Merkel Out!

Can someone please get this woman out of government?

Can someone tell she’s just to manage Germany and hasn’t been elected to tell the rest of Europe how to manage themselves?

Can this woman with zero understanding of lesson 1.0 of Macroeconomics that managing national finances is not the same as bullying her children back home?

Can someone tell the Germans that embracing a woman like this is indulging in her evil disrespectful external ways?

Can someone please tell her it’s her fault that the demise of the EU is looming so very near!

Can someone please get the German empirealistic dreams on check? Didn’t go too well the previous two times, it’s bound not to go too well now.

Can someone please tell Germans that German morals are not world morals. That German rules are only good for Germany. And that in open discourse discourse needs to be open!

The EU is made of democratic countries. The peoples have to be respected. Repeatedly disrespecting them leads to this. Greeks can’t stand her. Portuguese and Spanish can’t stand her. Italians can’t stand her. Brits most certainly can’t stand her! And she still strouts around like the owner of it all.

I can tell you her disrespect for other nations and her firm drive to decide for others and impose her money driven shite is behind the disgust of many Brits for the EU and for good reason I have to admit, despite being a UKIP myself.


We’re going backwards so fast!

So this is how the world has gone through phases of utter idiocy in the past.

The U.K. has just voted a ridiculous vote, a break it all vote, break the EU, break the world economy, break most of all its own financial well-being, break its modernity, but worse, break its “United” as well. The HSBC is moving its headquarters to France and many will follow. This country tumbles back into the dark ages. Because people were playing a parade.

There’s that blond guy in the US, Trump of an elephant, also being voted in what is most likely a defiance of the people against the establishment. But a dumb one cos it’s a shoot in the foot. Reminds me when the Italians  voted Cicciolina the porn start for senator, it was an act of defiance, but a cool one and at least a few hundred men managed to touch her naked breasts mid street for it, nobody wants to touch anything of Trump.

The Arab Spring was also a cry against the politicians. And against the lack of choices young people have in countries where only old people have access to decent jobs. But again, even amongst cries in streets and demonstrations and unrest, there was logic, there was a desire for something better. Here in the UK there’s just nostalgia for the past. In the country that still hasn’t figured out how taps work. In the country that does not make highways so as to preserve warehouses from the XVIIIs. It’s a country that does not like change and wants its country back. Of afternoon tea, scones with jam, and local packed beer pubs. Good luck with that.

And then there’s the songs, the rap songs in the US, ever more eroding of women. And the growing rape culture. A disrespect for women like I have never seen. Like I did not see when I visited Iran! And so many sad women, with little self-esteem. After all our conquests! 

This whole thing reminds me of two recent movies – “Agora” and “The Physician”. Both are about the fall of all the acquisitions of enlightenment at the hands of ignorant fundamentalists. It happened in the II century in Europe, when scientists were condemned by the rising of Christianity to the places of political power (Agora) and it happened before the XI century in Arab countries, when fundamentalist Muslims destroyed the places of study and maths (The Physician). History has many a times walked backwards and, after 60 solid years of progression in the West, it seems like we want that too, we’ve had too much of a good thing.

Truth be told that that good thing was obtained at the cost of a lot of going backwards in other countries. The US backing fundamentalists minorities in Saudi Arabia and other Arab counties for the sake of oil power has been one major reason, I think, for the erosion of the quality of life in so many places. In Iran itself women used to wear their hair uncovered in the 70s!

Thing is, society cannot evolve alone, a group cannot grow at the cost of others. At some point those others are going to grow large enough and decapitate the queen. Wasn’t that what the rise of Communism was about too? That’s what we learn again and again and somehow we always forget again and again. Why do we forget? Because a new generation comes about which bares no notice of the paths trotted before and thinks they know better. In the UK it’s the old, who were brought up in post-war peace and think they know it all, think savagery does not exist here and cannot come from them. Right. Whenever one group of people deems itself superior to others, big shit happens and they do, so much so they don’t get their taps checked – what could the rest of the world possibly know better?

I never dreamed I’d witness times as these. Maybe the Queen will come out of her shelter and stop this madness already. Say “Dudes, I don’t want to loose Scotland and the Northern Ireland over which so much blood and tears have been spilled, so we’re staying in the EU and enough talk”. That could work, right?

The EU did need a wake up call

Maybe this BRexit thing is not such a bad thing after all. Maybe it will be a wake up call for the EU. We have seen the EU abuse its power since 2008. In fact, we have seen Germany take on too dictating a role, imposing inconceivable pain on Greece and Portugal for the sake of the improvement of its own exports, oh the money they made off of our unemployment, interest, and suffering. Any economist in the world (and I studied plenty of that) knows you do not come out of crises by raising taxes and creating unemployment, you come out of crises by lowering taxes and doing structural changes that even out the imbalances of the economy, such as thinning governmental institutions or freeing labour markets. But no, the solution was “they misbehaved, they must be punished”. And blindly and purpouselessly they bled them. The EU replaced itself to elected governments to impose the law of idiocy. Do you want to be part of that EU? I don’t. I want to be part of a EU that puts people first, that solves problems together and that listens to the votes of the people. Now if this referendum had happened in Greece or Portugal or Malta or Romania, noone would care. But the UK is one of the three pillars of the EU. They were dumb enough to let it fall out of the Euro in 1993 and regretted it ever since, they will do what it takes now to make a EU where Europeans might actually want to belong. And it is one that is not a puppy in the hands of Merkel.

The disgusting handling of the EU debt crisis

Said the news today. Sure took them long enough!

In the recent European debt crisis the call for solution was quite the opposite: raise taxes, punish the people who were evil to go into default, lower their growth to negative, and whatever other utter economic nonsense professed by Merkel and buddies, as if she was handling her children in kindergarten and not full grown economies with millions of innocent people in them.

In economic school, we learn there are two ways to handle a crisis: cut taxes and increase expenditure (Keynes way, solved the Great Depression) or pour money into the economy (monetary way). That is why we have governments, to manage the first, and central banks, to manage the latter. Both stimulate the economy to produce more and with the excess production you can pay more stuff, including your debt.

Raising taxes doesn’t work because it takes away incentive to invest, extras to consume and generally lowers economic activity. What is worse, it doesn’t even guarantee more money into the government’s pockets, because taxes are often a percentage over the economy’s GDP and the increase of the percentage leads to a reduction in GDP, so the respective product stays the same or gets reduced. So the only change from an increase in taxes is that people get poorer and more miserable.

And Merkel, IMF, BCE and friends know this. They went to the same schools as anyone else!

The way to solve the crisis would have been: 1. to ensure that the government is lean and efficient by reducing corruption and closing dummy tentacles, 2. to remove legal obstacles to efficiency, like allowing unproductive people to be fired, no more jobs for life (topic for another post), 3. to do very specific investments in key points of the economic fabric, like the ship industry in Greece, 4. to organise economic fairs to get more commercial paths for Greek and Portuguese companies, 5. to improve IT systems to ensure a better ability to tax the whole economy and not just the few that can’t escape, etc etc etc etc.

That is btw how Portugal got out of the crisis. They managed because the government took step 2 and the economic fabric took step 4, opened unexploited commercial paths to everywhere, that allowed the country to grow its exports and display the largest economic surplus of its recent history. Not due to the Troika, but despite it!

So why didn’t Merkel and friends require any of it and instead demanded further economic depression? Because it was in their benefit. Germans have benefitted from a lower Euro, which allows them to export more, lower interest rates, as investors bought their cheap debt as a safe haven, etc etc etc. In the mean while, there were unemployed homeless people in Greece dying of cancer without medical care. But that was fair because they didn’t pay their debt?!!! And Germans still vote for Merkel?!!! I would be disgusted of having such a leader. And ashamed to be making my money this way.

We’re all rational, in our own crazy way

In MicroEconomy school, we learn that economic agents (also known as people) act so as to maximise their own utility function.Utility functions are personal and in-transmissible. My utility function includes lots of dancing. And coffee. And time watching sunsets. And doing mentally stimulating work.

Love is when someone else’s well being is part of your own utility function. That is something very special indeed. I love my mother. When I do nice things for her, I am maximising my own utility function and that makes me happy. So love is motivated by as much selfishness as anything else. 

Parents have a large portion of their utility function dependent on their child’s wellbeing. So even a mother’s love is motivated by selfishness. 

Which is absolutely fine! Selfishness and self-preservation is the strongest force of nature. So we have to embrace it in the right way. Embrace the good with the bad that makes our fabric. Just acknowledging the good is depriving people of humanity, Milan Kundera suggested in his “Unbearable Lightness of Being”.

Economists get baffled by Psychologists. Not everybody can be rational because some people are crazy and some non-crazy people act crazily some times. Then they give the example: a woman who likes shoes might travel 100km for a shoe sale in another town, which is irrational because she spends more money in gasoline than she saves in shoes. The example is of course fraught. It forgets the utility associated with the excitement and fun of the trip, the joy of driving, the joy of filling time with a different plan. Her trip choice was actually perfectly rational.

Other people’s behaviour might at times seem nonsensical but only because we do not know the terms of their utility function. Even a mass murderer is maximising his sick utility function, that contains the sick pleasure of causing a pain of a similar kind as the pain that was inflicted on him as a child. Which makes evil self-perpetuating and trans-generational.

So here’s the good news: you’re rational! Doesn’t mean you’re not crazy!

7 and the divine proportion

7 is my favourite number.

And apparently it is the most commonly liked number. The man who told me that actually wrote a book about it. He developed a whole internet survey around why people like their favourite numbers: some Hungarian dude told him 7 was like a sexy woman, bla bla bla.

I associate 7 with the divine proportion, Phi, which is embedded in the human concept of beauty and the way nature builds new forms out of old ones. Phi is approximately 1.62 and 4 times that is 6.48, which is a boring number as it is pair but it almost rounds up to 7:

– 7 years of thin cows, 7 years of fat cows, said the Bible,

– 7 years marriage crisis (my marriage died at 7 years),

– I got over living in Edinburgh after 7 years,

– economic cycles renew themselves every 7 years. 7 years is the addition (approximately) of 4 cycles, we learn in Economics school: 1. for the first forth of the cycle things are looking up, all’s good and optimistic; after Phi (1.62) years “mmm maybe it’s not all life-saving but it’s still ok”; 2. after 2*Phi (~3.5) years, “it’s as good as at the start but this shit’s been coming down”; 3. after 3*Phi (~5) years things hit rock bottom and you think it’s all gone; 4. then in the last year and a half you’re back where you started, you’ve gone full cycle, eternal Indian circles.

And then, after those 7 years, you find yourself wondering who you are. What you want. What was this stage that just finished. But more importantly, what is coming next. Am I equipped for what’s coming?, and who’s this person next to me who’s been here so long and who somehow doesn’t see the world my way anymore? And you reassess. And you make new investment decisions. And the economy picks up again. And you divorce and find something else to do with your life, for better or for worse. Or you miraculously manage to patch it up and you enter a whole new fresh phase of your marriage, like I have seen happen.

4 times Phi brings the snail shell back to a new growth cycle, a whole new beginning, a whole new stage of its personal evolution, that seems independent of the previous but stems from it indelibly. I think that’s why most people like 7. Not because it so a prime number that doesn’t quite fit. Not because it balances itself elegantly in a funny angle. But because it encompasses that very cycle that kills the comfort in our lives and sends us off on new adventures and the big Unknown, like the Portuguese on a nutshell boat across the big wide oceans, like Phoenix reborn from the ashes, again again and again.

Have a great day.