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Monday, October 6, 2008

When all else fails, read the instructions.

Competitive capitalism is going to take some lumps and bumps in the near and far future as a result of what I call the "double bubble" that has hit us from 2000-now. OK, it is well and good that this type of self-evaluation takes place. But when it is all said and done, please remember that the only way that you and your family and that of your ancestors have escaped the grinding poverty that characterizes most of the world's population is through the evolution of free markets here in the U.S. and throughout our economic history. If you take the income level of what we define today as poverty ($10,400 for an individual in 2008), 13% or so of our population are classified as poor. If you take that same income level and put it into equivalent purchasing power dollars in the year 1900, the turn of the last century, guess what percentage of the U.S. population in the year 1900 was below what we consider poverty today? The answer: 90%. And that is a solid economic fact from Nobel Laureate Robert Fogel.
Remember this as competitive capitalism gets hammered and takes a whipping. Don't forget the bigger picture. Oh yes, and remember too that the World Bank definition of poverty is $2.00 a day.

And one more thing, when the conversation turns to greed, listen to the Master here:

Milton Friedman is in the Randy Parker Hall of Fame too, but I'll speak more of him later...and for the rest of my life.

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