The Grip Of Death
Apr. 19th, 2011 01:07 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
avevale_intelligencerPrompted by my "financial entropy" post a while back, I've started re-reading this book, and am finding it excellent, readable and still (unsurprisingly) horrifyingly relevant.
Some of my commenters invoked the "liquidity ratio"; the rule that a bank can only lend a certain fraction of its assets. Rowbotham says that that was abolished in 1981 by Guess Who's government, as part of the removal of any regulation that would interfere with bankers making absurdly colossal amounts of money (literally, in fact, as well as enriching themselves).
I'm not going to say that anyone *should* read this book, because that's never a good idea. But I think it tells the truth about what is going on, quotes and names its sources, and is neither politically partisan nor as rabidly opposed to big business as I am; for example, he makes a point of not blaming industry for the fact that we are locked in a spiral of insufficient purchasing power chasing ever more goods manufactured to ever lower standards, because more and more of everybody's money--consumers and businesses alike--is swallowed up in an attempt to service constantly multiplying personal and corporate debt. And therefore I think it's worth reading whatever your opinion may be about the current political or economic climate. Besides, it's fun to read, which I never thought I'd say about an economics textbook.
I have been rethinking my entropy post, and I think I can explain it it terms of the Laws of Money Dynamics, which can be stated in the following simple terms (after me, Donald);
The First Law Of Money Dynamics:
Wealth is debt and debt is wealth.
Wealth is debt and debt is wealth.
Very good. The Second Law Of Money Dynamics:
Wealth cannot of itself pass from one body to a poorer body.
Wealth cannot of itself pass from one body to a poorer body.
Wealth can't pass from a richer to a poorer.
Wealth can't pass from a richer to a poorer.
You can try it if you like, but you'll only get sorer.
You can try it if you like, but you'll only get sorer.
'Cause the wealth of the richer is a bottomless pitcher.
'Cause the wealth of the richer is a bottomless pitcher.
So the poorer body's wealth will pass to the richer.
So the poorer body's wealth will pass to the richer. (First Law!)
Wealth is debt and debt is wealth and debt is wealth and wealth is debt...
Obviously, this formulation still needs some work, and I have been very conscious of some local exceptions to the Second Law which have enabled us to keep, you know, eating and living and so on, but in the macroeconomic sphere it seems to hold up remarkably well. It's notable that money behaves in exactly the opposite way to heat, and thus the end result of financial entropy would in fact be all the money concentrated in one place (e.g. Rupert Murdoch's Cayman Islands bank account) and none anywhere else. Whether this would then result in a financial Big Bang is for abler researchers than I to determine.
So. The Grip Of Death. Michael Rowbotham, Jon Carpenter Publishing. £12.05 new from Amazon, or a tenner used (plus shipping, of course). Worth every penny.
Some of my commenters invoked the "liquidity ratio"; the rule that a bank can only lend a certain fraction of its assets. Rowbotham says that that was abolished in 1981 by Guess Who's government, as part of the removal of any regulation that would interfere with bankers making absurdly colossal amounts of money (literally, in fact, as well as enriching themselves).
I'm not going to say that anyone *should* read this book, because that's never a good idea. But I think it tells the truth about what is going on, quotes and names its sources, and is neither politically partisan nor as rabidly opposed to big business as I am; for example, he makes a point of not blaming industry for the fact that we are locked in a spiral of insufficient purchasing power chasing ever more goods manufactured to ever lower standards, because more and more of everybody's money--consumers and businesses alike--is swallowed up in an attempt to service constantly multiplying personal and corporate debt. And therefore I think it's worth reading whatever your opinion may be about the current political or economic climate. Besides, it's fun to read, which I never thought I'd say about an economics textbook.
I have been rethinking my entropy post, and I think I can explain it it terms of the Laws of Money Dynamics, which can be stated in the following simple terms (after me, Donald);
The First Law Of Money Dynamics:
Wealth is debt and debt is wealth.
Wealth is debt and debt is wealth.
Very good. The Second Law Of Money Dynamics:
Wealth cannot of itself pass from one body to a poorer body.
Wealth cannot of itself pass from one body to a poorer body.
Wealth can't pass from a richer to a poorer.
Wealth can't pass from a richer to a poorer.
You can try it if you like, but you'll only get sorer.
You can try it if you like, but you'll only get sorer.
'Cause the wealth of the richer is a bottomless pitcher.
'Cause the wealth of the richer is a bottomless pitcher.
So the poorer body's wealth will pass to the richer.
So the poorer body's wealth will pass to the richer. (First Law!)
Wealth is debt and debt is wealth and debt is wealth and wealth is debt...
Obviously, this formulation still needs some work, and I have been very conscious of some local exceptions to the Second Law which have enabled us to keep, you know, eating and living and so on, but in the macroeconomic sphere it seems to hold up remarkably well. It's notable that money behaves in exactly the opposite way to heat, and thus the end result of financial entropy would in fact be all the money concentrated in one place (e.g. Rupert Murdoch's Cayman Islands bank account) and none anywhere else. Whether this would then result in a financial Big Bang is for abler researchers than I to determine.
So. The Grip Of Death. Michael Rowbotham, Jon Carpenter Publishing. £12.05 new from Amazon, or a tenner used (plus shipping, of course). Worth every penny.