It seems that every 50 years or so a new economic theory emerges, so pure in its form that it becomes the overarching principle of our economy and our lives. Monetarism, while well intentioned and theoretically plausible, still has its flaws – just the same as every other theory presented to mankind. What we have learned of late, is really what we have known all along – theories are just unproven law. We can not deny; however, that there are moments in history when the stars perfectly align and everything seems to make sense. Today, things are quite different, and if history has taught us one thing, it is that we need to look to the past to identify our path moving forward. Albeit, every generation tends to add an additional level of complexity due to size, scale, and overall impact, but these are things that are easily overcome through the collective knowledge and collaboration that despair bestows upon us all.
The following quote is an excerpt from one of my favorite books entitled “Capitalism and Freedom“:
“The heart of the liberal philosophy is a belief in the dignity of the individual, in his freedom to make the most of his capacities and opportunities according to his own light, subject only to the proviso that he not interfere with the freedom of the other individuals to do the same.”
While I agree that this lack of interference is the root of pure economic freedom, it is also in essence, the same ideology that has presided over our current circumstances i.e. Deflation, Budget Deficits, Trade Deficits, Unemployment etc. Monetarism may have been the direct or indirect “cause”, but in all realism, any ideology when not applied succinctly can act as an enabler to wealth destruction. In a sense Milton Friedman was spot on in his belief that we should not be concerned about being greedy in our own pursuits for economic, social, and political freedom. These truly are the pursuits that we all have, and at its root, monetarism captured that to the ‘T’. However correct these principles have proven themselves to be, I am starting to realize, that health and employment truly do matter!
Although John Maynard Keynes was an extremely eclectic individual, I expect all that he embodied to make an immediate revival within the United States. It is apparent that there are periods of time where the money supply and government intervention just are not enough to overcome fear. And as history indicates, we slowly head down that path where we are forced to get to know our neighbors, share, and even talk to one another about our problems – as if we never had a reason to before.
At this juncture I think we need to ask ourselves whether or not the really great booms are worth it the inevitable frustration and heartache or if we should take an approach of stability over prosperity. Personally I think both can be had, but my opponents would most like refute that we can not have our cake and eat it too – understandable. So the more I think about it the more I question the validity of laissez faire economics and await the future that is already well known to all. Some may call it prosperous, others may call it hell, personally I just want my freedom back – then again I have had that since the day I was conceived.
If you are looking at your portfolio, or watching the chaos that is syndicated television, I encourage you to stop….take a big breath….spend some time with your family over the holidays…and relax! Below I have listed 5 reasons why things are not as bad as they could be:
2. Things are getting awfully cheap (One Dollar House)
3. People are not throwing shoes at you….at least hopefully! (Who Throws a Shoe?)
4. You still have your health (83 year old boxer)