This is just a short commentary on a news item that appeared on Yahoo! just this morning. This came from the world of "science", as this nonsense tries to pretend it is, while actually being a pathetic attempt to make Creationism look like science.
"2009: A space oddity; big blob in early universe" the headline declared referring to a huge light source estimated to be 12.9-billion light years away! The Big Bang theory is still kicking, it seems, and it is no small source of amazement that rational people still sit still and swallow this garbage by the trowel full.
The first clue came when the article went on to state that "scientists" were looking back to when the universe was only 800-million years old, an indirect reference to Big Bang. "The photo is beyond fuzzy," the article states without crediting the remark, but it couldn't be fuzzier than the thought processes of these "scientists".
Let's proceed rationally.
This "blob" of radiation-emitting light is 12.9-billion light years away; that is where t was 12.9-billion years ago. If the universe was only 800-million years old then that would be how long it had to take for the object to get that far out. As anyone familiar with scientific mathematics knows numbers quantify objects, and those objects are part of the value being expressed. They are called Units, and they either combine with other units (foot-pound) or cancel each other out. An example of the latter would be;
You traveled at 50 miles/hour for 3 hours. How far did you go? The answer of course is 150 miles. The hours canceled each other out, one being in the denominator of the first term, the other being in the numerator of the second term. Now for the problem at hand.
Dividing 12.9-billion light years by 800-million years will require a little substitution to overcome the limitations of the Blogger posting program. The solution to this problem relies on Scientific Notation, which this site lacks the capability to depict. To compensate I will use the form N E^x, where N is a number greater than zero and less than ten, E is 10 and x is the power to which E is raised.
Thus 2 E would be 20 (2 x 10), a thousand would be 1 E3 (1 x 10 x 10 x 10) and so on.
12.9-billion light years would be 12.9 E9 and 800-million would be 8 E8. We want to know how fast an object would have to travel to cover 12.9 light years in only 800-million years. It's a division problem; 12.9 E9/8 E8 = 1.512 E or 15.12 light, as the years would cancel each other out. So what does 15.12 light mean? As used in the expression it would refer to the speed of light, therefore to travel 12.9-billion light years in 800-million years an object would have to travel more than 15 times the speed of light!
Any questions?
Thursday, April 23, 2009
Monday, April 6, 2009
Silver Lining - The Two Economies
The "meltdown" that we are so eagerly awaiting will probably be just another "crisis", like the Savings and Loan debacle of the 1980's, the Dot.com bubble of the 1990's, and the Housing Bubble of more recent vintage. Economists are predicting tough times ahead, but it is my opinion that these "experts" have no idea what they're talking about. They attend Ivy League universities and upon graduation go to work for major corporations, government agencies, or "think tanks" and never experience life on the street, where most of us live. Their cockamamie theories, like Arthur Laffer's "Supply Side" economics of the disastrous Reagan years, that only made the rich richer, are seriously flawed. George H. W.Bush only exacerbated the problem by ignoring the Savings and Loan disaster, and here we are. But where are we? Are things really as bad as they say? I don't think so. I'm going to ask you to think about something if you are among the many facing foreclosure of your home. If you know someone who's in that position, tell them what I am about to tell you.
Your mortgage is a fraudulent contract!
That's right. And if you're into foreclosure you can sue the bank that issued the mortgage, and get to keep the house. The explanation is based on Contract Law; ask any attorney who practices in this area of the law if what I say isn't true.
Any business transaction is an exchange of value. I pay my rent each month by check - just hand it to the apartment manager on the first of every month. In up to two weeks the check arrives at the bank and the owner of the property receives cash. The bank takes the money out of my account and puts it in his account, or just counts out the currency in that amount. In exchange I receive living a secured living space that is warm in the winter, cool in the summer, keeps my hair dry when it's raining, and is my private little domain. I'm happy; I get what I need: the owner is happy; he gets his money, and all is right with the world.
What we have is a contract. even though there is nothing on paper. Even though there is no written agreement between the owner and me (I've lived here for twenty years) a contract still exists because the three conditions essential to any contract exist;
The offer. The owner has an apartment to rent, the salesman has a car to sell, etc.
The acceptance. I agree to rent the apartment, buy the car, or the latte, etc.
The consideration. I pay for what I get. Value changes hands.
Now, let's buy a house. You can't afford the whole nut so you go to the bank and they write a mortgage "contract" that you are obliged to pay over the course of twenty or thirty years. Most folks are honest and will pay the mortgage every month - if they can afford it. But in the Housing Bubble, with it's sub-prime loans, NINA (No Income, No Assets) mortgages, HELOCs (Home Equity Lines of Credit) a lot of people got suckered into buying homes they couldn't afford on the theory that these shacks would appreciate in value and could be resold in a year or two.
Did the banks care? Actually, no. The reason the banks wrote these mortgages is because they didn't keep them longer than a few weeks. They sold the paper to Wall Street (Lehman Brothers) who, in turn bundled them into packages of mortgages (tens of thousands) and sold them to the world's central banks, insurance companies, and pension funds. The bank gets paid, you get stuck! You're in a rough spot; right?
No. For two reasons; first, the bank has no legal right to foreclose: they don't own the mortgage. Only the owner of the mortgage can initiate legitimate foreclosure proceedings. These mortgage "tranches" have changed hands so many times that in many cases no one can tell who owns the mortgage on your house.
The second reason you're off the hook (though you'll have to go to court and sue) is that the mortgage is a fraudulent contract. The reason for this is simple: the bank didn't put up any money; they created it out of thin air thanks to fractional (fictional?) reserve banking. There was no consideration, ergo no contract. It would be the same as if I paid my rent with a check when there is no money in the account.
This is just one item of the law that most people are unaware of; there are many more. And economists are right up there with John Q. Citizen when it comes to knowing anything about real economics. Let's have a Quickie Quiz, OK?
How much is the Dollar worth to you?
Ask forty economists what the value of the dollar is and you will get forty different answers. Oh, they'll refer to their charts and tell you the exchange values against the Euro, Yen, Pound Sterling, Franc, Peso, or whatever. All wrong! The answer?
The Dollar is worth whatever it will buy. Simple. It's called the Exchange Value. Because I know this I bought an $85,000 bicycle for $13.00 ten years ago and spent about $100.00 a year on it. What made this bicycle worth so much? I didn't own a car all that time and rode the bike everywhere, or used Public Transportation (ride all over town for a month on $30.00 - a monthly pass). To run and maintain a car over that period was averaging about $8,500.00 per year. Ten years: $85,000.00 in savings.
And that's not mentioning the health benefits that allow me to approach the age of 71 without doctors, prescription drugs, or any health aids whatsoever. Most folks take me for early fifties. When I tell people my true age they ask me if I'm retired. My reply is, "I'm not old enough to retire."
Go to a men's store and buy a good suit off the rack. How much will you spend? Four or five hundred? More? I'll get a suit of the same quality for $70.00 - tailored! I get shirts that cost $30.00 to $50.00 retail for $3.69 apiece. I took out a small signature loan a week ago at 3½% interest. I am a smoker but unlike most people who are paying nearly $7.00 a pack with the latest tax hike, I get away for about $2.60, and the tobacco is organically grown and has no additives. I spent $50.00 for an injector machine two years ago: it has paid for itself many times over. I share some details of how I do these things on earlier blogs.
What I am practicing is laissez faire, economics, what Adam Smith wrote about in the eighteenth century. It's pretty simple, simple enough that most economists have some idea what it's all about. Then there's the economic theory introduced by John Maynard Keynes, about which most "Keynesian" economists don't have a clue. Another Quickie Quiz.
What is the economic theory that our economy is based on?
a) Adam Smith's laissez faire
b) Keynesian economics
c) Both
If you chose c go to the head of the class!
We all have heard, at one time or another, about the New Economy. Oh, it's called a Capitalist Economy, an Information Economy, a Consumer Economy, and there's a theory that supports every one of them touted by one of the Greats of Ivory Tower babble. The fact is an economy is an economy; if you earn more than you spend you are solvent, no matter if you're an individual, a mom-pop store, a major corporation, or a government. If you spend more than you take in, you're bankrupt. Period. End of discussion.
Adam Smith's Wealth of Nations was published in 1776, at the time we were having our Revolution. In those times economies were all largely agrarian with some industry that by modern standards would be very primitive. Labor was mostly unskilled and semi-skilled and was thus highly mobile and easily transferable. Workers of average intelligence could be quickly trained in simple, usually repetitive tasks. Wages followed prices. Normal business cycles (not the boom and bust, roller coaster kind authored by the Fed)caused some minor dislocations; a company experienced a setback and laid off a portion of their work force. Since there was no unemployment insurance the laid off worker took whatever job he could find, usually willing to work for less. In this way laissez faire always tended toward full employment. In better times wages rose as there was competition for labor, and it was possible for a worker to advance himself according to his background and experience. In contrast with today's economy, background is not nearly as important as it was in Smith's time. Today it's all about education and ability.
John Maynard Keynes introduced his theory of economics in the 1930's and many modern economists seem to believe that this theory replaced Smithian Classical economics. It did no such thing, rather it brought that theory into modern times. Most economists and government officials seem to believe that Keynes endorsed government spending to stimulate the economy: to deal with depressions, boom and bust cycles, and inflation. It is quite clear that rampant government spending creates depressions, recessions, and those cataclysmic shifts in the markets that have plagued us so much over the past three or four decades.
The reason, and Keynes saw it, for these dramatic shifts in the economy is that with a growing technological base comes specialization in a given field. As specialization becomes more intrinsic to an economy the mobility of labor is severely restricted. The labor in not readily transferable, thus periods of unemployment are protracted and the unemployed person must wait out the slump, taking menial work in the interim, or seek training in another field. Out of all this came assistance programs and jobs sponsored by the government during the Great Depression the most productive of which was the Civilian Conservation Corps, a programs that put people to work building roads, dams; planting trees and building national parks, and other infrastructure projects. It worked!
I read Keynes many years ago and suspect that since then the basic texts have been "bible-ized": edited and altered to say what a small faction of power brokers wished it to say. My recollection are quite different from what I presume to be Keynes' true arguments.
For one thing there's the matter of government spending and the creation of wealth through debt. Keynes endorsed the exact, diametric opposite! Keynes saw the role of government as "lender of last resort" to areas of the economy needing financial support. These funds would come from the General Fund, money actually in existence, not cranked out of thin air as the Fed presently does. These loans would be paid back with a nominal low interest.
Also, Keynes held that the proportion of the total money supply as capital be around 10%. The rest out in the society to fuel commerce and create jobs. The so-called "capitalist' economy is exactly what Keynes did not propose as I recall from reading about the British economist's view. But in the intervening time this fact has been obscured by know-nothings who proclaim a "new" economy, implying that their ersatz "Keynesian" economics replaces that of Adam Smith. It does no such thing; rather, it expands and modifies Smithian doctrine. Adam Smith is alive and well on Main Street.
This brings us to the question of dollar value. The dollar is in a steep decline with respect to other currencies, the comparison that most pundits refer to. But what does that have to do with you and me? The value of a dollar to me is what it will purchase at any given time. I have a French ten-speed bicycle, a Gitane that I bought for $13.00 twelve years ago. It needed some work and I spent about $200.00 getting it restored: $213.00 for a bicycle that I probably couldn't sell for $50.00, but I didn't buy it to sell. I bought it to ride, and ride it I did; to work, shopping, for recreation - everywhere! For ten years I did not own a car and rode the bicycle and public transportation. Can you understand me when I say I that the value of that bicycle over the ten years was $85,000? A conservative estimate held that to operate and maintain an automobile averaged about $8,500.00 a year. Ten years? $85,000.00.
That's value.
I bought a car from a lawyer friend fifteen month ago; it was his late mother's car.
He wanted me to buy it and even gave it to me to drive for a month. He needed money and offered it to me for about $6,000.00 - Blue Book had it listed at $6,600.00 at the time. I made a firm counter offer of $5,000.00 and he took it. Today I still owe the credit union $3,000.00 but the book value is $6,000.00 - twice what I owe on the car. It is also one of the best cars made over the past twenty years; I have had no trouble with it, and a mechanic friend of mine remarked one time, "You'll never wear it out." Plus I can take it to the dealer and get it washed for free! That's value. Do I still have the bicycle? Sure, and I still have the vibrant good health that riding it for ten years helped me to attain. I still ride it, though not as much - still much farther than most people. That's value! The Gitane also has 24,000 miles on it and still gets compliments from tome to time. It's a cool bike.
What will you pay for a suit of clothes, even at a discount superstore? You can pay $600.000 to $800.000 for a suit of average quality; I can get a suit for less than $100.00, same quality, good label - and if anyone asks I can say, "My tailor." This technique is described in one of my earlier submissions; no need to go through it again.
There are many ways to cut corners and spend less, often far less than you otherwise would at straight market prices. What's the big deal about buying new stuff? Think about this: New goods are only new until you pay for them - after that they're second hand before you even leave the store or lot!
The message is simple: People need money even in good times. In hard times even more people need money, and a lot need more money. Save, eliminate credit, and pay only what bills are absolutely necessary. Then looks for bargains. They're out there!
Your mortgage is a fraudulent contract!
That's right. And if you're into foreclosure you can sue the bank that issued the mortgage, and get to keep the house. The explanation is based on Contract Law; ask any attorney who practices in this area of the law if what I say isn't true.
Any business transaction is an exchange of value. I pay my rent each month by check - just hand it to the apartment manager on the first of every month. In up to two weeks the check arrives at the bank and the owner of the property receives cash. The bank takes the money out of my account and puts it in his account, or just counts out the currency in that amount. In exchange I receive living a secured living space that is warm in the winter, cool in the summer, keeps my hair dry when it's raining, and is my private little domain. I'm happy; I get what I need: the owner is happy; he gets his money, and all is right with the world.
What we have is a contract. even though there is nothing on paper. Even though there is no written agreement between the owner and me (I've lived here for twenty years) a contract still exists because the three conditions essential to any contract exist;
The offer. The owner has an apartment to rent, the salesman has a car to sell, etc.
The acceptance. I agree to rent the apartment, buy the car, or the latte, etc.
The consideration. I pay for what I get. Value changes hands.
Now, let's buy a house. You can't afford the whole nut so you go to the bank and they write a mortgage "contract" that you are obliged to pay over the course of twenty or thirty years. Most folks are honest and will pay the mortgage every month - if they can afford it. But in the Housing Bubble, with it's sub-prime loans, NINA (No Income, No Assets) mortgages, HELOCs (Home Equity Lines of Credit) a lot of people got suckered into buying homes they couldn't afford on the theory that these shacks would appreciate in value and could be resold in a year or two.
Did the banks care? Actually, no. The reason the banks wrote these mortgages is because they didn't keep them longer than a few weeks. They sold the paper to Wall Street (Lehman Brothers) who, in turn bundled them into packages of mortgages (tens of thousands) and sold them to the world's central banks, insurance companies, and pension funds. The bank gets paid, you get stuck! You're in a rough spot; right?
No. For two reasons; first, the bank has no legal right to foreclose: they don't own the mortgage. Only the owner of the mortgage can initiate legitimate foreclosure proceedings. These mortgage "tranches" have changed hands so many times that in many cases no one can tell who owns the mortgage on your house.
The second reason you're off the hook (though you'll have to go to court and sue) is that the mortgage is a fraudulent contract. The reason for this is simple: the bank didn't put up any money; they created it out of thin air thanks to fractional (fictional?) reserve banking. There was no consideration, ergo no contract. It would be the same as if I paid my rent with a check when there is no money in the account.
This is just one item of the law that most people are unaware of; there are many more. And economists are right up there with John Q. Citizen when it comes to knowing anything about real economics. Let's have a Quickie Quiz, OK?
How much is the Dollar worth to you?
Ask forty economists what the value of the dollar is and you will get forty different answers. Oh, they'll refer to their charts and tell you the exchange values against the Euro, Yen, Pound Sterling, Franc, Peso, or whatever. All wrong! The answer?
The Dollar is worth whatever it will buy. Simple. It's called the Exchange Value. Because I know this I bought an $85,000 bicycle for $13.00 ten years ago and spent about $100.00 a year on it. What made this bicycle worth so much? I didn't own a car all that time and rode the bike everywhere, or used Public Transportation (ride all over town for a month on $30.00 - a monthly pass). To run and maintain a car over that period was averaging about $8,500.00 per year. Ten years: $85,000.00 in savings.
And that's not mentioning the health benefits that allow me to approach the age of 71 without doctors, prescription drugs, or any health aids whatsoever. Most folks take me for early fifties. When I tell people my true age they ask me if I'm retired. My reply is, "I'm not old enough to retire."
Go to a men's store and buy a good suit off the rack. How much will you spend? Four or five hundred? More? I'll get a suit of the same quality for $70.00 - tailored! I get shirts that cost $30.00 to $50.00 retail for $3.69 apiece. I took out a small signature loan a week ago at 3½% interest. I am a smoker but unlike most people who are paying nearly $7.00 a pack with the latest tax hike, I get away for about $2.60, and the tobacco is organically grown and has no additives. I spent $50.00 for an injector machine two years ago: it has paid for itself many times over. I share some details of how I do these things on earlier blogs.
What I am practicing is laissez faire, economics, what Adam Smith wrote about in the eighteenth century. It's pretty simple, simple enough that most economists have some idea what it's all about. Then there's the economic theory introduced by John Maynard Keynes, about which most "Keynesian" economists don't have a clue. Another Quickie Quiz.
What is the economic theory that our economy is based on?
a) Adam Smith's laissez faire
b) Keynesian economics
c) Both
If you chose c go to the head of the class!
We all have heard, at one time or another, about the New Economy. Oh, it's called a Capitalist Economy, an Information Economy, a Consumer Economy, and there's a theory that supports every one of them touted by one of the Greats of Ivory Tower babble. The fact is an economy is an economy; if you earn more than you spend you are solvent, no matter if you're an individual, a mom-pop store, a major corporation, or a government. If you spend more than you take in, you're bankrupt. Period. End of discussion.
Adam Smith's Wealth of Nations was published in 1776, at the time we were having our Revolution. In those times economies were all largely agrarian with some industry that by modern standards would be very primitive. Labor was mostly unskilled and semi-skilled and was thus highly mobile and easily transferable. Workers of average intelligence could be quickly trained in simple, usually repetitive tasks. Wages followed prices. Normal business cycles (not the boom and bust, roller coaster kind authored by the Fed)caused some minor dislocations; a company experienced a setback and laid off a portion of their work force. Since there was no unemployment insurance the laid off worker took whatever job he could find, usually willing to work for less. In this way laissez faire always tended toward full employment. In better times wages rose as there was competition for labor, and it was possible for a worker to advance himself according to his background and experience. In contrast with today's economy, background is not nearly as important as it was in Smith's time. Today it's all about education and ability.
John Maynard Keynes introduced his theory of economics in the 1930's and many modern economists seem to believe that this theory replaced Smithian Classical economics. It did no such thing, rather it brought that theory into modern times. Most economists and government officials seem to believe that Keynes endorsed government spending to stimulate the economy: to deal with depressions, boom and bust cycles, and inflation. It is quite clear that rampant government spending creates depressions, recessions, and those cataclysmic shifts in the markets that have plagued us so much over the past three or four decades.
The reason, and Keynes saw it, for these dramatic shifts in the economy is that with a growing technological base comes specialization in a given field. As specialization becomes more intrinsic to an economy the mobility of labor is severely restricted. The labor in not readily transferable, thus periods of unemployment are protracted and the unemployed person must wait out the slump, taking menial work in the interim, or seek training in another field. Out of all this came assistance programs and jobs sponsored by the government during the Great Depression the most productive of which was the Civilian Conservation Corps, a programs that put people to work building roads, dams; planting trees and building national parks, and other infrastructure projects. It worked!
I read Keynes many years ago and suspect that since then the basic texts have been "bible-ized": edited and altered to say what a small faction of power brokers wished it to say. My recollection are quite different from what I presume to be Keynes' true arguments.
For one thing there's the matter of government spending and the creation of wealth through debt. Keynes endorsed the exact, diametric opposite! Keynes saw the role of government as "lender of last resort" to areas of the economy needing financial support. These funds would come from the General Fund, money actually in existence, not cranked out of thin air as the Fed presently does. These loans would be paid back with a nominal low interest.
Also, Keynes held that the proportion of the total money supply as capital be around 10%. The rest out in the society to fuel commerce and create jobs. The so-called "capitalist' economy is exactly what Keynes did not propose as I recall from reading about the British economist's view. But in the intervening time this fact has been obscured by know-nothings who proclaim a "new" economy, implying that their ersatz "Keynesian" economics replaces that of Adam Smith. It does no such thing; rather, it expands and modifies Smithian doctrine. Adam Smith is alive and well on Main Street.
This brings us to the question of dollar value. The dollar is in a steep decline with respect to other currencies, the comparison that most pundits refer to. But what does that have to do with you and me? The value of a dollar to me is what it will purchase at any given time. I have a French ten-speed bicycle, a Gitane that I bought for $13.00 twelve years ago. It needed some work and I spent about $200.00 getting it restored: $213.00 for a bicycle that I probably couldn't sell for $50.00, but I didn't buy it to sell. I bought it to ride, and ride it I did; to work, shopping, for recreation - everywhere! For ten years I did not own a car and rode the bicycle and public transportation. Can you understand me when I say I that the value of that bicycle over the ten years was $85,000? A conservative estimate held that to operate and maintain an automobile averaged about $8,500.00 a year. Ten years? $85,000.00.
That's value.
I bought a car from a lawyer friend fifteen month ago; it was his late mother's car.
He wanted me to buy it and even gave it to me to drive for a month. He needed money and offered it to me for about $6,000.00 - Blue Book had it listed at $6,600.00 at the time. I made a firm counter offer of $5,000.00 and he took it. Today I still owe the credit union $3,000.00 but the book value is $6,000.00 - twice what I owe on the car. It is also one of the best cars made over the past twenty years; I have had no trouble with it, and a mechanic friend of mine remarked one time, "You'll never wear it out." Plus I can take it to the dealer and get it washed for free! That's value. Do I still have the bicycle? Sure, and I still have the vibrant good health that riding it for ten years helped me to attain. I still ride it, though not as much - still much farther than most people. That's value! The Gitane also has 24,000 miles on it and still gets compliments from tome to time. It's a cool bike.
What will you pay for a suit of clothes, even at a discount superstore? You can pay $600.000 to $800.000 for a suit of average quality; I can get a suit for less than $100.00, same quality, good label - and if anyone asks I can say, "My tailor." This technique is described in one of my earlier submissions; no need to go through it again.
There are many ways to cut corners and spend less, often far less than you otherwise would at straight market prices. What's the big deal about buying new stuff? Think about this: New goods are only new until you pay for them - after that they're second hand before you even leave the store or lot!
The message is simple: People need money even in good times. In hard times even more people need money, and a lot need more money. Save, eliminate credit, and pay only what bills are absolutely necessary. Then looks for bargains. They're out there!
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