Friday, November 22, 2013

Consumption Tax

Tax consumption rather than tax paycheck

Cut government spending rather than increase tax

Enhance economic growth rather than cut spending

Enhance people's happiness rather than economic growth

Raise the next generations rather than people's happiness

Raise the tax to raise the next generations

A politician thinks of the next election. A statesman, of the next generation.
James Freeman Clarke

Tuesday, November 19, 2013

Vending Machine

Almost Five years have passed since I started teaching at tech schools and college. 

I have realized that I should be a vending machine: it always provides people with good and new products and if the contract expires, it finds new buyers. 

Everyone should be my buyer with new competitors behind me. Vending machine is necessary for us, and I should always be like it.

I have never been a good vending machine for students since ever. It is difficult for me to become a good vending machine. 

Monday, November 18, 2013

On Modern Capitalism

My coworker says, 

"Seeing students looking for a job in black suit and simple tie, they look like they are going to be in slavery..." 

I feel like agreeing with him. To build the modern capitalist society, it is necessary for people to  prefer working for company or some other organization. 

Behaving independently should be fine in the society as described in economic theory, but many people are not so clever, rational and strong that they can perform well independently. That's why we need company or some other types of organization to organize and coordinate ourselves. (And that's the very work of a great economic theorist, Ronald Coase.)

So we can say that modern capitalist society needs slavers working for company to make the society capitalistic, and if it is true, then I would say that I agree with anti-capitalists' idea when I disagree with slavery anyway.  

Saturday, November 16, 2013





Friday, November 15, 2013

Exams for Government

I have class to teach economics for the entrance exam for government. 

Here in Japan to get a job of the government, we should take an exam of economics and law. 

I (and everyone for sure) hate exams and it looks weird for me to teach how to get a good score. 

It may be a surprise for you that every Japanese government employee has learned economics when you see the recent performance of the Japanese economy. (Well, recent Japanese economy looks good after the chairman of BOJ changed.)

It may be a good proof that Japan has been a socialist country where the government control and command is highly influential....

Tuesday, November 12, 2013






Monday, November 11, 2013

Living under the Uncertainty

Recently I have learned the necessity to tell risk from uncertainty:

Risk is what can happen with some probability that can be known for sure, while uncertainty is what can happen with some probability that cannot be known for sure: Risk is known unknowns, while uncertainty unknown unknowns. Technically, Risk is unknowns with known cumulative distribution functions (CDFs), while (Knightian) uncertainty is unknowns without known CDFs.   

We are now and always in the world of uncertainty where we cannot see what will happen soon.

It is a sad thing to know what will happen in the future, but it is a happy thing not to be informed of what will happen to us.

What we know for sure about uncertainty is that we cannot know only that a good thing will happen, but also that a bad thing will happen. 

We are said to have a biased view on uncertainty: we are always worried that a bad thing or the worst thing will happen to us, while forgetting the likelihood that a good thing or the best thing will happen. 

We are more likely to avoid unknown unknowns. We may change the attitude toward uncertainty to make our life better and better, and need to learn about how to deal well with unknown unknowns.

Sunday, November 10, 2013

A True Role of Fortunetellers

Whether you may agree or not, I think that fortunetellers are almost always right: They say a right thing about you and your uncertain future. 

The reason is simple: fortunetellers are well familiar with the people coming up to ask themselves. They are generally worried about their own future, their career, lifelong partners and business and so on. Otherwise, they won't come up to ask fortunetellers.

What's more, those who ask fortunetellers may be seeking the very similar answers or hints. They are not seeking a bad thing about their life, rather a good thing.

I've heard some medical researches report that fortunetellers are playing a role just like mental counselors: By listening to and saying a good thing about the people, fortunetellers can heal them. 

Last night, after drinking a little, I dropped by a fortuneteller sitting in the chair along the street and asked her about my near future. 

I don't believe such a superstition, and after listening to her I decided never to ask her again. No, she didn't say a bad thing about me, but rather she told that my future would be fine and better. Then I realized that true success will never comes just if I wait for it to come. 

I say to myself, I should make a decision by thinking myself and take the responsibility if I want to make my future brighter and brighter.

Saturday, November 09, 2013



産経新聞 11月9日(土)12時20分配信
 神奈川県警捜査3課などは8日、住宅に忍び込んで現金を盗んだとして、住居侵入と窃盗の疑いで、川崎市多摩区の無職、城戸隆志容疑者(47)=同容疑で 逮捕=を再逮捕した。城戸容疑者は窃盗を繰り返しながら家族を養っており、「生活費や遊興費、マンションのローンなどに使った。約20年間、泥棒で生活し てきた」と容疑を認めているという。



20年も泥棒してたら、 立派な職業だ。

Friday, November 08, 2013

It Can't be Helped Now....

I don't think that the US was wrong in bombing atomic bombs. 

It should have been a right decision that the US could make at that time. 

The problem is why then the US should have used atomic bombs: Is it because there was fear of the power of a giant socialist, the Soviet Union? Or, is it because then the President Harry Truman wanted to gain more support among then the American citizens? 

These reasons sounds true, but I can think up another reason for that:
the US wanted to succeed in the Bretton Woods system and needed to become politically strong enough to make their currency, dollar, accepted as the world currency such as gold. 

The US needed to be stronger than other political giants and so it should have bombed atomic bombs.

Wednesday, November 06, 2013

Tuesday, November 05, 2013

Modern Externality

While I see the people in the downtown chatting, listening to music and watching TV with smart phones and some of them annoying neighbors, I come to think that they should be taxed as high as gasoline and tabaco are taxed. OK, facebook and twitter may well be taxed too, and people will be much freer from what always bothers themselves.

Monday, November 04, 2013

Who Is the True Leader?

Suppose you were the President or the Prime Minister and your fellow citizens were taken as hostage by terrorists. What to do? Save them to accept the terrorists' request? Refuse the request instead of saving them? I think that it's a real job that a real leader should do.

Sunday, November 03, 2013

On Money Multiplier

Central bank prints yen bills, say 1 billion yen, by buying government bonds worth 1billion yen from private banks. Then private banks lend 1 billion yen to people.

Through this process, how much money can increase in the economy as a whole?

This is the problem of money multiplier and here's how to calculate it:

1.People borrow 1 billion yen from private banks and they deposit 1/(1+a) billion yen in the private banks. a is a ratio of currency to deposit, currency/deposit, or deposit:currency=1:a.

2.Then the private banks again lend (1-r)/(1+a) billion yen to the people and they again deposit (1-r)/(1+a)^2 billion yen in the private banks. r is a ratio of reserve to deposit, reserve/deposit. Reserve is the deposit of private banks in the central bank.

Through these processes repeated again and again, money in the economy as a whole increases by (1+a)/(r+a) billion yen.

The calculation is,  1+1*(1-r)/(1+a)+1*{(1-r)/(1+a)}^2+...= 1*(1+a)/(r+a)

The right term, (1+a)/(r+a), in the above identity is called money multiplier.

For example, if a=0.4,r=0.2, then 7/3=2.333, and thus 1billion yen can increase by 2.3 billion yen (1.67 billion yen increase in deposit and 0.63 billion yen increase in currency).

If a increases to 0.5, r remains the same, 0.2, then the money multiplier is 2.14. If a remains the same 0.4, r increases to 0.3, then the money multiplier is just 2.

The lesson is, if the ratio of currency to deposit or the ratio of reserve to deposit increases, the money multiplier decreases. 






Friday, November 01, 2013

School, Money, Social Welfare and Life

People saying that experience is more important than school and love is more important than money may have no experience of crisis in life; School is necessary to get a job, and money is necessary to live a life.

Indeed school should be the place where we learn how to make a decision ourselves through studying, friendship, bullying and love, but in real world there seem to be a lot of people who rely on others; Some people saying that people depending on social welfare are asshole should get aware that people working for company face almost the same situation as do those depending on social welfare: No company, no job, no money and no life.

We may have studied how to depend on company, government and other people in school: how to get liked by everyone, how to look good, and how to have us appreciated in workplace may have been most necessary to learn in life. It can hold true when people get together and can make it, but, looking around, I can see many old people sipping tea in the afternoon and such a golden age has already ended.

He or she may have struggled to make a living, but as a result he or she is forced to apply for social welfare. Hearing that news, I realized that I am next to, and that rising social welfare and rising national deficit and debt incurred by it posts a doubt on the life we live depending on and getting appreciated by others, and asks us to change the way we live.