2022-05-19


Worthy

  • The Cantillon Effect and Stock Market Crashes

    This is no way to run a country. In a society with a coherent social vision, people would get rich investing in baby formula production, or medical dye, or generic pharmaceuticals, all of which are in shortage. But instead, money has been flooding into cryptocurrencies, weird obvious scams like SPACs, and a manic art market. Christie’s, for instance, just sold a famous Andy Warhol painting, a 1964 silk-screen of Marylin Monroe. The work went for $195 million to an anonymous bidder, which is the size of the annual budget for a small city, like Norman City, Oklahoma. When baby formula is in shortage and art markets are insane, the economy has clearly become the byproduct of a casino. (I suspect there’s probably some form of collusion here, of auction houses, high-end museums, and billionaires, to keep prices high, but the point stands.)

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