In a previous post, we said that David Hume explained that everything that exists is a perception which can either be an idea or an impression. We then extended Hume's idea, that all ideas are separable, by calling basic ideas as a quantum of idea, which manifests physically as a quantum of information. We put these ideas in their own 'quanta' in order to isolate them (not to compute them) to prevent the mind from connecting them with other perceptions.
We are now left with impressions which are not quanta-fiable or isolate-able. Impressions are sensations conveyed by the senses and manifest as sensations and feelings, which are then converted by the mind into ideas. Describing their ultimate forms in a physics perspective, we can say that ideas are particles while feelings are waves. Particles, such as our ideas, are static, while waves, such as feelings, are dynamic and continuous. A simple and obvious proof of this is the ego, which is a feeling of the self, which is dynamic and continuous.
Our prediction for the coming crisis is based on the metaphysical supposition that economic activity is ultimately based on demand, which is then based on desire, which is a feeling which is not isolatable nor calculate-able, but instead is continuous but fluctuating. We differentiate individual desires from the desire of the human species as a whole, since individual desires are greatly influenced by the individual senses and since economics is never confined to a single entity (otherwise it would be called 'budgeting' instead). Thus, we need to explain the concept of this wave of collective natural human desire in order to explain how we came up with the prediction of a crisis either as a global stagflation or global depression, which is ultimately based on the metaphysical notion that history repeats itself or that everything in the universe has a cyclical nature, since the whole universe is made up of waves which pulsate, or have highs and lows.
On the everyday level, particles and waves are easily discernable. The nature of a table 'object' is different from the nature of a sound 'wave' and the nature of water in a glass is different from the nature of the ocean moving as waves. But in the quantum level, when nature of the particle is thoroughly analyzed, the distinction between particles and waves become blurred as explained by wave-particle duality:
Hume explains that this defect is due to the limitations of the human mind:
The capacity of the mind is limited and can never attain a full and adequate conception of infinity.. In rejecting the mind’s infinite capacity, we suppose it may arrive at an end in the division of its ideas.. Therefore, the imagination may reach a minimum idea which it cannot further subdivide or reduce without annihilating it.. The same is true for the impressions of the senses and the imagination.. The minute parts of distant bodies do not convey any sensible impression.. because.. their impressions were reduced to a minimum.
Thanks to technology, we can now perceive the smallest units of matter, only to see that they are made up of strings which have the nature of indivisible waves, just as 'love' can be both an idea or a feeling. These waves or impressions are ultimately by perceived by human feeling, which has a different nature from human intellect.
We must not omit.. our accustomed method of examining ideas by considering those impressions, from which they are derived. The impressions which enter by the sight and hearing, the smell and taste, are affirmed by modern philosophy to be without any resembling objects consequently the idea of solidity, which is supposed to be real, can never be derived from any of these senses. Therefore, the feeling is the only sense remaining that can convey the impression.
With regard to the passions, the human mind is not like a wind-instrument which loses the sound after the breath ceases. It rather resembles a stringed instrument. After each stroke, the vibrations still retain some sound which gradually and insensibly decays. The imagination is extremely quick and agile. But the passions are slow and restive. This is why, when any object is presented that affords a variety of views to the one, and emotions to the other, the fancy may change its views very quickly. (Hume, Treatise)
Ideas can be lost easily, but feelings take time to disappear. This is because an idea is an external particle (comes from outside) which can 'escape' the mind, while feelings are continuous as an internal wave (comes from inside) which are struck and vibrated in the mind. Also, the mind can convert a feeling into an idea just as reality can convert light waves into light particles. Even if a feeling is converted into an idea, its true nature still is that of a feeling (i.e. feelings cannot be traded, for example, but it can be spread like sound via sympathy). You can never 'dispose' of your love by giving it to another person. Instead, you can only make that person feel some of it through actions, and even then, it will not be exactly in the same degree as yours.
A particle is merely a 'slice' of a wave observed by the individual mind. The imperfect human mind sees the wave as a particle, but the perfect omniscient Mind sees it as a wave, its true form.
What we see as a gold coin gives our senses a small impression, which we then convert as an idea-'particle' of a gold coin. If we were omniscient, then we would not only perceive the gold coin as a coin, but also as bullion being minted, as gold ore being turned into bullion, as star dust being turned into gold ore, and as start dust being formed from the Big Bang -- all at the same time. In short, we would know everything about that gold coin as a wave from its absolute past to its absolute future*.
* According to Eastern Philosophy, there is no absolute past nor future, we just put it here for explanation
Our above explanation, if applied in physics, can help explain the strange and spooky things in quantum mechanics. In fact, by extending Hume's maxims, the universe's true principles can be discovered, which can then allow instant travel through space (i.e. teleportation) and time (i.e. time travel) without needed huge amounts of stored energy.
However, our interest here is socio-economics, specifically, how waves of desires cause recessions, price fluctuations etc., so that we can build more stable socio-economic systems. By looking at the movement of commodity prices we can say that peaks in prices are represent a time of high desire for that commodity and troughs as a time of low desire. Sometimes you want a thing, sometimes you don't. But normally, your number of desires increase through time, unless you are going towards the end of your life, when the energy to achieve desires seem to wane.
However, since the 2008 financial crisis, the global economy has not risen as fast as before, which means that the collective desire of humans has not risen, which then contradicts its natural behavior. You'd expect that the global economy would be booming since oil prices are low. Therefore, there must be something artificial that is hindering the natural desires of humans.
'GDP' should be rising but it isn't
As discussed in a past post, profit maximization and the ownership of the work of others (outside equity) are artificial ideas all invented in the 19th century by businessmen or economists that thought like businessmen. These ideas have slowly created local policy-ideas, such as corporate law, and then global policy-ideas such as Bretton Woods to spread themselves via a wave of collective human selfishness that has always existed, as proven by past crises such as the 1772 credit crunch, Mississippi Scheme, South Sea Bubble, etc.
Even if you had a great idea and desire to create a new product or service, you will still have to get money from someone. Ordinarily, that someone will just think whether he will get his money back, maybe with some interest. But nowadays, people think whether it will be profitable to lend or invest. The idea of return on investment ROI blocks the natural tendency to invest and circulate money which then hinders work from being mobilized and things being developed. Unfortunately for the world, Smith and Hume (and even Marx in a way) said that profits naturally fall with economic development, and so keeping the idea of profit maximization at a time of low profits (or developed world) will just lead to secular stagnation.
An extensive commerce, by producing large stocks, diminishes both interest and profits; and is always assisted, in its diminution of the one, by the proportional sinking of the other. I may add, that, as low profits arise from the encrease of commerce and industry, they serve in their turn to its farther encrease, by rendering the commodities cheaper, encouraging the consumption, and heightening the industry. And thus, if we consider the whole connexion of causes and effects, interest is the barometer of the state, and its lowness is a sign almost infallible of the flourishing condition of a people.
Those who have asserted, that the plenty of money was the cause of low interest, seem to have taken a collateral effect for a cause; (Hume, Essays)
Since waves are continuous, they cannot be removed, but only 'toned down'. Ideas on the other hand can be dislodged, and since particles are dislodged by other particles, then the bad ideas of profit maximization and outside equity can be dislodged by more sustainable ideas that are in SORAnomics such as moral sentiments, fellow-feeling, natural price theory, consumption motive, etc.
Since custom has sanctified profits, equity, and nominal value, and has entrenched them fully in human minds, only a very urgent and serious need, such as that arising from a new economic crisis, will be able to start the process of dislodging those ideas, and hopefully be able to even dislodge Economics, as a compound idea, as well.