Pinflation

by admin

 

Download this episode | Open Player in New Window

In which, pinball might help us get a handle on a complicated subject.

The Crash Course by Chris Martenson http://www.chrismartenson.com/crashcourse
fredgraphfile
EPISODE SCRIPT:

Pinball is a great game. There’s something about playing a game where the operating system is the same as the visible universe. Dress it up as much as you like, add all the animatronic figures, blinky lights ramps and rabbit holes, but at the heart of it, pinball remains the ultimate physics-based game engine.
Because when you get down to it, it’s just a ball bearing and gravity. From there you get acceleration, momentum, spin — a percussive and ballistic drama trapped safely under glass for your amusement.
Which makes pinball seem like a very honest game. It’s easier to suspect that the complicated mechanism of a computer could tip things one way or another. And, if you’ve played a first person shooter online, then you’ve yelled at the screen because you know you got cheated.
Pinball can’t do this. We know the game can’t change the laws of physics for it’s convenience.
So it seems honest, until you start looking at the score. Or, more precisely, the way pinball is scored over time.
1964 – Majorettes, produced by Gottlieb — capitalized on a new feature. (add a ball) if you scored 2000 points, you got an extra ball. You got another one at 5000. The score only went up to 9999, so if you managed

to roll it, I’m sure the free balls would kick in again.
1976’s Disturbingly named Capt’n fantastic and the Dirt Brown Cowboy ( which was featured in the episode “Lather, Rinse, Repeat” ) also had a top score of 9,999.
In 1983 Gottlieb Amazon Hunt, which marketing copy cleverly described as a Jungle of Fun – had a top score of 999 million points. What the hell call it a billion And to be sure, Amazon’s are big game. But you have to admit that’s quite a jump in points. 20 years, 100,000 % inflation.
Now, part of the explanation is that pinball games moved from electro-mechanical ( that is, dials in the scoring mechanisms that physically rolled over like an odometer ) to Solid State. Which meant that pinball companies could inexpensively add another decimal place to the score. Or as many as they wanted.
Which brings us to 2003 and the Lord of the Rings pinball game. Which features the highest ever score multiplier of any pinball game. Through an interlocking complexity of modes and objectives that defy comprehension, a player can get whopping 84x score multiplyer. Which helps, because the maximum score is theoretically infinite.
At the time of this article, the current high score reported for Lord of the Rings on Pinballhighscores.com was 4.2 billion. But don’t expect it to last. I have it on good authority that underfunded colleges in India are starting to use refurbished Lord of the Rings Machines to help them in their search for large prime numbers.
So my question is. What happened? Why did the scores of pinball games inflate to the point where you get a couple million points just for successfully finding and pressing the start button. And also closely linked question: why has this phenomenon not attracted more attention? Sure it’s not AIDS or the unrest in the Middle East, crushing sub-saharan poverty, but isn’t it a little odd how normal, how matter of course this tremendous inflation has been?
I mean, basketball hasn’t gone from 2 points a basket to 200? It’s not like touchdowns are somehow cheapened by only being 6 points. And one point, one simple point in soccer is enough to incite riots.
I think that part of the answer is that it’s difficult for people to comprehend inflation of any kind. But with pinball, it’s easy to see that the bumper hit that got you 5 points in Majorette, is physically the same action as the Balrog hit in Lord of the Rings that awards you more points than the gross domestic product of Micronesia.
Points are cheap in Lord of the Rings. And points have become worth less and less over the history of pinball.
And this is point inflation.
So what about currency inflation?
It’s a terribly important question. And as I have spent more time reading and thinking about our current financial troubles, I have come to believe that they are fundamentally and inexorably linked to systematic currency inflation.
That is to say, the appearence of higher prices, when in fact, the dollar is just worth less. It’s how the 5 and dime store becomes the dollar store. How a game of pinball goes from costing a nickel to costing a dollar.
One of the reasons I’m interested in this is that I come from a family of economists. And if you think being a writer in family of jocks would be difficult, consider what it would be like to be an artist among the utlitarians. It’s kind of like being a boy being raised by wolves.
But it’s okay. They are very loving according to their savage customs and I would not trade my family for anything. And it has given me an insight into things economic that most writers just don’t have. On long nights when the moon is full, I know what causes packs of economists to howl, and what their strange music means. And, every once and a while, I can translate their savage language into English. I can read the signs that the econ tribe leaves in the wild.
And if I were to pick a subject to write about that had the highest degree of difficulty, it would be economics. History, mathematics, physics, almost every other subject has had great popularists. People who have written interestingly and intelligibly about their subject matter. Not so with economcs.
Don’t get me wrong. Freakonomics is a plesant diversion. I’m sure there are few other works out there that I’m missing. But Economics has no Carl Sagan or Stephen Hawkings.
Which, in and of itself is fascinating to me. Black holes are interesting. No two ways about it. Where the universe came from and how it was formed, there’s some deep magic there. But a black hole isn’t going to eat your house. And an economic downturn just might.
So I thought I would write a little bit about things economic.
And right now I’m fascinated, or terrified, by inflation.
And the entire point of this wandering little essay is to point out that number of points in a pinball game and the number of dollars in a economy are set by the same rules. They only go up. And when released, the game designer pretty much loses control over them.
You see dollars can’t be exchanged for a fixed amount of gold at Fort Knox, or anywhere else. The only reason dollars have value to you or me or anybody else is that people will take them in exchange for, well, a game of pinball or a cup of coffee.
Now difference between pinball inflation and money inflation is that money inflation has some pretty serious and unpleasant consequences for all of us. And, in the last three months, the federal reserve has practically doubled the monetary base. That’s kind of like the pre-multiplier points in Lord of the Rings. You can find a link in the show notes to the Federal Reserve Bank of St. Louis website that will show one hell of a hockey stick curve.
Now to attempt to explain the full ramifications of this monetary expansion would take a lot. Pictures would help. So would a PhD. And I have neither. But I know a guy who has both.
In the three years this podcast has been running, I don’t think I’ve recommended another podcast or blog or bit of online media. And not because they’re not out there and not because they’re not good. But because plugs and promos just didn’t seem to fit into the format. And, quite honestly, I was living in my own frantic little world.
But I’m going to recommend one now. It’s a series of short videos by a man named Chris Martensen. It’s called the “Crash Course”. And he does a brilliant job of explaining all the stuff that every citizen should know about the economy, in terms that every citizen can understand. My admiration for the job he has done cannot be understated.
You can find the course at http://www.chrismartenson.com/crash-course
These are scary times we live in. The kind of times that no one has ever seen before. And, if you’re like me, ignorance of a subject makes it 10 times scarier. I don’t know why it is so, but if I were being by a pack of lions, I would find some comfort in being able to identify the different kinds of cat teeth.
What I’m suggesting to you with the pinball analogy is the very tip of a nuanced argument about the nature of money, currency manipulation and the business cycle. But my point is very simple.
(pinball sound effects)
When the way we manage our currency like our economy is a game of pinball, should anyone really be surprised if one day it goes on tilt?