Four Basic Truths of Macroeconomics

I believe Germany has done the opposite. Unions have agreed to pay cuts so they wouldn't be let go. Part of the reason may be that wage levels are reasonably flat compared with the US, so the upside in switching jobs for a better paying one at a competitor is limited versus the hassle of doing so. In any case, it's an interesting alternative model which ensures stability for employees and employers alike.

To add to that internet connected device is required, but latest iPhone that costs 15x as much is not really materially more important than a $50 one for looking at job ads/emailing potential landlords.

Likewise, a flagship phone 5 years ago might be technically less advanced than a flagship phone today, but that doesn't mean todays flagship phone is any better at looking at job ads today than the other one was 5 years ago either.

This idea that we should weight technical improvements like this when judging how the economy is performing just seems like a (maybe unintentional) attempt to paint a rosier picture than actual reality to me.

Almost like there's a moving target ;)

The math says that inflation has destroyed what was rightfully a much stronger currency because of the work that went into it.

There is no shadowy cabal of elites, it's a blatant effort of independently greedy overprivileged beneficiaries who are in position to thrive better the more that the general financial malaise of working people becomes overwhelming. Lots of the wealthiest have never built their original family fortunes any other way.

There's not supposed to be a need for a consumer economy.

Remember how it was, over the last 50 years of macroeconomics? There are equations for this.

Every single recession was never going to end until consumption picked up.

Too bad consumers are just about tapped out, so naturally it's going to be worse than ever.

That's no conspiracy, that's just what the math said.

What if we would have had a producer economy instead, or even just a more reasonable balance?

How do you like it when your equations show what you thought was a negative was reversed back into positive territory like the 21st century has never seen?

Remember in expensive places like San Francisco or New York City, the small single-family homes which are out of reach for all but the most fortunate today, were the exact same homes that were well within reach for a wage earning factory worker, the kind who eventually retired without significant raises over their career while producing products which required no price increases since there was no serious inflation. Their passbook savings accounts provided a secure retirement after their home was paid for, and property tax at the time was still insignificant compared to today. Only a single income was necessary for that kind of security.

If you had a better-than-average job, like being an engineer or something, and had the disposable income for more meaningful investments than mere passbook savings, your single-income family would not have needed to settle for the smaller homes and you would have been able to retire someplace like Florida or Hawaii for instance in perhaps more deluxe accomodations than you had during your working years.

The old folks' UBI of Social Security came along just for those who missed the boat altogether. Wasn't really needed until after the Fed had settled in a while.

Remember, there's not supposed to be a widespread need to raise your socioeconomic stature unless something is wrong to begin with.

It's just nice having that opportunity if you would like to take it, and productive capitalism can be one of the efficient options but there are others which are even quicker, with many of the quickest not actually productive in the _macro_ sense.

As we have seen.

The math says that inflation has devastated the US dollar and the vast majority of American workers with it, because that's the only dollar they were working for.

People are so desperate some of them would probably rather work for some imaginary coin now in way that would never have been considerable when silver dollars still had their intended $1 face value.

Hindsight's 20/20, if your equations do not yield the actual outcome you may just need to brush up on your business math.

All kinds of math could be more accurately done, right now we've got 45 comments remaining but it says 139 at the top of the page.

Apparently over half the comments at the time have now been retracted, maybe it was bad math on all sides?

Just compare food, shelter and education, not luxury goods.

For a solid intro to economics, I found a real gem of a suggestion by an econ professor at UC Berkeley [1], so I'll share with you. His advice is to start from the father of economics himself, Adam Smith. Then follow that up with Das Kapital (which I know is an unpopular stance here on HN) and some Keynes (who is credited with coming up with the economic theory that helped bring the UK and US out of the Great Depression). Here's a snippet of Prof. DeLong's advice:

> We have our recommended ten-stage process for reading such big books:

1. Figure out beforehand what the author is trying to accomplish in the book.

2. Orient yourself by becoming the kind of reader the book is directed at—the kind of person with whom the arguments would resonate.

3. Read through the book actively, taking notes.

4. “Steelman” the argument, reworking it so that you find it as convincing and clear as you can possibly make it.

5. Find someone else—usually a roommate—and bore them to death by making them listen to you set out your “steelmanned” version of the argument.

6. Go back over the book again, giving it a sympathetic but not credulous reading.

7. Then you will be in a good position to figure out what the weak points of this strongest-possible argument version might be.

8. Test the major assertions and interpretations against reality: do they actually make sense of and in the context of the world as it truly is?

9. Decide what you think of the whole.

10. Then comes the task of cementing your interpretation, your reading, into your mind so that it becomes part of your intellectual panoply for the future.

> Follow this process, and your reading becomes active. Then you have the greatest possible chance of learning the books—of thereafter being able to summon up sub-Turing instantiations of the thinkers Adam Smith, Karl Marx, and John Maynard Keynes and then running them on your wetware. If you can do that, you can be closer to being as smart as they were. And at the same time you will be aware enough of their weak points and blindnesses that you can be wiser than they were.

[1] https://www.bradford-delong.com/2019/12/a-note-on-reading-bi...