Talkin' Big by Dittmer Tom

Author:Dittmer Tom
Language: eng
Format: epub
ISBN: 9781510737075
Publisher: Skyhorse Publishing
Published: 2018-01-15T00:00:00+00:00

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JERRY GOULD

Jerry Gould, a PhD and professor emeritus at the Graduate School of Business at the University of Chicago, was another guy who changed my life for the better. Jerry taught applied mathematics and management science and he used to tell me, “All math PhDs wanted to be physicists but couldn’t make it.” He was a really funny guy and he used to laugh when his students would give him bad reviews after his lectures. They would call him the most arrogant, dumb sonofabitch they’d ever seen, and Jerry would laugh like crazy. He built a system so he could trade the market and beat it. I put up the money. He traded, it didn’t work, and he lost it all in just a few days. Then he built a system for stocks, which did work. I loaned him the money to start the business and I got half the business. I wound up making a million-some bucks from it when it was eventually bought by Fidelity.

Jerry introduced me to a group of guys at the University of Chicago, School of Economics, and these guys were all geniuses: Milton Friedman, Arthur Laffer, Gary Becker, and Merton Miller.

Milton Friedman, Nobel Prize winner in Economic Sciences, was probably the most influential economist in the world at the time. He was an advisor to President Reagan and British Prime Minister Margaret Thatcher, and he was a big advocate of the free market. Friedman, with the help of the Ford Foundation, made it possible for thirty young students, called the Chicago Boys, from Santiago’s Universidad Católica in Chile, to come to America and study “monetarism” with Friedman and his group of economists. Monetarism is basically a macroeconomic view that inflation depends on how much money the government prints. Basic Econ 101.

The Chicago Boys returned to Chile after the Pinochet coup and put Friedman’s free-market reforms system to work, which is why Chile has a good economic system today. Their Social Security is privatized. You buy stocks with your money. You don’t give it to the government for them to spend and issue you an IOU; your money actually exists. You want to borrow from your Social Security to buy a house? Fine. The money is actually there. Imagine, the average Chilean now retires with 80 percent of what the average American retires with, and their system didn’t begin until 1980. Those guys went back home and changed Chile forever.

Arthur Laffer was a two-term member of Reagan’s Economic Policy Advisory Board. He was also a consultant to Secretary of the Treasury William Simon, Margaret Thatcher, and others. The Laffer Curve, depicting the relationship between tax rates and tax revenue, is attributed to Arthur Laffer, though he never claimed to have invented it.

Gary Becker went to Princeton and the University of Chicago. He won the Nobel Memorial Prize in Economic Sciences in 1992 and the Presidential Medal of Freedom in 2007. He was considered one of the most important social scientists in America.

The other guy in the group was Merton Miller, from Boston.

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