In recent decades, anti-immigrant parties have surged in the polls and entered most European parliaments. Since the last federal elections even Germany, which had not had a party right of the CDU since the Second World War, now has a right-wing populist party in the Bundestag. According to this Bloomberg article some of the reasons for this rise are: immigration, inequality and globalization. This development is influential and is presumably known to all readers of this article. But, you might ask, does voting for an anti-immigrant party automatically make you extreme right? It does not. It is wrong to suggest that all voters of the PVV, AfD, UKIP or Front National are extreme right. But then again, some of them are, and some politicians in these parties are as well. With the extremists mixing in, it’s hard to determine who is who. Extreme right ideas are seldomly expressed openly and are often blended into a more moderate narrative. So how does one determine if a party is just critical of immigration and globalization or if their intentions lie deeper? In this article, I will display some signs that show an underlying ideology. This way, you can identify the extreme right ideology, even if it doesn’t wear a swastika. Ideology Underlying intentions are important to determine the weight of words, and how far one is prepared to go to achieve his or her goals. And with the far right, much of the underlying intensions originate in the fascist ideology. Since the Second World War, extreme right groups were marginalized and the word ‘fascist’ became a curse word. This has discouraged people to associate with fascism, and it has also let this once influential ideology lose its relevance. This has been a very positive development, but a negative by-product is that people now associate negatively with the word ‘fascist’ without actually knowing what it stands for. This creates opportunities for politicians to just put another name tag on the same old ideology, or a somewhat modernized version, and sell it as something else. But don’t be fooled, the ideology has the same consequences. Fascism, , has many shapes and forms. But some aspects are shared by most fascists. They like traditionalism, violence and nationalism. They dislike minorities’ rights, consumerism, modern values, intellectualism and democracy. Fascists see the world as one big battleground. Nations or races fight each other and will grow stronger through survival of the fittest. This is why nations should stick together and may not be divided and weakened by fighting internally, since this will result in domination by ‘the others’. Individuals are merely a piece of the collective, fighting for the common goal: the survival of your group. Any element that undermines the uniformity of your group should be forcefully removed. Therefore, everyone has to be on the lookout for internal enemies, which is why fascist ideas tend to be paranoid and why they produce so many conspiracy theories. Creating a feeling of threat is a very effective way to mobilize people, certainly when you’re being threatened from within. This theory of a fifth column (a group within a society that seeks to undermine its own group) is popular in extreme circles on both the right and left. The underlying ideology means that for fascists, much more is permitted than for the average critic of immigration. Violence and suppression are fine since you’re just defending what is your own. An example of the effectiveness of threat trough conspiracy is the stab-in-back-myth. After the First World War, extreme conservative and fascist groups in Germany claimed that the war could have been won if it wasn’t for the socialist Weimar government that ended the war, and the presumed large Jewish influence. Therefore, the harsh punishment that Germany faced from the Versailles treaty was entirely the fault of the traitorous government, which was allegedly trying to undermine Germany. Even though the military strategists agreed that the war was lost, the myth was enough to inspire the Kapp-putsch, a coup that tried to replace the socialist government. Even though this coup failed, it instigated enough distrust of the Weimar establishment that made the rise of the Nazi-party a lot easier. The effectiveness of such conspiracies is not only the element of threat, but also that it is self-confirming. The target can’t credibly deny that he is not trying to undermine his own group, since that would be exactly what a traitor would try to convince you of. Anti-establishment parties have been very effective in dividing the population from its political elites by pointing at their failures. The extreme right however does not say the elites are incompetent. The elites are  evil and they pose an immediate threat to your well-being. Conspiracies against the people A conspiracy theory that is often used since the recent refugee crisis is that of replacement. Liberal elites allegedly promote immigration to replace the native population of a country, because immigrants tend to vote more left-winged. The refugee crisis has also sparked fears for the racial purity of Europe in extreme right circles. It fears the racial degradation of Europeans that comes forth out of mixing races. Take for instance the Dutch party FvD (Forum for Democracy), a conservative party with anti-immigrant stances. Their leader, Thierry Baudet, said that he is afraid of the homeopathic dilution of Europe and that he wanted to contain ‘our boreal Europe’. These are dog-whistles in extreme-right circles for a racially pure Europe. These international conspiracies are based on the idea of Globalism. This means that the elites want the degradation of national states and the to open western borders. Liberal elites allegedly want to break the western society, break the sovereignty of national states and establish a global government. National traditions stand in the way of this, and therefore have to be broken. A tool for breaking these traditions is something that’s very present in recent debates: political correctness. Critics of political correctness say that the liberal elites forbid the people to say what they want if it can insult a minority group. Just open YouTube and you’ll be flooded by rants against the ‘social justice warriors’. Political correctness makes a lot of people very angry, as well as the extreme right. But their reasons lie deeper that just annoyance. They see these emancipatory movements as direct attacks on traditional values. Political correctness is a tool in these attacks, and these attacks are again inspired by a conspiracy against the people: Cultural Marxism. Cultural Marxism is a school of thought that says the traditional western values are like chains to the population, and need to be systematically destroyed in order to prepare them for communism. This school of though is often ascribed to the Frankfurt School, a group of German Marxist exiles in the United States that also were predominately Jewish (which always raises alarm bells with the extreme right). Although this interpretation of Cultural Marxism is highly doubted, it is enough to frighten the extreme right. They fear that society will degrade without its traditional values to keep it in check. For instance, if traditional gender roles disappear, this will decrease the masculinity of western men, making it easier for other races to dominate them. Also, increased women’s rights are dangerous since women are ‘biologically less loyal to the tribe’ and are therefore more inclined to invite intruders into society. In essence, traditional values are the natural way for a society to function orderly. Take them away and you get chaos. Since the extreme right tends to be paranoid, they see cultural Marxism in many aspects of society. Feminists, ANTIFA and LGTBQI action groups are common targets despite their limited political influence. Another common target is academia. In conservative circles, the more left-winged tendency of the highly educated has often been explained by the left-winged tendencies of professors. The extreme right sees this as a preconceived plan to infiltrate the university with ideologues, brainwashing their students to reject western values. The results of imprinting these ideas into the student’s young mind are a degradation of morals, mass immigration and eventually submission. Seeping through The extreme right is a complex phenomenon, and the characteristics described above are just the tip of the iceberg of the complete worldview the extreme right has created. The characteristics probably describe things that you recognize. However, not from extreme right propaganda itself, but from people that are taking over (some of) the narrative and techniques employed by the extreme right. Creating the notion of threat (‘rapefugees’, ‘a tsunami of immigrants’) or conspiracy from the elites against the people are now often used by anti-immigrant populist parties in Europe. US president Donald Trump based much of his presidential campaign on it. A concept like cultural Marxism, once only used in extremist circles, has now entered the common narrative, with people like popular YouTube professor Jordan Peterson criticizing it. Don’t get me wrong, complaining about the loss of traditional values is what conservatism is all about and that’s legitimate. But to a growing extent, scaring people with the notion of being threatened by those in power and those on the outside is solely used to achieve certain political goals. Fascism creates totalitarianism. It induces paranoia, fierce discrimination and dehumanizes anyone that merely seems to have different views than you, and positions them as an arch enemy. Fear as a means in politics has become mainstream. It is our duty to stop this and make our political narrative shared and open again.

In the beginning of the 1990’s, the World Wide Web saw a significant boost in usage, after the introduction of one of the first ever web browsers which was developed for home use, the NCSA Mosaic. The browser was developed by Marc Andreassen, a computer scientist who believed that the potential of a web browser that could provide images, texts and several types of multimedia to its users through the internet was too good to pass up on, and he was right. After its release, the browser was purchased by Microsoft, and Internet Explorer was modeled around Mosaic. Andreassen’s thoughts regarding the potential of such a project paints a perfect picture of what was to come for the World Wide Web. After finding its place in the mainstream and entering countless homes, the internet in today’s age has the flexibility to be molded into a personal assistant for any individual to have. The countless hours and resources that are being poured into internet-based projects are attracting investors from all over the globe, and developments through the platform constantly send shock waves through culture, commerce and technology. Just by thinking about it for a couple of minutes, one can realize how many large companies, organizations and even governments have made their services, not only available, but dependent on technological devices and the internet. Lately, especially with the astronomical rise in the usage of social media, internet based platforms have become something of a virtual office for many individuals, especially through social media platforms such as YouTube, Instagram, Twitter, Facebook, or livestreaming websites such as Twitch, Periscope or YouNow. Countless users have found success in building themselves a brand that manages to have a reach over millions of account owners and opened themselves doors to business opportunities that has earned them a considerable amount of wealth and networking. As somebody who spends a lot of time on the internet on several different mediums, I tried my best to observe the steps that should be taken while aiming to create one’s own “virtual kingdom” and questioned why the internet might be a good platform to invest time and effort into. After some time, I’ve realized that the best place to start questioning from would be the “internet celebrities” I enjoy following myself and come up with a small list of things I believe are important. Before listing some of the elements that I’ve found to be important, it is important to understand one major feature of the internet and social media: It brings the world together. The networks large capacity, combined with individual interest has the ability to bring together users from across the world together on several different occasions. Skill: Like any other job an individual might have, being skillful in a certain area can be used as a great tool while working towards establishing a profitable online presence. As I’ve mentioned earlier, the internet can give people opportunities for exposure that they may never be able to find in daily life, and in the most unexpected times as well. Admirable levels of skill in a certain activity, especially in rather trivial areas such as music, arts, or even video gaming can help users find professional opportunities they would struggle to find otherwise, or market their craft online through streaming services or online stores. Even mega pop stars like Justin Bieber and Dua Lipa were discovered through cover songs they’ve uploaded on YouTube at a young age. Personality: On top of skill, personality also works as a huge element while establishing an online brand for one’s self and may even go as far as surpassing the importance of skill. Many users have found success without specializing in anything of mechanical substance. While trying to come off as wholesome and positive might be a safe choice, many internet personalities have found success in coming off as unique, enigmatic, or controversial. Controversial figures and their polarizing thoughts/behavior is likely to attract a lot of traffic their way, regardless of what genre of content they’re into creating. Therefore, it can be said that, regardless of how the personality of a person may come off as, it is important to aim to be interesting and relatable to amass a following on the internet. Effort: The last element I want to highlight is effort. While it is realized by many that the internet offers a wide range of services available to its users, one might be surprised at how little of it we take advantage of. To amass a decent following, users are required to network as much as they can, and push their brand name in several different platforms constantly. Multitasking between separate social media platforms is important in increasing reach, as ones product may go to places never expected. Paid promotions have made their ways in to social media platforms more prominently and have become a huge part in online exposure. Conclusion: In conclusion, many parallels can be drawn between what must be done to find success online, and in real life job opportunities, as finding success is a universal goal and is being valued by similar virtues and elements. However, it is of utmost importance to understand that an open mind and an ambition to embrace change is what is required to form a successful brand online. Since the concept of a virtual office acts as an outlier from the traditional work sense, it is important to understand the magnitude of the opportunities that it may create without prejudice, and some effort must be shown into learning the technicalities to be able to get started on creating your own online brand.

President Trump recently announced tariffs on metal and aluminum. Sticking to his major communication channel for all foreign policy, he announced it on Twitter and mentioned “Trade wars are easy to win!”. However, this policy has met been met with a lot of uncertainty, and experts from around the world are afraid of the ramifications. The term for this economic phenomenon – “trade wars” sounds ominous, implying there is a winner and a loser. So, what exactly is a trade war, what does history teach us, and what will happen in the future? Ricardian economics advocates for trade based on comparative advantage, as opposed to trade based on absolute advantage. The principle of comparative advantage is driven by opportunity cost. Opportunity cost is the next best amount foregone by doing an activity. For example, you could be doing one of three things right now: Reading this article OR 2. Watching Black Panther OR 3. Watching Jersey Shore Reading this article will give you 100 satisfaction points, watching Black Panther gives you 80 satisfaction points, and finally, watching Jersey Shore gives you 10 satisfaction points. So as a rational human being (hopefully) you will choose to read this article. Consequently, you forego option 2 and 3, and between them, option 2 has the highest points. Thus, your cost for choosing opportunity 1 is 80 points (because it is the next best alternative). Applying this concept to Ricardian comparative advantage is the next step to understanding international trade. In his 1871 book “Principles of Political Economy and Taxation”, David Ricardo idealizes a global economy with only two countries, England and Portugal. Without going into details, it basically shows that if a country specializes in what it is good at producing, then it is more beneficial to international trade compared to autarky. The corollary of this is that countries engaging in international trade are dependent on each other for goods, which is why increasing tariffs on imports are not a good idea. The idea behind increasing import tariffs is to stifle international competition, and to allow domestic industries to grow. Consequently, the other countries’ industries face losses due to reduced exports, causing them to retaliate in a similar, if not aggravated manner. This loop goes on and on, which is why there are no clear winners or losers in trade wars. History tells us that protectionist policies have more negative consequences than their intended positive effects. Although these policies have been around beginning with mercantilism, there are three examples in this article which show the politico-economic costs. Italy and France After Italy’s formation in 1871, the government wanted to protect its infantile industries from international trade, especially from the influence of France, which was much stronger in terms of political and economic influence, compared to Italy. To this extent, Italy practically ended trade with France, by raising tariffs to 60%, one of the highest in history. In retaliation, France passed the Meline Tariff in 1892, which crushed Italian exports and delivered a monumental blow to the Italian economy. 2. United States of America and Canada During Republic governance after the Civil War, the government took protectionist measures in accordance with its economic nationalist platform. As a result, it suspended trade with Canada, and faced retaliatory measures. 65 major U.S. companies shifted production to Canada, instead of paying the high import tariffs. Thus, in an effort to limit outsourcing, this resulted in loss of jobs for the American economy. 3. Smoot-Hawley Tariff Act Considered to be one of the most extreme efforts undertaken by the U.S. towards protectionism, the Smoot-Hawley Tariff Act was implemented in 1930. Tariffs were imposed on hundreds of goods, however, the main purpose of this was to shield the domestic agricultural industry after the devastation of World War I. It is no coincidence that the Great Depression was also during the same time. Although this law did not cause the Depression, it certainly aggravated the situation. Canada and Europe retaliated to this, pushing trade barriers on more goods. In 1934, President Roosevelt retracted this law, and Reciprocal Trade Agreements Act. The U.S. also supported the General Agreement on Trade and Tariffs (GATT), the North American Free Trade Agreement (NAFTA) and the World Trade Organization (WTO). Evidently, imposing tariffs on international trade indisputably leads to trade wars. Some economists conjecture that only countries with immense bargaining power over its trade partners are in a position to push for tariffs and still gain from it. However, (as big as) U.S contribution to the  global economy may be, governments like Canada and organizations like the European Monetary Union are in a position to retaliate. The EU has already threatened to impose tariffs on blue jeans, Kentucky Bourbon and Harley-Davidson motorbikes. Coming back to President Trump’s proposal to increase steel and aluminum tariffs by 25% and 10% would lead to more structural unemployment in these sectors. Employment numbers in the steel industry have been declining, with around 650,000 people working almost half a century ago and 140,000 working today. It remains to be seen how the world will react to this. With China being a credible competitor to the U.S. economy, the Trump administration must make wise moves. Or, they will be met with fire and fury, like no one has ever seen before.

Personal computers are extremely complex machines. The intricacies of billions of individual circuit components working together and essentially upholding the foundation of the modern world are fascinating in itself, and it has been this way for the past few decades now. What’s newer though is the specialisation of labour that goes on within your computer. Since the 90s, computers are now operating with individual components, all connected to each other by the motherboard. One specific component stands out, however, and that’s not because it’s extremely important for your computer’s day-to-day functioning. The graphics processing unit (GPU) has a very straightforward and descriptive name, it… processes graphics. Essentially the component attempts to reduce the workload of the central processing unit (CPU) by taking over tasks that are related to making things show up on the screen. This leaves the CPU more time to do critical tasks, such as communicating with the Facebook servers in order to download the cat video you’re about to watch. The video data, in turn is taken over by the GPU, which processes it to make your viewing experience smoother and clearer. GPUs aren’t used only to show videos though, nowadays pretty much all of the user interfaces you interact with (such as the web browser you use to read this article, and the article itself) are actually displayed by the GPU. Video game and tech-savvy readers also know that they are used to compute the individual frames of the game that they’re playing. The latest computer-generated animated movie you saw? Entirely done by GPUs! In essence, if you can see it, it’s the GPU… or is it? I’m going to be discussing a particularly interesting phenomenon today. Fundamentally, it’s more about asset pricing, if anything. For some odd reason, GPU prices have gone up significantly compared to their launch prices in the past few years. An example would be the NVIDIA GeForce GTX 1080, which is quite famous for being the strongest consumer-grade GPU (remember that companies like Disney use thousands of higher performance units, and movies still take weeks to be processed from beginning to the end) had its price come from $500 to $899 on Amazon (and only one left in stock at the time of writing). Well, that’s really odd. Cost of raw materials or processing together has not increased nearly twofold over the past two years, and by any means the prices of these GPUs should have gone down given how newer components are entering the market. There’s something fishy going on, but in the end, it doesn’t get much more complex than your first-year microeconomics course: Supply and demand. With all the talk about cryptocurrencies going on at peak level for the past few years, I can imagine that a lot of people share my sentiments about how tiring it has become to hear the word ‘crypto’ in the first place. Yet, the reason for the GPU price hike is actually entirely about cryptocurrencies. The way most (not all) cryptocurrencies function is through a process called ‘mining.’ This term is used to describe the use of computing power to verify transactions. When someone mines a block, they are rewarded a significant amount of the cryptocurrency at hand. This economically incentivises people to mine, which sustains the network by having the transactions be verified reliably and quickly. The unfortunate issue is that the difficulty of mining is often artificially adjusted. In the case of bitcoin, every ‘block’ of transactions on average take 10 minutes to be mined. This means that when more people enter the network with more computing power, the blocks become more difficult to mine, and still take 10 minutes on average. Funnily enough, someone found out that GPUs are actually pretty damn good at mining. Even though your CPU can do the job quickly, GPUs are specialised in performing mathematical operations instead of logic operations. Mining involves heavy use of the former. Although there’s hardware dedicated solely to mining, such chips are produced at very small scales by independent manufacturers, making them very expensive (and often cost ineffective). Because GPU manufacturers have been in the industry for so long, and are able to manufacture at global scales, miners started preferring GPUs over dedicated mining components. Again, because more people entering the mining network doesn’t make mining any easier, there’s always space for a new miner to squeeze in and get some returns. This leads to insatiable demand for GPUs, but supply is still heavily constrained. GPU sales are still skyrocketing, not because people want to watch videos in 4K or play games with higher system requirements, but because people want in on the cryptocurrency action. Manufacturers of these components, even though they had the means to keep up with the demand, are no longer able supply them directly. Exploiting this opportunity, people who already have GPUs (or have the scale to purchase them as soon as they are available through the manufacturers) can optimise their prices to match the highest bidder’s willingness and ability to pay. The issue has gotten to such a stupid extent that the manufacturers, such as NVIDIA, are now attempting to impose sales restrictions on their own units and limiting the amount available for purchase per customer. It has gotten past the point of basic profit maximising, but actually trying to keep their customers loyal and happy. If your target audiences, which consist mostly of video game players, are unable to purchase your products at suggested prices, then all they left is the overpriced stock of third-party retailers. Unfortunately, the manufacturers’ attempts are in vain, and the prices are still nearly double what they should be.

The science of economics is heavily criticized as to be disintegrated from the society. During the war periods, most of the attention of the academics was devoted to the fact that the decision-making of an individual is only based on his or her own motivation, without any altruistic consideration of others. After the World War, some deviation from the prevalent methodology of studying the rationality of humans was realized and the study of economics expanded (albeit quite minimally) to group behaviors and how group interactions can have some certain extent of influence on future individual decision making. However, it has reverted to the initial direction in recent decades and researches in economics are again dominated by findings that can only indicate scanty correlation and not the underlying causality. This is a concern which makes the science of economics and its relevance to the society as fragile as ever. After all, the science of economics evidently belongs to the home of social sciences, so it must have had some degree of relevance to the study of society, which is sociology. Sociology could be seen as the foundations of many economic theories and explanations to many economic matters. In this issue, I would like to dive into how sociology has helped economics so far and why it should receive more attention from economists. There is much more similarity between the two fields than you might think. Sociology and Classical Economic Theory George C. Homans, a famous social scientist, believes that there is an agreement, and a fundamental similarity, of social relations with respect to the theoretical foundations of economics. He discovered the observation that the social reward for a particular action is analogous to the classical demand-supply model. For example, the law of supply states that the higher the price of the goods, the more manufacturers would offer the product to be sold. His constructed social theory shares some insight from the law of supply: the more rewarding a course of action is, the more likely an individual is to perform that particular type of behavior. Similarly, the greater the cost of undertaking an action, the less likely an individual is to perform it, which resembles the theory of demand. However, despite the interesting observations of Homans (along with his other hypotheses), the theory does lack some extent of validity. If the theory is attempted to be generalized to other complicated contexts, for example, extending to the relations between (social) organizations instead of the interaction between a limited number of individuals, then the simple law of demand and supply does not hold true anymore. Extensions of this social theory including the recognition of the difference of social macro-interactions through the difference of regional culture, the social status and other types of perceptions, but it does not seem to help later generations of economists to do their work. Sociology and Economic Behavior The studies of sociology and its relationship with economics have gradually shifted from purely focusing on social relations between humans independently to a more central approach on the interaction between multiple social agents. More specifically, in the works of Frank Dobbin (2005), the interference of power, institutions and the networks can be used to identify the myriads of factors influencing the economic behavior of individuals: Power relates to the manipulation of one’s influence on another party or multiple other parties. The concentration of power in the hands of the few can exert significant influence on society, for example, raising the bargaining position of one relative to others (on a micro-scale) to taking private benefits as being the common interest of the society (on a macro-scale). Karl Marx was the first intellectual to publish a renown detailed description of this matter and put forward many harsh critiques on the how capitalists use political liberalism as the protective tool to push their agenda forward. Social institutions also affect individual economic behavior through customs and beliefs. The law, regulations and the states indeed shape certain behavior in a manner that some certain courses of economic actions are restricted through the applications of appraisals and punishments to a respective behavior. Religious doctrines can have a significant impact on people’s behavior, as while Protestantism promotes entrepreneurship and work ethics as the pathway to live, other religions praise salvation as the means to achieve the fulfillment of spiritual life. This is arguably the powerful motivator to the prosperity of Europe in the last millennia, compared to their counterparts elsewhere. Aside from the influence of social institutions, your social milieu can enforce you to perform appropriate courses of actions that are fitting and acceptable. This so-called network effect will influence your behavior depending on which social group you identify yourself to be in. One can be extremely rational (that is, acting solely in your own self-interest) if you are surrounded by the environment in which everybody is more self-centered than altruistic. For example, your own occupation also shapes your future interests and hobbies that follows the behavioral patterns of your friends and colleagues, instead of being perfectly rational as the classical economic theory asserts. As the relationship between behavioral studies and sociology are so closely connected, in certain cases, these two interests can be often understood almost in an identical manner, especially during the latter half of the previous century. A small difference does arise between the studies of the two disciplines in themselves, is that while behavioral economics is more empirical and utilizes mathematical and statistical methods, sociology is more theory-dependent and analyzes social connections and behaviors in a more qualitative manner. Sociology and….. the financial crisis? Although initially, the relationship might seem a bit far-fetched, the social scientists do think about the financial crisis as the anticipation of reconstructing the economic structure. In economic literature, the failure of the financial system, namely the process of securitization, is largely attributed to the collapse of the housing market, the banking sector, and ultimately, the global economy. Social scientists do not see the financial crisis as the corruption of some financial abstract mechanism or structure, but rather see it as the clash of the interaction of individual behaviors and culture. Professor Michel Wieviorka described the financial crisis in 2008 as the global mutation in the last 35 years. He also prescribed the championing of neoliberalism (as social institutions) in which the adoption of deregulation policies in the financial sector in the United States is highly supported by politicians. These policies have allowed the existence of “modern” financial products that are so complicated that only a few could possibly understand the complex ingenuity behind it. As they were advertised blatantly to the consumers, more people kept being bought into it. This gives rise to a pattern of behavior called moral hazard, which is now widely popularized in economic textbooks. Economics is defined as the study of how societies use scarce resources to produce valuable commodities and distribute them among different people. However, I think that most people realize that in economic studies, the concern for society is often left out of the equation and it tends to be all about the consideration of the parties as completely separate identities. I personally think that there is some departure of this objective of us as students of economics. In the study of economics, we are seldom tested on the reasoning behind the motivation of individual choices. Although the discipline of game theory can provide some insightful explanation into explaining economic behaviors, it could not uncover the underlying economic reason that most researches that are being conducted. There is too much reliance on finding explanations to an economic problem through with hypotheses which in many cases are quite unreasonable. There should be a necessity of our discipline to go back to its roots where initially economics is studied based on each respective behaviors, and understanding all of that is fundamentally important to take practical steps forward in advancing economics.

We all have that one friend who knows exactly how much the dollar will cost in a week, a month or in a year. And there is always another friend who also knows, but has a completely different story. Which of them do you trust? As some of you might know, I come from Ukraine. A country in Eastern Europe. A country that is going through a period of transition and change. But I am not going to touch the topic of political and economic instability in my home country. I want to talk about predictions. Predictions that people, who live in a country that is experiencing a period of uncertainty, are making. Prediction about prices, inflation and exchange rates. In the past years, people’s lives in Ukraine, in particular, became very much dependent on the cost of the dollar. When Ukraine experienced the first wave of gryvna (Ukrainian currency) depreciation, everyone in a country suddenly became experts and knew exactly how much currency to buy, how much to sell and when will be the best time to exchange it back. «In reality, no one knows anything» Let’s face it. In reality, no one knows anything. Professionals who work in the largest private companies and in governmental institutions, have a large amount of information and have tools for forecasting the exchange rate. They have financial models – in simpler terms, Excel sheets, in which they enter different figures such as interest rates, the volume of imports and exports, etc. Specific formulas consider all given numbers and the forecast is being based on that. Easy and simple. Although, how reliable are these predictions? In quiet periods, the fundamental forecasts do not differ much from the current situation and therefore, are of a little interest. In the times of instability, however, no formula can take into account the whole diversity of life – every fundamental model has its own set of unpredictable factors. As a result, the forecasts turn out to be ad hoc and inaccurate. In such periods of uncertainty, one of the main questions that people face is whether to keep their saving in home currency or any other currency, for instance, dollars or euros. We, as future economists and financiers, know how it works – when we save money, we are interested in their safety and the ability to use money when necessary. Savings are usually stored in cash, in bank accounts or in deposits. If you store savings in the deposit, the bank will charge interest on it, the savings will grow. Because of inflation, today’s gryvna or dollar is almost never equal to tomorrow’s. Money is gradually depreciating, prices are rising. For a 1000 gryvnas 10 years ago, you could have bought groceries for the whole week, today – you will barely able to buy at least half of those products. «What matters is the purchasing power, not the amount of money on your bank account» As a result, the amount of money on your bank account is not important, what matter is what you can buy for this money in the future. The future purchasing power of gryvna is affected by two interrelated factors: the exchange rate and inflation. The exchange rate is important because Ukraine does not produce enough goods on its own. And what is being produced within a country, is still done on imported equipment and technologies. Thus, prices for almost any good, from an iPhone to sugar, depends on the cost dollar and euro. From this point of view, keeping your money in foreign currency is better: it keeps the purchasing power more stable. An iPhone is worth $ 700, and it will worth it in the future. Another issue, though, is that the majority of the population in Ukraine receives their salary in gryvnas, and $700 dollars today in gryvnas, will, most likely, cost less in the future. Moreover, in addition to the exchange rate, there is one more factor influencing the relation between gryvna and dollar – the difference in interest rates. In the case of savings, this is the interest for which money can be placed in the deposit. Rates on gryvna deposits are traditionally higher than for foreign currency. This is not because the gryvna is so cool, but because of high inflation and general uncertainty in Ukraine. The contribution in gryvnas brings more profitability than in dollars. This is some sort of reward for supporting the home currency. Deposits in gryvnas are good when the dollar rate does not change. And when the gryvna rises in price (that is, the dollar costs less in gryvnas), then you find yourself in an even better position: not only  you have a higher percentage, but the currency becomes more valuable. The question that arises here is whether the interest received at a high gryvna rate compensates for the losses from the devaluation of the currency? There is no clear answer to this question, and after all, it depends which time interval is compared. For instance, when gryvna depreciated from 8 gryvnas to almost 30 gryvnas per $1 in 2015, it was more profitable to keep your savings in dollars because of the amount in gryvnas. Originally equivalent to $ 1000, turned into $ 869, and $ 1000 turned into $ 1150. Two things can be concluded. First of all, in short term, the dollar does not always provide a winning situation. And secondly, dollar gives greater stability in the long term.  Over the last 5 years, a thousand dollars turned into a thousand and a little and the equivalent in gryvnas turned into less than a thousand. The reason for that is a drastic devaluation in 2013-2015. Lesson learned? What are the lessons that Ukrainian people should have learned over the past couple of years? Firstly, and most importantly, there is no simple and accurate answer to how much the dollar will cost in the future. Even the most logical and stable model of predictions cannot take into account sudden shocks and unexpected changes. Secondly, a gryvna today involves risk but possible profit. A dollar today – is stability. Savings imply stability, investments require some risk, speculation is a concentrated risk. If you want to risk in the hope of getting a quick profit, choose for the gryvna. If you want to invest for a long time – rather, the dollar. Have Ukrainians learned their lessons? Well, this is a whole different topic for debate.

It is common for the Turkish government, and numerous governments worldwide, to use foreign policy as a tool of domestic policy. A mildly interested citizen could notice how politicians change their tones dramatically on polemical subjects within notably short time frames, tailored to their current political agenda. I find that this take on propaganda works especially well in nations many would describe as emotional, fanatical, and above all temperamental. It is beyond my insight to comment on the matter globally, yet I can easily approach the subject by my keeping up with the Turkish news. In a recent example, Turkish Defense Minister Nurettin Canıklı urged the US to end support to the YPG (People’s Protection Units, a mainly-Kurdish militia) in Syria. President Erdoğan supported Canıklı, by mentioning that the US troops standing in the way of Turkey’s military operations in Syria would receive an “Ottoman slap.” The US State Department spokesperson probably had to google what an Ottoman slap is before commenting, “We’re used to that kind of rhetoric, whether it’s from the Turkish government or from other governments… we don’t get too riled about that.” I luckily did not have to look it up; an Ottoman slap is believed to be a hand combat technique in the Ottoman army in the event of a soldier ending up unarmed. One that is such a strong blow that it could easily turn out to be lethal. Another instance was last year, March 2017, when President Erdoğan labeled the Dutch government as “Nazi remnants and fascists” after a Turkish Minister was not allowed in the Netherlands as part of the constitutional referendum campaign. Erdoğan’s words have echoed in the global media, accompanied by much disconformity. However, when it comes to a vote, the criticism from abroad does more good than bad. It would be naive for anyone to think that Erdoğan and other Turkish government officials have unresolved anger issues and resentments, and that the Ottoman slap metaphor is impromptu. Clearly, these are carefully calculated political moves, and controversy is the oil that greases the wheels. Any veto for the Turkish government from abroad is translated right into envy or bigotry in the mainstream Turkish media. Conveniently, this plays right into the temperament of the people, and their patriotism. This exact scenario took effect in the last year’s constitutional referendum when support for Erdoğan and the Justice and Development Party (AKP) peaked every time a European government (Dutch, Swiss, German, and Austrian) disallowed campaigning in their country. Inspecting Erdoğan’s casual threats to various countries on a regular basis, one might be surprised that those very words have likely increased his approval ratings in the recent polls by some percentage points. What is more, these spectacles of tenacity practically have immunity against any opposition opinion. No opposing leader would imply that they go hand in hand with a European government in their critiques. During the referendum campaign, opposition leaders who were against the referendum measures censured EU governments for blocking campaign events for the sake of not crossing the public opinion. At the time the Dutch government emerged as the public enemy, a few days later it was some other country, person, idea… In essence, a common enemy often brings people together, independent of what or who that enemy might be; at least in Turkey. Despite gaining massive support and popularity back home, this rhetoric is deteriorating EU-Turkey relations, along with years and years of discourse. With Greece and Bulgaria bordering Turkey on the west, the EU has undeniable ties to Turkey both geographically and economically. Since 1996, the EU-Turkey Customs Union establishing a free trade area proved much useful to both parties. On Turkey’s part, it has improved both imports and exports, and consequently the GDP per capita. The country’s economic transition from agrarian to industrial was sped up and eased through its membership of the customs union. Without a question, a finer dialogue between EU and Turkey which aims to make progress as allies rather than create speculation would let many other rewarding opportunities possible for the pair. The repercussions of the undiplomatic tone of voice that Turkey has adopted in the last years is worrying in other aspects of life too. A conflict with Turkey helps right-wing extremists in Europe with an anti-immigrant and anti-Islamic agenda. This, in turn, complicates many things as simple as a visa application for the Turkish people. When Dutch – Turkish people living in the Netherlands protested in front of the Turkish Embassy in Rotterdam during the referendum campaign, Geert Wilders, the leader of the Dutch Party for Freedom (PVV) tweeted:“The Netherlands can see that these people are Turks, not Dutch… they have Dutch passports but they don’t belong here.” Wilders is using the same tactic, exploiting his voice as a politician to criticize specific countries/people in order to round up support back at home. While in the short term this kind of behavior plays well for certain politicians or parties, what is at stake for the people, diplomatic conversation and progress, is far too important to joke around with. However, this does not mean that the politicians will play fair. It is up to the people to set the theatre apart from the reality and turn to actions rather than words when it comes to politics. It would be no surprise to witness the use of similar language as Turkey gets closer to the 2019 presidential elections. Hopefully, today’s elections’ dramatics will not cost the Turkish people their future.

1st October, 2017. A mass shooting in Las Vegas kills 58 people and injures 851 more. 5th November, 2017. A mass shooting in Texas kills 26 peoples, 20 injured. 14th February, 2018. Mass shooting in a high school in Florida, 17 people killed and 16 more injured. Those are latest ones. The big ones. Gun ownership is controversial. Every time following a mass shooting or any unfortunate incident concerning weapons occurs, debates are held about the efficacy of gun policies: Should we make the laws tougher and ban the ownership of firearms? Should we lessen them and let people posses their own arms to protect themselves? Both sides can be argued and defended. The United States is one of the world’s most permissive countries concerning gun ownership policies. The Second Amendment of the U.S. Constitution states “a well-regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed,” but individual states have their own laws and regulations, some of them more restrictive, some others more indulgent. The Gun Control Act of 1968, as amended by the 1994 Brady Handgun Violence Prevention Act, prohibits the sale of firearms to several categories of “prohibited persons,” such as people under 18 years of age, those with criminal records, the mentally disabled, dishonourably discharged military personnel, people taking drugs, and others. Apart from these, the U.S. has few restrictions when it comes to gun ownership policies. In fact, the country, with less than 5 percent of the world’s population, has about 42 percent of the world’s privately-held firearms. This makes the U.S. the country with the highest per capita gun ownership in the world, and among developed countries, one with the highest homicide rates, of which great part of it is caused by gun homicides. It is not that America has much more crime than other countries (many other developing countries score higher on the homicide ranks), but it is that crime in the U.S. is much more lethal. Why? The problem when it comes to gun ownership in the U.S. is how easy it is to get a firearm. Under European Union’s laws, firearms are classified into four categories based on their level of dangerousness. The acquisition and possession of these are subject to a license and other qualifications that must be met by individuals, such as having a “good cause” and not being a danger to themselves or to society. In addition, EU Members are required to establish a register of firearms, to which only designated authorities will have access.  Dealers are also required to maintain a register of firearms. The table below illustrates selected conditions some developed countries require from their citizens when owning firearms: Source: gunpolicy.org As shown, all other countries require a license to purchase most guns and those purchases are recorded into an official registry. In order to get a license, people need to state a reason for why they want a gun. Additionally, most of those countries demand a safe storage and a safety training. Note: some U.S. states have passed stricter laws. For example, California’s state constitution has no right to bear arms provisions, and all gun sales require a background check. At this point, it would be logical to think there is a positive relationship between gun ownership and homicide rates among highly developed countries. Making it simple, more guns means more deaths; fewer guns, fewer deaths. However, the controversies of this issue are more complex. First of all, can stricter gun regulations lead to decreased rates of violence? Looking at some data and examples, it is easy to find the existing positive relationship between the two concepts. Let’s take the example of Australia. After a mass shooting in Tasmania in 1966, the government banned and bought back all semi-automatic and repeating shotguns (about 700.000 of the total 3 million total guns), and imposed new restrictions on owning other guns. Many analysts have declared the effectiveness of these measures, citing declining gun death rates and the absence of gun-related mass killings in Australia since 1996. Because of this, Australia’s gun control efforts have been suggested as a possible model for the U.S. to follow. If these restrictions have worked in Australia, a country with very lessened laws concerning gun ownership before 1996, why would they not work in the U.S.? The problem when comparing these models, making the assumption that these regulations would work in America, are two: First, Australia did succeed with the tougher policies and ban the automatic and semi-automatic rifles, but research shows that among the various attempts that have been made to enforce gun confiscation around the world, only about one third have succeeded (this research was conducted in 72 countries by the Small Arms Survey, 2007). Furthermore, if failing to successfully implement the restrictions, the United States could expect a great amount of the current stock of firearms to flood the black market, which rounds the 325 million total firearms compared to the 3 million in Australia. Howard Metzenbaum, an American senator, resumed the issue stating “if you don’t ban all of them (guns), you might as well ban none.” The second problem is that we are not certain to which extent do gun policies reduce homicide rates. Some studies, and especially many conducted by the non-profit corporation RAND have not found a strong evidence on the causal relationship between specific gun policies and outcomes such as reductions in homicide and suicides. RAND studies state that the decline in violence in those countries that adopted stricter laws (in this case, Australia) is not a direct consequence of the laws adopted, or at least not entirely. On the contrary, they claim that levels of violence, homicide and suicide were already on a declining rate prior to the tightening of the laws. The RAND studies have added more uncertainty to the present question; nevertheless, some types of measures have been found to really make a difference: policies meant to prevent children from getting access to firearms (e.g. safe storage of guns) reduce both suicide and unintentional injury and death. Also, policies that require a permit for the purchase a firearm reduce the rates of violent crime. This might be the reason why America’s homicide rates rank so high compared to Europe’s or Australia’s rates (and also to Israel or Japan, as frequently compared developed countries). Do fewer guns therefore lead to less violence? There are many other factors contributing to violence, name poverty, drug consumption or urbanisation, and as most of the times when it comes to ethical issues, it depends. But certainly, among highly developed countries, more guns lead to more gun deaths. As always, we as human beings should be aware of our need (and responsibility) to behave morally. Killing others, killing ourselves, to me it is still incomprehensible. After all, I believe, lives are priceless.

Today’s article is by our guest writer Sergey Khalil. He’s a third year student at the BSc Economics and Business program at the FEB. Enthusiastic about what new technologies can bring, and trying to take part in the process of shaping the future through investment. As the title suggests, we live in an era of limitless possibilities… and YES, it does include ‘printing’ your very own ‘currency’ with no legal consequences. At least for now, that is. Sounds a bit far fetched, but this is essentially what has been happening with the emergence of ICOs, or Initial Coin Offerings—a new way for companies to raise funds. Anyone can issue their own ‘cryptocurrency’ in a matter of minutes, thanks to a handful of platforms that let you care only about the name of a new coin and how many of them you want to create. This might seem as an easy way to get rich quick, which surely is within the realm of possibilities, but chances are me and you are not the only ones who have thought of it this way. Most new technologies go through a ‘hype’ phase which is clearly indicated by extensive media coverage, huge money inflows and a consequent advent of numerous scam artists wishing to make a quick buck on impatient and uneducated investors. This article is not about maximising your return-on-investment (ROI), but rather about minimising risk exposure, which is key to any investment strategy. Even if you are not planning to invest in crpyptocurrencies any time soon, getting to know the basics of the ICO economics and more importantly how not to lose money to bad ICOs can prove to be useful in the long-run. An ICO in a nutshell ICO, again, stands for Initial Coin Offering, which is a way for a company to raise funds by ‘offering’ investors the opportunity to buy newly issued digital tokens with other cryptocurrency (e.g. BTC) or fiat money (e.g. USD). As a general rule, an ICO is held in an early stage of the project to finance its launch and core product development. In that sense an ICO is quite similar to crowdfunding. One may also notice an uncanny resemblance of the terms ICO and IPO, or Initial Public Offering. Probably this is one of the main reasons for confusion between the two. “Digital tokens” have nothing to do with ownership of the company, in fact, because of the absence of clear regulation guidelines there might not even be a company behind the project in the first place. Moreover, it is usually done without the friction and restrictions of conventional financial system, since major part of funding for ICOs comes in the form of other cryptocurrencies. So it is fair to say that an ICO is a way for someone to attract capital at an early stage of the project without the hassle and bureaucracy associated with obtaining a loan from a bank, or seed funding from a venture capital fund. Why are investors even attracted to ICOs? Well, they generally have these two ideas in mind before investing: Buy now for cheap, sell at a higher price later on: This sentence alone pretty much sums up what investing is, however the difference here is the expectation of a disproportionate ROI, that has clearly been the case throughout the last couple of years on cryptocurrency market. Retrospective ‘mental trading’ (how much would I have now, if I invested some money in ETH some time ago) leads many amateur investors to experiencing FOMO (Fear of Missing Out). Considering the Ethereum example, $100 invested during its token sale could go a long way with more than $200,000 in present value. No wonder people want to jump on this bandwagon! Use tokens to get platform’s services at a discount: For instance, early investors in FileCoin (decentralized file storage platform) could have received more than 90% discount on its service (storing data) as of when the article is published. This approach seems to be very pragmatic and still prone to turning into speculation. These two ideas originate from two categories of digital tokens: security tokens and utility tokens. First ones behave similarly to stocks and other conventional securities, while the latter are used as integral part of the blockchain platform providing access to its services. It is a good practice to assume all new digital tokens to be securities, unless there is a clear reason why this token is such an important component to the platform it’s being offered by. How does the a lack of regulation and immature markets come into play with ICOs? Having the basics of ICOs covered and out of the way, we can now explore the most neglected side of this magical money-making market: risks. Probably the biggest one is fraud, when founders of a project ‘disappear’ after its ICO is done. Since there is no regulation of such crowdsales, investors give their money based solely on trust. At the same time, it is almost always the case that there are no binding commitments from the team and the company to deliver practically anything, and in the absence of the legal structure they will have no liability either. In some sense, the emergence of numerous ‘exit scams’ and fraudulent projects is economically incentivised. Moreover, significant risk here is in the management of the received funds: Start-ups usually receive funding in stages and every next round is contingent to performance – if a company mismanages first seed money and will not fulfil its commitments, no further funding will be available. Compare that to the ICO situation, where a business idea secures from several to tens of millions USD without even having a minimum viable product. Who wouldn’t want to get several millions in cryptocurrency with no liability? In fact, many would – including those with good intentions of bringing value and those with selfish intents. It is important to acknowledge that it is entirely possible that the project will not survive the early adopter phase. Like in traditional markets, betting on innovative technology can yield high returns but it also means that most of the projects are likely to fail, since nobody knows what will work and what won’t. It is really hard to anticipate what native ‘killer feature’ a new technology will have and when a successful company that brings it into reality will come about. Remember, Facebook didn’t exist until 2003, and just like Uber, Airbnb and Tinder it has not been part of the internet boom of the 90s. Also, it is useful to keep in mind that cryptocurrency markets are subject to price manipulation in large due to lack of liquidity, which may make investments made during a hype phase of the project look rather disappointing with major negative ROI for long periods of time. This eventually leads to the market risk. The market is still in its early stages of development and prone to panic sells during periods of FUD (Fear, Uncertainty and Doubt) as well as moments of euphoric price spikes, hence the enormous volatility. The scenario when global community would ban all the cryptocurrencies altogether seems highly unlikely, especially with existence of a few cryptocurrency ‘safe heavens’ (e.g. Belarus) and the creation of the self-regulating associations in Japan; however, prices still seem to be very dependent on the investors’ sentiment. This situation is likely to continue until ICO regulation comes around as a part of the broader set of laws that would outline the legal status of cryptocurrencies, thus eliminating a significant element of uncertainty in that sense. What to look out for before participating in ICO? Investing in the early-stage projects involves putting trust in the team and founders, in their competence, diligence, and commitment. So, background and reputation of team members behind the project are utterly important. A lot of the criteria converge to the ultimate question: Will this team be able to succeed in what they have set out to do? There is a slow, but clear move towards more rational valuation methods comparable to that of VCs. For example, such a simple thing as funding through an escrow can vastly reduce the unnecessary risk of project failing in the short-term by conditional capital release by a third party (the escrow), and it also decreases the incentive for the team to just take the money and leave, since relatively not that much money is available at any given moment. And yet it is not so common, but with an increasing number of fraudulent projects it is easy to imagine for it to become general practice on the market. ICOs that have something to show are much more likely to raise capital. In contrast, many VCs wouldn’t even consider investing in a start-up without MVP, since it shows team’s competence and determination to make the project a reality. A careful study of the associated whitepaper (the document outlining how the project and the cryptocurrency/token is supposed to function), agreements, and other supporting documents that should be easily available really can’t be stressed enough. Doing so will help to surface some peculiar details that organisers of the ICO may have decided to conceal, like that the project might not be incorporated. Relatively speaking, the chance for deliberate fraud should be less than that of a project that is not incorporated. So by extensively informing yourself ahead of time, you can make better investment decisions. By the way, in the IPO world it is not even possible to not be incorporated, which again signals how young this market really is. Instead of a conclusion… The complexity of it all makes the barriers to entry seem high, when in fact they are lowering by the minute as companies start to realise that the one who is closer to the consumer wins. In the context of the blockchain infrastructure, it means the emergence of more accessible and intuitive interfaces for the end users. Maybe you haven’t learned today how to print your own money per se, but at least you are much less likely to fall victim to scam-ICOs and hopefully not as likely to take uncalculated risks with cryptocurrency investments in general. Investing is not as easy as it seems and requires a lot, let me repeat again, A LOT of research and I mean hours of scrupulous reading and fact-checking. With the current stage of the market framed as ‘building the infrastructure,’ most projects are quite technical in nature, …but hey, when it is all easy and clear, there simply won’t be as many high-risk high-return opportunities.

Contrary to popular belief and university propaganda, academia do not always foster an independent mind. In their first course on microeconomics, every budding economist is confronted with the notion of rational economic man allocating his scarce resources to fulfill as many of his stable and given preferences as possible. If these budding economists are like me, they will find this very hard to stomach. I buy my groceries in the supermarket that is closest to my home. I buy a certain brand and type of computer if my tech-savvy friends recommend it and I find myself influenced by advertising on a daily basis. So, far from making rationally informed choices, I am a lazy uninformed creature of habit. My preferences are not stable and given, but depend on social ties and advertising. Moreover, behavioral economists have shown that such deviations from rationality are the norm rather than the exception (e.g. Thaler 2015). So, far from confirming the theoretical starting point, subsequent experiences and observations in economics have proven it to be even more misguided than it already appeared at first sight. I was told however, that none of these misgivings mattered. Economic rationality was not to be taken as a simplified description of real behavior, but rather as a ‘center of gravity’. People could deviate from rationality for a while, but the market would discipline them in the end so the trend would be as our model predicted. I couldn’t see how or why that would occur. If people buy their groceries dearer than necessary, this does not usually leave them so deprived and penniless that they are forced to rethink their shopping strategy. Thus, the irrational behavior of many people may well persist forever. But if this is so, markets cannot be expected to equilibrate. At this point, my microeconomics professor had had enough: ‘Mr. Damsma, if you want to be an economist it is crucial that you get a hold on this stuff. Insight will come, I promise.’ The moral of this story is that independent, critical thinking is often fine for card carrying members only. Undergraduates will have to learn the rules of the discipline first. So, far from fostering an independent mind, it can be said that academics often only accept criticism that follows disciplinary rules.  Any attempt to debate the suitability of these rules themselves is likely to be met with skepticism: if someone does not accept a discipline’s starting point, s/he probably has not had proper training and is thus not worth talking to. Thus, having an independent mind hurts your academic career, while uncritical assimilation helps it forward. And so, like many students before me (and undoubtedly many after me), I swallowed my criticism, silenced my intuition and set to work manipulating model after model. I could not believe this would ever help me understand reality and my professors hardly ever tried to demonstrate that it did either. Microeconomics 101 is not based on empirical data, nor is its truth demonstrated by them. As my studies continued, it became clear why my misgivings about rationality and equilibrium were silenced. It turned out that not only micro-economics, but modern macroeconomics too, was based on these counterintuitive and factually absurd representations of economic agency. As my studies continued, ‘the abstract theories intensified [and] the equations multiplied’ (Raworth 2017: 2) but insight never came. Sure, I learned to fit models to data, but the data hardly ever supported the model. It was rather the other way round: parameters in the model had to be adjusted until the model fitted the data. But if every situation requires a new and unique model specification, it can hardly be said that the model helps us understand the data (Romer 2016). Unfortunately, economists are not rewarded for enhancing our understanding of empirical data.  Instead, they are rewarded for showcasing their ability to force them into a framework in which rational agents interact to equilibrate demand and supply in markets. Thus, this ‘wholly counterintuitive doctrine (…) drives away all but a high-morale in-group that is enough to keep the sacred flame burning’ (Solow in Colander 2007). After the financial crisis, more and more economists started to doubt whether this institutionalized silencing of critical thinkers was such a good idea. Krugman speaks of a ‘Dark Age of macroeconomics’ (2009) in which conformity with conventional wisdom (viz. rationality and equilibrium) trumps critical thinking and an honest pursuit of truth. Others explain ‘the systemic failure of academic economics’ with reference to ‘self-reinforcing feedback effects within the profession [which] led to the dominance of a paradigm that has no solid methodological basis and whose empirical performance is, to say the least, modest’ (Colander, Föllmer, Haas, Goldberg, Juselius, Kirman, Lux & Sloth 2009 in Kolb (ed.) 2010). Rodrik chimes in by saying ‘Macroeconomics may be the only applied field within economics in which more training puts greater distance between the specialist and the real world, owing to its reliance on highly unrealistic models that sacrifice relevance to technical rigor’ (2009). Levitt makes essentially the same point when he writes: ‘The single easiest way to make a mark in a modern macro paper is to solve a problem that is really, really hard mathematically. Even if it is not relevant to anything, it is seen as a sign that the author has “impressive skills”, which is enough to get a job – and even tenure sometimes – at top universities’ (2009). The list goes on and on, with similar sentiments being voiced by Nobel laureates like Stiglitz or former governor of the U.S. Federal Reserve System Meyer. This begs the question as to why students still need to learn this stuff. If so many prominent economists believe their theories have led us astray, why do students still need to learn them? Are professors in modern macroeconomics willfully ignorant? Perhaps some are, but even those that have seen the writing on the wall, are frequently unable to break the mold. After all, they rose to prominence by being incapable of independent thoughts or willfully ignoring them (I, for one, do not see how else one could persist and flourish in a ’wholly counterintuitive doctrine’). So, even if they know deep down that their profession is broken beyond repair, they have built their career on their extraordinary ability to ignore reality and manipulate absurd models rather than their skills in contemplating and assessing more realistic alternatives. So they continue to assess their students by the only yardstick they know: their ability to manipulate and build models in which rational representative agents optimize outcomes and equilibrate markets. Students that want to transform their discipline, thus have to navigate a minefield. If they are to become experts whose knowledge is relevant, they have to approach their discipline like the joke that it is. At the same time, they can only be taken seriously if they gain respect by getting excellent grades. Perhaps modern macro-economics is best approached like a psychiatrist would approach a delusion. A psychiatrist is usually genuinely interested in the contents of the delusion and the implications it has for his patient. Thus, the psychiatrist studies the delusion with zeal and enthusiasm in order to understand his patient’s inner world, but he never contemplates moving to that world himself. Similarly, economics’ students can try to get a firm grasp of the paper world their discipline presents them with in order to get to grips with economic pathology. Understanding your discipline’s delusions is the first step to dispelling them. Once dispelled, recovery can begin. As the quotes above indicate, the profession is open to therapy, but it needs a friendly nonjudgmental outsider that understands the delusion’s appeal to guide it out of it. It knows that its delusions are harmful, but is afraid to live without them. The profession needs a therapist and students may be well placed to take on that role.

Paved with various political controversies, the start of the 23rd edition of the Winter Olympics brought many ongoing questions to light. With security concerns voiced by France, Germany and the US toward the end of 2017 as a result of North Korea’s nuclear programme, the event was viewed with skepticism and as a spark for controversy. As such, I decided to look at the timeline of political events in parallel to this year’s Olympic event with the aim of answering whether South and North Korean relations are on the path to improvement, or not. More than 30 years ago, South Korea was hosting the Olympic Games for the first time. With a booming economy, the “Asian tiger” was ready to showcase the rapid development of its capital city, Seoul. However, the news was not well received by its neighbor. With less than 35 years since the separations, relations between the two Korean states were colder than ever and the competition between the them was heated. Thus, North Korea proposed to co-host the summer Olympics, and when the initiative was declined by the IOC (International Olympic Committee) the rivalry sparked. Unfortunately, in 1987 the Air Korea Flight 858 was taken down by a bomb, causing the death of 115 people. Therefore, the ’88 Olympics ended with North Korea not participating at all, lost lives and an even more unstable relationship between the two countries. But the situation is a lot brighter this year. On the 9th of February 2018, South Korea is hosting the highly anticipated sports event for the second time. Fortunately, the flow of events seemed to have gone in a different direction, especially concerning the relations in the Korean Peninsula. At the beginning of January Kim Jong-un( North Korea’s leader) proposed diplomatic talks over the participation of North Korea at the Olympics. It came to a shock when on the 17th of January, the countries announced a singular delegation, which was to march under a Unified Korean Flag. The news was largely unexpected as last year’s relations seemed tenser than ever. The short-run improvement was a relief for many, and it seems to have allowed the Olympics to happen without large political controversies. At the opening ceremony, the North and South Korean delegations walking side by side was a moment of hope for many and the first start to better international relations.  Thus, it appears that president’s Moon Jae-in’s campaign promises of improving relations within the peninsula are starting to come to tangible facts. Since Trump’s election, the G-zero world has forced countries, such as South Korea, to take initiative into their own hands. As America is slowly drifting into isolation it is likely that Moon will try to come to an armistice with Pyongyang. This year’s Olympic Games might have acted as a platform for a plan that was already thought through. As bright as the future might seem on the official’s side, the people are far from being united. This underlines the unsustainability of the short-term improvement. Once South Korea announced the unified female hockey team, there was great general unrest. The situation is even worse as the young people were the ones most vocal about it, raising a clear division among the two nations. As the future of the country, their reluctance to adhere to Moon’s idea of nationalism poses a real and long-term problem, which is unlikely to be solved in a matter of weeks. The situation is further exacerbated by the little consideration to Kim Jong-un’s unpredictability. It is important to remember that just a month ago the leader was reinforcing the reality of North Korea’s nuclear weapons. All in all, the initial question does not seem to have a definite answer. With the same language and cultural heritage that the two countries share, the hope of better relations is strongly justified. It seems hard to comprehend the division between so many families that the spheres of political influence have created. It is hard to determine whether the time for unity can be seen upon the horizon. The lack of transparency from North Korea and the many South Korean sources give us half of the larger picture. But, unity is driven by the people, and a stronger cooperation between the two countries is frowned upon by many at the present moment. As the Olympic mascot for this year, the white tiger, South Korea still stands alone. However, this might not be the same tomorrow.

For humankind, basic resources have always been a reason to begin conflicts. Take the example of agriculture; since its discovery, ancient human tribes fought each other for the most fertile piece of land. The deadly diamonds market has split apart entire countries in Africa resulting in the creation of criminal self-defense groups that have threatened international peace. Oil has also played its role by destabilizing the Middle East and giving rise to some of the most dangerous terrorist organizations. But who would have imagined that something as simple as bananas could shift the course of international trade, to the extent of constructing coup d’états, forging revolutions and inspiring some of the most serious guerilla armed groups. Bananas, that famous sweet fruit that we all have every morning for breakfast. But bananas would be as strange as guavasteen if it weren’t for the one of the icons of American Imperialism: the United Fruit Company. The UFC was the largest and most profitable company to produce, sell and transport bananas from Central to North America. Its plantations took place in every Central American country along with Colombia and Ecuador. Its influence reached such a level in the US, that at some point, virtually every member of Congress had a stake in the banana company. Relating bananas to politics sounds simple, absurd and even ridiculous when you think of it. However, during the 20th century, the banana market played a huge role in the United States economy. Its impact on the American stock market reached a level high enough for the US government to authorize various intelligence operations in order to shift Central American politics in line with the “banana interests”. As Peter Chapman mentions in his book “Bananas”: “the United Fruit Company had possibly launched more exercises in regime-change on bananas’ behalf, than had even been carried out in the name of oil”. In the late 19th century, various American entrepreneurs found themselves roaming in the jungle of Central America in search of inexpensive opportunities. The recent opening of its markets made it an attractive and cheap area for foreign entrepreneurs to invest. By the end of the century, these entrepreneurs owned vast pieces of land after they discovered an unknown, bizarre fruit that could easily be transported to the US with no risk of perishment. However, the lack of infrastructure in Central America obliged them to construct its own railroads and telecommunications in order to ease its production and transportation. As a consequence of these heavy investments, by the beginning of the 20th century, they not only owned the local countries’ land, infrastructure and workers, but also their governments. The outstanding success of bananas in the United States, skyrocketed the size of the investments in Central America, turning these countries into what was known as banana republics (not the clothing retailers). The term banana republic was first used by American writer Oliver Henry to refer to a politically unstable country with an economy dependent upon the exportation of a sole limited resource, usually bananas. A country where social classes are stratified and the export of such product is only controlled by the country’s ruling plutocracy and bourgeoisie. In turn, the banana republic governments – aware of their countries dependence on bananas – helped the UFC to appropriate multiple parcels of land. For the UFC, no piece of land should remain available to any potential competitor. Their main business strategy was the acquirement of thousands of acres in order to leave no land accessible to any other fruit company, even if these acres had no purpose to the company. At some point, the United Fruit was only using one third of the land that it owned. During a time when land was the main food provider for the lower classes, the United Fruit Company left millions of locals with no land and no means of survival. Some specific countries were notoriously affected by the United Fruit Company operations. The UFC carried the heaviest vote in decision-making by controlling their main pieces of infrastructure and their largest percentage of jobs created. For an organization whose only purpose was the reduction of costs to increase profits, human rights outside its country of origin (USA) were an obstacle to achieve its goal. So the UFC began to use its immense influence in line with its interests, at the expense of the people. Guatemala, Guatemala “We chose Guatemala as our starting point because it was politically the weakest country at that time” – United Fruit Company employee. The United Fruit Company was so big, so influential and so dominant, that locals began to call it El Pulpo (The Octopus) for its multiple arms that could reach even the most hidden spots. A good example of its domination was Guatemala’s coup d’état. In 1951 Jacobo Arbenz was named president of Guatemala. Arbenz installed a series of agrarian reforms that aimed to the distribution of land to locals. He nationalized significant amounts of unused land from the UFC and redistributed it to peasants. As a response, the UFC spent millions of dollars lobbying the United States government in order to reverse the situation. Their key play was the portrayal of Arbenz as a communist leader that could threat US capitalist interests. Consecutively, the US government in times of the Cold War could not afford a communist leader in its backyard and therefore in 1953, the CIA was authorized to commence Operation PBSUCCESS. This operation overthrew Arbenz and imposed a more right-wing leader in line with the US interests. The regime-change operation involved severe violence and was later called a new form of economic imperialism. Among the civilians fighting on the coup was a 25-year old Ernesto Che Guevara, who had been convinced by this conflict of the necessity of armed struggle against imperialism. This will later wind up to the Bay of Pigs. After the coup, Guatemalan sovereignty was shattered leaving thousands of people homeless and landless. Years later president Bill Clinton apologized for the CIA intervention, so no hard feelings. Cienaga, Colombia “Always remember they were more than three thousand” – Arcadio Buendia (One Hundred Years of Solitude protagonist when referring to the death toll of the Banana Massacre). If we go back in time a few years more and travel south Latin America. We find ourselves in the north-Colombian jungle. The small town Cienaga or, as Gabriel Garcia Marquez would call it: Macondo. Facing the Caribbean Sea and sharing waters with Haiti and Jamaica, Cienaga enjoys optimal weather for the plantation of tropical fruits. Its rapid access to water and its ideal climate made Cienaga an icon for the United Fruit Company. However, this weather turned deadly when combined with deplorable working conditions and multiple diseases spread by mosquitoes. It was not long until workers felt unsatisfied with their work at the United Fruit. The 16-hour work shifts were inhumane, especially at temperatures above 35 degrees. Their salaries in the form of food-coupons were frustrating since these could only be exchanged for basic goods in the same UFC food shops. So by 1928, the banana workers decided to go on strike. Their claims were 8-hour work shifts and a change in salaries from food coupons to real cash. The strike rapidly turned into the largest labor movement to ever set foot in Colombia. At the end of November 1928, a telegram was sent from Bogota to Washington describing the situation and making more than one mention of the “communist” group that was forming in the town of Cienaga. As a response, by the beginning of December, the US sent an armed fleet to Colombian coasts in order to “protect” American citizens and the interests of the United Fruit Company. On December 5th, during a strike gathering in the main square of Cienaga, the Colombian army – afraid of a North American invasion- arrived in a matter of seconds to the scene, blocking every street and covering every rooftop. After a five-minute warning, they opened fire against the strikers. Hundreds (maybe thousands) were murdered with no discretion towards women or children. A telegram dated January 16th, 1929 was sent from the US Embassy in Bogota to the US Secretary of State in Washington stating: “I have the honor to report that the Bogota representative of the UFC told me yesterday that the total number of strikers killed by the Colombian military exceeded one thousand” (there are diverse sources specifying a higher number of murders). In hope of a prompt forgetter, the corpses were later removed and thrown into the sea with help of the UFC transports. However, scars remained within society. The massacre resulted in the formation of self-defense groups that would later turn into guerrilla arm groups. Yes, one of them was the Revolutionary Armed Forces of Colombia, aka FARC. After decades of violence and repression, FARC turned into one of the most violent threats to Colombia and the USA. Kidnapping and drug trafficking were their main methods of self-financing. They set the entire Colombia (and nearby countries) under a curtain of terror for over 50 years and were labeled a terrorist group by the CIA. Their terrorist operations finally ended on August 2016 after current president Juan Manuel Santos signed a peace agreement. They are now a political party. New York City, USA Fast forward a few years and we find ourselves in 1974, New York. The era of President Nixon, the Vietnam War, The Beatles music and hippies all around. The era when corporate raider Eli M. Black was the largest UFC shareholder, but also the era when Hurricane Fifi hit the coasts of Central America. Fifi crushed a significant amount of banana plantations in Honduras, resulting in huge losses to the UFC. As a result, the UFC needed a way to reduce its operation costs and shareholder Eli M. Black had a strategy to do so. A strategy involving huge levels of corruption. The same strategy that would later end his life as a way to express his remorse. On February 3rd, 1975, pedestrians walking on Park Avenue in New York City were shocked by the sudden fall of a human body. This was Eli M. Black committing suicide from his office on the 44th floor of the Pan Am building. After a thorough investigation, the U.S. Securities and Exchange Commission exposed a scheme where M. Black bribed the president of Honduras Oswaldo Lopez Arellano, concerning a reduction in export taxes. Apparently, Black killed himself two weeks before the scheme was to be published. Trading in the United Fruit stock was halted, and Lopez Arellano was later ousted in a military coup. After this episode, the United Fruit Company decided to rebrand the entire organization by changing its name to Chiquita Company (the little company in Spanish) as a way to cover its tracks. They moved their US headquarters outside New York City and hoped that customers would quickly forget about their evil past. Fortunately for Chiquita, that was exactly what happened. Chiquita Brands International still operates in and outside the United States, it is one of the largest banana distributors in Europe and still obtains most of its products from Central and South America. Humankind may soon forget history chapters if there is nothing to remind us about these outstanding situations that even affect our everyday lives. If something as simple as bananas can have this impact in the world, what can’t? Is the United Fruit Company leaving us a lesson about economic dependency? As Colombian colonel Aureliano Buendia states in One Hundred Years of Solitude: “Look at the mess we’ve got ourselves into just because we invited a gringo to eat some bananas.”