Joel Bowman with today’s Note From the End of the World...
“A stupid man’s report on what a clever man says is never accurate, because he unconsciously translates what he hears into something he can understand.”
~ Bertrand Russell
We live in strange times, dear reader. Perhaps you’ve noticed?
Through the mist we peer in earnest, grasping at Truth’s elusive form. Approaching in calculated stealth, we feel our pulse quicken and our eyes widen, thrilled at the prospect of capture, of comprehension...
...only to realize we have apprehended a specter, a fantastic phantasmagoria, while into the impenetrable haze the key to enlightenment absconds...
More musing in a second. First, a warm welcome to all our new readers, many of whom joined us over the weekend. (Thanks, especially, to those who became paying members. Your support is greatly appreciated.)
If you’re just tuning in, we’ve been following along with what we’re calling “The Greatest Political Experiment of Our Time.”
And boy oh boy, it’s been a doozy!
The Road to Venezuela
From a nation on the brink of hyperinflation... mired in squalid, multi-generational socialist-Peronism... on the verge of complete collapse and well along the “road to Venezuela”...
We’ve witnessed, in just the first 100-days of the world’s first libertarian presidency, a truly remarkable turnaround. Inflation in Argentina fell from 25% month-over-month in January (the highest rate on the planet)... to ~20% in February... to 13.2% in March. And falling.
While still “horrendously high,” (as per the president’s own words), it takes a Herculean effort to turn the gigantic “ship of state” around...and an enormous amount of patience and good will on the part of the voting public, desperate for a change of course. (More on that, anon.)
And now, stores and restaurants – which literally couldn’t ticket items on menus and upon shelves a few months ago, with prices changing by the day – are suddenly awash with discount signs and 2x1 specials. We snapped the video above at the local Farmacity a few hours ago.
Here’s some less anecdotal data (the chart below denotes the weekly change in a basket of supermarket goods – food, household cleaning products, etc.)
“Greedy Capitalism”
Inflation expectations for the next 12 months, which were fast approaching the ~250% mark when Señor Javier Milei took office in December, are now down to an average estimate of 128%. (The median of economists polled was 100%.) And month after month, week after week, day after day, that number continues to fall, along with prices at the register.
But what caused such a drastic run-up in prices in the first place? Was it “free markets run wild?” How about “greedy capitalism"?” Or “corporate price gouging?”
Readers of these pages will be entirely unsurprised by the following list of unfortunates, compiled using data from central banks and the IMF.
Voluntarism > Violence
Hmm...
More money chasing less goods equals – ceteris paribus – higher prices. It’s simple enough for any non-Enron advisor to understand. (#SorryNotSorry, Paul Krugman...)
And yet, still central planners assure us that it is free markets that cannot function, that voluntary exchange leads to price distortions and subpar outcomes.
According to the witless bureaucrat brigade, with their immaculate calculations and grand pretense of knowledge, markets must never be allowed to discover a price... nor individuals be permitted to make a choice... nor must cows be excused a natural, midfield emission, lest the world combust in flames.
Ratherl, all things on this green earth must be properly ordered... by them, naturally.
Little wonder the “political caste” fears the power of the free market, of Friedrich Hayek’s “spontaneous order” and the observable superiority of cooperation over coercion, liberty over larceny, voluntarism over violence. As Hayek himself wrote in The Fatal Conceit (1988):
The main point of my argument is, then, that the conflict between, on one hand, advocates of the spontaneous extended human order created by a competitive market, and on the other hand those who demand a deliberate arrangement of human interaction by central authority based on collective command over available resources is due to a factual error by the latter about how knowledge of these resources is and can be generated and utilised.
~ Friedrich Hayek, The Fatal Conceit (1988)
Rock ‘n’ Roll!
As for the man behind Argentina’s remarkable turnaround (so far), whom the feckless seals in the mainstream media try to paint as a “dictator,” a figure of the “ultra far-right,” a “tyrannical autocrat”... what has he to say of having delivered the nation from the evils of Peronist policymaking, Keynesian economics and cultural Marxism?
Is he lording it over the hoi poloi from the champagne-soaked comfort of a private jet? Or perhaps he’s hobnobbing with celebritards on the deck of some gazillionaire’s yacht? Or lecturing the public about their gas stoves, plastic straws and carbon footprints?
Nah. He’d rather attend a rock ‘n’ roll concert with his girlfriend at a local Gran Rex theater down the road. After high-fiving members of the public on the way in, Sr. Milei took his seat among his fellow Argentines to enjoy the show (video taken last week, H/T @cristiancim)...
To which we can only say, “Rock on, Señor. Rock on!”
Stay tuned for more Notes From the End of the World...
Cheers,
Joel Bowman
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Deflation... at the End of the World?