Economics from Left, Politics from Right Brain
Economic principles don't have comapssion. The invisible hand, which governs today's economy, does not have a heart or the right brain. Cold economic laws will apply to you or your business in the long run. The following is a sample list of such laws.
1) Law of no free lunch
- (In general) No good thing comes for free.
- (in particular) If you want the government to step in, you have to pay a higher tax to
support all its incremental activities and actions.
- Milton Friedman's book: "There is no such thing as a free lunch"
2) Law of the opportunity cost
- "You cannot have your cake and eat it too."
- Greg Mankiw's Principle #1: "People face trade-offs.
#2: "The cost of something is what you give up to get it."
3) Law of unintended consequences
- "Every coin has two tails."
- No government policy is flawless.
- No one, possibly except for your date, is perfect.
4) Law of diminishing marginal benefits
- one can eat only as much as one can."
- Thank goodness! She will keep eating endlessly, otherwise.
- Greg Mankiw's Principle #3: "Rational people think at the margin."
* What do you think? This particular law is actually a boon to us.
5) Law of an enevitable bankruptcy
- "You will go bankrupt if you are short of money."
- Andrei Schleifer and Robert Vishny (1997): "The market can stay irrational longer than
you can stay solvent."
(This idea itself is orginated from J.M. Keynes: General Theory p.157).
6) Law of competion
- Competion for profit maximization is only to compete economic profit away.
7) Law of self-fulfilling prophesy, aka irrational market psychology
- What a large number of people believe will happen does happen.
8) Law of bad men walking
- "Behind every great fortune lies a great crime." (H. Balzac)
- Pure water fostes no fish. (Korean proverb)
9) Ironical law of consumption
- Pleasure from consumption, power from safving.
* Interpretation: The purpose of economy is consumption.
However, keep consuming and you'll end up as a serf.
e.g.) US vs. China
Donald Trump vs. Warren Buffett
10) High inflation is variable inflation.
- We can live with expected inflation, but not with unexpected inflation.
- Corollary: Persistent populism results in socieal unrest.
11) To live to die
- (Jean-Jacques Rousseau) "An organism begins to die at the very moment of its birth and carries within itself the causes of its destruction."
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