Forget Piketty's 700-Page Tome - Here Is The Shortest Economics Textbook Ever

Tyler Durden's picture

Forget the 700-plus-page Piketty 'socialism for all' tome; here is economics that everyone can understand.

Click image for link to website

And here they are... the 5 things they don't tell you about economics...

1. 95% of economics is common sense

You don’t need a degree to understand it

 

We’ve got this profession wrong; a lot of professional economists think what they do is too difficult for ordinary people. You’d be surprised how often these people are stupid enough to say things, at least in private, like ‘you wouldn’t understand what I do even if I explained it to you’. If you cannot explain it to other people, you have the problem.

 

People express strong opinions on all sorts of things despite not having the appropriate expertise: climate change, gay marriage, the Iraq War, nuclear power stations. But when it comes to economic issues, many people are not even interested, not to speak of not having a strong opinion about them. When was the last time you had a debate on the future of the Euro, inequality in China or the American manufacturing industry, despite the fact that these issues can have a huge impact on your life, wherever you live?

 

2. Economics is not a science

Despite what the experts want you to believe, there is more than one way of ‘doing’ economics

 

People have been led to believe that, like physics or chemistry, economics is a ‘science’, in which there is only one correct answer to everything; thus non-experts should simply accept the ‘professional consensus’ and stop thinking about it.

 

Contrary to what most economists would have you believe, there isn’t just one kind of economics – Neoclassical economics. In fact there are no less than nine different kinds, or schools, as they are often known. And none of these schools can claim superiority over others and still less monopoly over truth.

 

I accept that being suddenly asked to taste nine different flavours of ice cream when you had thought that there was only one plain vanilla can be quite overwhelming. In order to help, I attach here a simple table that will help you overcome your initial fear.

 

3. Economics is politics

Economic arguments are often justification for what politicians want to do anyway

 

Economics is a political argument. It is not – and can never be – a science.

 

Behind every economic policy and corporate action that affect our lives – the minimum wage, outsourcing, social security, food safety, pensions and whatnot – lies some economic theory that either has inspired those actions or, more frequently, is providing justification of what those in power want to do anyway.

 

Only when we know that there are different economic theories will we be able to tell those in power that they are wrong to tell us that ‘there is no alternative’ (TINA), as Margaret Thatcher once infamously put it in defence of her controversial policies.

 

4. Never trust an economist

It is one thing not to foresee the financial crisis; it’s another not to have changed anything since

 

Most economists were caught completely by surprise by the 2008 global financial crisis. Not only that, they have not been able to come up with decent solutions to the ongoing aftermaths of that crisis.

 

Given all this, economics seems to suffer from a serious case of megalomania.

 

The financial crisis has been a brutal reminder that we cannot leave our economy to professional economists and other ‘technocrats’. We should all get involved in its management – as active economic citizens.

 

5. We have to reclaim economics for the people

It’s too important to be left to the experts alone

 

You should be willing to challenge professional economists (and, yes, that includes me). They do not have a monopoly over the truth, even when it comes to economic matters.

 

Like many other things in life – learning to ride a bicycle, learning a new language, or learning to use your new tablet computer – being an active economic citizen gets easier over time, once you overcome the initial difficulties and keep practicing it.

 

Unless you are willing and able to challenge the professionals, challenge the experts, what’s the point of having a democracy?

 

There is no excuse for complacency. If you organize and demand reforms then a lot of amazing things happen, but it won’t come easy – we have to fight for it.

And there it is - all you need to know when watching the talking head bloviation and justification day after day...

Source: Penguin Group (buy here)

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LawsofPhysics's picture

6.)  When Fraud is the status quo Possession is the law.

Skateboarder's picture

0) Business Schools are evil and MBAs are made out of ego-inflating-gayness concentrate.

AlaricBalth's picture

A mathematician, an accountant and an economist apply for the same job.

The interviewer calls in the mathematician and asks "What do two plus two equal?" The mathematician replies "Four." The interviewer asks "Four, exactly?" The mathematician looks at the interviewer incredulously and says "Yes, four, exactly."

Then the interviewer calls in the accountant and asks the same question "What do two plus two equal?" The accountant says "On average, four - give or take ten percent, but on average, four."

Then the interviewer calls in the economist and poses the same question "What do two plus two equal?" The economist gets up, locks the door, closes the shade, sits down next to the interviewer and says "What do you want it to equal?" 

gh0atrider's picture

Bitcoins are real money.  Sentimental dopes are angry at that simple fact.

bania's picture

where's The Forward by Krugman?

Anusocracy's picture

There are basically three competing economic systems: that of the foragers, that of the pharaohs, and that of the free market.

One steals too much, one thinks it can steal the right amount, and one rewards producers.

Marco's picture

A lot of the landed aristocracy, both old school (UK) and new school (South America) don't produce diddly ...

Anusocracy's picture

Government and its cronies don't have to produce anything of value, or even anything needed.

Not when they can take resources from their subjects and use that to force them to do their bidding.

Four chan's picture

( ) the reevaluation of all values is the worst thing that can happen to a person. at first.

macholatte's picture

 

Definition of EXPERT

 

X is a mathematical expression for an unknown

Spurt is a drip of water under pressure

Therefore, an Expert is an unknown drip under pressure

 

 

zerozulu's picture

One rule in my economics textbook,

 

 

1. never borrow money.

Stuck on Zero's picture

I understand that there are other versions of that book that cover: Social Science, Psychology, weather forecasting, investment analysis, and political science.

 

Badabing's picture

Understand this,

The S&P, don't let it fool you. it plays on greed, what it actually is, is toxic financials  selling out our children's future to change the true number of it's worth 666. Everything from that low has been a lie.

 

  Its the banks that pump and dump to feed like a parasite on the hard working back of of the productive man, and  cheat and change the rules on the fly to draw us in and take all for pennies on the dollar.

 

   The world is changing, we are more connected than ever, the spin is of little effect.

You see the smoke is clearing and the mirrors are cracked the inbred families have lost control because we are becoming aware of the sting.

 if you want to fight than fight with what they hate, for us to have gold the real money.

 

  The S&P, all time high, with all the mark to fantasy equity, don't let them fool you it's shit. 

Thats our economics

Manthong's picture

So tell me why Mr. Guillotine invented his famous product.

thisisjustarandomusernameicreatedforzerohedge's picture

saying most economics is common sense because of the premise of supply and demand is like saying most of physics is common sense because the observation of gravity

as a ex-economics graduate who won't touch it with a ten foot pike, i'm as cynical as anyone about it.... and we can agree and disagree about the theories all we want. but to devolve the mathematics behind most advanced microeconomics to common sense is a little disengenious. 

 

Bro of the Sorrowful Figure's picture

there's a caveat to that. i fully agree (after being a debt surf and then pulling myself completely out this year). one should never borrow money for personal consumption. however, if someone is borrowing money to create new capital goods, then debt is a useful and necessary tool.

WonderDawg's picture

If the return on investment is greater than the cost of the money, it is a logical and legitimate strategy, instrumental in many cases.

All Risk No Reward's picture

1. Renting money to society at interest is prima facie fraud.

2. Renting money to society at interest is prima facie fraud.

3. Renting money to society at interest is prima facie fraud.

4. Renting money to society at interest is prima facie fraud.

5. Renting money to society at interest is prima facie fraud.

6. Renting money to society at interest is prima facie fraud.

7. Renting money to society at interest is prima facie fraud.

8. Renting money to society at interest is prima facie fraud.

9. Renting money to society at interest is prima facie fraud.

10. Renting money to society at interest is prima facie fraud.

The very foundation of our economy is FRAUDULENT and all it takes is a rational mind and some 5th grade math to understand it.

The problem is that people have been programmed to irrationally believe that something is true because the "authority" (financed by the Banksters) says so.

Debt Money Tyranny
http://www.keepandshare.com/doc/4768883/debtmoneytyranny-6-1-pdf-60k?tr=77

If I lend you $20 @ 5% interest, in one year your owe me $21 due to the accrual of $1 interest expense on your end and $1 interest asset on my end.

In one year, you owe me $21, yet only possess $20 because I own and control the the $1 you need to pay me back.

Just like losses, Muppets, you can't make it up on volume.

A bailout is when I create $20 @ 5% interest and pocket the $20 proceeds in my corporate front pocket and send your Muppet *ss the bill for $21 even though no Muppets received any money - all while telling the Muppets I'm doing it for them.

If I didn't see this con going on all around me I would not have believed it.

The above is veritas...  read it repeatedly until you understand it - or embrace Muppetism into your the serfdom that awaits you and yours.

Shed the appeal to authority programmed biological android routine and engage free and independent thought - that is your destiny that has been hidden from you by special interests that profit from your cognitive blindness.

This message is not to those who can see, it is to those who think they see but don't understand what I've posted above...  your whole society is anchored on fraud.

Bro of the Sorrowful Figure's picture

debt based currency is the root of all evil

Kirk2NCC1701's picture

"Neither a Lender nor Borrower be"  - Shakespeare (Hamlet)

"If you lend money to one of my people among you who is needy, do not treat it like a business deal; charge no interest." - Exodus 22-25.  

http://biblehub.com/exodus/22-25.htm

The Old Testament "classes the usurer with the shedder of blood, the defiler of his neighbor's wife, the oppressor of the poor, the spoiler by violence, the violator of the pledge, the idolater, and pronounces the woe upon them, that they who commit these iniquities shall surely die." Id. at 2. The usurer was put in the same category with extortioners, Sabbath-breakers, those who vex the fatherless and widows, dishonor parents and accept bribes (Ezekiel 22). Id. at 17. The usurer was also classed with the liar, the unrighteous, the backbiter, the slanderer and perjurer, and denied the right to inherit the New Jerusalem (Psalm 15). Id. The usurer is further classed with the meanest and lowest of men and the vilest of criminals (Ezekiel 18). Id.

http://www.openbible.info/topics/usury

All Risk No Reward's picture

Everyone is society is forced to be a borrower because money is lent into existence, BY DEFINITION (the only exception being coinage, but that is trivial compared to the debt money).

YOU HAVE NO CHOICE TO BE IN DEBT - AND THAT'S THE FRAUD OF DEBT MONEY TYRANNY.

Debt Money Tyranny
http://www.keepandshare.com/doc/4768883/debtmoneytyranny-6-1-pdf-60k?tr=77

Debt is not a Choice
https://www.youtube.com/watch?v=juQc0rLdB-E

How to be a Crook
https://www.youtube.com/watch?v=2oHbwdNcHbc

Renaissance 2.0
https://www.youtube.com/watch?v=96c2wXcNA7A

Debunking Money
https://www.youtube.com/watch?v=7_yh4-Zi92Q

thisisjustarandomusernameicreatedforzerohedge's picture

first rule we learned in finance in university was to never use your money and always use other people's money to invest

1. always borrow money.

not disagreeing with you or anything; just a funny... or sad contrast.

New_Meat's picture

fred, you really don't care about "at first" nor has there been any human "care" in the later stages.

August's picture

I met a nice college-age kid in South America.  His dad was the European chief for the Carlyle Group.

He was being groomed to run Argentine and Uruguayan holding for his family. Nice kid who played guitar, very popular with the girls.

shovelhead's picture

Sure they do.

Their money produces more money.

This is what extra money is supposed to do.

Flakmeister's picture

Don't confuse "producers" with "exploiting labor arbitrage"....

flacon's picture

All those money-grubbing skilled workers are exploiting the corporations they are working for by DEMANDING and HOLDING HOSTAGE their employer with a MONEY RANSOME (also known as a pay cheque). 

Escrava Isaura's picture

Did any Hedgers ‘of you’ read Piketty’s book? Or even the reviews at Amazon?

Anyone?

My bet, by reading some of the comments, the vast majority of you have absolutely NO clue of what you’re talking about….

None!

And that’s a shame.

jez's picture

Yes, if you have nothing better to do. Know your enemy.

 

But only if you can steal a copy, or are given one.

UselessEater's picture

Know your enemy indeed.

Piketty's solution to crony-capitalism is a global wealth tax. Another IMF stooge painting a picture for global governance.

 

http://www.amazon.com/Capital-Twenty-First-Century-Thomas-Piketty/dp/067...

 

New_Meat's picture

know yourself

know your enemy

100 battles, you will never be in peril

but ya gotta' know

- Ned

{thanks to Sam}

economics9698's picture

Well when I read he didn’t know the top tax rate under Hoover I kind of put it under the header of useless propaganda.  If I want to read lying bullshit I can open one of my textbooks I teach from.

PT's picture

As the masses progressed from superstition to science, it was natural that they abandon religion and try and find a scientific equivalent.

From "Love God with all your heart, soul, mind, and strength, and love your neighbour as you love yourself"

To "Economics.  The science seeking to find the best way to distribute limited resources amongst unlimited wants and needs".

But as the former was corrupted and became, "Money is evil so you should give it all to me",  what made anyone think that the latter could escape unscathed?  With the former, you risk the wrath of the eternal God.  With the latter?
???
???
... The richest economists preach what the richest people pay them to preach.  The richest "Economics Schools" preach whatever the richest pay them to preach.  Alternative views struggle to survive unfunded.  The seeds of the downfall is well documented in their own doctrine!

Short answer?  Economics = Propaganda.

While Economics and Economists may start out with the noblest of intentions, their own doctrine suggests that those intentions will not last too long.

"I am King therefore I must be right because otherwise God would not allow me to be King"
vs
"I am rich therefore I must be right because otherwise the markets would not allow me to be rich!"

Or, as someone else put it:
http://www.nakedcapitalism.com/2011/04/blacklisted-economics-professor-found-dead-nc-publishes-his-last-letter.html

rubiconsolutions's picture

"My bet, by reading some of the comments, the vast majority of you have absolutely NO clue of what you’re talking about…"

I don't have to eat a turd sandwich to know it tastes like shit. And yes, I read the reviews and decided to not waste my money. 

brucyy's picture

What is a shame ? 

That we can't all sing together about the virtues of militarized hypertaxation for everyone except himself and his elite circle ?   

Do you know how close this guy is from the french socialist party , what a mess this country is in by following just a few of his ideas ?

how screwed you are if you take all he said at face value ?

Confirmation bias is a beautiful thing. So much possibilities . 

4 wheel drift's picture

NO clue of what you’re talking about….

None!

And that’s a shame.

 

-lol

 

all i need to know is that there is an implicit agreement between politicians (aka liars and thieves) and eko-no-mist (the equivalent of the voodoo priest of tribal times), iow the tool of the liars to fool the populi....  as times advanced, they saw the need to complicate simple common sense stuff measuring idiocies and injecting unintelligible gibberish, calling themselves "scientist" in the process....

the real shame is that the populi is so dumb that they never question the "wisdom" of all these shitheads all they are interested as members of the free shit army is how much shit the next liar in chief will wield out ....   of course hidden under a holy shroud of more gibberish by said "scientists"

 

FTS

deflator's picture

 There are basically three competing economic systems: that of the foragers, that of the pharaohs, and that of the free market.

One steals too much, one thinks it can steal the right amount, and one rewards producers.

 

The article just flew right over your head...

you obviously can only comprehend "free markets". Zero comprehension of fiat and why it has followers. Why promote the idea of free markets in a fiat world when it only suits the powers that be? 

If we were in a sound money world, what you have to say would be every bit as irrelevant because everyone would already know what you are trying to say.

Anusocracy's picture

Why would they know?

You don't.

deflator's picture

 People such as yourself understand sound money andfree markets most everyone else does not. whos realityis relevant? ours or theirs?

 

 When the New Deal was passed most Americans(even the poorest of dirt farmers) knew it was a power grab by the government(not socialism).Afterwards, they voted for Conservatives(Rothbard and Mises type conservatives) for the next 30 years--did that stop the new deal? Politicians were all for the new deal because it allowed the government to grow beyond what it otherwise would have been able.Our government wasn't nearly as big as it is now because it was limited by the fact that it could not go full retard. Gold reserves were checks and balances. It only became the most beloved government program after the checks started rolling in...

and then Nixon closed the Gold window at the Federal Reserve where FRN's could be exchanged for Gold at $38 the ounce. The rest is history bitchez.

Anusocracy's picture

Okay, thanks for elaborating.

I support the participation or non-participation in governance as only an individual's choice.

deflator's picture

me too but said choice is meaningless to the governing collective.(federal,state,county,city, financial, real estate, insurance, education and all encompasing homeland security) government.

Henry Chinaski's picture

I found the problem.  TPTB saw this list and thought it said 1.95% of economics is common sense.

MsCreant's picture

Fonestar, BitBot. How goes it?