Smart people saying smart things

Smart people saying smart things May 14, 2013

Warren Buffett on Gold

Gold, however, has two significant shortcomings, being neither of much use nor procreative. True, gold has some industrial and decorative utility, but the demand for these purposes is both limited and incapable of soaking up new production. Meanwhile, if you own one ounce of gold for an eternity, you will still own one ounce at its end.

What motivates most gold purchasers is their belief that the ranks of the fearful will grow. During the past decade that belief has proved correct. Beyond that, the rising price has on its own generated additional buying enthusiasm, attracting purchasers who see the rise as validating an investment thesis. As “bandwagon” investors join any party, they create their own truth — for a while.

Adam Smith, in The Wealth of Nations

Is this improvement in the circumstances of the lower ranks of the people to be regarded as an advantage or as an inconvenience to the society? The answer seems at first sight abundantly plain. Servants, laborers, and workmen of different kinds, make up the far greater part of every great political society. But what improves the circumstances of the greater part can never be regarded as an inconvenience to the whole. No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable. It is but equity, besides, that they who feed, clothe, and lodge the whole body of the people, should have such a share of the produce of their own labor as to be themselves tolerably well fed, clothed, and lodged.

The liberal reward of labor, as it encourages the propagation, so it increases the industry of the common people. The wages of labor are the encouragement of industry, which, like every other human quality, improves in proportion to the encouragement it receives. A plentiful subsistence increases the bodily strength of the laborer, and the comfortable hope of bettering his condition, and of ending his days perhaps in ease and plenty, animates him to exert that strength to the utmost. Where wages are high, accordingly, we shall always find the workmen more active, diligent, and expeditious than where they are low.

Alisa Harris: “No, Kathryn Joyce Is Not Attacking Good Christian Parents”

Nowhere does Joyce claim that the extreme cases, particularly those involving child abuse, are representative of evangelical adoptions. She is consistently at pains, in both the book and her interviews, to stress that the people she’s writing about are almost all good people with admirable intentions. She does point to a well-documented trend, that spans from fundamentalist evangelical groups all the way to major organizations like Focus on the Family and the Southern Baptist Convention, in evangelicals advocating international adoption as a kind of acceptable social charity work that doesn’t compromise fundamentalist positions on sexual ethics. It changes nothing that Merritt has never heard of some of the adoption organizations involved; anyone who has actually been through the process certainly has. In both her book and her Mother Jones story, Joyce charts the history of this rising phenomenon without overstating its size or influence.

As is often the case when mainstream reporters present portraits of evangelical behavior that cut through their own self-justifications, Merritt tries to sidetrack the story with detailed assessments of the exact size and influence of certain books and organizations Joyce mentions and claim she has attributed some sort of outsize influence to them. The goal seem so be help evangelicals circle the wagons, not to consider that some in their tent — almost all very good people — are participating in what has become a global network of child trafficking to serve the desires of Western parents.

The Rev. Phil Jackson: “God is pissed off and so am I”

There is a passage in Luke 7:11-16 in which Jesus stops a funeral and heals a child from death, brings him back to life, and gives him back to his mother. How I dream of that moment. But, I also believe I can work to stop the funerals in the first place and bring our young men and women back to Christ, back to their families, and back to their communities. This means working for personal transformation of young people’s lives. But it also means looking at the structures we live in and asking how they can change to make our streets a safer place to grow up.

Steve Benen: “Senate easily approves fix for flight delays”

When the sequester started kicking children out of pre-K, Congress did nothing. When this stupid policy denied low-income seniors the benefits of Meals on Wheels, Congress barely noticed. When sequestration cuts put new burdens on cancer patients and cut housing aid to struggling families, most of Congress shrugged its shoulders.

But when business travelers ran into flight delays on Monday, a unanimous Senate approved a fix without breaking a sweat on Thursday.


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What Are Your Thoughts?leave a comment
  • Lorehead

    What are you talking about? You raise interest rates to reduce inflation at the cost of short-term growth. But inflation is already below-target, and growth needs to be higher. Why would you raise rates now? That’s utterly senseless.

  • Lori

    Yup. That’s a theory only until you’re really poor and then you get it in a way that goes far beyond theory.

  • First of all, intent is not magic. Second, if you’d meant “diamonds are considered material proof of a man’s love for a woman by sexist, consumerist society”, then that’s what you should have said. But that’s not what you said. You’re trying to blow smoke up our collective ass and avoid behaving like a decent person.

  • It’s been pointed out before that you don’t have to propose with anything.

  • Fusina

    Meh. Just ignore him. I like a good argument as much as the next person, but the qualifier there is good. This started out okay, could have been good, but one of the arguers refuses to play by the rules. So I quit.

    Besides, I just got a bunch of triangle shape crystals in four different colors set in sew-on settings to make pretties with, and also several colors of a navette shape and some octagons. Gotta run, sparklies are calling my name…

  • I wrap that up into the necessities category too. I’ve lived minimalist (I had a place once that was smaller than most studio apartments — a single room and a shared bathroom) and a starvation diet, and while I know it’s possible, in theory, to live on about as much (with a better diet, probably), that’s not what I mean.

    Unfortunately, it’s hard to put a line between “living comfortably” and “living in luxury,” but what’s comfortable should include reliability, health, a certain degree of preparation for disastrous future events — and some extra for things that are completely unnecessary, but nice to have.

    But value is subjective, so my “not necessary, but nice to have” doesn’t include things like, I dunno, a pony. And for people with children, that has to encompass a lot of things, not just the parents’ desires.

    Still, there’s got to be a practical limit somewhere. A person might need a budget as high as $200,000 a year, but we still have people with a budget ten times that who act as though if they don’t figure out a way to charge us for breathing oxygen, they’ll wither up and die.

  • Oh, I don’t expect anything productive. But I don’t like to leave bullshit un-called, and at least I’m getting some amusement.

  • I know I COULD but it wouldn’t be very romantic. it would be like water for diamond

  • I don’t consider society to be sexist or consumerist though so I wouldn’t have said that. At any rate,buying a diamond for your future wife is a normal activity that people recognize as such.

  • Lots of things are considered “normal” — that doesn’t mean they’re not wrong or damaging in some way.

    And clearly you’re more interested in bullshitting and moving goalposts than you are in behaving like a grown-up, so I’m out. This is no longer amusing.

  • No your raise interest rates to save the society from entering a Japan like lost several decades. If inflation was the answer the 70’s would have been great. There’s no rule saying you inflate in this situation and contract in that. Keynes is pseudo science money should always have the same value and any return to that is welcome.

  • Lorehead

    You are deeply, deeply confused.

  • stagflation

  • How do you accomplish “money should always have the same value” without inflation? If there’s still X amount of gold, but there’s now 2X as much stuff to buy, then your choices are “X amount of gold now buys 2X as much stuff” or “X amount of gold still buys X amount of stuff, but the other X of stuff can’t be bought by anyone because we’re out of money.”

  • Lorehead

    You’re using the Internet, so you must be aware on some level that not everything is the same as it was in 1979.

  • Fusina

    Well, that argument I can understand. Hee. Do go on, I am getting amusement from reading this. I just didn’t want anyone else to get bored. Considering it was my fake bling statement that started all this, of course I have to read everything. ;-)

  • Fusina

    He doesn’t consider society to be sexist or consumerist. . ,

    I dunno, it just got interesting. See, I got my first lesson in the sexism of society from my parents. My Dad paid my brother and me to mow the lawn. The agreed on amount was 3.50. Then, one day, I found that my brother was being paid 5.00. And had been for a while. No, I didn’t get retroactive back fees. But I wouldn’t work for less than he did. Um, so the inequality of pay thing is a very sore spot for me. I also get annoyed when I am treated like “the little woman”. I have a brain, I have been tested and found genius (and, considering they tested me because they thought I was mentally retarded, I find that amusing), so do not disrespect me. I know Shakespearean insults and I’m not afraid to use them.

  • arcseconds

    I always rather liked the note in the Penguin Dictionary of Philosophy about Ayn Rand:

    “An American writer of Russian origin, whose so-called philosophy of Objectivism extols selfishness and condemns altruism”

  • he was! who downvoted that

  • then I would exchange my dollars for gold because you broke the pact. That’s the beauty of it

  • “you just made that up .”

    Not at all, actually. It doesn’t take a lot of looking to quickly see that this is an accepted historical fact pretty much anywhere. Even amongst websites who’s primary goal is to sell you gold.

    “Yeah that’s why there are no gold coins anywhere in the world! (There are tons of them literally.)”

    The fact that there are so many gold coins is proof of what I’m saying: That gold isn’t useful. If Gold was useful, its primary activity after being mined from the ground wouldn’t be to spend all of its time sitting in bar or coin form. People would actually, you know, do something with it.

  • If women don’t want diamonds that’s FANTASTIC. If something else, perhaps kale, is now a girls best friend, that’s wonderful. My point was the diamond industry exists because there is a demand for them so SOMEONE out there is buying diamonds or they would not be so expensive. engagement rings are a common way diamonds are sold.

    Shifter cat- That was insensitive of me, sorry

  • No, the money supply increases under gold standard. like 2 percent a year or something. They buy more gold.

  • general_apathy

    Ahaha, that’s beautiful. Someone was justifiably bitter.

  • “Girls” do not share a hive mind. We like different things. Do you like exactly the same things as FearlessSon? No? Then why would you expect me to like exactly the same things as Jenny Islander? Dumbass.

    Maybe you will pay attention when a man says it:

  • “Make new mistakes” is one of my mantras.

  • When the states and cities fall, when your back’s against the wall: black powder and alcohol!

  • OMG

  • aim2misbehave

    That’s true, but the formation of the Euro hardly can be described as “apocalyptic”. I’m talking about the concept of hoarding gold in preparation for a situation where all governments and banks and centralized economic institutions are all defunct if not entirely obliterated.

  • aim2misbehave

    Eh, my problem with diamonds as a store of wealth is that their monetary value is inflated because De Beers and everyone holds back the majority of them – if they were to all enter the market at once, the value would collapse.

    Still, diamonds are good for making really, really sharp things that don’t wear down easily, so I think that they’d probably be more useful than gold.

    Now, Mylar on the other hand… the space-agency-grade stuff is super expensive as it is (long story, but I’ve actually got a few pieces of it), but whoever’s got a lot of that stuff could buy whatever they wanted because keeping warm and/or cool would be a huge priority.

  • aim2misbehave

    Some designer stuff is genuinely high quality, though. Like I used to be all “Who’d pay that much for clothes? Suckers!” but then I moved to a place near a Goodwill that was donated to by very, very rich neighborhoods… I get some of it. I go shopping at Goodwill by not looking at tags, but running my hands along the racks and feeling for quality things. Like, Target and Old Navy are perfectly fine places to get clothes, but those aren’t going to survive well – I have a $25 Target sundress that I got new, and a Marciano sundress that I picked up for $6 but was originally about $150-175, and the Target sundress is in worse condition six months after I bought it new than the Marciano sundress was over a year after I had bought it secondhand. If I was rich, yeah, I could see myself buying designer clothing.

    The designer purses, though, specifically are what I don’t get: I know more than a few people who have them. They’re high quality, but i don’t think $2500 high quality, not when you’re carrying around something with a name on it.

  • BaseDeltaZero

    That… is completely irrelevant to the gold standard.

  • BaseDeltaZero

    Oil can be composted from most organic materials, sure, but at a much lower rate than it can be extracted (extractible oil being a very much a limited resource).

    Land is ‘virtually infinite’ only if you’re hiding an FTL drive somewhere. Even if you’re going to expand into Russia or drain the whole damn ocean, it’s limited.

    Furthermore, this is ignoring the fact that just because you *can* do something doesn’t mean you *should*. A system that *requires* growth results in an ever-growing resource demand, which gets harder and harder to fulfil. It is the very definition of unsustainable. Technology *might* keep pace with the demand, but not necessarily universally, and the distribution probably won’t. You can already see this happening – resources that are practically available are running out, so the growth that hid the basic inequalities of puritanical capitalism is diminishing, resulting in the capital becoming more and more concentrated (in laissez-faire capitalism, capital tends to flow towards capital… but, under ideal conditions, it grows so quickly that this is compensated for by the growth at the bottom – the rising tide really does lift all boats, but it starts with the dinghies). If that growth stops, the flow nevertheless continues, resulting in widespread deprivation, and, ultimately, collapse into total kleptocracy and/or feudalism).

    Advances in technology to allow accessing other life-bearing planets would most likely require alternative energy sources, which would render oil irrelevant.

    Fuel is not the only interesting use for hydrocarbons – plastics, pharmaceuticals, a staggering variety of chemicals…

  • my point is about the market for diamonds which happens to generally be aimed at women for WHATEVER reason.

  • basically: a well run fiat system resembles a gold standard in terms of money supply growth. The difference is during bad times, fiat allows you to inflate more, rather than make painful corrections. Unfortunately 1. corrections are called that for a reason, they need to happen and 2. politicians like , say, Nixon get a hold of the printing presses via stuff like “The President’s Working Group on the economy” aka the Plunge Protection team and use it for their own ends.

  • ngotts

    The important resources aren’t finite.

    Srsly? The visible universe is finite. The ability of the environment to absorb our wastes without undermining the conditions of our existence as a civilization is so finite we’re likely to reach its limits within the lifetime of many now living.

  • ngotts

    My guess: free-market bullshit.

  • ngotts

    Here’s someone who’s scarcely on nodding acquaintance with reality.

  • ngotts

    Indeed. Seldom was an honest person so traduced by those claiming to be their followers.

  • ngotts

    You’re just a neigh-sayer.

  • Barter probably parallelled currency, in the sense that sometimes it was easier to trade straight-across two horses for two donkeys, while other times it was easier to sell two horses for units of currency (carved stone, salt, metallic coins, etc) and then later go buy two donkeys.

    I expect that as societies got more complex the monetary system won out due to the sheer simplicity of a medium of exchange rather than inefficient barter transactions.

  • The point people are making is that even a “gold standard” is relative. By devaluing gold, you effectively cause a fall in the value of money, which is equivalent to a rise in prices.

  • You did not just say that. OMFG that is about the stupidest, silliest attempt at rhetorical judo I’ve ever seen.

  • Enron would never have even tried treating electricity as a casino-like tradeable property with speculative value if it wasn’t for the tendency of Western society to be governed by materialism and the idea that you can find a greater fool to sell something to and haul down a lot of cash without a hint of a sense of shame about the way you’re doing it*.

    The day traders and short sellers you mention are in large part both a symptom and an exacerbation to the fundamental problem with capitalism that it isn’t just assigning a value to everything around you, it’s making sure they fluctuate rapidly too. The greater the fluctuations the more money you can make.

    This is why derivatives are so appetizing to speculators. If you bet right, you can make millions or even billions. Bet wrong, and you get Long Term Capital Management and the US government having to quickly hide the true extent of the damage you could have done to the world economy.

    It’s as absurd as the Libertarian idea that you can create tradeable units of paper to establish property rights over air, for God’s sake.


    * Have you seen the recorded conversations and emails that have come out after every major crisis since ~2000? In almost every case the comments made by the people involved are uniquely unflattering to anyone outside the in-group.

  • You don’t get it, do you? QE1, 2, and 3 haven’t been done for the benefit of you, the ordinary worker. They’ve been done for the benefit of the banking sector. By helping banks push bad assets off their balance sheets, Bernanke and his successor will, they hope, persuade banks to begin lending again and in doing so, restart the US economy.

    Given that the SGS alternate unemployment rate is still around 20%, you can tell how effective that idea has actually been.

  • Because it’s a total nonsense question. What the crap does motorcycle maintenance have to do with anything Fred linked?

  • Chris Hadrick

    He was similarly misguided on monetary issues. A silver standard would be Constitutional though.

  • Chris Hadrick

    I would guess barter came before mediums of exchange. probably the more people moved about the more they needed something portable and exchangeable.

  • Chris Hadrick

    It was used as conductors in mainframe computers. people out it in their teeth and wore it as jewelry. If it were as commonplace as other metals it could be used for many more things.

  • Chris Hadrick

    How does the gold standard devalue gold?