Because human beings know things that are physical and know things that
are spiritual both are seen as realities. Interestingly, as the lower aspirations
– which tend to be physical needs – are fulfilled higher aspirations are
sought. The higher aspirations like love, loyalty, and friendship are not
physical things; nevertheless they are the realities, the realities of human
beings who are in a state of higher aspirations.
Methodological dualism defines the seemingly insurmountable bridge
between “the external world of physical, chemical and physiological phenomena
and the internal world of thought, feeling, valuation and purposeful action.” [Mises in Human Action, Fourth Revised Edition (San Francisco: Fox
& Wilkes, 1996), p. 18]
The cusp of social sciences is always near this enigma. The exploration of the
human mind is the task at hand and it will be a task of primary importance for
the foreseeable future.
Consider one evident manifestation of dualism: the act of rational
self-interest that ultimately leads to the well-being of all. This is the very essence
of the divine economy! As you can see the divine economy must be profound
indeed!
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Monday, October 28, 2013
Tuesday, October 22, 2013
Profit Motive - Agent Of Continuous Economic Progress.
In the unhampered free market we have individuals,
demand and supply, prices, production, and profit and loss all working
beautifully to allocate limited resources to meet the unlimited wants as best
as possible. Ultimately then, it is the profit motive of the profit seeker that
acts upon the market process, stimulating production to increasingly meet the
needs of the consumer. Therefore it can be said that the profit motive serves
as an agent of continuous economic progress.
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Monday, October 21, 2013
The Fantasies Of Empirical Economists Are Destructive.
Those who are
removed from the market and who are out of touch with how production needs to
change to meet the demand cannot contribute anything. These are the empirical
economists! They assume away the essential characteristics of how demand really
operates in the market – that it is intimately tied to subjective valuation.
That erroneous fantasy is the starting point of their arbitrary and destructive
economic intervention.
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Twitter @DivineEconomy
Check out my new website: http://bruce-koerber.squarespace.com
Thursday, October 17, 2013
Why Tolerate The Destruction of Profit - The Prime Generator Of Income?
Since profit is the prime generator of other
incomes the destructiveness of monetary economic intervention on interest
rates and on both entrepreneurial profit and the purchasing power component of
profit have repercussions and reverberations throughout the economy.
Other types of economic intervention (e.g. regulations) also constrain prices or production causing either shortages or surpluses that cannot be remedied by the natural market processes because of the coercive characteristics of the intervention. This is what happens in the unnatural condition of a hampered economy because it is being subjected to this type of political corruption of the economy.
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Other types of economic intervention (e.g. regulations) also constrain prices or production causing either shortages or surpluses that cannot be remedied by the natural market processes because of the coercive characteristics of the intervention. This is what happens in the unnatural condition of a hampered economy because it is being subjected to this type of political corruption of the economy.
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Monday, October 14, 2013
Know The Three Profit Components.
Profit has
three components. The pure interest component is shared alike by production for
profit and by other investments earning interest. What is expected for
sacrificing present consumption for future consumption is the pure interest
component. It is an expression of the natural time preference. No action would
be taken if this pure interest component is not present.
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The second
component is entrepreneurial profit which comes about because the future is
unknown. Ex ante estimates for production and price are guesses with a certain
amount of entrepreneurial profit potential. Astute entrepreneurial perception
may lead to a lessening of the risks taken despite the uncertainty faced.
Alertness then to the market reaction – ex post – is mostly where the
entrepreneurial profit component is captured. For instance if excess demand is
discovered early in the selling period a raising of the price would lead to
increased profits making the entrepreneurial component of the profits larger.
Of course also, a lack of entrepreneurial perception could lead to losses.
The third
profit component is the purchasing power spread. This element is mostly seen
nowadays as a phenomenon of monetary intervention which causes the purchasing
power of the currency to decrease due to inflating the money supply. A profit
margin has to be built into the ex ante price because it takes time before the
product reaches the market. Ex post the purchasing power will have declined when
there is inflation making real profits significantly less than nominal profits.
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Sunday, October 06, 2013
Production Is Always A Prime Candidate For Investment.
Why take the
risk? The margin between the selling price and the per unit cost of a product,
the price spread, is enticing as long as it is equal to or greater than other
opportunities, such as earnings from investing in financial assets instead of
production. Since production is the most basic of all endeavors it is always a
prime candidate for investment. Potentially, profits emerge from production.
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