AboutWarren D. Miller, CFA, ASA, CMA, CPA Expertise My in-depth knowledge of economics is confined to three sub-disciplines: Austrian economics, industrial organization, and evolutionary economics. Other questions dealing with macroeconomics, the traditional neoclassical paradigm, labor economics, environmental economics, agricultural economics, health economics, and so on should go to those who have the appropriate expertise.
N.B.: I DO NOT ANSWER QUESTIONS MARKED 'PRIVATE' because I believe that knowledge should be shared, not hoarded. I also believe that such questions are likely to come those trying to cheat. Similarly, as one who was a full-time academic for half a decade, I can recognize test and homework questions several time zones away. Therefore, please do not demean yourself by submitting such questions to me. Those who do so are cheating, pure and simple, and I WILL call you out publicly if I believe you are doing so. I have a zero-tolerance policy where cheating and dishonesty are concerned.
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Experience I work with Austrian economics (which is different in major respects from the traditional neoclassical model), industrial organization (which is about industry structure, conduct, and performance), and evolutionary economics (almost, but not quite, the economic analog of its biological counterpart) everyday in my work. I appraise closely-held businesses, provide exit-planning services, and offer high-level strategic analysis, advice, and clients to CEOs and owners of mid-sized businesses. Understanding, applying, and writing about these disciplines is an essential part of how I have made my living since 1993.
Organizations CFA Institute, Strategic Management Society, American Society of Appraisers, Institute of Management Accountants, Academy of Management, Culver Legion
Publications CFA Magazine, Strategic Finance, Valuation Strategies, Value Examiner, Journal of Advanced Property Economics, Harvard Business Review, American Fly Fisher, CFA Digest, CPA Expert, and Business Valuation Review, among others
Education/Credentials MBA - Oklahoma State (1991)
BBA - U. of Oklahoma (1975)
Chartered Financial Analyst designation (2006)
Accredited Senior Appraiser (2006)
Certified Management Accountant (1992)
Certified Public Accountant (1992)
Question Hello, I am doing my final project for high school, and I need an interview from an expert. We had to choose one topic from mainstream culture and write a paper about it and what it says about us as a culture.
My topic is our economy, how it is based on materialism, and how it affects each and every one of us
M thesis at the moment is:
Although capitalism and democracy produces affluence, when the system breaks it creates havoc for the middle and low economic classes.
I am researching the current state of the economy, but as this has happened before I wanted to get some background information about the Great Depression. I am also going to use the Agricultural Adjustment Act and the slaughter of millions of livestock while millions of Americans were starving.
What were some of the leading causes?
How did the American financial system affect the normal people?
Looking back on history many years later, what is your impression of our society at that time?
Thanks very much
Answer Matt, I'd like to help you, but your questions are just too broad and would consume too much of my time. In addition, I believe you can find the answers to some of them by googling. In particular, there are all kinds of resources on the web about the Great Depression. Google "Great Depression" and "causes." Try these links:
If you want a fine book on the subject, I recommend "The Forgotten Man" by Amity Schlaes. It's excellent.
I would caution you not to be too hard on capitalism. Your questions imply that you are not a strong supporter of the system. You should be, and for the following reasons:
1. Capitalism has brought more freedom and a higher standard of living to more people than ANY other system. It's not even close.
2. Our system is NOT "broken," and it never has been. What is broken is the brains of politicians who are either too stupid, too ignorant, or too self-centered to be able to explain the system to their constituents.
3. One of your questions implies that the upper class is a fixed and unchanging group of people. That is bunk. It is NOT true. I, for one, have been homeless. I'm now very comfortable and have a significant personal net worth which I worked like a dog to achieve. There is more social mobility in our society than in any other one on the planet. Rich people become poor, and poor and middle income people become rich. If you think the current 'great recession' is not hard on wealthy people, then you've not talked to any of them. It's hard on all of us.
4. But the current mess was NOT caused by capitalism. It was caused by a bunch of hack politicians (mostly Democrats, but 1 or 2 Republicans) leaning on banks to make loans to people who couldn't even pay their rent; they did this under the guise of "The Community Reinvestment Act of 1977." Then the politicians leaned hard on their hack buddies over @ Fannie Mae and Freddie Mac to buy the bad loans from the banks. Alan Greenspan, then chairman of the Federal Reserve (and a lifelong Republican), kept interest rates far too low for far too long, despite ample empirical evidence that the housing market was hugely overheated. Fannie Mae and Freddie Mac bundled the bad loans into instruments called "mortgage-backed securities." These were complex devices with different durations, different credit ratings of the borrowers, etc. Wall Street forgot everything it had been preaching for the last 50 years about portfolio diversification and loaded up on these securities, many of which came from "sub-prime loans." When the housing bubble finally burst, a ton of people got hurt--borrowers, banks, and, especially, you and me. The same fools who initiated this insisting we believe that they can fix the mess they launched. They cannot, and we're all going to learn that lesson the hard way. The very best thing we can do is NOTHING. Let the market sort out this mess. The longer we wait to do that, the longer it will take for things to return to normal. Right now I believe it will take several years, at least.
5. It IS true that capitalism is a tough system. It just happens to be miles and miles ahead of anything else we've ever come up with.
6. While you're out there bewailing "materialism," don't overlook the fact that our system has created more spirituality, more church-goers, and higher donations to charity than any other system. Anyone who tells you differently simply hasn't looked at the FACTS.
7. The problem with capitalism is not the system itself. It is the ignorance of the American people about economic matters in general and capitalism in particular. If you want PERMANENT 10 unemployment, PERMANENT slow economic growth (which will create fewer jobs for fewer people), and less freedom (any expansion of the federal government creates an equal and opposite reduction in personal freedom for each of us), look at any country in the European Union.
8. I strongly recommend that you read "Economics in One Lesson" by Henry Hazlitt. It's an easy and fun book, and you won't have a bit of trouble understanding every word of it.
Sorry I can't do more, but I hope I've been helpful anyway. Kindly help me by completing the rate-the-expert email you'll receive on the heels of this response. Your ratings and, especially, your comments help me help people like you who ask such interesting questions.
