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This issue is dedicated to  the economy.

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Mortgage Meltdown and It's a Wonderful Life

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Dollars to Doughnuts Economics


It's a shame when a perfectly good slang phrase meets its death. It's downright tragic when a superior one bites it. Such is the case with the phrase "I'll bet a dollar to a donut" which was often used to express one's certainty. A donut is still a donut but unfortunately a dollar falls quite a bit short of where it once did and to such extent that the comparison of the two no longer adds up to a safe bet.

While I have not been able to trace this wonderful phrase to its origin I do know that I have been aware of and using it regularly since a time when donuts came in dozens numbering thirteen at a cost of around two dollars. It doesn't take a mathemagician* to estimate the relative value of a singular donut at that price. No matter how the math works this is not a bad rate of return to the winner and even if you lose you still get the donut even if the price was dear.

It seems though that donuts of the singular variety these days are pushing the dollar mark. More in places that have no compunction for taxing foodstuffs and while it is arguable that one's life may not depend on having a donut to the extent that a sack of flour might, in general terms a donut is far more desirable. The market demonstrates this through the conspicuous absence of 'coffee and flour' shops. Even if there were such a thing I doubt that cops would be known to frequent such an establishment.

continued from preceding column

All of this reminds me of feeling robbed in an east coast airport. I paid $4 for a coffee and the Danish equivalent of a donut. This all speaks to the devaluation of the dollar. Perhaps if I were to demonstrate. Let us move the economy onto a donut basis:

The Federal Reserve would measure the donut supply (d1).donuts People would amass and even hoard donuts in various forms but since unlike dollars, donuts lose their usability, one should never hide donuts in one's mattress. People would speculate in values: Danishes trading at a ratio to the French cruller, Bismarks trading against the An-doughnut, the sort the Japanese eat. Like unto the "Berliner" an An-doughnut is filled with Bean Jam. The South Africans have one called a Koeksister, (try saying that three times fast). This would be the ForEx or Foreign Exchange.

The government would of course take some portion of your donut and hold it. There's a perverseness about me that hopes this would be the filling --the jelly or cream part, and this part should be replaceable but since all donuts are not created equal in that some are not filled my fantasy will probably also not be. Filled, that is.

Further, the Fed would evaluate donuts on their relative worth, i.e. the desirability of each variety. Donut holes for example are not greater than the sum of their parts. We would think of them as donut makers themselves do, as spare change. The holes are something you save up for a rainy day; more difficult to exchange but still of some measurable value.

continued from preceding column

So as currency, various donuts would have an exchange value of increasing quantity, based on both the ease of consumption and the degree of satisfaction they provide.

Am I the only one getting hungry by now? When I started this article it was only my wallet pining for sustenance. That hasn't yet changed but now insult has been added to injury by way of stomach pangs.

There is a political historical precedent for moving the economy onto a donut basis. One famous U.S. president announced that he was a jelly donut to a crowd of Germans. “Ich bin eine Berliner" was the phrase in question. He intended to say that he was a citizen of Berlin. No, it wasn't Ronald Reagan and he knew that the mic was on. Many economic dissertations have been made on the basis of beans, though not specifically those of the jelly-variety, which is where Ronald Reagan would come in.

I should establish my bona fides here.

I am no tyro in the field of donuts. I prefer the spelling doughnuts much as I prefer my cheese as "cheese," not "cheese food."

I was once feted on a birthday with a plate of donuts with candles.

I once lived with several cats (4) all of whom enjoyed consuming donuts and two of whom would search out the boxes and steal the contents with impudence. One of those two did so with both relish and impudence. No, he did not use pickle relish on his donuts, that would be as silly and unlikely as an American President announcing to hundreds of thousands of Germans that he was a jelly donut.

I started work at a rate of twenty-three donuts an hour. I am currently making less than that rate. What has happened?

Did the Federal Donut Reserve make some error? Did I back the wrong activity as a choice of profession?

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