Tuesday, July 15, 2008

Obama___Giving Ground Back To Politics And Economics

Incentivization of Laws, and Integration of Belief System’s Actions

Hi Barack, I want to thank you immensely for returning the nation’s people back to earth, with your easily understood ideas, sound knowledge, and good judgment. You are certainly giving ground back to politics and economics, like no-one, in the entire history of the country. But___and this isn’t a reflection on you, as the entire nation is under the spell of its own economic blindness. At the same time, I must warn you___You’re $150 billion infrastructure spending, over ten years, isn’t even enough to brush the nation’s teeth, when compared to the true national security emergency needs, we are sincerely facing. Am I being too up front and arrogant? Yes, I am. But, I’m pretty tired of this nation’s eco-geo-military-political foolishness, over the last 35 years. And, I think I’m old enough for a little arrogance to be excused, so please hear me out…

You will need to learn how to finance trillions of dollars, over that ten year period, to solve the very serious problems we face, not just billions. The bill now leaving the country is already a $1 trillion dollar loss per year, so___We have to finance a trillion per year___now___to cover and recover that trillion deficit per year___before___we squander so much of our national debt capacity, bailing out corrupt and incompetent speculators___Before___We lose our chances of real truly sustainable recovery. This is possible, if properly managed. This is also far more serious, than I’ve presently heard anyone mention, yet many have for years offered solutions, as have I. Below, in the post script section, I have listed some general solutions. Hundreds of others ideas about the same solutions are listed on my two blogs: http://macromouse.blogspot.com/ and http://theawakeningoftheamericamind.blogspot.com/ and I’m not just listing these blogs for advertisement fame. I sincerely care about the future well-being of my beloved family, and all the families of my entire nation, so please don’t treat me lightly. I am, slightly over-educated, if you know what I mean…

I’d now like to mention a few ideas to allow easier understanding of my own ideas, and others below. I think the easiest is through a concept of mine; Incentivization of Laws, and Integration of Belief System’s Actions. Now, that may sound rather complex, but it’s actually quite easy to use this concept, from the earliest native tribes, to our present predicament. If you just imagine a moving/sliding bar line, that one can move the bar left or right, it’s the only mechanics needed to represent all law incentive systems, and belief system’s actions, as well. Just place the bar in the center of the line, and let it represent early native instinctual experiential memory’s actions of a 50%/50% natural and necessary incentive level of survival. This was a natural balance of man, nature and resources in balance, with his early law systems, of potlatch, that actually punished any excess greed. Now, let’s look at what happens when one moves the incentive bar to the extreme right, increasing incentive to 100%, and we could quite easily see China’s present state of excessive capitalism, where the death penalty on bribery isn’t working, right now. Now, slide it back to about 90% to the right, and one can quite easily see America’s Wall St. position of excessive speculations. Now, slide it back to about 65% to the right, and one can see FDR’s, or your own Main St. incentive position, btw, a quite well regulated market, quite fair to the greater good of all concerned. Now, slide the bar to the left 100% and you’ll see absolute communism, at zero per cent incentive, a very bad and failed Mao system. Now slide it to 90% left and you’ll see the near zero incentive system of Stalin’s failed socialist Russia. All throughout history, this is how law systems, ideologies, and belief systems have moved, and behaved___Laws and incentives pretty much describes all eras of history. So, I think it’s about time to learn the mathematical truth this simple concept and model of systems of law and thought work___wake up___and fix this world___Back to FDR/Keyne’s, new, full Bancor “International Financial Architecture” system. Dr. Paul Davidson and Jane D’Arista are the two main economists you must contact, and enlist on your economic team. They can teach your team how to do the massive, paid-for, financing needed. Then, you will have a true grand strategy, to clobber McCain with…!

Real change is Law Change, and you know this, already. All your fine efforts will be defeated without “International Financial Architecture” law change___First…!!! This change will pay for all your other changes…

Thanks to Obama___Change the world? YES WE CAN…!

Your loyal servant,
Lloyd Gillespie
(a polymath, autodidact, true Keynesian economist)

Plato & Exchange Clearing
Plato - The IFI Question?

"The citizen of the ideal state will require a currency for the purpose of every day expenses; This is practically indispensable for workers of all kinds and for such purposes as the payment of wages to wage earners. To meet these requirements, the citizen will possess a currency which will pass for value among themselves, but will not be accepted outside their own boundaries. But a stock of some currency common to the Hellenic world generally i.e., of international currency, will at all times be kept by the state for military expenditures or official missions abroad such as embassies and for any other necessary purposes of state. If a private citizen has occasion to go abroad, he will make his application to the government and go; and upon his return if he has any foreign currency left over in his possession, he will hand it over to the state receiving in exchange the equivalent in local currency." Plato

Tuesday, December 09, 2003
A Few IFA Proposals - Conventional - Unconventional
by Lloyd

Ah yes, Edward. Quite a problem we seem to be in. Since Edward asked this question, I thought I might stick my head out and see how many chop it off. Somehow, I feel they may not since we are all in such a quandry... "What this means is that the seesaw analogy fails: Europe cannot go up while the US goes down: both need to descend together. So the problem here is architectural (any suggestions Lloyd?):"

As I stated in one of my posts at: MacroMouse and in thorough agreement with you Edward, "We have never been here before." Due to the vast imbalances in global ppp's, wages, debts, trade, wealth, exchange rates, etc., which have evolved since the collapse of the Bretton Woods System in 1971-`73, we face the most serious challenge since, oh who knows when, forever("The Shadow Banking System", updated). So what would I do with the international financial architecture? If enough serious minds are willing to admit something needs to be done, then there are definately several answers.

The goal, of course, is to rebalance the entire global system. How? Well, many forms of external exchange clearing have been put forth since Plato first advocated it, though none overly appeal to me or many others, as suggested - they reduce too much autonomy. Therefore, I suggest several different forms of conventional exchange clearing and several unconventional forms of internal exchange clearing - which allow a higher degree of local autonomy. I see no other way to otherwise rebalance the massively out of balance system. If we had originally, in 1971, rebuilt the then broken system by making balanced floating exchange the law of the land, we wouldn't be here, but we didn't. Just for the record, we could have made a 10% to 20% maximum balance band law the IMF would have been mandated to follow when nation's ppp's drifted out of balance, that they should have been mandated to rebalance, even though we had abandoned the pegged system. A rebalancing framework could have and should have been set up at that time, even if it meant loaning, or using a standby agreement until hostilities ended, the money needed by the U.S. to finish the war, etc. It would have been smarter than destroying the entire system as has nearly happened(Now happening, "Shadow Banking Collapse"). There were many ways to rebuild a workable system at the time, it was just the acrimony over the war that prevented such a wise course. I mention this for background on what now must be done.

I have only recently come across enough information and empirical evolution to possibly offer a few new and different answers. I am no where near ready, but I can set the framework. At the outset, moral hazard must be guarded against most in the workings of any new system. As Alfred Marshall suggested, we could use his "units of production",(units of purchasing power) as a solid standard of a new architecture. I suggest a very large basket[20% of GDP] of commodities, production, goods, and services as the new standard for all nations. This large 20% is required because I further suggest using many forms of derivatives contracts and bond contracts as insurance for the new system of clearing - to satisfy the large financial interests. I suggest this be a minimal, (sliding time scaled law structure), financial computer controlled international clearing architecture - politics removed after implementation. To implement, all capital markets must be either closed[short term] or laws of gradual rebalance must be written into the architecture implementation and evolution. This way all nations can maintain their sovereignty and autonomy more than other already advocated systems. If the laws and computer programs are properly written, the world can evolve over a given timeframe to a new global balance of all thus mentioned markets. Rebalancing is a simple accounting trick if enough financing is forthcoming, to do so. It will take much new IMF(and a temporary national debt expansion, as per Alexander Hamilton, putting our nation on firm financial ground, with the assumption of state debt into the first national debt) financing, but the rebalancing will recreate so much new credit productivity, it will pay itself back over time(just as Hamilton's did) just as the massive public financing of global WWII did.

There is also internal exchange clearing, a non-conventional system, that I have written George Monbiot about. There are several of these variations, also, but for now I will enter my e-mail to George:

Earlier today I came across an article of yours about a meeting, to come up with an alternative to capitalism other than the other failed system - totalitarianism. I'd like to make a suggestion that there is a way to build such an architecture. BTW, you are my favorite author. The system I am talking about is already here, almost but unrecognized, as yet. On the one side we have what I refer to as Minsky's Heinz `57 capitalisms. On the other we have the Heinz `57 totalitarianisms. None of these are satisfactory. Yet, the answer lies somewhere in the middle between the two. BushCo wants to implement an outrageously totally free [for the corporations that is] capitalism. China, on the other hand is moving from totalitarianism toward BushCo's totally free corporate capitalism. If it goes all the way this would be a big mistake, as the perfect mixed market capitalism lies in between.

What I'm talking about here is the world has a chance to help China develop the first perfectly balanced mixed economy of public and private enterprise. I use this example as the developed nations will not yet listen to common sense. Now, I know from reading your books and articles you can easily grasp this. If China were to naturally evolve to a state of 20% public enterprise markets and 80% private enterprise markets we would have a chance to witness something truly amazing in economic history, if properly organized at this % mix. As, at this total market mix the 20% public enterprise market could be used to keep inflation/deflation permanently in check throughout the 80% private enterprise market, thus allowing a fiat money system unlimited potential. I mention this about China as it is the only experiment in the world heading toward and most likely to reach this % threshold. It would be a great loss to the world if we do not recognize this once in earth's lifetime chance to grant the world a new path. E=1/5X is a formula for perfect competition capitalism.

The 20% public enterprise mix must be a total % market organization of all production, goods, and services in order to check inflation/deflation throughout the 80% totally free private enterprise side. A triple entry banking system can be set up to finance. Alfred Marshall, at the turn of the century, mentioned such a similar mix with his units of purchasing power. This is the same thing, so to speak, at a much expanded macro level. If you can actually see this system, which I think you can, you must see the advantages a fiat system would possess when inflation/deflation can be market controlled, it frees the printing press to have free reign to build an unbelievably wealthy, healthy, strong, and viable moral capitalism.

If China were to discover this capitalism key, the rest of the world would be forced to emulate - gladly as debts and taxes would vanish or could be used productively. They most likely will cross the 1/5X threshold sometime in the near future as they are privatizing at a fast rate - almost 50% already. There is no need for them to cross it in disarray as is the case with many of Europe's social democracies and Russia's failed transition. They only need be shown the simple facts. Please dialogue with me to work out the details. The world needs us George.

I wrote three books about this system through the `80's and `90's. Trouble is they are very crude web published material - not enough free time. I am now retired and have the time to finish. My work will be rewritten and republished this winter. My first paper will be 20 to 30 pages long on global credit productivity - a totally new macroeconomic subject.

just a start, I have more,
everyone, dialogue with me,

MacroMouse - IFA

"We need a fixed value monetary system. At the present time, we have none. Under floating exchanges, America is simply a powerful ship on an ocean, with no rudder. Old gold, silver, and other known standards will no longer work. They will not work due to the massive increases in communication's speed, the varied endowments of nations' natural resources, and encrypted international speculative opportunities. Therefore, we need a new system. INTERNAL EXCHANGE CLEARING is such a system. It is an entirely new fixed value enhancing - [production standard] - monetary system, to benefit all humankind."

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