While I am sure you think that it is merely the ramblings of a “pre-pre-dementia” Boomer, I cannot over emphasize the idea that you cannot genuinely understand anything without a historical perspective. And this lack of a historical perspective is only one of the human intellectual deficiencies.
Slavery has always been a nasty business, although it has been practiced since forever. Capturing and keeping other people under subrogation is hard work, so there has to be a good reason to do it.
Europeans first discovered sugar from the locals while on the Crusades and called it “sweet salt.” The first record of the word “sugar” in English is in the late 13th century.
The first widespread commercial production of sugar was in Brazil to feed the European addiction. The problem was that sugar production is a messy super labor-intensive business from harvesting to refining.
The problem was the heavy labor involved because the Europeans refused to work except as supervisors. The solution was to bring in slaves from Africa. Every place that Africans spread around the world from the Caribbean to Fiji was primarily because of sugar and tobacco production. Without the huge demand for both sugar and tobacco, the massive slave trade of Africans to the Western hemisphere might never have existed.
We have trouble putting data in context. There is the “Misinformation Effect” that we are all subject to.
Psychologists Elizabeth Loftus and Geoffrey Loftus showed people car crash footage, then asked how fast the cars were going when they “smashed”/“collided”/“bumped”/“hit”/“contacted.” Depending on which of those specific verbs was used in the question, the estimated speed of the cars varied widely. That is how we are manipulated by the headlines.
We are becoming more unable to make rational judgements because of an inability to understand what we see. Pinpoint one piece of data/information that would give you insight about the Philippine economy. The unemployment rate? Labor Force Survey is a nationwide survey of 51,000 households asking about their employment. Unemployment in “developed” economies is based on the actual number of people receiving government benefits. You cannot compare the two in terms of accuracy. Fact: “Jobless claims rise to 8-month high: Americans collecting jobless benefits for the week ending July 9 rose by 51,000 to 1,384,000.”
Yet we compare the Philippines with the US, and it is apples and mangos. Can we in the Philippines talk data like this? “Sales of previously owned homes dropped 5.4 percent during the month of June, the fifth month in a row that we have seen a decline.” Home sales are a critical measure of an economy. What can we say about the Philippines? Honestly, nothing.
The Mismatch Theory: Moths evolved to navigate by the moon, a good strategy until the invention of electric lamps, which now lead them astray.
There is the “Nocebo Effect” when harmless substances can make people feel ill if they “think” the substance is harmful. There are some nations that are under terrible economic stress because of too much debt. In The 1970s, one country was the Philippines owing the International Monetary Fund. Now China is the big, bad lender, and it has become a serious problem but not for the Philippines.
The Philippines’s total debt to China is 0.03 percent of gross domestic product or about $1 billion. Now we can make some valid comparisons. Vietnam’s China debt is 5.7 percent of GDP and $14.8 billion. Malaysia’s is 2.6 percent and $8.5 billion, and Indonesia owes China 2 percent of its GDP and $22.2 billion.
Information ignorance is as easily solvable as turning on an electric light in a dark room. But faulty thinking is much more difficult to remedy and is much more dangerous. It can be like a painless cancer, a silent killer, which has no easy cure.
E-mail me at mangun@gmail.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis provided by AAA Southeast Equities Inc.