Perhaps the most apt metaphor to describe the decade ahead is that investors, consumers and taxpayers will all be rafting whitewater rapids with ever-briefer stretches of calm.
David, have you heard of the Chapwood Index? It is based on real-world prices and attempts to do what you envision. MIT has the "million prices" index as well, though this isn't weighted so it's deceptive: if the major expenses rise, they're not offset by some occasional low-cost purchase going down in price.
Personally, I think the best approach is go back 40+ years and measure the purchasing power of wages then and now. Example: my tuition and student fees at a 4-year state university was $232 a year in 1975. That's about $1,400 in today dollars. The tuition at my alma mater (University of Hawaii) is now $14,500--almost exactly 10-times the inflation-adjusted price of 1975.
It took 40 hours of work for me to pay my annual tuition in 1975. Today it would take 966 hours for a student earning $15/hour. Throw in student fees . junk fees and let's round it off to 1,000 hours of labor.
So tell me again how we're so much better off now because I can stare at a phone all day long and cars have rearview cameras....
The nation-state serves a purpose. Without it, we end up with mafioso-warlords and "warring states". Actually, the Han and Roman empires were pretty good deals for the residents. Just pay your taxes and don't try to cheat the Empire or carve off a chunk for yourself, and you were protected from the worst abuses. The armies of the Han and Rome were actually rather modest, as both empires relied on diplomacy, trade and bribes to reduce conflicts.
America circa Emerson's era 1840s was a nation-state but it had a light touch on daily life. What can't be sustained goes away, and so what goes away is the unaffordable "Savior State" (my term).
The list of 10 I was given to work with can be boiled down IMO to 1) deglobalization 2) definancialization and 3) war, which is a constant source of instability and surprises.
Thank you for all the comments. warm regards, charles
I have been planning 5 different scenarios in my own life to determine and maintain resilience
It’s important to plan for different possibilities in one’s life. An obvious one is death leaving a family with no father. So life insurance and assets for survivors
CHS writes a great article, but in my opinion, the nation state is a dead idea. People are waking up. They are selling their city homes and 401ks. They are moving to the country and starting farms and small businesses that deal locally, not globally.
Eventually, there will be a tax revolt against the state.
If I squint really, really hard, I think that I could write a semi sane, reasonable paper for 2-9, but 1 and 10 are just insane. None of these actions are prudent at all, which means that some countries are going to one or more.
Charles I wonder what the world would be like if the illusion parts were dropped
Sort of a utopian question or maybe dystopian how it would be hard to fathom
1.
So lending money with interest would not exist. So banks could not create money for mortgages and charge interest so essentially all houses would be bought with cash or on some sort of extended payment mechanism
2. Politicians could not lie so would be prosecuted for fraud if did.
3. Companies could not issue common stock. People would make real investments in the company and would have part ownership. So basically all companies would be private
4. Government positions would be very numerous say 1000s of senators and representatives. 5 simultaneous presidents picked by lottery. All political positions filled by lottery for two year terms max one per lifetime
5. Fiat money would be illegal
Would need a peg to something real like gold
We are so immersed in this strange miasma that it’s hard to imagine anything else
6. Universal healthcare to reduce the shadow work you have mentioned
Am wondering if there is simulation software where can put in a bunch of constraints for a government system then see what outcomes would arise with different possibilities
It’s quite fascinating just pondering different systems
David, have you heard of the Chapwood Index? It is based on real-world prices and attempts to do what you envision. MIT has the "million prices" index as well, though this isn't weighted so it's deceptive: if the major expenses rise, they're not offset by some occasional low-cost purchase going down in price.
Personally, I think the best approach is go back 40+ years and measure the purchasing power of wages then and now. Example: my tuition and student fees at a 4-year state university was $232 a year in 1975. That's about $1,400 in today dollars. The tuition at my alma mater (University of Hawaii) is now $14,500--almost exactly 10-times the inflation-adjusted price of 1975.
It took 40 hours of work for me to pay my annual tuition in 1975. Today it would take 966 hours for a student earning $15/hour. Throw in student fees . junk fees and let's round it off to 1,000 hours of labor.
So tell me again how we're so much better off now because I can stare at a phone all day long and cars have rearview cameras....
The nation-state serves a purpose. Without it, we end up with mafioso-warlords and "warring states". Actually, the Han and Roman empires were pretty good deals for the residents. Just pay your taxes and don't try to cheat the Empire or carve off a chunk for yourself, and you were protected from the worst abuses. The armies of the Han and Rome were actually rather modest, as both empires relied on diplomacy, trade and bribes to reduce conflicts.
America circa Emerson's era 1840s was a nation-state but it had a light touch on daily life. What can't be sustained goes away, and so what goes away is the unaffordable "Savior State" (my term).
The list of 10 I was given to work with can be boiled down IMO to 1) deglobalization 2) definancialization and 3) war, which is a constant source of instability and surprises.
Thank you for all the comments. warm regards, charles
Yes had read that Roman Empire at certain stages was a win win situation
I liked the shadow work term you came up with
It’s something I experience a great deal with my family
My wife says it’s as if the system creates lots of office idiot jobs
For example a dental office front desk has 4 people
Same with doctors office
Physical therapist office
It’s insulting to call them office idiots but some do behave that way
Some are like 80 years old and seem like have dementia
But they need to work as cannot retire fully
One woman have seen her 15 times and she still does not remember my name
I feel sad for her actually
She really seems to have dementia
I cannot see things getting better sadly as no politicians are looking at the economic issues
They all just want that political office job so maybe they can get a pension and good healthcare and some “donations”
Chapwood index makes sense. Thanks Charles
Great summary Charles
I have been planning 5 different scenarios in my own life to determine and maintain resilience
It’s important to plan for different possibilities in one’s life. An obvious one is death leaving a family with no father. So life insurance and assets for survivors
Having a second passport
Or even third passport
Having some sound money
Guaranteed income
Can you survive a 70 percent market correction
Your neighborhood becoming unlivable
Kids education options under different scenarios
Two reliable vehicles
Etc
The future is unpredictable
But as the old saying goes “have dry powder”
CHS writes a great article, but in my opinion, the nation state is a dead idea. People are waking up. They are selling their city homes and 401ks. They are moving to the country and starting farms and small businesses that deal locally, not globally.
Eventually, there will be a tax revolt against the state.
Lot of sense in that
Charles I have tried to use Shadiw stats guess John Williams is the creator
It’s the worst designed web site I have ever seen
As I have expertise was wondering if during my retirement should build a transparent site for tabulating inflation data
Since have Walmart online Amazon online etc it should be incredibly doable
Can get information from Zillow on equivalent rents etc
Am not in it for making money but more for creating transparency
If we are lied to about inflation then basically real incomes real GDP and everything are lies
If I squint really, really hard, I think that I could write a semi sane, reasonable paper for 2-9, but 1 and 10 are just insane. None of these actions are prudent at all, which means that some countries are going to one or more.
Charles I wonder what the world would be like if the illusion parts were dropped
Sort of a utopian question or maybe dystopian how it would be hard to fathom
1.
So lending money with interest would not exist. So banks could not create money for mortgages and charge interest so essentially all houses would be bought with cash or on some sort of extended payment mechanism
2. Politicians could not lie so would be prosecuted for fraud if did.
3. Companies could not issue common stock. People would make real investments in the company and would have part ownership. So basically all companies would be private
4. Government positions would be very numerous say 1000s of senators and representatives. 5 simultaneous presidents picked by lottery. All political positions filled by lottery for two year terms max one per lifetime
5. Fiat money would be illegal
Would need a peg to something real like gold
We are so immersed in this strange miasma that it’s hard to imagine anything else
6. Universal healthcare to reduce the shadow work you have mentioned
7. Corporations would not be people
Sorry also
8 end income tax
9 end federal reserve
Am wondering if there is simulation software where can put in a bunch of constraints for a government system then see what outcomes would arise with different possibilities
It’s quite fascinating just pondering different systems
Charles I need to look more into how the Paul Volker policies increased income inequality and broke the middle class
I view what happened during covid as a repeat at that
But income inequality is already so high that now are pushing people into homelessness or to leave USA
Is this just late stage empire behavior?
Professor Michael Hudson seems to say that
Empire devours its children so to speak