THE
INGRAM SCHOOL OF ECONOMICS
By Edward C D Ingram
Skype
edwarding2; WhatsApp +44 749 713 8287; email eingram@ingramsure.com
Updated
22nd March 2017
DON'T MISS THE PEER REVIEWS
There are two key parts to the Ingram School's model for the real economy:
#1 The financial
and economic framework creates enormous instability, scares people,
re-distributes wealth, complicates everything, and makes it impossible to
manage the economy in a simple and effective way which otherwise can be done.
#2 The
management of the economy through collaboration between government, monetary policy, and
treasury taxation after the size and various roles of the government sector has
been decided.
THE FRAMEWORK
After they had
seen some cruder but related ideas experimentally working in Turkey, I was
approached by Old Mutual on the recommendation of Graham Hollick, their ex CEO,
to make a start on this using my latest refined lending and savings models. The
venture was not started due to the regulatory and taxation issues. But it could
have transformed all of their financial products from pensions to managed funds
and home loans and commercial debt, making them all safer, cheaper to
administer, and easier to market. Safety sells.
THE SOLUTION
We need
thousands of people to be trained in understanding this and made fit and ready
to implement the necessary changes at ground level. And we need to train policy-makers at the
highest levels in the theory so that it can be seen to be academically sound,
fully practical and set up working committees on the practicality of
implementation. At the same time those attending the course will help to shape it and to be a part of the developments which will shape the future. They will be proud to have made that contribution to the welfare of mankind. This is not a one-way exchange of information.
THE
THEORY
IN DETAIL:
The key prices
in all fours of the major units of the world's economies (A to D below), are
not being allowed to adjust to offset the falling value of money. If they could
adjust, that would optimise the use of all of the resources in all of these key
units of the economies of nations. Only goods and services seem to be
relatively free to respond to all market forces, and only then when monopoly
power is sufficiently restricted.
A. Financial savings and loan contracts are
sheltered from market forces, as in fixed interest
maturity values and loan servicing cost; or made to behave differently by the
formulae used to calculate home loan repayment costs, for example. The same
applies to commercial loans. Everything is unsafe and unstable.
B. Currency markets are unsafe because they cannot separate the value of the currency for trading
purposes from
C. The prices for international capital exchanges should
take the volatility without affecting the value of the currency for trading
purposes. Little work has been done on regulations which could separate the two
markets in currency by minimizing arbitrage. This damages half of world's
pricing studies, abruptly ruins multi-billion investment plans, and heightens
international tensions.
D. Interest
rates are manipulated by central banks. Instead the stock of credit should
be managed.
THE COST
#1 When prices
are not able to respond to market forces, rising as the value of money falls as
well as adjusting to all of the usual things, they become too cheap and unable
to balance supply with demand: Optimum use of the resources involved cannot be
achieved and harmony between the four units of the economy gets destroyed.
#2 It
re-distributes wealth and destroys good financial plans bringing about a loss
of confidence, reduced investment, and behaviour changes. It can undermine the
safety of governments and their leaders in person.
#3 It generates complexity
- a generation of pricing and demand instabilities, each generation of
instabilities creating the next generation in a cascade which includes new
legislation and other interventions which also have adverse effects as well as
benefits.
#4 It becomes
extremely difficult for the best economists to create reliable economic models,
to prove what is causing what, and to find reliable correlations, or to agree
in any way about how to get a grip on the management of the economy.
#5 The Gini
index rises as knowledgeable people with power take advantage.
THE SOLUTION
TO REPEAT WHAT
WAS WRITTEN EARLIER: The Ingram School has been set up in order to create an
international working study group of policy-makers and practical people at
every level with all of their diverse experience where everyone can contribute ideas
and challenges and end up with a university certificate at the end of the
course. This was agreed after the university in question had become familiar
with many of the ideas over a period of years, starting in 2007/8.
PART 2 OF THE COURSE on the management of the economy is contained in Modules 3 and 5 which deal with the collaboration needed
between government in setting the goals of the government, the treasury in
collecting revenues, and the central bank or other body charged with exercising
control over monetary policy.
The proposals
put forward for the discussion, and subject to change as a result of proposals
from the participants, benefit from Mr. Ingram's in-depth thought experiments
and extensive reading of the work of very influential other economists
including the very latest theories being circulated and discussed. Extreme care
has been taken over the formulation of the assumptions and the logic which
follows from that.
INFLUENCERS
INCLUDE:
Lerner and J M
Keynes, David Hume and Adam Smith, Warren Mosler, Richard Werner, Lord Turner, Bill
Mitchell, the Monetary School, The Austrian School, Robert Shiller, along with
other famous economists and their schools of thought.
UNIQUE KNOWLEDGE
In addition to
this Mr. Ingram studied the dynamics of systems and systems control as an
engineer, so that knowledge is forms a part of the course.
He also warned people
at the Bank of England and the USA about the forthcoming financial crisis from
around 2004 onwards. He warned Zimbabwe about the coming hyper-inflation and
was privileged to witness that experiment at first hand. He saw how Old Mutual
and others including the asset management arm of Kingdom Holdings which he had
personally created, managed to survive. He has incorporated lessons learned
into the proposed financial contracts for institutions. Few people get that
kind of insight at close quarters.
UNIQUE ADVANTAGE
Mr. Ingram is
not employed by a university with the pressures to publish multiple papers per
annum. He has been able to study all of the areas concerned in depth and in
discussions with others both on the internet and in high powered review groups
face to face over a period of decades. It has been found that it is necessary
to cover all units of the economy before people are satisfied because each
interacts with the others. Creating such insight, including the need for a
unifying theory which brings everything together, is not something which other
academics have the resources of time and energy and the unstinting persistence
without reward or payment, to do.
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