Book Value

One cannot agree with Mark Perry all that often because of his Conservative radicalism. This One, though, stands right on the Money. We have had a massive loss of ‘book value’, but no real loss of anything else as yet. Most Americans enjoy a Capital Worth greater than they possessed in 2001 due to several actual mediocre years; still, where they were employed an Asset aggregation. I have not done the superimposition of models of 7-year Intervals, I leave that to the Working Economists; factual reality still impels Me to state that We have done well in the most recent Interval. Capital Asset flow patterns follow the GDP lines, and are always generally higher than previous Periods. Everyone needs to stop and take a Breath, while letting Production Profits pay off outstanding debt; the whistle will blow to start the Race to Wealth again soon.

Floyd Norris ignores the entire Scenario of Windfall Profits and Losses. Do I feel sorry for GM?–Not on your life!. Do I feel happy for Exxon?–Get real! Neither Company had much to do with the alteration of their Profit margins, or do they present any superior or inferior Service. One would like to claim that Exxon is Inventive, though their relative refusal to expand Drilling operations makes this doubtful. One can assert GM lacked foresight as to Consumer desire, though that is a Crock; Consumer desire did not change until Gasoline started to head toward $4/gallon. Both Companies show the Profits degradation consistent with massive infrastructure and bureaucracy. Neither Company has forwarded a truly Original Incentive for decades. My Suggestion is rank Communism: force Oil and Auto industries to pool their Profits, and then Average the Total, with equal Payout. Guess What?–Private Enterprise did not do so good!

Greg Mankiw criticizes the right Stupidity, but for the wrong Reasons. The United States does not want a leadership role in the WTO in the arena of universal Trade agreements. We should not surrender major Trade advantage with large Inputs, in exchange for small Trade advantage with light Inputs. One does not build a viable Business structure by subsidizing Operations making no Profit with the Profits of highly viable Operations. One also does not subsidize Operations making great Profits, but where there is little chance for expansion. Both the ethanol subsidies and the Farm Bill are ridiculous, but giving away Profits to gain Trade expansion is also an idiocy. Someone, someday, may even insist that Government neither help or hinder economic production potential. lgl