December 16, 2008

That What I Want

Money. We use it every day, we work to get more, we save (some of) it (hopefully) for a rainy day. But what is it? You might think of paper money as sort of an easier to carry stand-in for gold coins, and that was true for our great grandparents but not anymore. So is money now just an abstract concept no more real than the number 5 or 68 or 23,968? Were does money come from? The government prints it but is that the same as creating it? Does the government have a monopoly on creating it? Will answering any of these questions help me understand what is going on in the economy today?

I think the answer to the last question is, "Yes". The most helpful explanation I've found is Money as Debt. It isn't perfect. It seems to include several dubious quotes. But it does seem to do a good job of explaining how the business of money works overall. It's almost an hour long, the last 20 minutes includes some of the filmmaker's proposals for changing the system that I don't think would work, and the first 20 minutes is spent on an introduction that might seem so obvious that you don't think watching the rest is going to teach you anything. But you'd be wrong. Unless you already own a bank I promise you will have an "ah ha!" moment watching that middle 20 minutes.

After watching it I looked at what is going on in markets today and tried to apply my new understanding to explain what was going on. Banks and investors were writing off bad debt essentially destroying money so that would explain the deflationary pressure we've seen in asset prices. But on the other had the government bailouts have created new promises to pay (t-bills) so shouldn't that balance things out? Why are we still seeing deflationary pressures and the economy sinking? Then I read about The Velocity of Money. It's really, really long. It's not like a book, more like a really long short story with math. The short version is: you can print all the money you want but you won't get any inflation if people don't spend it.

Anyway, that's my blog post for today. Two informative links for you if you're bored (and if you're reading my blog you probably are). Anyway, light blog posting until after the holidays and I get the new blog software installed.

Posted by thom at 12:50 PM | Comments (0)

December 14, 2008

Waking up is Hard to do

Posted by thom at 07:56 PM | Comments (0)

The Big Bounce?

Modern physics has a problem: It can't model what happened during the first few picoseconds of the universe. When they do the math using their current models pesky little infinities rear their infinite little heads and the whole endeavor quickly goes to hell (or rather, infinity) in a hand basket. Now, if you're like most reasonable people you're probably not going to sweat that first one millionth of one millionth of a second (0.000 000 000 001 seconds). Luckily physics seems to attract unreasonable (or at least anal retentive) types who insist it's important to know such things. Seems they have come up with something that might just work.

Posted by thom at 05:27 PM | Comments (0)

December 13, 2008

The Pull of the Moon

If you haven't had a chance to look yet go check out the moon. It's at its perigee. The full moon is the largest it's been since 1993. You should go look now since it's going to start shrinking now.

Posted by thom at 11:53 PM | Comments (0)

Another Day in the Universe

A good friend pointed out I haven't been updating my blog. Very true. I haven't been feeling very sunshiny about the world of late and most of the time I feel like if I wrote anything I'll come off sounding like Eeyore. But in our SoS (sink or swim) society you got to pull yourself up by your bootstraps so hopefully in the next few weeks I'll feel more like blogging. I'm going to be switching to TypePad blogging software, getting the whole mess under revision control, and be doing some more nerd focused blogging on math and programming. That might sound boring but it's really not. That's a common misconception. Oh wait, it's not actually a common misconception, I guess it really is boring.

In the meantime, Merry Christmas.

Ooops, I hadn't cleared my spam log in nearly a year. It had over 7000 entries in it. Whew!

Posted by thom at 10:54 PM | Comments (0)