Why Hasn't Inflation Reared Its Ugly Head In The U.S. Economy? The Answer Is: Technology!

Many economists and financial speculators were surprised when the U.S. economy didn't experience significant inflation following the inflow of "money" generated by the U.S. financial system and other world banks following the economic problems in the years 2007 and 2008.

As we experience another year during which the U.S. Federal Reserve system used its fiscal powers to increase the flow of money in the economy, analysts again are concerned about the specter of inflation.

We are right to be concerned about the risk of inflation, but I don't think we need to be concerned about inflation as much as we were in the 1970's and 1980's for one simple reason.  That reason is that our technology is keeping inflation from happening.  And by "technology" I mean the information, knowledge, and automation of accounting processes we enjoy as part of the computer and information ages.

Inflation occurs when demand for a product exceeds supply.  This rarely happens anymore because businesses are so good at forecasting demand.  Businesses strive fervently to produce enough product to meet demand but also to avoid overproducing and causing excess inventory of product they can't sell.  Therefore they have invested heavily in computer systems connected to the Internet to provide good models based on forecasts of the exact demand for product expected in different areas of the world based on hundreds of factors.

How can Amazon deliver those protein bars you ordered in the morning to your home within hours?  It is because they have forecast that there will be a certain about of demand for those protein bars in your geographic area and have provided just enough supply of those protein bars at their local warehouse to meet that demand.  They are not tracking what specific people want; they are tracking the statistical averages.  They also know how to factor in the impact of weather, festivals, sporting events, and concerts into the impact on demand in specific areas and stock their warehouses accordingly.

Amazon does this really well, but Walmart does also; as do thousands of other businesses.  This means that inadequate supply is not as likely as before the computer age.  It is only when the raw material is in short supply that we are our economy will be unable to meet current demand; such as when the packing plants shut down and we can't get beef to supermarkets; that we have cases where supply fails to meet demand.  And these cases are temporary.  People don't fear that they will go on for years.

Due to better access to information and our ability to forecast future demand, we are much more likely to meet demand in the future and thus less likely to face situations where supply systemically fails to keep up with demand causing long periods of inflation.

Are Improvements to Productivity Always Good? The Case Against It, and a Lesson for Company Culture

When I was a young adult I often pondered what activities I, or any person, could engage in that were clearly and objectively good.  I asked myself what I should do with my life?  How should I live?  How could I know if my actions were good for the world in which I lived?  I reached one conclusion.  I concluded that if my actions increased the productivity of myself and others, then my actions must be good.  If I built a bridge that shortened the time required for people to complete the chores in their lives, or if I created a website that helped people find information more quickly, or if I wrote a software application that enabled people to more quickly and accurately complete chores, then I was doing good.  Anything that improved productivity, especially if it improved the productivity of others and continued to do so when I was not around, was inherently good.

For myself, as a software developer, I saw the code I was writing as helping to improve the productivity of others.  I undertook many projects on my own with that singular goal in mind.  I still do today.  I also volunteered much of my time helping others and helping them become more productive.

But my philosophy, my conclusion about productivity, changed over the years.  I no longer believe that improving the productivity of others is always inherently good.  Usually it is, but there are times when it is not.  Some examples from history include the workers in plants building weapons for the Nazi Germans.  Some workers intentionally made their products defective and slowed down processes because they wanted those they worked for, the Nazis, to fail.  I can similarly imagine that there may be people in North Korea today that are not motivated to improve the productivity and hence the success of the regime they live within.

Closer to home, I find it very reasonable to believe that many workers are not willing to improve the productivity of work at their companies.  In the western world, I doubt that many workers currently seek to sabotage the productivity of the companies they work for, but there are many that are not motivated to recommend productivity improvements or to work to make their coworkers more productive. 

This is a cultural problem for many companies.  An accountant at a company may see a potential to save millions of dollars by making some accounting changes, but if the accountant knows the cost savings are going to simply go to the pockets of the millionaire owners of the company, the accountant is not motivated to make the company aware of the option.  Software developers may have little interest in improving their software development processes to improve quality and reduce cost when the sole beneficiaries of these improvements are the wealthy owners of the corporation.  And I must say I support that deduction.  As a laborer, I don't want to see my extra efforts solely benefit those who already profit more than I do from my work.

Personally, I try to avoid working for companies solely focused on increasing profits.  I prefer to work for companies that will use the productivity improvements I identify and create to reduce costs for customers and increase salaries of myself and other employees.  A lot of companies exist that follow each philosophy, but I believe companies that focus more on sharing the wealth of the company with the employees and customers do better than those that give the rewards of productivity improvements to the business owners because the culture of those companies rewards the employees for increasing their productivity.

In conclusion, improving productivity is not a desirable good when you are working for the bad guys.

Thank You Vice-President Mike Pence @Mike_Pence for Displaying Real Leadership During the Dark Hours of January 6th, 2021

 

1) Your statement to the country about your Electoral College duties: https://www.cnn.com/2021/01/06/politics/pence-trump-electoral-college-letter/index.html

2) Your leadership in action to call the National Guard to assist with crowd control:  https://www.cnn.com/2021/01/06/politics/pence-national-guard/index.html

3) Your speech when resuming the count of the Electoral College votes:  https://www.cnn.com/videos/politics/2021/01/07/mike-pence-capitol-riot-violence-reaction-senate-full-speech-vpx.senate-tv

Our distractions leave us no time to think

Reflection is the best tool we have to learn about ourselves.  To understand our own behaviors and actions.  Few take the time to do this.  Few know how to do this.  Few can avoid the barrage of distractions clamoring for our attention:  the need to check facebook, instagram, tiktok, emails, instant messages, the visual distractions within the room reminding us of chores to be done or games to play or television programs to watch or books to read, the auditory distractions of family, friends, and pets.

Find a way to do this.  Make a plan to isolate yourself for 30 minutes one day.  No devices, no sound, no music, no family or friends, no TV, no computers, no phones.  Just time with yourself.  Discover yourself.  You are very interesting to you!

The truth is so brilliant that we must not come upon it all at once, lest we be blinded by it.

Instead, it's radiance must be revealed to us around the corner, giving our visual senses time to adjust, and our minds time to prepare and be opened to the truths radiance.

Humans Have Not Created "Artificial Intelligence", We Have Created "Illusory Intelligence".

I suggest we use the phrase "Illusory Intelligence" in place of  "Artificial Intelligence" for the software we have thus far created to emulate the decision-making ability of humans.

Our current neural networks do not reflect upon their own thoughts.  They are not conscious.  They do not comprehend the context nor meaning of their decisions in relation to the values, impulses, drives, and motivations of beings in our universe.  They are simply mathematical calculating machines.

We can describe everything about chocolate ice cream using physics and chemistry, and thus mathematics.  But if a being has never experienced the pleasure of tasting and consuming chocolate ice cream, don't you think they are lacking some understanding of the truth?

Our neural networks are useful tools and they should be distinguished from systems based on rules and simple algorithms to produce results.  That is why I recommend "Illusory Intelligence", because they software gives us the illusion that there is an intelligence making accurate decisions.

Why do we grieve the loss of some more than others? Why do we cry more for the death of a cat than a cousin?

We should not feel shame when our level of grief does not conform to what seems logical.  Grief is an emotion that needs expression and release, not introspection.  Just as our bodies ask us to relieve the pressure on our bladders when needed; so too do our bodies ask us to unleash the grief when the balloons of emotion are ready to burst.  Once the first waves of grief have passed, your mind will be less imbalanced by the grief, and better able to ponder the depths of your emotions.

Like our bodies, our minds are not as adept at doing something new when we first experience it.  We do not automatically know how to ride a bike, or catch a ball; but the more we do these activities the better we can manage them.  The same is true with emotions such as love and grief.  For many love is not experienced until our teenage years or decades later.  Likewise, for some, grief may not be experienced for decades into adulthood.  But for most, a time, a first time, will come to experience grief; and the first time experiencing grief may weigh more heavily upon us because the emotions are new to us.  We are not used to the feelings and the physical affects upon our bodies, of the grief; and this inexperience may exacerbate the feelings of grief and confusion.  As we experience grief more frequently we may become more hardened to it; and we may subconsciously control and reduce the impact of the grief upon ourselves.

The list of things that affect the level of grief you feel at the loss of a family member, friend, pet, or stranger include:

• Your personal experience and history with grief.
• The age at which you first experienced grief.
• Your proximity to the deceased and your role in their death.  If you were the one that had to decide to order the euthanasia, grief may be more intense.
• Your relationship to the deceased and your sense of closure.  If you failed to share meaningful feelings with the deceased, or if your last words to the other had been spoken in anger. 
• The manner of their death.  If they met a violent or unexpected end, your level of grief for them may be affected.
• The amount of time you spent with the deceased, whether human or not.  The loss of the cat that is part of your everyday life may evoke more grief than the loss of the uncle you saw just once a year.  This is normal.
• The presence of others that share your grief.  Grieving alone may feel different than grieving with others.
• The physical state of your mind and body.  The amount of alcohol or drugs recently consumed and your general mood prior to the loss such as already feeling depressed or euphoric.  Depression and drugs often make feelings of grief more intense.
• Your sense of control over your life and belief in karma.  For some, grief is humiliating and they twist the emotion into anger, often blaming fate or others for causing the death.  Turning grief into anger is never beneficial in a peaceful society; but it may be useful in a society at war.

Don't question your grief, just let it flow.  Don't let it turn to anger.  Don't take hasty action during the initial moments of grief.  We make better decisions:

• once we have expressed our griefs,
• after we have performed physical exercise,
• after we have spent time in silence outdoors,
• and while the sun is shining.