Team Building Exercise

When I was a kid, I was pretty good in most sports with the notable exception of baseball. In baseball I was really awful. I could throw good but absolutely could not hit for my life. I struck out nearly every time. Consequently I was picked last when teams were chosen in the traditional schoolyard way. I don't recall this being particularly awful as I took it for granted that I wasn't good so being picked last seemed like a natural consequence. I did hate batting and I recall it stressing me out when it came to be my turn.

The other day my recollections of my terrible skill coalesced into a wonderful metaphor for malinvestment. When I was struggling with Austrian economic theory, I found myself on a forum arguing about what malinvestment was. At the time, I imagined all investments contributed to the economy so the notion of the ills of cheap credit eluded me. As it turns out, picking schoolyard teams is a perfect metaphor.

Start with a random group of kids whose ability falls on a curve. The more kids you pick for the team, the skill level lowers in each addition kid. If a teacher mandates that the entire class is going to play, even people like me will find themselves on a team even though they wouldn't get picked if the teams were smaller. What is the result? I strike out at a crucial time and lose the game.

In the free market, the credit supply is like the number of players on each team. With less credit (high interest rates,) only the most profitable investments can be undertaken. With more credit (low interest rates,) less profitable investments are possible. But this is like including the lousy players on the team by increasing the team size.

In this metaphor, the teacher is the central banks. In the absence of the teachers, those like me who were awful in baseball, would have pursued some other goal to the mutual benefit of both me and the baseball team I didn't play on. Those playing baseball would have loved to determine for themselves whether each additional player was a benefit or a hazard, but of course it's just a game. The teacher has decided unilaterally that everyone will benefit by being on the team, even though many don't want to play at all.

Lowering the interest rate and stimulating the economy is like a teacher telling the team captains they must increase the size of their team and pick the lousy players. Meanwhile, on another part of the schoolyard, the soccer team is deprived of players, or a new made-up game never gets created at all.

The only way to fix a baseball team with rotten players on it is to get them off the team, not add more marginal players. The only way to "fix" the economy is to let wages and prices adjust themselves, not maintain recession conditions with cheap credit that encourages the marginal investments that created the problem.

Perfect Canmore Weekend

My perfect Canmore weekend began with a test drive of my new ice axe. I got it used from the University of Calgary Outdoor Club for a song. Had fun practicing self-arrest on the snow and found it remarkably useful in the heavier scree. I climbed Mt Lady Mac behind the house with it and found it to be a worthy ally that made some icy sections very comfortable. My 6.5 hr total up and down time didn't break any records but it was above zero even at the summit, calm and sunny all day! Behind me in the picture is Mt Grotto which I climbed last year.






-----------------------------------------------------------------------------------------------------------------



Next day, Suz and I walked up to the Canmore Nordic Center where they were holding a World Cup cross-country ski race. It's the last big race before the Olympics, so everyone was there and in peak form. I was awestruck at the speed! Both men and women were skiing up massive hills not much slower than I would bicycle down! Canmore residents were well represented in the races and local girl Sara Renner put on an amazing display of determination to place 3rd. The crowd, which lined the entire course, nearly exploded while watching her attack over the last 1km straightaway seen in the picture. It's a real privilege to witness up close such rarefied talent, determination, strength, endurance and execution. Here's a short vid I took to get an appreciation of how fast these guys can climb.





-----------------------------------------------------------------------------------------------------------------

After the races were over, we hiked back down to town for some winter carnival events. Main street was blocked off and a ton of snow was dumped. I can't tell you how satisfying it is to see people skiing down main street instead of driving! One of the more civilized sights I've seen.













Once you've ditched the cars and left the snow on the street, there's really only one thing left to do-
grudge match dog sled racing!

The best race of the day had to be a couple that was getting married down the street who put their carefully orchestrated wedding on hold, and appeared impromptu in full wedding regalia. The groom raced the bride with her wedding dress blowing furiously in the wake!



As dusk approached we settled down with a coffee and watched ice sculptors carving. The end of a great weekend.