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Thursday, January 06, 2011

The good economist

Workers are more valuable in India because they're cheaper...
It's almost as if in our economic system value becomes inverted...

I do not think that anything changed.
The mistake is viewing the economy as ruled by moral and ideological principles.
Economy is first arithmetic and second arithmetic applied to profit.
Why would anybody work or invest if not for making a profit and a bigger profit if possible?
The ones who invest for philanthropic reasons are few and they have other reasons to do so.
Not last the satisfaction of feeling "good".
I see Gates as a ruthless entrepreneur (he wouldn’t be there if it was not so) and his "doing good" looks to me the easy effort (what he gives compared to what he earns is peanuts) of feeling "better" and his personal excuse is "besides I save on taxes".
With these premises it is clear that people invest where it is easier to have a good ROI.
They produce where it is cheap and sell where it is expensive and cash the difference.
At least as long as it lasts.
Economy is arithmetic, but it is also arithmetic applied to reality.
You cannot expect infinite growth in a world that is finite in number of consumers and in quantity of raw materials.
A good economist is the one who is able to make that growth last as long as possible and more than anything, is able to make the downhill as less painful as possible.
Do you want a stable and good economy?
No restrains, no regulations, the least possible taxes.
If people invest, they create jobs, if people have jobs they spend.
And when you come out with the fact that deregulation means people who take advantage I invite you to look at a world which is regulated:
Aren’t there crooks, does the law forbid to find ways to elude regulations and take advantage, and most of all isn’t the law made by the ones that the same law should regulate?
Do you really think that in a world ruled by lions there will ever be a law that forbids eating gazelle’s meat?
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