Good afternoon,
According to the Wall Street Journal’s Paul Gigot, governmental diligence is often measured by increased spending, instead of results. Think Canadian healthcare, or any number of government job creation schemes.
Imagine you’re tied up with a project at home and you send your son out for groceries with your tap-and-pay credit card. When he comes home with a few bags of provisions, what do you do? You probably rifle through the food and examine the itemized receipt. Milk, eggs, bread, cheese, hamburger, paper towel, a horse, and a hockey bag filled with used false teeth – total cost, $7,597.74. Atta boy! That’s more than I spent on groceries since the first Trudeau was dating Streisand.
This boils down to what Friedrich Hayek called the “Knowledge Problem,” which in essence says there’s little bits of mundane wisdom, subtle, but functional, scattered throughout society like manna. Its collective impact nearly always outperforms the policies of Professor Whatsit from the University of Smartypants, who is now serving selflessly as Assistant Minister of Benevolent Order-Monkeys.
Said simpler, this is why the Soviets could never figure out how many shoes to make, and why governments, like good hockey refs, should do as little as possible while maintaining their core functions. If we’re talking about the refs the post-game show it’s never, ever a good thing.
Who’da Thunk?
Quote: (From a murder mystery we were watching a while ago.) “Okay, I’ll wait for you here at the cake fridge.”
Wait, what?
Just standing there all along -- in a remote part of Northern Scotland, the original cake fridge was the idea of Lynn Johnson, a farmer in the area. Unstaffed, it was a rethink of the long-established “honesty boxes” that were being used to sell eggs and honey, etc.
The oddity caught on, and today there’s a tea shop and bakery attached to it, along with a handful of employee -- and a help-wanted sign. Lynn is looking to hire more to meet the growing demand.
We do love our preposterous innovators!
Weekly Notes:
The push and pull on U.S. equities:
When equity markets are in transition there are usually a number of fits and starts as they work their way through bear market declines and get closer to beginning a sustainable bull phase. We look at the negative influences weighing on the market today, but also see some reasons why the S&P 500 could deliver positive full-year returns, once all is said and done.
Regional developments: Inflation continues to decelerate in Canada; U.S. economic data mixed, more rate hikes likely; Europe/UK prospects improve, central banks to tighten; Japan’s trade deficit jumped to a record in January.
See more here: Global Insight Weekly.
Have a great weekend!
Mark