The Econosphere by Craig Thomas- A Review
A belief I thought vindicated as I began the book... until I grew concerned I was reading some sort of religious tract, more akin to the Gaia Hypothesis. Even Thomas himself acknowledges that effect, calling his thesis somewhat hippie-ish.
But I stayed with the book, and am glad I did. Chapter 3 is exhilarating; Thomas takes the often arcane and confusing world of economic precepts and tenets, and renders them sensible for even the lay-reader (especially the lay-reader) in the most easily digestible method, by telling a tale that embeds those concepts within the tale:
"Imperfect information, in fact, is the chief factor that keeps us from maximizing our utility at any one time. You go to where you think you will find the greatest success and happiness, given all the information that you have, but on occasion, when you get there, you find that your treasure map was either incomplete or just plain wrong."Thomas repeatedly alludes to the sentiment above as "perfect markets; imperfect information" -- a perfectly pithy analysis of investors in public securities markets.
I came to really like this book as I continued; this is no turgid economics treatise on some new concept, but a living, breathing organism. Which is only fitting, when the reader remembers Thomas's concept of the Econosphere. Too, Thomas considers all inputs in an economic system, including the biggest player, the government:
"In this sense, we must conclude that government does help the cause of the wealthy. Furthermore, our usually smoothly operating central banking apparatus and, thus far, its good track record in managing our currency is a benefit to all of us operating in the marketplace. We all benefit from the knowledge that we can trade labor for currency, and turn around and buy goods and services of equal value with that currency. That is a good thing. However, given the massive and well-paying occupations that have flourished within our increasingly complex financial markets, we also cannot help but wonder whether the beneficial fiscal situation created and maintained by our government does not benefit some more than others."Do not let the snippet I quote above confuse you, for I believe Thomas to be an economist of the Austrian School; a suggestion that slips out between the cracks of his text. Whether or not I am correct, Thomas stands apart from his economist peers -- followers of the Austrian School, or no -- for Thomas is not rigid in his stance and perspective, which I believe makes his analysis that much more valuable.
"Brands are great. Firms are great. But people are what matters. It is the human life span that creates value. Sure, great brands and the firms that own them are a big part of harvesting that value. But when those brands are no longer great, they play a much smaller role in adding to aggregate wealth. We should not worship firms or brands as permanent deities; rather we should view them as great accomplishments in human cooperation and entrepreneurship, and realize that often when these firms fail, it means that others are succeeding.The Econosphere is not perfect, but my quibbles fall under the general rubric of seemingly no blue-penciling (by a qualified editor); too many dangling participles, split infinitives, and typos. But those all are quibbles, as I noted, and do not harm the reader's enjoyment or interest.
"A firm is a moment in time; the Econosphere is forever. We need to feel more passionately about the Econosphere than we do about any particular firm, whether we love it or hate it. The firm exists because the Econosphere provided the incentives to bring ideas and capital and labor all together. The firm exists because of the Econosphere, and it cannot exist without it. Remember, the Econosphere is our social environment, and if our environment wants to impose extinction on something, such as the dinosaurs or AIG, we should not question it."
Craig Thomas offers his readers an extraordinarily positive perspective, never Pollyannish, and I am very glad I read his book. I also appreciate his 10 suggestions that close the book, which are more than mere summation. With my expectations more than fulfilled, I can state flatly that The Econosphere deserves your attention and interest. (Which recommendation, btw, just happens to fulfill one of those 10 suggestions... Deservedly so.)
-- David M Gordon / The Deipnosophist
Labels: Book review