The Economy

Introduction

Knowledge in Action | Scale is the Limit | Discontent | Vested Interest in Status Quo

Knowledge in Action

a. the right focus

Nothing new under the sun.
In 1945, Friedrich Hayek was already a famous economist.
At this point in History, he was in the midst of particular circumstances.
They made him see the nefarious effects of overwhelming governance powers.
Vision influenced his landmark paper: "The Use of Knowledge in Society".
In an interpreted nutshell, when price is a synthesis of what is at stake:
the sovereign conduct of omniscient goodwill benefits those concerned.
Decentralized monopolies emerge from this definition of an ideal economy.
"What is centralized is not part of the monopoly" implies no oxymoron.
What a monopoly should manage and its scale, we will see.
Ubiquitous economic arguments digress from our initial statement.
Supply versus demand overlooks the greater price dependency on allocation.
Liquidity, exceptional interventions and black swans are more influential.
Discrete steps in the unfolding of events resemble a pragmatic procedure.
A system of operating rules is hard coded in institutional charters.
The laws of economics can explain but they do not take action.
A protocol with stated objectives is actually driving the economy.
On the one hand, we spent too little time optimizing the modus operandi.
On the other hand, actionable formulas lack in continuous randomness.
Financial reserves override dynamic fluctuations at will.

Scale is the Limit

b. micro & macro

Institutions are sacred.
They have stood the test of time.
Businesses have not.
The administration is wishful for growth.
Supervised entities are dying for it.
Businesses stand or fall because they cannot walk.
They are constrained like a tree in a forest reaching higher for the sun.
They grow not to stay in the shadow, until resources are exhausted.
They might not reach high enough, though.
Not everyone was born on a rich soil.
Some have spent everything they had for nothing; they were not big enough.
Some others don't even try.
Too much weight.
Too much leverage to reach a safe zone.
Too hard to move.
Too costly to make a mistake.

I just happened to witness a manifestation of the issue:

A lady entered the hearty restaurant where I'm sitting.
She explained that she would only have lunch if they served salad.
I know they do but that's not what they do best.
She eventually ordered a sandwich, almost complained about its size…
ate it and finally complimented the chef.

This is our economy, when you can afford eating out at a restaurant:
do not stick with your lean plans to have a nice meal.

Discontent

c. muted feedback

We have grown intolerant.
Contemporary populism has been fed up with the elephant in the room.
Despite rising sea levels, the ocean is not vast and rich enough.
Small fishes do not stand or support the existence of enormous whales.
Fatphobia has spread because growth is a ceremonial sumo fight.
Happy chubby koalas on the branch of a tree would gather more likes.
We do not make money from what we like.
We are not ready to remember the curves of Renaissance paintings.
But a serious dietitian would not recommend frugality.
We want more.
We want more of something different.
We want more proportionate harmony.
Pump and dump is a disgrace to fine finance.
We proclaim too big to fail a good investment.
Who is failing, then?
A safe stock.
Who is insecure, then?
This product is a killer.
Who is being killed, then?
Do you hear this rhetoric?
This is all too suspicious.
Are we blind, then?

Vested Interest in Status Quo

d. one size anomaly

VIP status above laws of common people discredits legitimate failure.
In their eyes, liability should scale with size.
Tax collectors are not the only ones struggling with unscalable imbalance.
Change is pushed one-way top-down.
Unadjusted levels of sophistication apply.
Every regulation flagged by a majority of affected parties argues:
central planning manages a theoretical body made of headless chickens.
They are missing corrective action when it is not reviewed or revised.
No economic actor is average.
Each of them will either lose or profit on each side of the aggregate.
Their deviation extends from a weighted average drawn to riches.
They're barriers of entry on one side and economies of scale on the other.
As Elinor Ostrom demonstrated in her studies of common pool resources:
rules derived from the status quo are the least productive.
An unconscious stream of calibrated thinking is turning down potential.