The famous economist John Maynard Keynes once wrote, “In the long run we are all dead.” That remark has often been interpreted as meaning Keynes and his subsequent followers only cared about the short run, that they would always advocate rash policies designed to generate short term benefits and ignore any long term consequences.
Of course, one can argue that politicians love that kind of thinking because they can “buy” votes and support with short term stimulative policies and then be gone when the chickens come home to roost. Anyway…in this piece Simon Taylor, a member of the finance faculty at Cambridge Judge Business School, wrote:
“It should be clear that he is not arguing that we should recklessly enjoy the present and let the future go hang. He is exasperated with the view of mainstream economists [of the time] that the economy is an equilibrium system which will eventually return to a point of balance, so long as the government doesn’t interfere and if we are only willing to wait. He later challenged that view in his most important work The General Theory of Employment, Interest and Money (1935) arguing that the economy can slip into a long term underemployment equilibrium from which only government policy can rescue it.”
By the way, the full Keynes comment (written in 1923) was, “The long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is past the ocean is flat again.”
OK, why am I writing about this idea today? Well, it’s because of something that, in the grand scheme of things, is not really important. I am, of course, writing about my Z06.
I have been writing about all of the potential modifications I want to do to the car, both in terms of performance and appearance. Obviously, I don’t have to do anything to the car; it’s great as it is. The amount of money needed to do what I want is a tiny fraction of my available resources, but some would argue (and have) that it is better for me to save the money just in case it is needed at some future time.
This is a classic long run vs. short run problem, in my opinion. No, this is not an excuse to show another picture of my car. I am not going to do so.
I believe that both the short run and the long run matter and that’s why decision making can be so difficult. Of course as one grows older the long run gets shorter. It is very difficult–perhaps impossible–to fully understand the potential long run consequences of many decisions, but that doesn’t mean the long run can be ignored.
So, while I am preparing to spend what I need to spend to modify the car, especially in terms of performance, my brain is waged in a battle of long run vs. short run. Are any of you in a similar situation? Do you classify yourself as a long run person, a short run person, or an it depends person?
My wonderful wife sent me this link to a story about “vintage” cars we shouldn’t forget. The problem is that the article lists 40 cars and you have to click on them one at a time. (A real tangent: why do I always type tiime the first time I try to type the word time?)
The cars range in time from the 1950s to the 1990s and include such disparate vehicles as the GMC Syclone and the Studebaker Lark. You also might not be able to click on all 40 vehicles as the website gets slower with each successive click and might time you out.
One of the cars listed is one that has been mentioned a lot here, the C4 Corvette. From fastlanecars a picture of a 1996 Corvette, the last year of the long-running C4:
As I have often written before, I have only been a fan of the C4 Corvette for about the last five years. Before, I thought they looked too plain and that before 1992 they simply were not good performers (ZR-1 excluded).
The looks of the car have grown on me and 1992-1996 Corvettes have plenty of performance, thank you. In fact, if you can be that picky, the 1995-96 cars are the best of the bunch, in my opinion, because of improvements like fuel injectors that were revised to better cope with ethanol content in gasoline, improved connecting rods, improved automatic and manual transmissions, various upgrades to reduce rattles, etc.
I’m not in the market for another Corvette, but in the event of a large financial windfall, one of these could be in play, especially a convertible. I guess my wonderful wife’s affinity for ragtops has rubbed off on me.
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