Mr. Paul Solman has made an excellent video, giving a timely view and a important prediction of the world economy.

One of the most serious deficiencies of economists is the lack of practical experience. Starting from the famous textbook seller, Professor Paul Samuelson, economists have never known how to formulate economic problems, which, because their complexity, must be guided by practical experience. All economists should be doing what Mr. Solman is doing in the video, getting information from businessmen directly rather than from their teachers or the government.

The video shows and confirms why businessmen know more the economists and reporters, more than politicians about economics. In the current financial crisis, businessmen are pitted against politicians, sadly, the strongest versus the weakest. Even after losing all their money, the Wall Street executives are still winning.

We need something and some people really powerful to out think the Wall Street financial professionals and to remedy the mistakes of the inept Federal Reserve under Mr. Alan Greenspan, who just represented the established view of economists and, thus, should not be personally blamed. Mr. Ben Bernanke, following the views of the late Milton Friedman, is doing far better and, at least, is still keeping the world economy from another Great Depression.

Mr. Greenspan, mistakenly trying to control the explosive growth of the Internet industry, single-handedly crashed the stock market by shrinking the money supply from March to October of 2000. He then had to lower the interest rate to an embarrassingly low level so that the economy, without the high-tech Internet, could be sustained by the low-tech housing and auto industries. Finally, not knowing the relationship between the interest rate and the price of mortgaged real estate, he started to raise the interest rate to eventually caused the Subprime Woe.

My student Chien Yi Lee, the inventor of Universal Computer Source Code, called my attention to a comment of Ronin8317 to the previous question (January 28, 2009) "Why Should We Call Them Economists If They Couldn Predict The Economic Fall?" relating to the pivotal topic of valuation.

Ronin wisely suggested that "ank" should be "forced to limit their valuation to a formula that is linked to the median wage." But, he contradicted himself by compromised his excellent suggestion with the common textbook notion that "the value of a house is ow much someone will pay for it.? Up to now, without a correct solution of value, THE MARKET PRICE HAS BEEN ALMOST ALWAYS WRONG, resulting in incessant financial crises due to the wrong valuation; irrational market participants produce irrational prices.

Instead of being "linked to the median wage" or any other fallible formula, the valuation should be based simply on the solution of value, which, being mathematically rigorous (patent 6,078,901), is a NON-VIOLABLE law of nature.

ONLY AFTER ALL THE MARKET PARTICIPANTS, INCLUDING, IN PARTICULAR, THE GOVERNMENT USE THE SOLUTION OF VALUE, would the market price or "what someone will pay" be correct.

If all the viewers under the leadership of Mr. Solman can put their heads together, this web site could become one of the most important sources for solving the world-wide financial crisis. I have already asked my students of post-science to promote this site. I shall personally inform the Federal Reserve, the Treasury, and some politicians . Thank you for your consideration. ### Hugh Ching, Post-Science Institute, February 2, 2009

Thanks for posting this Paul.

For my students, this segment is useful for showing deep insights:

- "Idle capacity" is global (millions of Chinese out of work too): There's no such thing as "US society" or "US economy" or "US history." States are governmental jurisdictions, not the boundaries of societies. We live in a multi-state economy type of society, since 1450-1550.

- The interdependence of exports and imports (e.g. paper to China for boxes of goods sent back here, shirts from Jamaica, etc.), shows the global scale of the downturn and that the world-economy.

- Exports of paper, imports of finished goods: It also illustrates how it is composed of "commodity chains" -- the interlinked processes of production / trade across the planet. Began with Dutch East India Co.

Also can illustrate how the center of the world-economy is shifting to East Asia just as it has previously shifted from the Italian city states to Holland (UP), to the UK, to the US. Now its shifting to Japan, HK, Shanghai, Beijing, Taiwan (not one place). But the world-economy is also structured by three-tiers. The US (Japan, EU, Canada, Aus.) still monopolize high-tech core parts of world division of labor, selling investment to China (65% of China's exports owned by foreign corporations), while parts of China, like Brazil, is semi-peripheral (exporting finished med. tech goods), while Congo, Nigeria, etc. remain peripheral parts, exporting raw materials, or for most of China and India, cheap and disciplined labor within stable states.

- The suddenness of the drop in flows: In relation to Weber's concern with substantive rationality and bureaucracy, the evolution of F.W Taylor's 'scientific management.' Now all commodity chains are on the same global stop watch (see Stop Watch). Production flows of the world's commodity chains (and employment ques) now start and stop in close synchronization.

Thanks for helping me teach these and other aspects of modern society Paul.

- Elson