Thread by @IntuitMachine

It's insanity that the primary tool we have for controlling the economy is through the manipulation of interest rates. This has led to the utter bonehead idea that if you lower the interest rates for buying homes and paying for college that you make both more affordable.

Homes and higher education become more affordable when through become more efficient in their creation. Yet here we are, we have yet to demolish government institutions like Fannie Mae, Freddie Mac, and Sallie Mae.

If you just look around you, we have all kinds of financial instruments that were invented in the 1950s that promise all kinds of payoffs that they cannot possibly deliver. It should be obvious to anyone that you cannot fundamentally change something by changing its looks.

Clearly, there is a gross misunderstanding of how to manage a market economy solely through financial interventions. It is an utter failure! Homes, higher education, and healthcare have exploded exponentially in costs in the USA.

But it is not like we don't have a clue of how to make goods and services accessible to the masses. Today almost everyone walks around in their pocket a smartphone that has the computational power of a supercomputer of the past.

Affordability happens when you emphasize decentralized production. This is where there is an open exchange of innovation and every entrepreneur has permissionless access to contribute. It is mindbogglingly frustrating that so few people even recognize this.

The challenge of affordability can be linked to the incumbents' unwillingness to change the status quo and thus relinquish their monopolies. Affordable housing is not built in places where people want to live.

Doctors artificially create scarcity by limiting the number of new medical doctors. Universities create their own scarcity by gaming admissions and playing a status game. Embedded in all these problems are incumbents creating barriers of entry.

Good governance must be sophisticated enough to recognize the monopolization strategy and tactics of the incumbents. If we continue down this road of prioritizing the incumbents, we will drive head first into an unsustainable economy that is destined to collapse.

We are where we are today in an unsustainable economy both ecologically and financially because our decision-making is driven by the preservation of institutional ideas of the past. It is becoming glaringly obvious that it is all failing and there's no solution in sight.

Any complex system accumulates technical debt based on decisions that were good ones in the past but have lost their utility in the present. Manageable complex systems undergo creative destruction which encourages the most robust new approaches to eventually dominate.

The longer we stall creative destruction, the longer we accumulate the technical debt. The entire global economy is heading for a crash that is inevitable unless we address the solution that is decentralized and sustainable production.

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