Economic Epicycles

(from 6/10)


The shift from national industrial economies to a global financial economy signals a shift (or an order-of-magnitude increase) into a "Ptolomaic epicycles" model of large-scale economic activity. The free-market model of the economy has become, with the shift from local price discovery focused markets rooted in the dual economic functions of allocating production and distribution activities on the primary or sole basis of "real" population needs to international speculative profit-oriented markets which tend consciously to ignore those base functions of economies in favor of pure profit, an effectively "religious" or "free market faith-based" model. The excessive complication of "financial product" creation, such as swaps and other derivatives, greatly resembles the construction of Ptolomaic epicycles to adjust the coherence of increasing astronomical observations to fit the heliocentric model of the astronomical world. Just as the heliocentric model which was maintained to conform to the then-current theology which held political dominance deteriorated further and further with each additional epicyclic adjustment, so the free-market model deteriorates further and further with each new consistency- and profitability-adjusted "financial product" invention.


What the global economy really needs is an economic Copernicus and Galileo to state and empirically confirm, respectively, a new model of economics. Perhaps one that cleanly merges the free-market assumption with a central regulation type of economy assumption. Or also with something like the system-theoretic regression-to-the-mean equalization balancing of most traditional economies.


[Types of economies:

Tradition

"Central" control

Free market]


Cf. Kapp and trading the carbon markets

<http://www.futuresmag.com/Issues/2010/June-2010/Pages/Kapp-and-trading-the-carbon-markets.aspx>


Cf. "Preparing for the new reality"

(FUTURES, June 2010)

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