Sure, thanks for the kind words! For me, this idea was like the Monty Hall Problem. I sort of got it intuitively but didn't really nail it down in my head until I wrote it out :-)
I'd really like to know YOUR take on the fancy shells question, and in the case where different kinds of fancy shells are used, where each kind can be obtained from regular shells only in a particular island
I’m not certain I’m in a good position to chime in on the issues surrounding running a large current account deficit. My view is that it’s complicated, but certainly there are risks and downsides, including inflationary pressure. In the U.S., the downside risks of a large and sustained current account deficit are, to my mind, mitigated by the fact that the U.S. dollar plays the role that it does globally, which—for the moment, at least—mitigates these risks. Of course, if/as the role of the dollar declines, these risks loom larger. So for now I’m not too worried about all the fancy shells on other islands, but if the role of the dollar starts to erode—and the rate at which the government can borrow climbs—I will be more worried about them. Thanks for the question!
All living things sustain a thermodynamic disequilibrium with their environments. The more effective the modelling of that environment, the more resilient the organism becomes. Now in the case of trade in which for one party, human capital is developed giving an enhanced grip on the environment, then that party becomes physically – thermodynamically – superior. The superior party can then impose its will on the others. The physical blindness of economics.
thanks, save me writing (badly) a version of this...
Thanks for the education, Rob! I understood this in principle, but never bothered with the math!
Sure, thanks for the kind words! For me, this idea was like the Monty Hall Problem. I sort of got it intuitively but didn't really nail it down in my head until I wrote it out :-)
I'd really like to know YOUR take on the fancy shells question, and in the case where different kinds of fancy shells are used, where each kind can be obtained from regular shells only in a particular island
I’m not certain I’m in a good position to chime in on the issues surrounding running a large current account deficit. My view is that it’s complicated, but certainly there are risks and downsides, including inflationary pressure. In the U.S., the downside risks of a large and sustained current account deficit are, to my mind, mitigated by the fact that the U.S. dollar plays the role that it does globally, which—for the moment, at least—mitigates these risks. Of course, if/as the role of the dollar declines, these risks loom larger. So for now I’m not too worried about all the fancy shells on other islands, but if the role of the dollar starts to erode—and the rate at which the government can borrow climbs—I will be more worried about them. Thanks for the question!
All living things sustain a thermodynamic disequilibrium with their environments. The more effective the modelling of that environment, the more resilient the organism becomes. Now in the case of trade in which for one party, human capital is developed giving an enhanced grip on the environment, then that party becomes physically – thermodynamically – superior. The superior party can then impose its will on the others. The physical blindness of economics.