Mokk said:
Get better glasses or put more effort in to it. Chances are if you did either instead of holding me accountable for your misconceptions about what i write we wouldn't be at this point.
I read that post, but it is 99% about your argument with firestreak over a definition. Your only 'point' being this line:
Mokk said:
All things a good investor relies on.
Which has absolutely nothing to do with the discussion we were having up until that point and really doesn't make a point at all. So, I'm forced to repeat myself:
Rones said:
I see your posts about the definition of common sense and the word 'often', but I do not see any argument on the topic of how taxiation affects business which was the topic until you entered the thread again.
As for you calling all of economics common sense, I will provide an example where that fails:
Before the Great Depression classical economists considered it 'common sense' that supply creates demand. This worked by suppliers hire workers, workers get paid, workers buy products, more products get made. However, when the Great Depression hit, we had supply, but the demand wasn't there. This required a revolution of thinking at the time. Since the old theories of common sense failed, a new view was needed. This came from a British economist, Keynes (who later won a Nobel Prize for his theory). This economist suggested the crazy idea that demand generates supply. 'Common sense' to us now, but completly countrary to 'common sense' then. At the time 'common sense' dictated that during a depression, the government should cut spending so that does not exceed the tax income also.
Keep in mind GDP =
Consumer consumption +
Industrial invest +
Government spending + (
Exports -
Imports)
So at the time C and G were dropping. Going off the 'common sense' at the time, the government put big tariffs on imports because that was money descresing the GDP and losing them money. Of course other countries reacted by hitting us with even bigger tariffs effectivelly removing exports/imports from the GDP and hurting the economy. Common sense sure worked well there. Keynes suggested the govenrment create a deficiet by spending more than it took in to generate consumption. People weren't demanding because they didn't have money according to his radical theory. Government did work programs and his radical theory worked. People had money, people demanded, the demand generated supply. A new 'common sense' for economics was born and the old 'common sense' discarded.
Common sense works for now only because it is what you grew up with and it has always worked for our generation. However, there is no gurantee that it will always work in future situations. Common sense isn't something we just have, it is something learned, developed, and that adapts. It is just the current most obvious solution to a problem, which works given the present circumstances, but could easily fail outside that situation. Imagine you are dropped on foreign planet...your idea of 'common sense' likely won't fair to well.
What if I told you there was a study that showed more Union soldiers died of exposure in the Civil War than Confederates because the Confederates were more experienced and outdoor types. Would you say that is common sense?
Well actually, just the opposite is the truth. More southerners died due to exposure due to inadequate clothing. I wish I had my psychology book handy. It had a very nice list of situations like the above. Then after you turned the page it told you all the situations were actually false and completly the opposite. It proved how common sense isn't so great and displayed the hindsight is 20/20 phenomenon.
Additional reading:
Failure of common sense in the medical world.