“Does a small group of centralized, academic policymakers in a room located in their nation’s capital — akin to a council of elders — have a better grasp on how to allocate their country’s labor and capital than the millions of people do at the individual level?” (p. 228)

“So, instead what happens in practice is that governments run moderate fiscal deficits most of the time, and bigger fiscal deficits during recessions and crises. Rather than a mix of fiscal surpluses and fiscal deficits, it’s a mix of fiscal deficits and bigger fiscal deficits.” (p. 223)

“Since central banks operate the primary ledger systems that the world uses for domestic and international commerce, then of course they are going to actively manage them, and therefore of course they will make plenty of mistakes. All the incentives are aligned in that direction, and so that’s how it plays out in countries all around the world whether we like it or not. This is an inevitable condition that we find ourselves in, unless or until we develop and adopt a better ledger system.” (p. 227)

“Almost without exception, if you look around the world for regions with persistent double-digit money supply inflation, those regions are not very economically productive. Instead, they tend to be in disarray. In that type of inflationary environment, it is hard for businesses to plan for the long run while remaining profitable, and it’s hard for workers to maintain wages that keep up with the cost of living. All negotiations become harder and more frequent, especially if they involve a lot of people, such as unions and large contracts. Investors want to get their capital out to easier jurisdictions, which increases the cost of capital for local businesses, which makes them even less organized, less profitable, and less competitive. In this context, the public ledger is broken, and by extension everything becomes broken. It risks becoming a vicious cycle, because disorganization leads to inflation, and inflation leads to disorganization.”

“Weak money encourages people to constantly borrow and invest rather than to save, whether that borrowing and investing make sense or not.” (p. 249)

Viewed through this lens of ownership, use, and maintenance being mutually alienated, goblin mode is that condition of the human self with respect to itself. You treat yourself as the property of a neglectful absentee landlord, you rent yourself out to users who neglect you as well, and when you break down, you hand yourself over to professional maintainers — the healthcare system — who try to restore you to “like new” state like you’re an insured car.

“Hard money encourages people to save, and to only borrow or invest when it seems like it really makes sense.” (p. 249)

I suspect there is such a thing as degenerate gnome mode too — a condition of stagnation, slow degrowth, high-inertia traditionalism, lack of innovation, claustrophobic connectedness with people you can’t get away from, things being nurtured to live on long past the point where they ought to be recycled, and so on. Uncritical gnome mode seems like a naturally reactionary condition to me, just as uncritical goblin mode seems like a naturally high-modernist condition.

“During periods of financial repression, governments historically turn to capital controls and lending restrictions to ensure that people hold the currency and the bonds while they are devalued. Interest rates are kept low for the government, but restrictions are placed on the private sector from making use of those low interest rates in unapproved ways.” (p. 289)

“I contend that these Tea Party and Occupy Wall Street movements were two sides of the same coin — a pushback against the country’s flexible ledger and the associated practice of using public debt and money-printing to save the large and well-connected entities at the expense of the everyday person.” (p. 285)

“Credit is a human construct and begins to look especially arbitrary to people when it was primarily accumulated by past circumstances and ancestors. So, if enough people become angry and feel that things are unfairly stacked against them, they can show the handful of owners of that credit how fragile their claims to such credit really are.” (p. 266)

“As the dust settled over the following years, the combination of fiscal stimulus and the recovery of asset prices led to very uneven results. The bottom 50% of the population collectively saw their net worth increase by $1.5 trillion from the beginning of 2020 to the beginning of 2022. The top 1% of the population collectively saw their net worth increase by $11.8 trillion over the same period” (p. 259)

“PPP was essentially untargeted because the United States lacked the administrative infrastructure to do otherwise. Harnessing modern administrative systems, other high-income countries were able to better target pandemic business aid to firms in financial distress. Building similar capacity in the U.S. would enable improved targeting when the next pandemic or other large-scale economic emergency inevitably arises” (p. 259)

“In those hard money environments, credit is still useful for activities with a high expected rate of return, but debt is used more judiciously.”