We are at the end of economic theory as we know it for three reasons. One is that information and knowledge don’t fall under the law of scarcity and under the law of diminishing returns. That’s a very important reason. When I sell you my book, you have it, and I don’t have it anymore. When I give you information, I still have it. In fact, I have more, because now you have it, and we can work together. For that, we have no economics.
The second thing is that we have only one economy, the national economy, for which we have economic theory. But we have now three economies. There’s still a local one, and for most businesses that is 80% of their business. There are regional economies, too, and we have global economies. How they’ll interact, we don’t know. But we do know that the model we have—that of the national state with a fiscal and monetary tax policy that determines that domestic economy—no longer makes any sense.
The third thing that has happened is that money has ceased to matter. You want to know what the fastest-growing money in the world is? It’s credit cards. They have become legal tender, and yet we don’t know how much credit-card money is in circulation. No central bank in the world knows how much credit-card money is out there or can control it.
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