COMMENT: Marty, I was cleaning out my office. I get around to once every 31.4 years. I found your report that was controversial back in 1990. You were at war against the fundamentalists who were always getting it wrong, as they still do today. I scanned it in and thought you should post this for the newcomers. You invented capital flow analysis, and you may not qualify for a Nobel Peace Prize since you advocate for peace rather than war, but you are in a category all by yourself. Being a trader rather than an academic who was in the trenches, not an ivory tower. People need to know that.
See you in London
SK
REPLY: Very interesting. Yes, they always use war to cover up something else. Hitler and Napoleon were trying to resurrect the old Roman Empire over all of Europe. The days of empire building inspired by the Physiocrats that the wealth of a nation was agriculture, so you conquered nation after nation are long gone. Adam Smith wrote his Wealth of Nations to challenge the French Physiocrats and their view that only agriculture was wealth. He argued that it was the total productivity of a nation that constituted its wealth.
Then along came Marx, and the wealth became labor, and he tore apart the economy out of jealousy. He attributed nothing to human imagination, the source of all economic advancement. Communism proved that the government was incompetent in regulating or developing the economy.
Smith was NOT an academic. He went out to observe how everything truly functioned. The socialists hate Smith because they follow Marx and want to force the economy to function the way they think it should. They reject any concept of a business cycle and come up with stupid theories like Random Walks, for that means that they can then manipulate society because it is all just random.
They are now all in a tissy. The government wants to REGULATE AI, and Biden put our illustrious VP in charge. There is a real threat that they will regulate what they do not understand and, in the process, destroy the industry, as they did with investment advice and force people offshore, giving birth to the Hedge Fund Industry.
