How We Got Here

Here is the Evidence that the euro adoption increased Trade within the euro-zone; something which Everyone accepted and expected, but now with a presentation of data. The trouble lies in the fact that the article provides little data itself. The real value of the euro comes as an alternate to the U.S. Dollar, increasing as a replacement Trade unit with its spread across Countries and Trade Products. The Dollar’s supremacy has been challenged by excess borrowing by the Federal Government, and the growth of the Dollar-traded Energy pricing Worldwide. I believe that both the American Consumer and American Business would be better served if the Dollar was replaced by the euro as the dominant Currency. The devolvement will actually raise Wages, and dismiss the excessive Pricing of Corporation Trading–$52 bn for a beer company?? (think of the Asset Profit Gain in the Century+ existence of the Company in average yearly Gain)

This passage from Bryan Caplan can be related to the above declarations; consider the huge increase of Replacement values for destroyed Property. Properties from California to Florida worth only some Tens of Thousands are now worth Hundreds of Thousands if not Millions, and much of it has been paid for by the Federal Government. Andrew Healy imagines that any of the Involved Parties–Contractors, Realtors, Home Owners–would want any emphasis on disaster prevention; especially with Early Warning and Evacuation. Many Property Holders currently do not even ‘Board Up’ in the presence of adverse Weather, or ‘Wet Down the Roof’ in the Fire Zone. A Tornado Strike can increase the value of a farm by up to a Million Dollars. Being in a Flood Plain can actually raise the value of Farmland. Who wants Disaster Prevention?

Menzie Chinn gives a good discussion on the definition of the Consumer Price Index. I include the evaluation here because none of the Indexes to define the Cost of Living broker in the vast effect of Third Party replacement of excessive Property damage. This creates an artificial Demand for Construction–raising such Costs, generates a false Market for Retail Goods, and artificially expands the Mortgage market–put in as respect for the current financial Crisis. The real false Reading is not the CPI, but the extended level of Governmental expenditures which are not accounted in any of the Indexes; though they probably double the actual Inflation rate with redress Expenditures (don’t think Government is cheap, or ineffectual in the Consumption markets). lgl