Everything You Need To Know About Economics But… Actually There’s Nothing You Need To Know

Flickr / Mark Wainwright
Flickr / Mark Wainwright

I cheated on every economics exam. I was majoring in economics. But so was my girlfriend and she was smarter than me. So cheated off of her tests.

But then it turned out she wasn’t so smart and we both failed.

My parents were so happy I wanted to major in economics. They thought this meant I would be good at business. “You will succeed at everything!” they promised me.

To be good at business you need to start with two things:

  1. Know how to help people.
  2. Know how to bribe people.

There’s no economics in there.

I switched majors to Computer Science.

This is a polite way of saying don’t listen to me.

1. WARREN BUFFETT IS A F***KING LIAR

Warren Buffett says the WORST thing is deflation. In other words, when prices get lower, he thinks, the world is over.

I have a saying, “there’s always a good reason and a real reason.”

Good Reason: if prices are lower, people will stop buying because they will wait until prices are even MORE low.

This leads to a death spiral until nobody buys anything ever again and the world, I guess, shuts down then. Puts up a “We’re Closed” sign.

That is stupid. If I’m hungry, I buy something to eat. If I need shelter, I rent an apartment. I don’t starve in the cold until prices get lower.

Some people argue prices have been inflating for 100 years.

This is BS also.

100 years ago, the first school for Dental Hygiene started. The Fones School of Dental Hygiene, in Connecticut.

Amount of bad smelling breath per dollar has gone down 99% since then. That’s deflation.

Try kissing a man or woman with bad breath. That’s more important to me than the dollar.

ALWAYS look for Warren Buffett’s real reason.

Real reason:

He doesn’t like prices to get lower because he has $50,000,000,000 invested in stocks and those stocks only make money for him when prices go higher.

That’s 1 good reason and 50 billion real reasons.

2. SUPPLY AND DEMAND IS BULLSHIT

Price is determined by situation.

If you want to buy a house and you look at two exact houses in the same area you would think they have the same price.

No.

What if one house had an owner that just died. Now his or her three children don’t want to own the house.

They want to dump it so they can split the money up. So the price is cheaper than the house next door with the stable family with two kids and a dog.

If you want to make money, look at SITUATIONS more than supply and demand.

The reality is: we don’t know the supply of an object. Nor the demand. Nobody ever does. Maybe it’s a rough guideline.

Death, divorce, debt lead to cheap prices. Those are three types of situations.

And price is determined by many more factors:

I was shopping for a coat the other day. In one high-end store, a nice coat was $7,280.

In the store next door a coat that seemed just as good was $150.

What’s the difference? Not supply. Marketing.

Sixty years of marketing have created artificially high prices (inflation) because marketers have figured out the science of mass hypnosis.

That’s why good marketers get paid a lot of money. Because their slave owners make even more money.

If there was never any marketing, then prices would be 1/50 what they are now.

Unless a coat was made out of solid gold it’s not worth $7,280. Or unless you personally slaughtered the cow and then crafted the leather to make the coat it’s not worth that either.

3. TAXES

This is a hot-button issue.

I don’t care about the difference between the richest and the poorest. This affects 1% of the people in the United States.

The other 99% lives on my street.

Believe it or not, the name of the street I live on is “Main Street”.

The street I lived on before this one was “Wall Street.”

I mean this very literally. I lived on THE Wall Street on the corner of Wall and Broad, right across from the stock exchange.

And then I moved 70 miles north. Now I live on 24 Main Street in a town of population 1000 along the Hudson River. I live three houses from the river.

If the rich are taxed more I can guarantee you my neighbors on Main Street won’t make that extra money.

Some of them are illegal immigrants. Some of them are mentally ill. There’s been two suicides on my street in the past five years.

But the river is beautiful. And I walk by it and my mind drifts when I wonder, “are ducks really monogamous?”

I do care that money I worked really hard for is taken from me and used to buy bullets. Lots of bullets.

When the local high school goes on a class trip to Washington DC, my money is being used for half those kids to lose their virginity.

I do care that Kevin Spacey takes my money and throws Katie Mara in front of a train. That happened.

Democracy is rule by majority. But I’m in the minority and I also hope my opinion can be validated but it isn’t.

The way I can be validated is if I vote with my money – where I want it to be spent.

For instance, I’d rather use money to hire people or invest in platforms like prosper.com to help other small business owners hire people and innovate and be successful.

Or Patreon to support artists I believe in. Or kickstarter, to support projects by broke but extremely creative and exciting innovators. Or gofundme to support my friends’ charitable efforts.

I don’t want my money to buy a bullet for some 18 year old to kill some 14 year old. Another kid in Africa who just wanted to live.

And yet I have no choice because I’m in the minority and probably always will be.

4. THERE IS ONLY ONE ISSUE THAT IS IMPORTANT FOR THE US ECONOMY

This is the most important thing in this post by far. Ignore the rest of this post. But please PAY ATTENTION to this part.

I should have put this first because it’s the only issue I care about. And most people aren’t aware of this issue.

United States companies have $2.5 trillion in cash sitting in other countries.

Apple, for instance, has $158 billion overseas they are afraid to bring back.

They are afraid to bring it back to the United States because then it will be taxed.

Think of it: $2.5 trillion being left out of our economy because of fear, just sitting in foreign banks, making those banks money.

That’s $2.5 trillion that can be used to hire people, create innovation, fund educational programs, start companies, etc.

If the money comes back it can be taxed as high as 50%.

So the answer is simple:

Tax holiday. January 2, 2016, bring all the money back and you only get a 5% tax.

That’s an extra $125 billion to the US government for basically free.

And then there’s something VERY IMPORTANT. It’s called the money-multiplier.

When you have a dollar, you buy a donut. Now the donut man buys a newspaper for the same dollar. The newspaperman buys a coffee.The coffee man buys a hooker.

One dollar is used on average ten times, equals about $10 in economic growth.

$2.5 trillion dollars equals $25 trillion in economy growth. That’s about $12 trillion in taxes, almost wiping out the entire US debt.

On top of that we can forgive all the student loan debt, stop wars, and give everyone free healthcare.

BAM! THIS SOLVES ALL THE PROBLEMS IN THE ECONOMY.

So why don’t politicians do this rule.

Because the bottom one percent will say the top 0.000001 percent are making more money, which may not even be true.

Politicians, as usual, are afraid.

I can tell you: most of the top 0.00001 percent are not very happy people anyway.

I’d rather have the $25 trillion in economy growth.

My girlfriend broke up with me so I couldn’t cheat off her tests anymore and I had to switch majors.

She lectured me on what “love” is and walked out and I never saw her again.

Then I was a horrible computer programmer. And then a mediocre businessman. An ok hedge fund manager. A better writer. A horrible husband. An ok father. And I don’t like being told what to do.

I don’t know why I just wrote that paragraph. Perhaps it’s to say, I don’t have a clue.

I hope I know a little more about what love is.

Or at least kindness. And tenderness. And gratitude.

And when I talk to you, I hope I make you laugh, and I hope we like each other. But I’m nervous.

This is more important to me. I think I love you.

And THIS is how introverted people can really scare people at cocktail parties. Thought Catalog Logo Mark

Related

More From Thought Catalog