Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: LLCF who wrote (28448)	2/5/2003 9:25:37 PM
From: Mark Adams	Read Replies (2) of 74559

Chop down a wonderful tree in your back yard [kill it] removing it's beauty, harmony, blahh blah blah [known as blahh going forward for BeautyLightHarmonyHappiness]... by selling the tree for firewood GDP goes UP... That is short term thinking... Sure GDP rises year one by the value of the firewood less the 8% (for a relatively mature tree) the tree would have grown had it not been chopped. Then run your net present value of the 8% per annum future growth discounted by the appropriate rate (are we in a 0% rate world? What does a 0% discount rate do to the net present value calculations? Interesting effect... can the tree be worth more left standing than as firewood, unless one is in dire need of firewood?) I wonder at times about the caucasian vs aborigine model of commerce. The native model would remove 1/2 the bark to make a needed canoe. The tree would likely recover, using the other 1/2 as a conduit for it's nutrient flow. The caucasian would chop down 100 trees, make 200 canoes, and then attempt to convince everyone they needed a canoe, some of whom would subsequently rent canoe storage space from another caucasian for off season storage. But all of this is a mere tangent on the culinary delights available to us for a rather slight effort to step out of the glare of McD's arches and probe the world of possibilities. Some of which hail from the same glacial water reputed as the source for the legendary Hunza longevity. The Balanced Scorecard does suggest that if we measure the wrong data points, we encourage the wrong results. Perhaps making themselves Obese, eating anxiously looking for blahh... looks GREAT on the level of GDP growth and misallocates resources to junk food production is a symptom of such.

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