Thursday, April 10, 2008

Adverse Government Interference

What are We to call this Situation? Possibly We could call it the Disintegration of Confidence. It is basically over-excitement of the Markets. A structural reassessment of the Price formation process could present some Price avoidance practices to restore Confidence, removing panic reactions from Price-setting. The Kids probably do not understand what I am talking about, and Business will scream I am attempting to punish small business for Market practice. What is this terrible Practice? It is a formalistic Shutdown of the Economy to force Conservation, for the sole purpose of bringing Prices into conformance with economic needs; a practice similar to throwing a bucket of cold water on a Patient in a hospital, who has too high a Fever. It’s effectiveness resides in the raw power of the force utilized; I will try to explain the decadent practice by examples.

One Prime example which I would advocate would be a law shutting down the national Interstate system for one hour a day, any day that the Price of Oil exceeded $100/barrel. The best hours for the Shutdown would be 9:00 a.m. to 10 a.m., or 1:00 p.m. to 2:00 p.m.; and usage of these two hours could be better than utilizing just one hour. Ambulances etc. would be excused, but law enforcement officials would be charged with ticketing all moving vehicles on the Interstates during these Periods, said Tickets to cost $1000 per occurrence. The impediment of economic Transport will obviously slow economic activity throughout the economy, and physically reduce the consumption of fuels by Transport vehicles during these Time-Outs. The existence of these restrictions automatically destroys Speculative reaction in the Markets, where Speculators realize that automatic Product utilization slowdowns are in place.

Another example of such atrocious practice could be a mandatory limitation of Bakery operations to a 32 hour Workweek, when Wheat exceeds Ten Cents per lb. (Gave this One to screw up the kids; Trade weight of Wheat varies from 54 to 70 lb./bushel–a standard of 64 Pints–with the Wheat of 12 Percent moisture or less). Now the Kids will ask why I would get so technical: well, it is exactly the Concept We wish to introduce, pressuring Uncertainty of Return into Price matrix. Artificial constraints could be implemented which would cancel Trade profitability, which would not inhibit necessary procurement of Product, but would make Speculators hesitate to search for Gain in the market; Government interference would inject a greater fear of loss into the market structure. Shortages would still govern the Markets, but that impact would be based on reality, based upon the arbitrary response of Government.

Does this discussion remind of the Third World stupidities imposed by Governments? The Intent is for that exact influence, though the economic thought is more advanced. It is all Government impediment of Trade, but the impediments specifically geared to generate real Trade advantage. The whole performance will be haphazard and poor, but would initiate the desired performance; removal of the Profitability of Speculation through desirable reduction of adverse over-Consumption. Is it the Way to run an Economy? No, but it inhibits the thirst for adverse Profits. lgl

1 comment:

123 said...

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