Wednesday, December 22, 2010

FRB still misunderstood!

Commenter MadMax asked me if I could respond to a post by Doug Reich about Fractional Reserve Banking. The topicality of that topic is a bit more 'perishable' than econ method, so I decided the latter can wait and I spent what time I had this past week on making that response. Besides, it also ties in with some on-going email (and now tardy) discussions I've been having with a few people and they all have the same issue that is at fault with Doug's post. I hope that this will help clear up a few things in that regard.

Also, note that I am not here actually to defend FRB. Other than when there is a bona-fide physical dearth of specie, such as in remote and rarely-visited locations or where bad law hampers the circulation of specie, there is no economic benefit to the practice and so should be heavily frowned upon. There is no excuse for it in a free economy that has decent communication with the rest of the world.

This is not all of my response, and I’ll post the rest later (update, here it is). It is not the best time of year to be doing this sort of thing!

For those who missed it, previous posts by me are here, here, here and here.

Thursday, December 16, 2010

Busy until Christmas

Hi there, people

It has become and will continue to be a very busy December for me. I'll be working every day right until Christmas eve. I have notes prepared for my next example of using induction and deduction in how an economist should proceed - validation of the Law of Unintended Consequences. At this rate it wont be done until after Christmas.

Btw, this is Chienna:

As to the whys and wherefores, there are of course things I am not allowed to say but I can say that Cognis has officially been acquired by BASF as of 9 Dec. On Monday this week we each got a lanyard, a magnetic lapel pin, an informational fold-out, and a booklet of stickynotes, plus also a celebratory morning tea. I have no idea how hectic work will get once the integration process hits full swing, but there should be a lull between Christmas and Jan or Feb. I must say it has been good working for Cognis, and I can also say that I am glad I was there for all of its independent existence after Henkel carved itself up. Now it is on to a new future!