PIIGS and Bailouts, A Thesis on the Cause

Why are/will PIIGS (Portugual, Ireland, Iceland, Greece, and Spain) / Countries Get Bailed Out

The following is my hypothesis on the cycle:

  1. System design flaws (eg. rules to keep a balanced budget are not sufficiently enforced)
  2. Misinformed voters
  3. Unqualified Candidates
  4. Fiscal Irresponsibility
  5. Debt crisis
  6. Bailout, default, or debt restructuring
  7. Currency Crisis
  8. Inevitable Outcome: System reforms

The key is to do system reforms as soon as possible so the issues don’t escalate. Decisions need to be made fool-proof with more checks and balances.   It’s an iterative process to get capitalism to function appropriately.  We don’t need to make the same mistake multiple times.

Work-in-progress Proposed solutions:

  1. Make it a criminal offense to not run a balanced budget unless there is a direct, and immediate threat to national sovereignty.
  2. Reforms currencies and back currencies by widely traded, liquid securities with fundametals (eg. commodity futures)
  3. Educate the public better so they can make decisions based on understand how capitalism works
  4. Cut out advertising completely in the voting process and create one website that hosts all candidates policies to eliminate waste, unfair advantages from better funded candidates, and allow an equal platform for sharing critical data in a more objective manner

Blueprint Vs. “Being Original”

Why reinvent the wheel? It’s far more productive to start with a blueprint that can save you time.  Most people follow many blueprints from hiring experts, leveraging other people’s technologies, and receiving an education in specialized areas.

I think experimenting is a useful way to learn in conjunction with applying a blueprint.

Focusing on creativity/originality may not be as fruitful as simply applying knowledge.

Related: leonapel.com/2010/07/24/original_ideas_are_derived/

Common Wisdom Can Lead to Common Success

Common wisdom–generally accepted information accepted as a truth–should be treated as merely a hypothesis until proven otherwise.

The following is the logic many people have:

Premise: X is widely accepted as being true

Premise (with logical leap): Anything that is widely accepted must be true

Conclusion: X must be true

I’ve found humans are predictably irrational. It’s better to question everything unless you want to submit to a life of blissful ignorance. ?I believe it’s wise to take control, remain skeptical and make independent decisions based on the best available data.