't, you can't, you can't." (Ryan Avent) http://www.economist.com/blogs/freeexchange/2013/12/secular-stagnation

Does the deficit come down with growth? It depends (Britmouse):
http://uneconomical.wordpress.com/2013/12/12/productivity-growth-and-the-deficit/

How safe does government debt need to be? (Andy Harless)
http://blog.andyharless.com/2013/12/stochastic-dynamic-inefficiency-secular.html

An interesting take (James Pethokoukis): Maybe patriarchal labor unions are to blame for rising inequality

Mark Sadowski notes discussion by both Nick Rowe and Frances Coppola in this lengthy comments section: http://pragcap.com/stop-with-the-cutting-ioer-will-increase-lending-madness

Evan Soltas does an interview: http://esoltas.blogspot.com/2013/12/how-i-got-into-econ.html

James Hamilton tells the recent story of the Federal Reserve short term interest rate:
http://www.econbrowser.com/archives/2013/12/federal_reserve_3.html

Getting Beyond Homelessness: Property Edition

Homelessness consists of many related experiences, which go well beyond taking one's chances in the elements outdoors. Once anyone has experienced some aspect of homelessness, life never feels or looks quite the same, even if only a short stretch is involved. While I suffered from a symbolic (identity) form of homelessness in recent years, that's hardly the same magnitude as being on the street with no house to sleep in. Identity homelessness is more a result of no meaningful employment, or too little work and social related engagement with others. Even so, involuntary solitude may be reminiscent at times of the solitary confinement in a prison cell.

Indeed, the only time I experienced the somewhat scary outdoors version, was a couple of nights back in Los Angeles in the early eighties. Plus, that's an experience which people from many life circumstance have had, upon moving to that area. So long as you had a car to spend the night in, things would generally turn out alright and you could return to the demands of whatever temporary job one was able to "scratch up", the next day. (in my case, selling pots and pans and the like, from the trunk of the Volvo)

The physical aspects of homelessness are a lot more unsettling when they're not short lived. What's more, an overall social dynamic is gradually shifting towards a reluctance to allow homeless people to remain in nearby areas. Yes, people still worry about the well being of the homeless, but there is a lot of uncertainty involved. Even though homelessness statistics have been reasonably contained in recent years (partly through imprisonment and suicide, no doubt), the root problems have yet to be addressed. Plus, in order for society to be able to face up to homelessness, also means owning up to some basic aspects of societal identity, unemployment and property use dynamism in general. Ideological and political discussions don't really get at that core. Homelessness is also a lack of understanding re the diminished capacity of property utility, in general.

Look at most any element of society today and ask, how dynamic is this particular social function or environment? There is a city block nearby where one of the elementary school buildings of my youth once stood. All that remains is a tree or two, some grass and a no loitering sign. I get the no loitering sign by the train tracks but hmm, this is not someone's parking lot or driveway...What's up with the warning, especially given the fact that local property taxes easily take care of spots like this? What could have been going on, at this small unassuming piece of property which would cause anyone to say, move on?

Certainly when we pay the price for private property, we deserve privacy. But when arbitrary decisions are made to just keep people off public properties of all kinds, my radar goes up in a hurry. Expectations to "stay away" from numerous public properties had already been a sore spot with me in the last decade. Worst on that list were too many neglected forests on supposedly public lands, in poor shape from lack of any maintenance or public engagement whatsoever, on the part of anyone. Is this the best we can do, because we can't figure out how to utilize public properties in ways more agreeable to everyone involved?

When I began my studies regarding lack of economic access,  something that really stood out were ill defined expectations for continued economic dynamism, regarding both public and private property most everywhere I looked. Some logic, if it could be called that, had holes that were big enough to drive a semi through. Indeed, the most egregious destruction I observed of private property, came from a place where few expect. Plus, even talking about it is apparently off limits for some elected officials: the sad results of convoluted familial laws. Some states are probably are a bit more adept at problem solving and actually useful in legal terms. But others have legal arrangements which do not give parties any true means of negotiation for property, in spite of billions spent for nothing and people going into poverty in their attempts to problem solve.

Unfortunately, the lack of ability to effectively negotiate with family members regarding property, has destroyed far more residences, landholdings, businesses and communities than the pitiful forests I observed. If one were able to measure such destruction, it would probably be greater than the destruction of many wars, but there is little impetus from the legal profession that I know of, to offer services to clients which actually help them. That is one of the reasons I believe that people need simple legal alternatives for property use, in which parties agree not to destroy one another and their jointly used properties, upon separations. Gridlocked legalities and a lack of ability to effectively negotiate with one another, diminishes both public and private property utility in multiple dimensions over time, and homelessness is just of them.

While I still don't understand appropriate taxation for land holdings, this much I do know: people need options in both public and private property dimensions that are much more dynamic than the limited purposes both serve in the present. Even though commercial private property is supposedly more limited than public property: at the very least, when it is successful, it serves many purposes and creates pathways by which many individuals can get things done.

This post is not intended in any way to be an argument against public property, but to suggest that public property be reconfigured to provide more meaning and purpose for society than much of it now serves. What's more, it could be capable of multi-purpose and local wealth generation in ways similar to private property, but for all citizens of community to access and maintain responsibly. While private property often gets needlessly caught between opposing parties, public property more than anything is simply suffering a crisis of imagination. We need more property of public designation, but even so, such designations would be pointless if they aren't capable of contributing to overall community well being. And presently, too many public designations don't really do so.

Consider why Hume believed in an unequal distribution of property. As indicated in Wikipedia, Hume felt that perfect equality would destroy the ideas of thrift and industry. He believed that perfect equality would thus lead to impoverishment. My question is why, then, do we observe steady legal impoverishment of properties in general? Once, our legal system made it easier for the marketplace to prosper, just as Hernando de Soto wrote in "The Mystery of Capital". But since the start of the Great Recession, the hopefulness expressed in his book has been diminished by a developed world which has forgotten how to continue the dynamism it once believed in.

Some of my strong feelings about property came from witnessing first hand, what turned out to be a decades long war between others over property. Those years of struggle which I could hardly extract myself from, impacted my own life with a homelessness identity which I am still learning to overcome. That experience is one of the primary reasons I strongly uphold the ideal of flexible property components and land holdings which can be separated as needed for business, individual and personal reasons.

What's more, dynamic and flexible components will only become more needed in decades ahead as crazy ants, for instance, take over the Texas countryside if this article is to be believed. Let alone global warming swallowing cities, hurricanes - argh, how many more reasons do I need for flexible snap together building components to become a reality?

And those flexible building components would do a world of good for the homeless now. Granted, I know that there are lots more issues at stake than innovative building components for the homeless. Trust issues are paramount, and this is where getting to the heart of more productive economic activity could really make a difference. These things really need to be accomplished soon, because not enough people are presently able to make the vital connections between technology, the benefits of mass production and a relative current state of wealth which remains fragile as a result.

Healthcare "Fail" Has a Silver Lining

How so? Every time I see one of those reports how the U.S. is near the bottom in terms of efficiency for healthcare spending in developed countries, I immediately think of the bright side: healthcare "fail" gives us a chance to seek out more inclusive free markets in knowledge use. What's more, open and voluntary healthcare markets can also serve as community templates, for further possibilities in other service and knowledge use areas. To be sure, it's not something that can happen overnight, but the lack of long term solutions for our present system, may eventually mean the demise of today's extreme limitations in healthcare practice.

Discrepancies have become vast, between what we would like to experience in service based terms, versus what people actually end up with. Insofar as markets for knowledge use are slowly evolving, the painfully dysfunctional healthcare marketplace of the U.S. is ripe for transformation. Just because a product is a services product, doesn't have to mean that more dynamic production and consumption patterns are impossibilities. Nor is any of this as simple as Baumol's disease costs, because methods of organization, ongoing coordination patterns, and potential healthcare strategies are also at stake.

Consider the recent "good" (?) news of growth containment in healthcare budgets. There is probably a world of pain behind those apparently "improved" numbers of slowing inflation, especially for anyone not close enough to retirement and Medicare. That is, many individuals and companies are likely delaying a lot of the healthcare consumption they would otherwise be taking on.

Delayed visits to the doctor are also a likely reality, since individuals are already transitioning out of private healthcare plans for the botched government rollout. Will it even be possible to determine the degree of activity which was lost in 2013, let alone continued delays in 2014? What's being missed in all this is the fact that balanced budgets and missed appointments are not a good indicator for imagined efficiency gains. While there are certainly problems in the system re some users "overusing" while others hardly use it at all, it seems fair to guess that few are really consuming to the degree that feels most appropriate to their circumstance, at the moment.

Not all doctors are comfortable with the participatory limits, which the AMA in particular has imposed over the years: wealth "shape shifting" limits on both production and consumption of healthcare in the U.S. While healthcare here has led to innovations which have spread around the world, at the same time its institutions have quietly subdued alternative strategies and healing methods. One aspect in this regard is that organized healthcare sometimes "takes out" preventative maintenance strategies, which can keep individuals from needing some surgeries in the first place.

How might one approach a better healthcare marketplace? Again this would not be a knowledge use market to replace current institutions, but to go where they can't go, and also provide what they often can't provide. Perhaps there was a time and place for the limitations they imposed so long as healthcare was available to wide swathes of the public, but that time is past. With government's permission, some doctors would be able to provide informal training in vital areas of medicine. This is especially needed for promising individuals in isolated areas who - by going the traditional training route - would have been priced out of the spending capacities of their own communities. Doubtless some would oppose this route, but it's not hard to see the writing on the wall otherwise as to a growing population with little healthcare access over time.

There is a significant degree of literature for alternative healing methods in the U.S. as well. While some of this is being accessed, one not only needs traditional medical education to provide it for patients, but the time available for alternative methods is quite limited. What's more, such options are more likely to be found in the cities, than in rural areas where they could do the most good for those with limited financial means. One of the benefits of voluntary coordination for healthcare is that people can also provide this in private settings which do not face the same regulatory problems and burdens of traditional healthcare environments.  Private environments can be beneficial as well, to prevent the spread of disease and antibiotic resistant infections.

Lots of healthcare problem solving can be met without resorting to surgeries and extensive prescription drug use. Plus, some of us just don't have metabolisms that tolerate prescription drugs easily. Some healthcare needs are really about bringing what's available in urban areas back to rural areas as well. There are so many unique facets and aspects of healthcare that could be represented by many individuals, in communities both large and small. While some of us aren't well suited for providing more basic aspects of healthcare, all of us can still contribute something of real value, because so much about our lives is directly related to overall health.

Time as Anchor

The realty of our measured time use matters immensely, both in both monetary and symbolic terms. Yet this measure of economic participation has not only been taken for granted, it has been abused time and again, by those who know it matters but can gain by keeping that information to themselves. Unfortunately it is not easy to observe the abuse, in that it generally happens in subtle contexts that play out spatially and over the course of time. Sometimes the full effect of abuse goes unchecked over multi-generational periods and contributes to business cycles in the process.

Once human skill develops and diversifies to a certain point, nominal targeting (aggregate spending) has the capacity to use time as a monetary anchor for economic stability. Why, then, are central banks reluctant to use NGDPLT as the primary monetary rule? Many who have gained power, have done so by abusing the anchor of time measure, whether by needless product limitations in the marketplace or by allowing finance to run amok with excessive take from the marketplace.

However the public needs to know what is actually at stake, for the very act of maintaining monetary confusion is still a powerful money generator for those who know how to play the confusion game. Arguments over financial regulation and government intervention only take attention away from what is actually needed: production reform and nominal targets for aggregate spending levels.

And to that end, governments and finance remain willing to obscure where the most important measure of economic activity exists. Perhaps this willing obfuscation wouldn't be so bad, if people could reasonably live with a limited rich class and no real participation from the rest. But our present environments and responsibilities were never laid out for those kinds of living options. Think of countless articles as to the costs of raising a child, for instance.

That doesn't mean some of us couldn't innovate into transformed living environments, at a fraction of today's costs. But so far that hasn't happened, and our monetary obligations to society are growing faster than income potential for the current infrastructure. Just one reason this is so important, is the fact that too few are really taking declining workforce participation seriously. To be sure, it's easy to rationalize that workforce participation was "artificially high" for decades thus a gradual return to something more "normal". But our present environment isn't ready for such a decline, normal or not. The fact that family formation is not really accessible to lower incomes tells us that. If we don't plan for better alternatives, technology is likely to be substituted on terms that are only accessible to some. Meanwhile in other areas without the same capital wealth, one can only guess what the price of one's room and board may actually consist of.

One reason for a possible bad outcome such as this: the world no longer has the same options for lifestyle choice that existed early in the 20th century. Before workforce participation ever became so high, people who could still opt out and live as one of my great uncles did, coasting through retirement and shooting squirrels out of the garden, fruit and nut trees so as to make squirrel dumplings. Some neighborhoods draw the line at shooting squirrels now, even if the pesky critters do throw half ripe fruit down to the ground.

But the more important point is that a lot of people aren't prepared to return to that subsistence still evident 50 years ago. For the most part, technology transformed land use options, and that in turn made our time use the ticket for economic access. The fixed scarcity of skills time use - not the fixed scarcity of land, - was supposed to be the primary wealth driver of the 21st century.

In subsistence circumstance, anyone gets that our time is important for survival. That does not necessarily mean we have to work nonstop, if basic needs are already being met in our environments and we utilize simple options. What it does mean is that participants have to take into account the maintenance needs of anything they create, use and rely upon, on a regular basis: let alone the time and resources that one's environment actually entails. I had to learn this lesson the hard way, by "saving money" on an older home which needed much more attention than I could give it with my limited finances and home repair skills.

Even people with more resources than I had, make the mistake of building homes requiring more hands on ability than they are able to provide when they get older. It is a travesty that people have not been able to innovate so that their environments don't have to be burdensome, difficult and even dangerous as they get older. It's great that we communicate better than ever before in the digital world. People complain regularly that the school environment hasn't changed in the last 100 years. But our surroundings also haven't changed one iota, in terms of making our lives easier or freeing up our time for other desirable activities.

Without the ability to use the fixed scarcity of our time as an anchor, we have no way to place relative scarcities into understandable and workable contexts. And because we do not understand the importance of time as a symbolic and monetary anchor, we have little means to free our time for anything but basic needs. To be sure there are individuals who manage to, but given the limitations of product definition they are in the minority.

Like the fixed scarcity of private property, our time use is a fixed scarcity in the midst of many confusing random scarcities. Just as property rights made today's marketplace possible, the right to competitive knowledge use in lateral time would make a free market in knowledge use possible as well. Consider what was written of David Hume, in Wikipedia:

In contrast to Locke, Hume believes that private property isn't a natural right. Hume argues it is justified because resources are limited. Private property would be unjustified...if all goods were unlimited and available freely. 

When nations were in the midst of creating wealth and abundance, some individuals were able to declare to declare their time use as much more valuable than others, with the government's backing. Government acquiesced (thereby limiting time value for everyone else exponentially) in the belief that random scarcities could readily make up the difference for the fixed scarcity of time use. For a time, of course, they did. But now, those exponential differences mean the basic need of healthcare is only available to a portion of any population, regardless of money hoarding, compounding interest or any other numerous compensating factors.

The idea of secular stagnation really comes down to an inability to separate the idea of time use as fixed, from random scarcities in any meaningful context. It is when we look at the world from the window of time use, that the ability for other resources to contribute to our lives comes into sharp focus. This is also the window where we see what is possible to produce, so as to provide further choice for what is ultimately consumed. With time use as monetary anchor, we are better able to recognize what is actually scarce or plentiful in our own lives, and the degree to which that relies on income. That in turn leaves us free to determine the kinds of technology that works best for us.

With time as anchor, it becomes easier to consider innovation along income continuums that nations and corporations may not take into account. For example, innovation now is thought of as something not necessarily good by today's youth, in that they aren't convinced it would be used for actual utility. Somehow, a robot personal servant doesn't have the same marginal benefit, for instance, of a robot capable of cleaning chimneys or woodstove pipes on steep and frozen roofs, when people are no longer healthy enough to maintain balance in a biting wind.

Again this goes back to innovation through income spectrums and points along the Maslow pyramid. If we allow innovation in both basic and non essential areas, that immediately puts time back in our lives for the non essentials we crave. That also sidesteps the current problem of lower income "making do" with plentiful non essentials while not having basic essentials designed for their actual circumstance. This is a problem which leads to both social isolation, and the inability to be responsible for both cultural and familial expectations.

For all their seeming importance, government fiscal activities and for profit financial activities are just as random as many resource allocations that both capitalize on in the good times. Neither governments or finance should maximize our time use as bait for their personal rewards, because we still need our time use to get us through the rough patches. In other words, we are the ones who are expected to stay steady, whether the governments and the financial realm chooses to or not. If we are to fulfill our obligations, those in power might do us the favor of not taking away the fixed scarcity of time at our disposal.

While it is understandable that governments and finance wish to deem themselves primary, they do not have an ongoing and constant capacity by which to do so. Thus, they do us a disservice by pretending they are more capable than we, for they are more dependent on our economic participation than they care to admit. Growth for the long run means economic access by as many as possible, through as many means as possible. Otherwise no nation can remain strong.