In Australia, successive Governments since the 1970s have focused on Inflation as the main driver of monetary policy. Some of what I have been reading lately suggests that this is more about protecting established wealth than it is about protecting the general population. If this is the case then why are we stressing about inflation rather than GDP growth, which is a better indicator of how well most people are living?First, I want to refer to Capital in the 21st Century. The main tenet of this book is that Income Inequality has been traditionally high between the 10% “Upper” classes and the general population and that the level of inequality decreased between World War I and the 1970s. In that time the difference in total income between the Top 10% and the bottom 50% was smaller than the long term and this meant less inequality. One of the most important drivers for the decreased gap in income was that Inflation (not ignoring the effects of financial collapse on the Great Depression and destruction of public and private assets in the wars as major contributors or perhaps triggers) went from a fraction of a percent per annum to 10% or more. Inflation effectively eroded the value of inherited assets (property, shares and family businesses) relative to income from labour, which rose in line with inflation. The book covers the detail very well and my review covers the main points.Continue Reading →
Insightful. Challenging and not nearly enough
This is the fourth book I have read by Malcolm Gladwell. I read it in less than a day and it was genuinely hard to put down.
Sadly, I am not a big fan of the author’s style. I do like the core of his ideas but the writing style grates a lot. North America centric and what appears to be analysis that is overly rooted in middle class privilege. That is despite his subject matter looking at almost everything but that cohort of humanity. Or maybe not – I cannot decide and that is where my difficulties lie. The choices of example and how they are presented appear to me to be more like proselytising than an unbiased examination of facts. I find some of his arguments by example worrying.
I do like the subject matter and the footnotes a whole lot more.
The book makes a case for some counter-intuitive understanding of how and why the strong are beaten by the weak. The most important thing I got from the book is to make sure that any analysis of “weak” or “strong” is done from an independent standpoint and with a deep understanding of the circumstances that influence relative strength. The next best thing from the book was to understand that we have to work hard to understand ourselves if we want to get the best out of our lives. Something that should be obvious but is easy to forget when trying to live our daily lives.
Oddly, but at the same time quite common, this book refers to other books I have read recently. In this case Seven Pillars of Wisdom by TE Lawrence.