Ep. 209 Bob Murphy Critiques Curtis Yarvin’s Explanation of Inflation
In a May 2021 essay, Curtis Yarvin (aka Mencius Moldbug) argues that the American economy runs on an inflation machine. Yarvin claims that the best way to measure the amount of inflation is to look at the change in aggregate personal net worth over a given period. Murphy explains why this is wrongheaded.
Mentioned in the Episode and Other Links of Interest:
- Curtis Yarvin (aka Mencius Moldbug)’s essay on The Inflation Economy.
- Eric Weinstein tells Lex Fridman his wariness.
- Help support the Bob Murphy Show.
The audio production for this episode was provided by Podsworth Media.
About the author, Robert
Christian and economist, Chief Economist at infineo, and Senior Fellow with the Mises Institute.
First I heard of the phrase “The Cathedral” was this essay (famous but oldish) which came out of the free software community. It’s about freedom, software and economics, but unfortunately there’s a lot of highly specific details about software projects that you need to understand in order to make sense of it.
http://www.catb.org/~esr/writings/cathedral-bazaar/cathedral-bazaar/
I suspect the recent usage might be something of a derivative from that, and perhaps a bit of creative misinterpretation. The rough idea being that “The Cathedral” is representative of a top down hierarchical design and implementation process (i.e. central planning), which gets very cumbersome as complexity levels increase. In contrast “The Bazaar” is more of a bottom up, self organizing process where small teams assemble whatever little bits and pieces are needed at the time and then exchange them with each other. Although Eric Raymond was talking specifically about software design, the same concept works for a lot of other high-tech activity where the effort is dominated by pushing against complexity boundaries. It does not work for simple linear projects like humans digging holes with shovels where that activity is dominated by logistics and mass mobilization.
The author is indeed a Libertarian, and something of an anarchist … he might even be in the Libertarian Party if you can get hold of him for an interview could be good, I haven’t heard much liberty talk from him in a long time but his blog has been active with programmer stuff. There’s lots of essays on his site, you might find some of them interesting.
That fish they serve in Japan is called “Fugu”, made from a puffer fish that contains a paralysis poison … surprisingly some of the victims appear dead for several days and then wake up again. Others never do wake up, it’s almost spooky.
I dunno, when you get to comparing the 2 communities both w/ 1M gold coins, I think your kinda forgetting the Nominal vs Normalized accounting.
If your currency has value based on what proportion of the total amount of currency you have, then there is a limit on the total value in a community, measured in that currency.
That’s why if you doubled the number of gold coins in everyone’s pockets, everything would be worth 2x as much in gold coins i.e. the total value of the assets of the community inc. gold coins would also double.
So long a gold coin in these communities is just a medium of exchange you cannot have the value (in gold coins) of all the assets sans coins be 100x the total number of gold coins.
If you count the value of the assets+coins it should only be ~200% the number of gold coins.
Imagine 2 communities with the same amount of wealth, Left hand side community uses a fixed 1M gold coins as medium of exchange, right hand side community uses a fixed 1M silver coins as medium of exchange. I would find it a bit spooky of the total value of all the assets of left community was worth ~100M gold coins, and all the assets of right community was ~2M silver coins. Something is w/ the gold coins as a medium of exchange and gold coin holders are worse off than silver coin holders. i.e. they can buy less stuff for the same number of coins.