The Speed of Money
The economy and its financial implosion thereof dominates the news and as with every self fulfilling prophesy, each news report just seems to fuel the flames to torch some more. What better way to put out a fire than to throw money at it? To be realistic, my humble small company and humanly wandering perspective does not adequately position me into a position of experience and credibility to tackle the complexities of the spiral I hear so much about. That said, I have done some pondering about the matter and what I came up with is this:
Imagine three humans, one who cuts lumber, one who builds things and one who grows food. And lets say the food grower has $100. He hires the builder to build him a shed, and the builder buys lumber who in turn buys food who in turn builds a barn and round and round the $100 goes from hand to hand. In fact, in theory, that single $100 could go around so many times that at the end of the year, each human shows that they made $500 a week, $26,000 per human totaling an annual combined income for the three humans of $78,000, from a single $100 bill.
It is not the amount of money that matters, rather it is the speed at which money travels that determines how much each person makes acquires and has. By years end, they all could have more of everything than they know what to do with.
Now lets add in taxes and put a big tax on every transaction and within a fairly short period of time that $100 will dwindle to near nothing. Spending with caution becomes imperative and the three humans will live impoverished unless they switch to an illegal barter system to circumvent the taxes.
Now lets add in deception wherein value is falsely represented. The farmer sells inedible food, the builder never builds on time and the lumber is rotted or perhaps the $100 bill is fake or worth only a fraction. Regardless of the deception, the fundamental is that the product or service is misrepresented and worth less than the amount it is sold for and therefore does not perform as expected. Deception has a similar effect as taxes but is perhaps time delayed. The ripple effect of the faulty construction of the shed allows the crop seeds to be eaten by critters impacting the next harvest and so on.
Taxes and deception both have the impact of adding friction to the flow of money and slowing it down. So from this simple perspective, the key to economic management is to keep money flowing at a reasonable pace. Too fast and things grow out of control, too slow and things grind to a halt.
Hence this is where we find ourselves now. Houses falsely represented in value, perhaps due to the excessive speed of money leading up to the collapse or perhaps due to deceptive loans extended to people lacking the financial position to repay. Regardless, there is no less money here on this planet today than last year, it is the velocity that money travels from one hand to the next that has changed. The speed of money has significantly slowed.
So how does on fix a financial engine bogging down with so much friction? Well, there seem to be two trains of thought:
1) Step on the gas and dump more fuel into the system, as in 'huge influx of cash' to overpower the friction
2) Take our foot off the brakes to reduce friction by holding those responsible for misrepresentation accountable while lowering taxation.
What do I think is the best way to get the economy back up to speed? Well, I think a focus on reducing payroll and sales taxes would be the first thing I would do. Clean, simple and immediate. No sales tax, nationwide and cut all payroll withholdings in half for both personal and businesses, effective immediately. This temporary nitro boost to the economy means more money in the pockets and/or everything just got cheaper, depending on where you live. Instantly and easily reducing the friction to the financial system in a way that is controllable. Then, as this money gets spent or saved and things ramp up, just scale the sales taxes and payroll taxes back up. Sure the governments and states take a financial hit in the short term but when the money flows again, it will all be made back up.
Oh, and as far as the huge cash dump into the banks that screwed us? Take that $ and loan it to the states and to cover budget shortfalls from the reduce tax income. At least that way the fed will be able to get paid back at some point.
Anyway, I have been rocking the old records at home and the first Run-DMC album has been making me smile with the old school beats. I find it particularly interesting that this 1984 song so perfectly seems to describe today as well.
And while on the topic of the gov, may as well add your # to the do nat call registryhttps://www.donotcall.gov/
While continuing the financial fun, take a peek at one of the coolest and funniest album marketing strategies I have ever heard of from the super cool guy and awesome drummer, Josh Freese and his new album 'Since 1972'. He is offering some pretty fun deals if you have some extra cash
$7
* Digital download of Since 1972, including 3 videos
$15
* CD/DVD double-disc set
* Digital download
$50
* CD/DVD double-disc set
* T-shirt
* “Thank you†phone call from Josh for buying Since 1972. You can tell him what you like about the record that you purchased, or what you thought sucked. Ask whatever you want, like “Is Maynard really THAT weird?†or “Which one of Sting’s mansions has the comfiest beds?†or “Are Devo really suburban robots that monitor reality or just a bunch of dads from Ohio?†or “Why don’t the Vandals play more stuff off the first record?†It’s your 5 minutes to yack it up. Talk about whatever you want.
$250 (limited edition of 25)
* Signed CD/DVD and digital download
* T-shirt
* Signed drum head and drumsticks
* Go on a lunch date with Josh to PF Changs or The Cheesecake Factory (whatever you’re into)
$500 (limited edition of 15)
* Signed CD/DVD and digital download
* T-shirt
* Signed cymbal and sticks
* Meet Josh in Venice, Calif., and go floating together in a sensory-deprivation tank (to be filmed and posted on YouTube)
* Dinner at Sizzler (get your $8.99 steak and “all you can eat†shrimp on)
$1,000 (limited edition of 10)
* Signed CD/DVD and digital download
* T-shirt
* Signed cymbal, drum head and drumsticks
* Josh washes your car OR does your laundry … or you can wash his car
* Have dinner with Josh aboard the Queen Mary in Long Beach, Calif.
* Get drunk and cut each other’s hair in the parking lot of the Long Beach courthouse (filmed and posted on YouTube, of course)
$2,500 (limited edition of 5)
* Signed CD/DVD and digital download
* Get a private drum lesson with Josh, or for all you non-drummers, have him give you a back and foot massage (couples welcome)
* Pick any 1 member of the Vandals or Devo (subject to availability) to accompany you and Josh to either the Hollywood Wax Museum or the lunch buffet at the Spearmint Rhino
* Signed DW snare drum
* Take 3 items of your choice out of his closet (first come, first serve)
* Change diapers and make bottles with him for an afternoon (after hitting the strip club)
$5,000 (limited edition of 3)
* Signed CD/DVD and digital download
* T-shirt
* Josh writes a song about you and makes it available on iTunes
* Co-direct a video with him for the song about you and throw it up on the YouTubes
* Josh gives you and a friend a private tour of Disneyland
* Get drunk together. If you don’t drink, we can go to my dad’s place and hang out under the “Tuba treeâ€
* Stone Gossard from Pearl Jam will send you a letter telling you about his favorite song on Since 1972
And to see the rest of them, check out:
http://soundcheck.freedomblogging.com/2009/02/20/want-josh-freese-to-join-your-band-got-75000/4962/
And a tidbit about out rat brethren from other parts of the world:
 **** Sound Nerd Speak ****
Okey dokey, here is a bit more on the L'Acoustics K-1 rig:
New fly bars that are the same dimensions as the boxes. Those beams on top rotate 90 degrees pin into the bars and offer plenty of leverage for up and down tilt.
Ohh, the sexy delta plate for side to side focus of the arrays
Nifty rigging allows you to pin your angles before you lift the box and click click click, the boxes open up and grab the proper positions as you lift with rigid locked angles. Say bye bye to tension straps.
Four channels of 1800 watts in two rack spaces fully processed, this little lightweight amp powers two K-1, 4 K-1SB, 4 SB28's or any other L'Acoustics gear you may have laying around.
So we had a gathering of Rat's and friends for the first K-1 training seminar ever. And well, we may as well get some surfing in. That would be myself, Manny, Tony Luna, Ronnie Kimball, and Brian Rat
Ok, and off I go to try and figure out the rest of the world.
DR
