March 10th, 2009

It seems that in these times of uncertainty and financial chaos, different types of cycle-theories become popular. I've seen these types of articles all over the place in the last few months - not that cycles weren't popular before, especially among those propagating rising prices in commodities. The rise of cycle explanations for economic events seem to go hand in hand with uncertainty - like it's a last resort of trying to bring clarity. I'm not saying that there aren't cycles, it's obvious that things tend to fluctuate; It's just that the introduction of the cycle often seems a bit strained or awkward - like it's not enirely necessary for explaining events. After all, we know that a credit expansion is going to have to contract at some time, but why call it a cycle? When the cycle is introduced we are venturing into the realm of philosophy.
Luckily for me and my readers, I actually studied philosophy for almost two years before I studied economics and my main interest there was in philosophy of history and cycles (don't be confused: history of philosophy is the actual history of philisophical thought - philosophy of history is a philosophy OF HISTORY). In economics we have cycles of many different sorts, some span over more than a hundred years while some span only over months or a few years. They're all related to the basics of economics - production and demand - and how these two can be manipulated by different 'forces'. In philosophy we have cycles that are generally focused on the elusive concept of culture; perhaps the most well-known of these cycle-philosophers is Oswald Spengler who identified (or theorized about) the rise and decline of cultures - like the rise and fall of the Roman culture. In short, what he identified was a type of original virility and strenght of the culture that then got weaker with time and finally ceased to exist, however this 'culture' did not coincide exactly with the Roman empire, which in it's later stages had lost all of the Roman culture and was nothing more than a zombie - and this zombie-analogy was transferred onto the modern western culture, not entirely unjustified (!). At about the same time as Spengler there were other philosophers who had taken on impressions from Hegelian-Kantian philosophy as well as Spengler and went a step further. I think the most well-known would be René Guénon and Julius Evola who both introduced cycles that not only covered cultures but also spirituality. A lot of their thought was actually formed not only from philosophy, but also from hindu and greek sources. It was the same basic lay-out as Spengler's culture-cycle, only here the origin was one of a pure spiritual understanding that over the course of many thousands of years became weaker and more and more forgotten and eventually led to a state of spiritual confusion. In hindu and greek traditions there are very clear accounts of these spiritual cycles, some may know of Plato's tale of the four humans - gold, silver, bronze and iron - that all represented a different age of humanity.
Ok, so we've briefly covered the philosophical cycles now and although I don't fully agree with the necessity of cycle-theories I am able to recognize a degree of truth in all of them, and that truth is best expressed in my all-encompassing theory of cycles (both philosophical and economic), namely the 'douchebag-cycle'.
What combines all the cycle-theories is that things start out good and then turn bad. Or as I like to think of it - some people are really clear about something, they're fired up and ready to go, but as they've kept going and the purity of their reality is realized they gradually loose passion for the state of things and forget about what was important. This is what a typical douchebag kind of person would normally do - they get fired up about something and then they loose interest and soon enough they're sitting around eating snacks and watching TV, while everything slowly fades away. Therefore: The douchebag-cycle. It explains everything! If you forgot to whipe your ass - blame the douchebag-cycle. If you are too lazy to pick your kids up from school - blame the douchebag-cycle. If you got really drunk and made an ass of yourself, blame the douchebag-cycle. Soon enough, you'll see Ben Shalom Bernanke on TV blaming everything on the douchebag-cycle. And why not give the guy a break, right? He's just on the wrong side of the douchebag-cycle!