Intro to gold site...

There is a lot of information on gold, silver and the precious metals available online. Much of it is coming from a strong Libertarian political and Austrian economics point of view or is trying to sell you some kind of investment product. Unless you want to pay for pure research you have to dig through all of this to get the facts and opinions.

I often feel that the people who are trying to sell something are easier to evaluate because their angle is more transparent.

Here is a good, relatively low politics, gold site that introduces many of the concepts you might find elsewhere on the web.

http://www.galmarley.com

Paying taxes with art...

Currently there is a problem with the U.S. tax system. A collector can donate one of their art pieces to a museum and receive a nice tax deduction for the gift, while an artist cannot do the same. The difference is this, the artist (we are talking established artists with a clear market value for their work) that gives an original work to the non-profit art center of their choice would only receive a deduction based on the cost of the materials used in making the work, while the collector can deduct the full market value of the work donated.

Currently artists are not being recognized as a business that adds value to raw materials in the tax code as far a deductions. A bakery that gives away cookies to a homeless shelter can take a full value deduction but not artists. And if your art is a ladybug in a Styrofoam cup then you are out of luck.

In comes Senators Robert Bennett and Patrick Leahy. For years now they have been kicking around Artists' Fair-Market Value Deduction Bills. There is a summary and history on the Americans For The Arts website.

There is also an brief interview with Senator Patrick Leahy on NPR's All Things Considered about this issue.

I am curious to hear how this develops.

So why is this relevant to a consideration of value? What does it matter if the government acknowledges the value of an art work? Can't we trust the marketplace in this matter?

The issue here is not just one of fairness within the legal system but also one of definition of value.

Clearly artist's add value to materials with their time, skill and knowledge, but how do you measure it?

If the production of an artist, who has been verified in the past by the market as a viable business, is unable to get an acknowledgement of fair market value for their work from the government, then either the government or the market is mispricing real goods and distorting reality.

Which is it?

And whoever is in the wrong here, whether market or government, can we trust their capacity to properly value other real goods like food, oil, or consumer goods?

This gap is created by concern that people might interpret the definition of art in a way that allows them to dodge taxes, but that is the problem isn't it - that is difficult to pin down the value of an artwork because much of an artwork's value lies in it openness to interpretation.

Perhaps a better question is: does the government or the market misprice art less?

Irrational Pricing

One of the important arguments in economics/finance is whether markets are rational. In other words in a big, liquid and transparent market such as the U.S. stock market does the current price equal so kind of true value. Of course even the U.S. stock market is not fully transparent which complicates the circumstance.

The fine art market is less liquid and transparent. Prices are set by a smaller number of artist, dealers and collectors who may make pricing decisions based on other issues...such as the dealer that buy the work of their own artist at an auction just to keep the price aloft among an otherwise uninterested group of buyers.

There is an interesting interview with a behavioral economist named Dan Ariely on NPR that looks at how a variety of other elements can influence pricing.

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Bees & Bats & counting...

These bats, with their White Nose Syndrome, reminds me of the bees and their Colony Collapse Disorder. What ever happened to the bee story?

NYTimes article: Bats Perish, and No One Knows Why

Sad to see so many little critters die. Is it fear mongering in a time when people are on edge about the economy/climate change/terrorism/etc to make this such a big story?

Seems the scary thing is that it is another unexplained event. We don't have an answer or control. And in specific sense it is another uncontrollable force that may have an impact on the food supply in the near future and raise food costs even higher...following the logic that bats eat bugs which if left unchecked will hamper food production.

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