I want to ask "In what sense is a gold standard more 'natural' than fiat currency?".
I feel like the actual intuition is that the gold standard leads to an economy that is closer to the Econ 101 Textbook Competitive Economy (E1TCE). I think this intuition lacks sufficient evidence to be believed. As a counter-argument, one of the most important differences between the actual economy and the E1TCE is that wages are sticky downwards. This stickiness is necessary for cyclical unemployment and, therefore, is largely the cause of recessions as we know them. A fiat currency with low and consistent inflation significantly reduces this problem and therefore makes the economy more like the E1TCE. A gold-standard-currency is typically deflationary and therefore makes the problem even worse. Is there a similarly important reality-E1TCE discrepancy the gold standard improves on?
Alternatively, imagine a parallel universe in which gold deposits were more randomly distributed, resulting in more volatility in the supply of gold. Is the optimal economic volatility for growth higher in that universe merely because of the distribution of gold deposits? Obviously not. So, we have no reason to think the distribution of gold deposits should predict optimal monetary policy in this universe either.
Fine, you might say - the point isn't "gold" per-se, the point is a fixed money supply, which we use gold to imperfectly enforce. But, we're still privileging the hypothesis that the volatility created fixed money supply is somehow optimal for economic growth without any justification. [Edit: also why a gold standard then? Just have the constitution forbid making more dollars instead]
if it is true that growth was higher before central banks started recession proofing, then there's an argument to be made that natural volatility is more optimal then our current level of volatility
That argument is literally correlation-implies-causation, and, given the enormous number of other differences between the 19th and 21st centuries, extremely unpersuasive.
KnotGodel
5mo ago
You also don't have to feel like you are losing status if I fuck your wife in front of you, or force you to blow me, but I would suggest not doing so demonstrates a lack of self respect
IMO, the problem with both of those is not that I'm losing status.
All else equal, all wealth should be taxed equally (say, flat 1%/y) , not income from wealth. Current tax laws encourage bubbles and poor investing. Just buy a garbage bond or shitcoin and uncle sam will barely touch it, but god helps you if you invest in a company actually making money. And don’t give me the hard-luck grandma story.
Hmm - I haven't heard this take before. Let me do some quick math, courtesy of the Markowitz model. Suppose you have two investment options:
- stocks that returns Norm(A, B)
- risk free interest rate: i
Let e be your risk aversion and let x be the the proportion of your portfolio you are investing in stocks
U = xA + (1-x)i - exxB
dU/dx = A - i - 2exB
x = (A - i) / (2eB)
Capital gains scales returns by k and variance by k^2 (where k = 1 - tax_rate):
x = (kA - ki) / (2ekkB) = (A - i) / (2ekB)
As taxes go up, k shrinks from 1 towards 0, which makes x increase. Therefore, capital gains taxes cause increased risk tolerance.
A wealth tax reduces returns by k:
x = ((A-k) - (i-k)) / (2ekkB) = (A - i) / (2ekB)
This is the same, so a wealth tax doesn't affect risk tolerance.
It’s like a poll tax on wealth, and like a poll tax, it’s very tax efficient.
I don't think this can be true. The chief academic argument against capital gains taxes is that they impose a 100% tax on consumption in the far future, which is maximally distortionary. The same is true of a wealth tax.
The problem with income tax is that it discourages economically beneficial behaviour, like working or good investing.... the state, counter-productively, eggs you on to be a bum and to stack your wealth under the mattress (ignoring inflation). Your lazy bum money should be taxed at least as much as superstar cancer-curing money.
I personally think that if society had no welfare, a flat income tax would be either not distortionary or push people to work more. Note: historically people worked much more and (e.g.) wages being 4x lower because your country is poor is equivalent to a 75% flat tax today.
I have an elegant mathematical model illustrating this result, but I think I've force-fed this forum with enough math already.
Depends on your definition of “caring”
¯\(ツ)/¯
As an example, I have a very specific explanation of how my caring has changed. You decided to simply assert that this change doesn’t count as “not caring” to you.
I could practice some “Outside View” and wonder whether you might be right - but then I remember that the Outside View presupposes the other person is actually adding valuable information and not just trying to “win” points at my expense
KnotGodel
2mo ago
Past me: I got downvotes; what is wrong with my comment?
Present me: I got downvoted; what does that imply about the community doing the voting?
KnotGodel
1yr ago
Caroline Ellison
As far as I can tell, you're just complaining that Ellison isn't as conventionally pretty as a supermodel? She is impressive in other ways:
-
daughter of two MIT economics professors
-
earned a national merit scholarship
-
BA in math from Stanford
-
In the top 500 of Putnam competitors in three years
-
Went to Jane Street straight out of undergrad, probably earning ~$600k / year
That is an incredible list of accomplishments for a 23-year old. If you're into smart/successful women, she's a clear outlier.
Your thesis:
The last several years are best modelled as a massive, distributed search for ways to hurt the outgroup as badly as possible without getting in too much trouble.
As with all such narratives, this says more about you than the world. You simply focus on all the ways Blues hurt Reds and ignore the millions of boring policy changes where nothing of the sort happens.
This lets your “model” be “correct” since you simply ignore all disagreeing events. For instance, I really don’t see how Biden turning immigrants away at the border is him hurting the Reds or how him sending arms to Ukraine is hurting the Reds or how a boring HOA meeting about lawn care is hurting the Reds.
Then you interpret your own bias as an objective fact of the world, which lets you make fun of people who don’t share that bias by effectively calling them stupid (which is the framing for your entire comment)
Not exactly a paradigm of clear and charitable thinking.
KnotGodel
4mo ago
You know - I've done some searching (Google, Google Scholar) and llm-ing (GPT, Claude, Bard), and I can't really find any evidence I would consider strong
- in favor or against significant media backlash against IQ testing potential hires
- in favor or against the claim that IQ tests were common before Griggs
- in favor or against the claim that IQ-testing of potential hires significantly decreased post Griggs
So, I guess I'm gonna revert to agnosticism.
Trying to understand why people don't take selected macro statistics as gospel truth about their own lives is, to use a common phrase, extremely out of touch.
It depends on the purpose of the discussion.
Is it to discuss policy? Is it to discuss aggregate public perception? Averages matter.
Is it to vent? They don't.
The question to ask: why are we on this forum?
Ehh, Griggs vs. Duke Power is overrated by HBD/IQ folks. It's not like IQ tests were ubiquitous before Griggs, were they?
I think the more important problem for large companies is that the PR costs might be large and that PR costs are very salient/legible in a way that employee quality is not, at least no in the short-term (and people are hardly paragons of rationality in the long-term). Like, if you were a CEO and added IQ tests, you can be certain of a media backlash and you're also risking subsequent punishment by the board. Even if you're certain it would improve employee quality, that would (a) be hard to prove and (b) even if you could, it would take years...
Smaller firms,
- often just copy larger firms (they are often, in a sense, even more risk-averse than big firms, since all the financial risk is borned by the owner)
- often aren't super g-loaded anyway (e.g. mom-and-pop shop, contractor laying flooring, etc)
- have less principle-agent problems (arguably, IQ-esque tests are most valuable, because they partially displace hiring favoritism) - like, if I'm mostly hiring people I know and have worked with before, the additional value of an IQ test is ~0
It was only with Reaganism... that the shift towards equating rampant capitalism somehow became associated with being "right-wing"
I think you're missing some pretty big things here. For instance, there was notable (though not universal) Republican opposition to the New Deal. In 1964 Republican presidential nominee Barry Goldwater generally opposed the New Deal - a pretty big split from Eisenhower. Nixon (the nominee in 1960 and 1968) supported "New Federalism", which was essentially replacing federal New Deal programs with grants to states. All of this was against a backdrop of Cold War anti-communism.
Even before the New Deal, Hoover was against government welfare (remember Scott's review?). Before him, Coolidge cut taxes and spending.
So, I'm not really comfortable saying that capitalism was associated with being right-wing only with Reagan. It seems to be an association that, if it even has a single origin, came decades earlier - possibly with the New Deal, but likely before even that, with Eisenhower being an exception to the rule.
KnotGodel
5mo ago
The Culture War? I guess something like the social activity related to emotionally-charged dichotomies?
KnotGodel
4mo ago
- There's virtually no actual cost in having money depreciate slowly over time.
- This is a fully general argument in favor of greater economic volatility. If you believe that, you shouldn't just be arguing for a gold standard - you should be arguing for the government to artificially create recessions.
- If this is tyranny, sign me up for another!
- Plenty of governments had no issue borrowing enormous amounts during WWII, so I have a hard time viewing a gold standard as much of an impediment to that.
Is that a dodge, or are you actually saying that you wouldn't feel like you lost status if I banged your wife in front of you?
Could you maybe describe what "status" means to you?
I don't really walk around thinking "I should to X at work to gain status" or "I should make fun of Y to gain status" or "Person Z lowered my status in that meeting - I've got to be sure to get even with them." I don't think that, in order to have more/closer friends, it is important that I become more popular than someone else. I do occasionally feel embarrassed (e.g. I said something wrong in a meeting) or ashamed (e.g. I forgot about a friend's birthday).
I guess I just don't think any of these as "zero-sum".
Even in the "banged your wife" scenario - does that give you status? I don't think it would among my peer group... Would I become less popular? Would people at work think I was less competent? I don't think the effect would be very large...
Do people actually think like that? To me, it doesn't seem like a good way to approach life from either a personal-happiness perspective or a social-welfare perspective. I don't know, I find the amount of emphasis you're placing on its importance confusing. So, I see three options:
- There is some disconnect between what you and I mean by "status"
- I actually do care immensely about status - I'm just repressing it.
- Some people viscerally care a great deal about status. Others don't.
KnotGodel
1yr ago
the problem is most easily solved by forcibly re-educating the peasants to say they love immigration
It's throw-away lines like this that make me avoid commenting here.
Then it's followed up by
If you want a vision of the future, imagine a boot stamping on a human face forever, while the face says "unlike those intolerant right-wingers, I'm open-minded enough to appreciate boot culture and cuisine!"
Ahh, such steel-manning, such charity - definitely no booing outgroup here!
KnotGodel
1yr ago
I think one point you’re downplaying is how much longer people are unmarried compared to the past and or poorer countries. For instance, the median age of first marriage has increased from about 20.5 in 1950 to about 32 today.
During the dating years, romantic inequality is more salient, and many people get burned in various ways, which makes them angry at members of the opposite sex.
The amount of time people spend obsessing over this scales linearly with the number of years spent dating. So, for instance, if we start counting from 16, that’s grown 3.6x.
Also, anger => clicks => ads, which has probably driven a lot of polarization more generally.
Finally, now it’s the media people themselves who are experiencing singleness (due to the marriage age increasing well past college). This gives even more voice to sex-based frustrations.
Cool post, but
It should not be a rocket science to isolate these factors, actually, it would amount to a very cool paper with plenty of citations. So where is this paper?
There are plenty of papers on the life expectancy gender gap in general. This one for instance looks at why the gap has narrowed in Sweden by looking at the contribution of different causes. They find "External causes of morbidity and mortality" (i.e. accidents, self-harm, assault) explained 15.1% of the gap in in 1997 and 21.2% of the gap in 2014 - conclusions that seem to broadly match yours.
However, I take your point about the lack of such papers. Given the political leanings here, I suppose commenters will point out that this hasn't stopped similar gender pay gap analysis. There is truth to that, so allow me to point out factors that don't boil down to "it isn't fashionable in this zeitgeist."
Such papers on the gender pay gap are almost always just glorified linear regressions. This makes the causal claims questionable, but also makes it clear why such papers are easier to write than a mortality gap paper would be. To do pay analysis, you can just survey 10k people, which will give you about 10k pay datapoints. You ask those people a battery of standardized questions. You plug-and-chug in a linear regression model. Done. If you tried that for mortality, you'd survey 10k people, which will give you ~150 death datapoints after a year. That's not enough to do any kind of definitive regression with lots of controls.
So, for mortality research, you will realistically need hundreds of thousands of people, which means you are realistically using either medical records or government records. If the latter, privacy and lack-of-standardized-questionnaires will make it a struggle. If the latter, privacy and lack of asking-relevant-questions will make it a struggle.
And, so, to do This Paper on the life expectancy gap, you are stuck integrating results from multiple other papers/fields. It's easy to subtract specific causes-of-death (as you did and the paper I linked to above did). But you want more, you want to control for smoking, drugs, alcohol, "meat consumption and overall life style". Here you run into serious correlation≠causation issues. Sure, the link you used claims that smokers live 10 years shorter, but there is no RCT - how much do we trust that as a causal claim? Ditto for the other things. Another issue is that the linear-regression-doer can include interaction terms, while the literature-review-using-various-sources paper cannot.
I'm not saying there is no impact on what-is-popular regarding what is published in academia, but there are serious differences between researching the gender mortality and pay gaps.
KnotGodel
5mo ago
If you’re a Christian, you should probably be doing that anyway? Well, that and charity - rich people have a hard time entering heaven.
Why should the existence of aliens affect that?
I don’t know what HylinkaGC or the rest are living like
Well, the one time he provided concrete examples of runaway inflation, his "lived experience" almost perfectly matched the official data. So, there's that...
KnotGodel
1yr ago
it's been de-facto IRS policy for years now to preferentially target rural/low-income individuals because they are viewed as being "easier marks"
This is, at the very least, a very misleading summary. The IRS is an order of magnitude more likely to audit people making $10m+ than those making under $1m.
Other evidence exists. For instance, in Sweden, social status decays by about 25% per generation, which is consistent with it being (a) entirely genetic and (b) approximately perfect assortative mating. Similar estimates are found for the US, England, Chile, and China - Japan and India have even smaller levels of decay.
ETA: The alternative interpretation is that there is an absolutely enormous environmental factor. However, given many twin studies (feel free to ask for link) that collectively show ~0 impact of environment on earnings, this seems exceedingly unlikely.
KnotGodel
4mo ago
If we had proof that intermarriage between class was as (in)frequent as intermarriage between race, how would you change your mind?
KnotGodel
4mo ago
I’m making the more narrow point about whether depreciating dollar is good or bad
In that case, I think my points re savers-v-debtors and Cantillion effects still stand. More broadly, the main benefit of inflation imo is that it reduces the distortions created by sticky wages.
Re volatility, yeah - I agree it's only a model, but I'm going to consider it the best guess until someone gives me either (a) a more plausible model or (b) empirical evidence to the contrary.
Do you know that many Effective Altruists and LessWrong-style-rationalists are vegans? Seems like a pretty good place to start.
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