Jesuit reductions in latin america circa 17 35

A model for collective residential and  production community units
Floating  in a market system
  Base
 A  garden and  handicraft shop
 System of commodity production

Social history as a cascade

Social history and the social dialectic

Take
the phenomenology of markets
And the  motion laws of exchane value
below
The  every item is unique vector
of transaction prices
Instant  by instant
 For  marketed  products

Global patterns of synchronicity and de synchronicity

Convergence in sub system cycles versus divergence in sub system cycles itself cyclical ? A simplistic simpletons question

Kaleki distribution cycle models at HET

Local development zones LDZs

LDZs need to cover slow developing regions To produce local exportable products and thus Extra jobs supported by extra local revenue sources j These zones should be integrated country wide And managed at the federal level with federal backed credit and grants

Exportable product location market

This could CO ordinate Location development zones Taking the location decision interaction into a market mechanism

Buffet trade Lerner market

have a plan to suggest for getting it done. My remedy may sound gimmicky, and in truth it is a tariff called byanother name. But this is a tariff that retains most free-market virtues, neither protecting specific industries nor punishing specific countries nor encouraging trade wars. This planwould increase our exports and might well lead to increased overall world trade. And it would balance our books without there being a significant decline in the value of the dollar,which I believe is otherwise almost certain to occur. We would achieve this balance by issuing what I will call Import Certificates (ICs) to all U.S. exporters in an amount equal to the dollar value of their exports. Each exporter would,in turn, sell the ICs to parties--either exporters abroad or importers here--wanting to get goods into the U.S. To import $1 million of goods, for example, an importer would need ICsthat were the byproduct of $1 million of exports. The inevitable result: trade balance. Because our exports total about $80 billion a month, ICs would be issued in huge, equivalent quantities--that is, 80 billion certificates a month--and would surely trade in anexceptionally liquid market. Competition would then determine who among those parties wanting to sell to us would buy the certificates and how much they would pay. (I visualize thatthe certificates would be issued with a short life, possibly of six months, so that speculators would be discouraged from accumulating them.) For illustrative purposes, let's postulate that each IC would sell for 10 cents--that is, 10 cents per dollar of exports behind them. Other things being equal, this amount would meana U.S. producer could realize 10% more by selling his goods in the export market than by selling them domestically, with the extra 10% coming from his sales of ICs. In my opinion, many exporters would view this as a reduction in cost, one that would let them cut the prices of their products in international markets. Commodity-type products wouldparticularly encourage this kind of behavior. If aluminum, for example, was selling for 66 cents per pound domestically and ICs were worth 10%, domestic aluminum producers could sellfor about 60 cents per pound (plus transportation costs) in foreign markets and still earn normal margins. In this scenario, the output of the U.S. would become significantly morecompetitive and exports would expand. Along the way, the number of jobs would grow. Foreigners selling to us, of course, would face tougher economics. But that's a problem they're up against no matter what trade "solution" is adopted--and make no mistake, a solutionmust come. (As Herb Stein said, "If something cannot go on forever, it will stop.") In one way the IC approach would give countries selling to us great flexibility, since the plandoes not penalize any specific industry or product. In the end, the free market would determine what would be sold in the U.S. and who would sell it. The ICs would determine only theaggregate dollar volume of what was sold. To see what would happen to imports, let's look at a car now entering the U.S. at a cost to the importer of $20,000. Under the new plan and the assumption that ICs sell for 10%, theimporter's cost would rise to $22,000. If demand for the car was exceptionally strong, the importer might manage to pass all of this on to the American consumer. In the usual case,however, competitive forces would take hold, requiring the foreign manufacturer to absorb some, if not all, of the $2,000 IC cost. There is no free lunch in the IC plan: It would have certain serious negative consequences for U.S. citizens. Prices of most imported products would increase, and so would the pricesof certain competitive products manufactured domestically. The cost of the ICs, either in whole or in part, would therefore typically act as a tax on consumers. That is a serious drawback. But there would be drawbacks also to the dollar continuing to lose value or to our increasing tariffs on specific products or instituting quotas onthem--courses of action that in my opinion offer a smaller chance of success. Above all, the pain of higher prices on goods imported today dims beside the pain we will eventuallysuffer if we drift along and trade away ever larger portions of our country's net worth. I believe that ICs would produce, rather promptly, a U.S. trade equilibrium well above present export levels but below present import levels. The certificates would moderately aid allour industries in world competition, even as the free market determined which of them ultimately met the test of "comparative advantage." This plan would not be copied by nations that are net exporters, because their ICs would be valueless. Would major exporting countries retaliate in other ways? Would this startanother Smoot-Hawley tariff war? Hardly. At the time of Smoot-Hawley we ran an unreasonable trade surplus that we wished to maintain. We now run a damaging deficit that the wholeworld knows we must correct. For decades the world has struggled with a shifting maze of punitive tariffs, export subsidies, quotas, dollar-locked currencies, and the like. Many of these import-inhibiting andexport-encouraging devices have long been employed by major exporting countries trying to amass ever larger surpluses--yet significant trade wars have not erupted. Surely one will notbe precipitated by a proposal that simply aims at balancing the books of the world's largest trade debtor. Major exporting countries have behaved quite rationally in the past and theywill continue to do so--though, as always, it may be in their interest to attempt to convince us that they will behave otherwise. The likely outcome of an IC plan is that the exporting nations--after some initial posturing--will turn their ingenuity to encouraging imports from us. Take the position of China,which today sells us about $140 billion of goods and services annually while purchasing only $25 billion. Were ICs to exist, one course for China would be simply to fill the gap bybuying 115 billion certificates annually. But it could alternatively reduce its need for ICs by cutting its exports to the U.S. or by increasing its purchases from us. This lastchoice would probably be the most palatable for China, and we should wish it to be so. If our exports were to increase and the supply of ICs were therefore to be enlarged, their market price would be driven down. Indeed, if our exports expanded sufficiently, ICs wouldbe rendered valueless and the entire plan made moot. Presented with the power to make this happen, important exporting countries might quickly eliminate the mechanisms they now use toinhibit exports from us. Were we to install an IC plan, we might opt for some transition years in which we deliberately ran a relatively small deficit, a step that would enable the world to adjust as wegradually got where we need to be. Carrying this plan out, our government could either auction "bonus" ICs every month or simply give them, say, to less-developed countries needing toincrease their exports. The latter course would deliver a form of foreign aid likely to be particularly effective and appreciated. I will close by reminding you again that I cried wolf once before. In general, the batting average of doomsayers in the U.S. is terrible. Our country has consistently made fools ofthose who were skeptical about either our economic potential or our resiliency. Many pessimistic seers simply underestimated the dynamism that has allowed us to overcome problems thatonce seemed ominous. We still have a truly remarkable country and economy. But I believe that in the trade deficit we also have a problem that is going to test all of our abilities to find a solution. A gently declining dollar will not provide the answer.True, it would reduce our trade deficit to a degree, but not by enough to halt the outflow of our country's net worth and the resulting growth in our investment-income deficit. Perhaps there are other solutions that make more sense than mine. However, wishful thinking--and its usual companion, thumb sucking--is not among them. From what I now see, action tohalt the rapid outflow of our national wealth is called for, and ICs seem the least painful and most certain way to get the job done. Just keep remembering that this is not a smallproblem: For example, at the rate at which the rest of the world is now making net investments in the U.S., it could annually buy and sock away nearly 4% of our publicly tradedstocks. In evaluating business options at Berkshire, my partner, Charles Munger, suggests that we pay close attention to his jocular wish: "All I want to know is where I'm going to die, soI'll never go there." Framers of our trade policy should heed this caution--and steer clear of Squanderville. Warren Buffett is chairman and CEO of Berkshire Hathaway. FORTUNE editor at large Carol J. Loomis, who is a Berkshire shareholder, worked with him on this article.