Gamesmith94134: Dr. Doom Warns Wall Street and Washington---- Heed Karl Marx's Warning!









• Gert van Vugt

The discourse in my opinion is almost unanimously tilted towards "saving the economy" and recovering from the crisis. Not just in the US, but in basically every industrialized country this is directly assumed as the way forward. However; I do not see how this follows from life, liberty, and the pursuit of happiness. Challenging the growth paradigm allows for two options to emerge:

1) redistribution of wealth and stimulus packages can kick-start demand driven consumption, and this proportionally creates sufficient jobs in due time, with a growing standard of living for all.

2) redistribution of work and profit, as well as deflation create a sustainable standard of living for all, where elimination of jobs due to technological and scientific progress introduces the end of work without falling standards.

Both solutions can be debated: the first depends on the assumption that consumer demands are infinite, although this is not what most data is showing. The second option is widely dismissed as causing a drop in the competitiveness of the economy, although empirical proof is unavailable up to date.

I understand that the second option is controversial in a country that still labels Marx's predictions as "wrong, of course", but I challenge intellectuals such as yourselves to be a bit more introspective.

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Read more: http://globalspin.blogs.time.com/2011/08/16/dr-doom-warns-wall-street-and-washington-heed-karl-marxs-warning/#ixzz1VJL1bHUz



Gamesmith94134: Dr. Doom Warns Wall Street and Washington---- Heed Karl Marx's Warning!





Mr. Gert van Vugt,

You make the best description on the theory on the economical growth Paradigm that the economic change seems like Malthusian’s diminishing return, and I agree. However, Mr. Roubini makes his point on the social disruption reverse itself through the diminishing demand. If we can put away the elements like the Ponzi scheme and benefactors in social caused deficiency or defects to growth. Corruption by capitalism and the dependency by socialism among societies both caused failure in the economical and societal development.

Perhaps, we focus on the circuitry on the accumulation of wealth and consumable wealth that runs the economy. It seems both the capitalism and socialism ran short and proven wrong in the economical model or social model that became self-destructive; eventually, the economy runs from diminishing demand to diminishing return, or vice versa. So, if we use the living standard as the equilibrium position to the supply line of the circuitry of wealth balanced by both of the diminishing return and diminishing demand.

How about I call my paradigm on the wealth circuitry in economical and social growth that supports and balances both accumulated wealth and consumable wealth; and it created a “Z” shaped development running both on the diminishing demand and diminishing return; which is based on the assumption, the route above the standard of living equal in length with the one below the standard of living is in agreement of its living standard to sustain a viable growth, which contains;

• The base line as the diminishing return where the societies kept peace with its populace that consumable wealth that cause economical displacement like with its negative growth or no growth; it provides entitlement or social programs with non-productive individual citizens for example, 27% of its population on welfare with add-on with subsidies to sustain a standard of living.

• The top line as the diminishing demand that ended with accumulated wealth favors of concentrated wealth owned by individuals that ended with profitless, 1% holds 27% of the global or national wealth, plus those with extra wealth is not in production yields to no growth.

• And the diagonal line that connected to both ends is the support of the price and value in the middle is the standard of living which contains the most of the productive individuals who is moving up and down the ladder of growth.

If more of the wealth accumulated than the wealth consumed, then it causes saturation of the wealth. The diminishing demand under the standard of living agreement made the demand idle because of the shortage of consumption. In the process, the standard of living will go down to meet its demand after the deflationary measure to make it consumable. In reverse, the wealth consumed is over the wealth accumulated, as it is less profitable. Then, it triggers the inflationary measures to aggregate demand to accumulate more wealth in its diminishing return mode; eventually it will balance itself again with the agreement of the standard living with a viable growth.

It is not the supply and demand. It is rather the circuitry of wealth under the spells of the lower living standard that diminishing demand is being part of the deflationary measure. If the accumulated wealth became saturated, then it means the lower living standard that made the demand finite like lesser demand in loan of dollars in ECB.

I am certain I am not being introspective; I may twist the theory a little; but the proof of the lower living standard in Europe made it plausible.

May the Buddha bless you?

