Steve Wynn made a wonderful crack about himself today while talking to Neil Cavuto. Wynn called the Bellagio his "practice hotel".

What he was describing is the X factor– the undefined element of enterprise that produces the magic of growth in excess of all the known inputs.

Hayek's lifelong interest was in understanding and explaining how human beings were able to increase their collective wealth so dramatically in the 19th and 20th centuries; he wanted to know how things had - this one time - been different. By the end of his life he had largely abandoned macroeconomics for the study of human perception because he realized that macroeconomics had no room for fundamental uncertainties; even its definitions of risk ended up being part of closed logic system that produced only tautologies.

What Vic calls the drift has been produced by the X factor. The delusion of our time has been that governments can "pump" "the economy" using their monopoly authority over money; but, as Hayek discovered, capital = money + enterprise. Government money alone is, as Tyler notes, just like water; no matter how much is pumped, it never seems to add any actual growth in wealth. It simply runs off into the gutter.





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