{"id":44193,"date":"2019-03-05T10:09:33","date_gmt":"2019-03-05T15:09:33","guid":{"rendered":"https:\/\/olduvai.ca\/?p=44193"},"modified":"2019-03-05T10:09:36","modified_gmt":"2019-03-05T15:09:36","slug":"chapter-5-bubbles-and-adam-smith","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=44193","title":{"rendered":"Chapter 5: Bubbles and Adam Smith"},"content":{"rendered":"\n<h3 class=\"wp-block-heading\"><a href=\"https:\/\/www.cobdencentre.org\/2019\/03\/chapter-5-bubbles-and-adam-smith\/\">CHAPTER 5: BUBBLES AND ADAM SMITH.<\/a><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">This chapter explores how laws enabling debt to be bought and sold transformed Britain. Suddenly, vast quantities of money and value were being created out of nothing. The effect was dramatic and widely commented on. Some people thoroughly approved, while others saw a new kind of tyranny taking over \u2013 a tyranny of fictitious wealth.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Speculators and \u2018projectors\u2019<a href=\"https:\/\/www.cobdencentre.org\/2019\/03\/chapter-5-bubbles-and-adam-smith\/#_ftn1\">[1]<\/a>&nbsp;soon realized that when money and other types of value can be created out of nothing, different types of debt can be created and used to raise prices, and therefore value. Assets can be bought with money made from nothing, prices can be talked up, more money can be created to fuel and satisfy demand, and \u2013 hey presto! \u2013 when the assets are re sold, sky-high profits are made. The table was laid for an orgy of speculative greed \u2013 and the orgy began almost immediately.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u2018It was as if all the lunatics had escaped from the madhouse at once\u2019 commented a Dutch observer.<a href=\"https:\/\/www.cobdencentre.org\/2019\/03\/chapter-5-bubbles-and-adam-smith\/#_ftn2\"><sup>[2]<\/sup><\/a>Hysteria for speculation took hold of public life. English poets, novelists, and playwrights wrote and argued about the virtues and vices of \u2018Lady Credit\u2019 \u2013 and joined in the orgy themselves. A whole century of literature \u2013 Daniel Defoe, Jonathan Swift, Alexander Pope, along with many less famous writers \u2013 was given over to satirising the new society of speculators and credit-worshippers.<a href=\"https:\/\/www.cobdencentre.org\/2019\/03\/chapter-5-bubbles-and-adam-smith\/#_ftn3\"><sup>[3]<\/sup><\/a>Hogarth did the same in art.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The profits of speculation left \u2018honesty with no defence against superior cunning\u2019 wrote Jonathan Swift in\u00a0<em>Gulliver\u2019s Travels.<a href=\"https:\/\/www.cobdencentre.org\/2019\/03\/chapter-5-bubbles-and-adam-smith\/#_ftn4\"><sup><strong>[4]<\/strong><\/sup><\/a>\u00a0<\/em>Speculations in credit \u2018ruin silently\u2026 like poison that works at a distance\u2026 by the strange and unheard-of engines of interest, discounts, tallies, transfers, debentures, shares, projects, and the devil-and-all of figures and hard names,\u2019 wrote Daniel Defoe, author of\u00a0<em>Robinson Crusoe<\/em>.<a href=\"https:\/\/www.cobdencentre.org\/2019\/03\/chapter-5-bubbles-and-adam-smith\/#_ftn5\"><sup>[5]<\/sup><\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">&nbsp;\u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"<p>CHAPTER 5: BUBBLES AND ADAM SMITH. This chapter explores how laws enabling debt to be bought and sold transformed Britain. Suddenly, vast quantities of money and value were being created out of nothing. The effect was dramatic and widely commented on. Some people thoroughly approved, while others saw a new kind of tyranny taking over [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[1799,7380,195,24089],"class_list":["post-44193","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bubbles","tag-cobden-centre","tag-debt","tag-ivo-mosley"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/44193","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=44193"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/44193\/revisions"}],"predecessor-version":[{"id":44194,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/44193\/revisions\/44194"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=44193"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=44193"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=44193"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}