Thursday, August 14, 2003

"darkness on the edge of town"

The power need not be off too long before political opportunists (and other looters) come crawling out of the outlets to seize the moment for personal gain -- hmm, now that's a theme...

But the real inspiration for this post is to point out a potential solution to the fallibility inherent in complex centralized systems (be they grids of electrical or political power): encourage decentralization, localized sovereignty, personal responsibility.

In this case, consider: A tax credit for the purchase of power cells. It would relieve the power grid, prevent mass blackouts, boost an industry, create jobs, encourage research and development of alternative power sources, and make the US less vulnerable to terrorist attacks.

Seems like a good reason to give some of their income back to those who earn it.

Sunday, August 10, 2003

hands -- visible and invisible

This post is going to be about the editorial in the WSJ Friday, August 8, 2003, entitled 'The End of Maestro Economics,' by Melvin Krauss. That piece discussed interest rates, and how the rising of them threatens to 'burst the housing bubble.' At issue is whether or not that is really a bad thing. I might mention that the editorial faults Alan Greenspan for 'sending signals' which allegedly caused a spike in market rates as bonds sold off.

Praytell, was it Greenspan's hand, or was it the wisdom of the marketplace responding to the signal that it's been peering for in the fog for so long; the inevitable signal indicating that the cost of money as measured by the best measuring stick -- the market -- has been too low for too long.

As for whether or not the 'bursting of the housing bubble' is a bad thing, I might point out that Mr. Greenspan was faulted for NOT doing anything to 'burst the stock market bubble' before it went the way of all bubbles. Too bad he can't win.

Nonetheless, a housing bubble is not a good thing and it's high time that the bubbles moved on so that intelligence might once again be brought to bear in the marketplace; so that the invisible hand might be left alone once again to straighten out the distortions created by well meaning but less capable 'visible hands.' Perhaps this is what Krauss means when he announces The End of Maestro Economics.