pull down to refresh
0 sats \ 4 replies \ @Solomonsatoshi 2h \ parent \ on: Econ October Recap econ
Do you understand the word always?
I agree that often, in fact mostly, free markets tend to deliver the best result, but with the proviso that in some significant cases (eg rare earths) they do not.
I need only provide one example of free markets failing to provide the ideal outcome to disprove the proposition that they are always superior, and I have. Rare Earths.
Strategies concentration of Bitcoin custody into a form where it is hoarded as a speculative commodity and is prone to US government regulatory capture/confiscation is a debateable example of free markets delivering the best outcome.
Much of Strategies 'success' to date is due to tax and regulatory factors which Strategy takes advantage of.
挖個礦有什麼關系？you think no one can mine minerals unless some government employee is giving orders and extorting the people doing the actual work??
reply
It is not the mining of rare earths that is the difficulty.
It is the refining of them.
China has invested heavily in the refining of rare earths for several decades and now controls the supply of rare earths globally.
It will take the US/West at least a decade to build refining capacity to even start to regain supply chains independent of China and even then only at a massive cost which no private refiner will fund- it will only happen with Massive US government SUBSIDIES.
reply
Not everything needs a subsidy to exist.
reply
Absolutely true.
But some things do.
A major part of the Chinese success in beating the west in terms of manufacturing competitiveness has been its massive government led investment in electricity power generation- the low priced electricity supplied by the state triggers private sector investment and productivity and gives Chinese businesses a significant strategic advantage over western competitors.
With AI now becoming a huge consumer of electricity the failure of western economies to produce more cheaper electricity is a potentially fatal strategic weakness.
The Chinese use scale and government planning to build 12 new nuclear plants based on improved blueprints sourced from the west while the USA struggles to complete one new nuclear plant and that one plant will cost 4x more than the Chinese ones which are also built far quicker.
reply