Gambling, capaitalism and Zimbabwe. Today is funny-money day. Curious that the day after Margaret Thatcher’s state funeral in 2013, the economist she most loved reading, David Ricardo, would have celebrated his 241st birthday. Ricardo shared a birthday with his older contemporary, Sir Francis Baring, another serious money-bagger who was born this day in 1740 and who founded Barings Bank, noted as the oldest merchant bank in the world until Nick Leeson destroyed it through wild gambling on junk bonds in 1995.
Another wild gambler, Paul Revere, started out on his ride through New England to warn patriots that “the British are coming!” today in 1775. Revere was a prosperous and prominent Boston silversmith and freemason, who helped organise an intelligence and alarm system to keep watch on the British military. I recall an advert played in the 1980’s at movie houses in my youth for Paul Revere cigarettes in which a secretive Paul Revere was shown riding out to warn American patriots. The cigarettes were not sold in the United Kingdom, but Baring and his bank continued to be a merchant bank of choice in the newly independent America even after the revolution.
David Ricardo would have approved of Baring’s continued support for foreign trade in the teeth of state interests because it proved his theory of comparative advantage. A theory which promotes international trade and rejects state interventions, comparative advantage is the economists’ equivalent of Einstein’s theory of relativity.
Einstein, a dedicated smoker, of course had absolute advantage when it came to thinking but I guess he would have been too busy today in 1955 to give much thought to the birthdays of Ricardo and Baring or Paul Revere’s ride, not because these facts had no bearing on his life but because Einstein was busy dying today in 1955. Like Maggie Thatcher, Einstein’s remains were cremated.
Few would recall though, that the country which would confound the theories of David Ricardo was gained independence today in 1980 under Thatcher’s rule. Zimbabwe marks its independence day today, wishing perhaps that its comparative advantage in international trade might be enhanced. When it comes to international trade, empire and a wild, gambling capitalism have ruled supreme for centuries.
– Doug Racionzer (see a full archive of these observations at http://serendipiday.blogspot.