Thursday, October 20, 2011

Dr. Fekete, Please Help

Dr. Fekete

I am writing to you in order to bring to your attention the fact that you have at least one very confused disciple – but then I repeat myself.

Please contact Ingo Bischoff. He needs remedial coursework in your “school” of economic thought. While I find myself in disagreement with some concepts for which you are well known (for instance the fallacious monetary theories behind real bills), I often find myself in agreement with you on more traditional topics. It is to these that I refer here.

I quote from the above commentary:

“Many a gold bug has the wrong strategy. He buys high and sells low. He cannot kick the bad habit. He should buy low and sell high.”

In reading this statement (as well as the general tone of your commentary) it seems you are quite comfortable with the idea that gold has a price. Of course, I am also comfortable with this idea as well. I see the price quoted 24 hours a day in such places as, well…this site, for example.

Please sit down before reading the next statement: Mr. Bischoff believes gold has no price. Yes, I too am flabbergasted by his statement. However, approach him with caution on this, as he can turn verbally abusive when he finds he has no logical response to his beliefs of fantasy…but again, I repeat myself.

And to a second point from your commentary:

“At this point the Friedmanite bunk was announced by professors who were the beneficiaries of the purge of old-line economists at American universities that a "weak" currency is boon to the country. It makes exports cheap while making imports dear….to see the Friedmanite bunk in the true light of science we need only recall that devaluation always makes the terms of trade of any country deteriorate. The euphoria of exporting more will last only as long as the stockpiles of imported ingredients used by the exporting industry last. Ever after, the country will have to pay more for the imported ingredients and will also get less value for units of its exports…”

I, course, agree completely with your line of reasoning, and have written so before on this subject here at the pages of DB:

I have extracted my earlier comments here:

I will cite only one exchange from the DB thread:

BM: What good is it to an exporting firm to have a week currency, when most of the inputs to production (commodities) have global prices?

IB: What kind of ridiculous statement is that...??? How can you even try to deal with it...???

You can see, Dr. Fekete, that Mr. Bischoff considers your statements on this subject as ridiculous, as you are today saying nothing different than what I wrote several months ago.

Please help him before it is too late.

Kind regards



  1. I miss you, bm, over at the bell. Your insights are needed as much as ever.


  2. Gpond

    You are too kind. I have not completely stopped, but obviously greatly reduced my efforts at DB. The main issue being too much trolling by one favorite DB interviewee. It became tiresome. Plus, this particular troll has grown very personally abusive, completely ignored by DB. It is there site, so I say nothing there.

    However, when I see a subject of interest, I read it at the site. Sadly, there are almost none of the long-term feedbackers that I recall. Perhaps they have grown tired as well. No John Danforth, no Bill Ross, no Lila, no Leonardo. I could go on. It was once such a vibrant community.