Theory vs. Practice
Diagnosis is not the end, but the beginning of practice.
The Hidden (Deadly) Costs of De-Correlating Price from Value
All that glisters is not gold.
Billionaire venture capitalist Marc Andreessen has recently stated:
"You're probably not going to get the bicycle manufacturing plant back that's going to build bicycles the way they existed 40 years ago. [...] What you actually want is you want to be making electric bikes, which are much more sophisticated physical artifacts that involve batteries and computers and chips."
I agree on the strategy but I disagree on the execution – because ever-growing complexity (an excremental process lacking a clear and sustainable vision for progress) is bad, not good.
Don't attempt to copy China – disrupt it:
I want a cheap, subscription-based, light, reliable, infinite-range battery-less bicycle – not a fragile, hackable, expensive, clunky smartphone on wheels obsolete within 2 years and requiring periodic battery replacement. If we deliver the former, we will get 100% of the global market – at the price we ask! If we make the second kind, we will compete on price with China... and lose, again.
30 years ago we had software or devices lasting decades. Today, APACHE has 14+ CVEs per month and NGINX 3+. Hardware routinely fails after a one-year warranty. Planned-obsolescence enriches a very few via eventually-failing "circular deals", but it destroys productivity and therefore our economy: people prefer things that actually work, seamlessly, and on the long-term.
Sustainable profit is not achieved by extracting more and more money from the ever-depleted pockets of consumers and governments – it is granted by offering immensely better alternatives to the general sorry state of things.
What is needed (to please customers – the ones paying for the products), is ground-breaking technologies cutting manufacturing and operating costs rather than incremental complexity generating ever-rising costs.
Economic Value is defined in "Principles of Economics" by Carl Menger (1871), as: "the importance of the goods at their disposal for the maintenance of their lives and well-being".
Value is how much a product satisfies... end-user needs.
Economists have defined "Equilibrium" as "perfect markets", that is: perfect information, perfect competition, real-time price adjustments, zero transaction additional costs, profit maximization of rational, uninfluenced agents.
But "Equilibrium" is yet another academic abstraction (a fictional story) not reflecting reality: heavily-subsidied battery-powered cars are a nonsense for the economy, ecology, technology and sustainability and were imposed by government regulations to defeat the natural market leaders (making the most desirable products) – a myopic defensive tactic:
Chinese cars now outperform Tesla cars at this game because electric engines are cheaper and simpler than high-end petrol engines. There was no distinctive Value making this switch sustainable – so we have lost, again.
The only sustainable way to preserve the economic "Equilibrium" is through legitimacy: gaining market share because we deliver immensely better Value for the asked Price.
The USA have been the leading force behind many technological innovations disrupting world markets and letting the Western economy grow – without a fight. That's where the Value is, for our know-how, our people, and our economy.
That's also where the investments should go – unless the taxpayers want to keep losing while enriching the "Too Big to Fail" crooks.
How It Was Done "With The Stroke Of A Pen" – And How Fast It Can Be Undone
The market was supposedly a (buyer-driven) mechanism for price discovery: people would buy performing companies to get a dividend.
But as publicly traded stock depends on company valuations influenced by (notoriously inaccurate) Notation Agencies owned by... investment banks, it was rather a tool for wealth extraction by its largest players (the famous "whales" in love with "pump & dump") who were able to quickly buy/sell in large amounts to completely change market positions, making hefty profits).
When fraud is not stopped, it grows further, and the market has become a liquidity-driven hallucination, promoting nonsensical narratives that substitute for actual financial performance and industrial value (ie: Cryptos and AI).
Buyers face "fictional stories" with no earnings and lifetime negative cash flow that behave like they are invincible gods – merely because they are infinitely funded. These market distortions eventually resolve themselves, in a bloodbath (with the guilty making gigantic profits).
In 1928, based on past productivity gains and consequent per capita growth in national income, John Maynard Keynes predicted that a century later, we would be so prosperous that we would no longer have to work.
Productivity growth and per capita income growth have ended at the upper end of Keynes' predicted range. So what is the cause of prosperity was achieved.
Keynes could not imagine that the benefits of this vast prosperity would be so unequally distributed that the elites would capture it almost entirely for themselves and the majority of the population would still need to work.
With their infinite magic money creation, banks have de-correlated Price from Value, on an exponentially-growing massive scale. While our GDP (Gross Domestic Product) slowly grows, real-estate prices rose 5 times faster due to an artificially-created bubble caused by Finance constantly buying to maintain high prices (exchanging virtual fiat money for tangible land and real-estate assets):
Yet, the real-estate bubble has been dwarfed by the exponentially-growing publicly-traded stock bubble (where our chronically indebted pension funds are "investing for our better good" and where private Central Banks so aptly invest the public money they honestly manage on our behalf – "independently" so we have no way to stop them).
The Fed is a private bank with 12 regional Federal Reserve Banks owned and managed by their shareholders, the To Big To Fail, 2008-bailed out private banks (Morgan Stanley, JP Morgan, Goldman Sachs...) that get a 6% dividend from the Fed – every year.
So, with the Fed, they wanted to make public and private debt grow, as fast as possible, with extravagant ever-increasing expenses.
Since 1913, the Fed lends these magically-created dollars to the US Treasury to pay for the ever-expanding US government deficits... while the taxpayers pay interest to the Fed for those created, lent dollars (National Debt Hits $38.09 Trillion, Increased $2.18 Trillion Year over Year, $5.97 Billion Per Day on Nov 2025, while the Fed charts below stop earlier, on April 2025):
The 2008 bailouts and 2020 COVID crisis are more visible on the second chart because while most of the the newly issued public-debt came to the bankers' pockets, the rest of the economy has been flatened – by an economic crisis, and the COVID lockdowns (an injustifiable measure: it is long known by Science that locking-down sane people can only have detrimental effects on their health).
Since 1913, The Fed has the power to create unlimited dollars which it then lends out (to the U.S. Treasury) for interest payments, that is, profit to itself. And its shareholders, a few private banks, effortlessly profit while debasing the U.S. greenback:
Since 1971, the US dollar has lost 99% of its purchasing power when measured against gold, the value unit that, in 1787, the US Constitution promised its dollar to protect its citizens.
This is the greatest wealth and power transfer ever made in History: President Thomas Woodrow Wilson (1856-1924), a "Democrat" that led the United States into World War I, gave the Fed, a private bank, its once constitutionally-mandated power (Article 1, Section 8) to "make and control the US money".
Sure of their impunity, they have proudly explained the way we are all abused (the speaker makes a clear distinction between "humans" who invent fictional stories, and "the believers" which survival, as animals, depends on "United States" and "The World Bank"):
"We can cooperate with numerous strangers because we can invent fictional stories, spread them around, and convince millions of strangers to believe in them. [...] Money is probably the most successful fiction ever invented by humans. Not all people believe in God, or in human rights, or in the United States of America. But everybody believes in money. [...]
And as time passes, these fictional entities have become ever more powerful, so that today they are the most powerful forces in the world. The very survival of trees, rivers and animals now depends on the wishes and decisions of fictional entities such as the United States and the World Bank – entities that exist only in our own imagination."
– Yuval Noah Harari, lecturer in history at the Hebrew University of Jerusalem, "Why Humans Run The World" (June 16, 2015)
WEF Adviser Yuval Noah Hariri is also famous for: "The Planet No Longer Needs the 'Vast Majority' of the Population".
Today's fake "IA" (planned to cost $5T) is just yet another "fictional story" told by the proud storytellers to both increase their wealth and power at the expense of everyone else.
Economists call this deceptive practice "Pump & Dump". It is illicit because aimed at fraudulently breaking the academic "Equilibrium":
In 1636, the entirety of Dutch society went crazy over exotic tulips. As prices rose, people got swept up in a speculative fever, spending a year's salary on rare bulbs in hopes of reselling them for a profit. Mackay dubbed the phenomenon "The Tulipomania":
A golden bait hung temptingly out before the people, and one after the other, they rushed to the tulip-marts, like flies around a honey-pot. Nobles, citizens, farmers, mechanics, sea-men, footmen, maid-servants, even chimney-sweeps and old clothes-women, dabbled in tulips.
That's the purpose of the stock-exchange! But what is the purpose of fake AI?
On one hand, academic researchers explain that fake AI invents fictional stories and is therefore unable to do the most basic tasks reliably, and, on another hand, the Finance-owned newspapers tell us that IA will replace most of our jobs:
The more new labor-saving machines are invented, the greater is the pressure exercised by big industry on wages, which, as we have seen, sink to their minimum and therewith render the condition of the proletariat increasingly unbearable. The growing dissatisfaction of the proletariat thus joins with its rising power to prepare a proletarian social revolution.
This scam is centuries-old, so economists have had enough time to give it a name:
"Debasement" is the magic trick of replacing silver by dirty-paper, and have people enjoy the show, applaud and ask for more. Hence trading many times more "paper-gold" than available tangible gold reserves, or breaking the USD-gold parity in 1971. These "policies" have lowered the good-value of gold, and over-priced the bad-value of electronic-money (replacing dirty-paper, itself replacing silver, itself replacing gold).
The central bank is an institution of the most deadly hostility existing against the Principles and form of our Constitution. I am an Enemy to all banks discounting bills or notes for anything but Coin.
The only way out is to correlate Price to Value again (to avoid this ever-increasing artificially-created inflation)... and to get back the money-creation monopoly that was stolen from the State by private interests:
If the American people ever allow private banks to control the issue of their currency first by inflation then by deflation the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered. I believe that banking institutions are more dangerous to our liberties than standing armies. The [monetary] issuing power should be taken from the banks and restored to the people to whom it properly belongs.
History tells us of debt-free and interest-free money issued by governments. The American colonies did it in the 1700's and their wealth soon rivaled England and brought restrictions from Parliament, which led to the Revolutionary War. Abraham Lincoln did it in 1863 to help finance the Civil War. He was later assassinated by an agent of the Rothschild Bank. No debt-free or interest-free money has been issued in America since then.
Germany issued debt-free and interest-free money from 1935 and on, accounting for its startling rise from the depression to a world power in 5 years. Germany finance[d] its entire government and war operation from 1935 to 1945 without gold and without debt, and it took the whole Capitalist and Communist world to destroy the German power over Europe and bring Europe back under the heel of the bankers. Such history of money does not even appear in the textbooks of public (govemment) schools today.
By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some.