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Episode-1126- A Discussion with Greg Carter “The Rural Economist”

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Greg Carter holds a B. S. degree in Business Management with a minor in Entrepreneurship. He has owned 3 businesses, sold 2 for a profit unfortunately the third was was destroyed by the April 27th, 2011 tornadoes which has given him a unique view into the reality of preparedness.

Greg has had an active interest in economics since high school.  Today he not only teaches economic principles, but also teaches self reliance in a baby steps fashion.

Member’s of the TSP community will know Greg as Greggcole on the TSP forum and Carterhomestead on 13skills.com  He joins us today to discuss the role of thrift in becoming more self reliant and his baby steps to approach to doing so.  We also discuss the economics of homesteading, including how chickens can explain economics along with some new/old ways to define economics in the first place.

Resources for Today’s Show…

Remember to comment, chime in and tell us your thoughts, this podcast is one man’s opinion, not a lecture or sermon. Also please enter our listener appreciation contest and help spread the word about our show. Also remember you can call in your questions and comments to 866-65-THINK and you might hear yourself on the air.

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Episode-1126- A Discussion with Greg Carter “The Rural Economist” — 11 Comments

  2. According to Wikipedia, as of February 2013 Saffron was going for approx. $4,336 per lb! Much more than a lot of drugs on the market I would assume.

  3. Thanks Greg. I enjoyed the podcast.

    My goal:
    To learn how to garden in general and specifically organic in a hurry.

    How I am accomplishing this on the fast track:
    I have planted my own garden but my wife and I work for an organic garden that is a CSA. Basically we pay half the price she charges for a share of what she produces a week. The other half we work for by working 2 hrs every Saturday. We get a full share of the produce for half price but most importantly we are learning from a very accomplished gardener. She is very good to share everything she is doing and why.

  4. I have not heard a single other person describe money in terms of energy. I just wrote this entire thing in agreement, however, I now have to say while I agree with the sentiment, I think it should be argued what today is not money, regardless of whos school of thought you use. I will agree 100% that energy = capital however. There is absolutely no other way to look at labor and individual efforts.

    You can make comparisons even further to “actual” energy as well. I may have a hell of alot of potential energy with coal, but without anything to use it with, its about of zero value to me. Its the problem with why we don’t value coal like oil. Sure is great, but you can’t run a car with it, therefore our valuations are going to change regardless.

    Further, the conversion of the results of your energy to another is purely subjective based on those exchanging energies. (I may value an item that took you less energy to produce, more than something that took me a hell of a lot of energy to produce). This further explains why it is so absolutely damning that some third party should ever be allowed to make that determination for you. (Governments fixing and enforcing prices).

    Hell it could easily be argued (in my mind) that “creating” price stability in it of itself, creates instability by missallocating individual resources and warping an individual’s ability to accurately value goods for goods. As I think about this concept more it makes me just fully realize further how wrapped this concept of money is (fiat). Although I’m kind of spinning in circles whether you could really call fiat money, and our current paradigm money at all. If a third party can dictate a price between two individuals, the individuals actually even acknowledge the going rate between said goods, then that is an absolute distortion of how people can/should perceive value. I guess people argue about “supply and demand.” But really prices are set by those selling and those buying. One can boil that down to a supply (the seller) and the demand (the buyer) but thats eye rolling because thats generally not how most of the economy functions (pawning valuables in a time of need is another story). To break it down simpler, if a bread maker makes alot of bread, and doesn’t really need bread, and a buyer has fish which he doesn’t really need (they need each others goods) why on earth should these individuals even consider non-actors in this transactions value on this?

    I’d say its fair to say that the stock market runs more like an auction than an individuals ACTUAL valuation of said thing. (At least in my mind, if you’re buying to flip something, you don’t actually value the object, you value gaming the system).

    • @New Mike –
      IMO ALL ‘financial markets’ (FOREX, COMEX, NYSE etc) at this point in time are casinos. ‘Players’ are betting on if the next dice roll will be higher or lower, not ‘investing’ in a business with the intention of sharing in the profits created by the creation and sale of a product or service.

      If this weren’t the case then the prices of companies wouldn’t exceed a ‘reasonable’ P/E ratio or the annual dividend. In other words, if the stock costs $100, and the company isn’t producing a profit of at least 4%, or $4 per share.. its just gambling.

      The big problem right now.. everyone is gambling, no one is investing.. and in the case of the TBTF types.. they’re gambling with our money, and when they shoot craps, the ‘casino’ (our beloved government) presents us with the bill.

      As for the ‘value’ of something.. there is of course value to yourself, and then value to others. That value is determined AT THE TIME you NEED the item for use or trade. [Example: Parachute while in your living room $100. Parachute while falling towards the ground..)

      So as long as people accept ‘dollars’ for their good and services they have ‘value’. As soon as they don’t, they have the same value as any other piece of paper.

      I think the real thought mistake is to think of ‘dollars’ as being a good ‘store of value’, and I would include in that, any assets who value is derived from their being denominated in ‘dollars’ (T-Bills for instance).

      Anything that can be easily produced at little or no cost, in unlimited quantities, will fall in value, and at some point approach a value of zero (you can still wipe your butt with it).

      The obverse kind of defines good stores of value.. things that you and other people want, that can not be easily produced, or replaced, and exist in limited quantities. An example from this episode would be ‘old growth wood’.

      The trick though is having something of value to others AT THE TIME you need to trade with them. And that pretty much means you don’t want to be a one trick/product pony. If you have a tomato farm, and everybody starts growing tomatoes in their backyards because the economy crashed and they can’t afford to buy them at the store.. you have nothing of value to trade.

      [The ‘replaced’ is because some things have a high value now, but that value could fall if something ‘better’ comes along. So.. oil is valuable today.. but if cold fusion happened, its value would fall sharply.]

      • ” not ‘investing’ in a business with the intention of sharing in the profits created by the creation and sale of a product or service.”
        This is why when people say they’re “investing in gold and silver” pisses me off. That’s literally not possible. Investing means putting energy into something with the intent on seeing a return of energy. Flipping for “profit” is just gaming the system and an absolutely ridiculous way to live. I like collectable stuff don’t get me wrong, but people who live their life around (a lot of people) this notion of buying to hold for increased value exclusively shows the financialized bubbles throughout the entire society. A house is not a fucking investment (it can be through business improvements) its a house, yet everyone (to include my dad) seem to think its about buying for appreciation. Not everybody can do that…

        ” and the company isn’t producing a profit of at least 4%, or $4 per share.. its just gambling.”
        Couldn’t agree more. Zerohedge ran a great article the other day about the lack of returns has boosted the worst debt to the lowest levels of returns. Forget about making reasonable investments or risk, buy anything.

        “As for the ‘value’ of something.. there is of course value to yourself, and then value to others. That value is determined AT THE TIME you NEED the item for use or trade. ”

        I mildly disagree but its mostly out of “nitpicking.” I’d argue that while that is certainly true, you can value having something for in the future because you’ll eventually need it. I don’t need a generator, until I need a generator. But yet its high on my priority of purchases (next month finally).

        “I think the real thought mistake is to think of ‘dollars’ as being a good ‘store of value’, and I would include… ”
        This is where I would digress from considering paper actual money. The whole notion that it can even be considered a store of value is nonsense. The whole idea that even a paper currency can be “Fixed” to an asset is also nonsense. By fixed, it means a third party is choosing the value of that object (regardless) and everybody going “oh sure.” That might be ok if it were left to that, but its quite clear that nearly all goods are then 3rd party priced to dollars. So you’re statement about deriving its value from dollars, really also applies to ALL OBJECTS. In my opinion, thats the way its been crafted, and the way we view our world. Not only that the way we’re pricing return on investment, is in dollars. How can I personally for my own sake, be a judge of value if all items are fixed in price by somebody other than the one’s I’m dealing with?

        Corporations have only REALLY made this a reality. People you buy from (generally) are corporations where the price is generally set back at headquarters. Price fixing. Business is evaluated on its ability to price returns purely with dollars. I think Rob Gray’s comments about profit / dollars really makes this point quite obvious. How can there be the term profit? The term profit can only exist if you have a price fixed system, particularly where all transactions are evaluated based on the standard (dollars, or anything else centralized eyes may regulate).

        “Anything that can be easily produced at little or no cost, in unlimited quantities, will fall in value, and at some point approach a value of zero (you can still wipe your butt with it).”
        While that is almost always the case, that isn’t a constant. In fact, right now, as the system is currently setup, you’re much more likely to see the price of dollars go through the roof (physical dollars). The system is setup for 0 and 1 to evaporate into thin air. Your statement can be just easily applied in the reverse. What comes easy, goes easy as well. Since evaluations are made with 0 and 1s, those “dollars” can disappear just as easy as they came into existence. (arguably you can’t compare US dollars to account ledgers, at least in my opinion)

        “The trick though is having something of value to others AT THE TIME you need to trade with them. And that pretty much means you don’t want to be a one trick/product pony..”
        Great argument for diversity and “polyculture.”

        As a nitpick, I would disagree with your oil to cold fusion statement. Perhaps coal and cold fusion. If we start driving around cold fusion cars, I’ll eat those words gladly hahah.
        Good thoughts.

        • I need to be working.. so here are two short thoughts..

          first, check out:
          http://sacred-economics.com/
          I’m not endorsing, just saying he has some very interesting ideas.

          2nd. the ‘sellers’ of money have convinced everyone that ‘money’ is the solution to every problem. the ultimate panacea.

          i would submit that money doesn’t ‘solve’ anything. that only human action does.

          the theory behind ‘money solves everything’ is that you can ‘pay’ someone to do something about your problem..

          you can see how quickly this starts breaking down..

          would love to get into how the flow of gold from west to east (china, india) has actually been going on since the 15th century.. and what that says about what 7000+ year old cultures think is a good store of value.. but i really gotta work.. 😉

  5. What if the time it takes to pick 3 gallons of strawberries is worth more than the one gallon you get?

    For me they would be some very expensive strawberries….

    However, the entertainment, and therapeutic value of the work involved may be worth the time spent.

    • Hence why somebody telling you the value of the strawberries makes absolutely no sense.

  6. Saffron a couple years ago was 1417.00 and ounce, I saw the price and really started thinking hard about growing… lol

  7. Sorry to be late to the conversation. I’ve been off traveling Ecuador and just catching up on the podcast.

    I just wanted to point out that I went back to school a few years ago and took a business class. The textbook defined Economics as “the system of managing and distributing limited resources.”

    I haven’t seen or heard that definition anywhere else until today, but it’s always stuck with me and I was happy to see that it was in a textbook somewhere. It was something I had understood since I started studying economics on my own time after the last housing crash and it’s something most people that I talk to don’t understand. Thanks for bringing it up.

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