Letter to Fallows re: Gold Bars as Big as the Sun

Throw a Dart, Monkey Boy

On 23Jun I wrote a phantom letter to an erudite avatar and I explained some long-winded theory that went on and on and never arrived anywhere. Then I publish it in my blog and it is buried forever. Until I hit send and email it to the erudite avatar. And Paco. BOTH! Wasting Pacos time is a tear i can mend. With distant avatars that requires life points.

 On Thu, Jun 23, 2011 at 10:14 AM, Paco Ahlgren wrote:

When demand for a good or service increases, so does the price... Fix that hole, and let's talk. Prices only fall according to Moore's law (which is actually about processor speed, I believe), because newer, better chips obviate older ones -- thus causing prices to collapse on older chips (and computers). Falling demand, and/or excessive supply causes prices to fall in the market.

paco

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On Jun 23, 2011, at 10:08 AM, Kirk Holden wrote:

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I am a dood and well meaning, freedom loving liberal and empathetic progressive. As such I read The Spirit Level and I obsess over the Gini coefficient. But suddenly the scales have fallen from my eyes. Let's say that the 10 richest men on the planet each had a bar of gold that weighed as much as the Sun. First off, this bullion would need to orbit earth at a great distance to diminish the warping of space-time but for the sufficiently rich this would be a minor inconvenience. This would of course skew the mean of the distribution of all wealth 'to the left' or toward x=1 (currently Mr. Slim) on the number line. In other words, positions one through ten would be Carlos Slim, Bill Gates,..., LeBron James - each with almost infinite wealth. It doesn't take a genius to figure out that at some point even if each person on this list tried to spend a good portion of even their daily interest on the gold, I do not become one iota worse off. In fact, an exponential increase in present spending by these folks would actually make my life better. How?

Let's say they all wanted 1,000,000 jet skis each for Christmas. Suddenly the demand for jet skis would sky rocket. What would happen next is that the price of jet skis would plummet as the incremental cost on the 100,000,000th jet ski would be about $7.00. This is basically an argument from Moore's Law (not Gordon, Larry the jet ski manufacturer). The more of anything we manufacture, the lower the incremental cost of each unit over time. Also, unless these gazillionaires cornered the market for peanut butter and jelly I would never feel the effects of the unequal distribution of income. It's all about the denominator. In short, when I divide by zero - Chuck Norris gets to punch a liberal in the face.

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I am sure there is a precise name for this phenomena but I am an engineer not an economist. There are always secondary and tertiary effects but my point is that even if my purchasing power falls over time I still have my Android, my internet connection and my DVR. And with each of these things the overall utility accrued (all the amazingly useful stuff I have in my living room) is greater than at any time in human history.

 sbop
 kirk 'our libertarian peer Megan M. might possibly agree with me' holden
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UPDATE: Tuesday

Au is the C60 Atom's little bitch

My murky point was this. The Rough Beast of the Technium controls all supply and all demand. Per Wm. Gibson, the most fantastically wealthy of this noosphere prepare the path for the emergence of each individual B3aST and emergent Rough Beast (teh Singularity of the Singularity of... The Omega Machine). The rich are not like you and I, they each have B3aST already. They can spin gold from imagination. Basing an economy on fermions and bosons certainly makes sense - there is not an alternate reality. But Au is nothing but an atomic number. Especially to the Rough Beast of the Technium. I am partial to Si and C myself.