It was a lesson in Physics, I was eleven years old and and had just gone up to my high school (Wembley County Grammar it was called then) – we were wearing smart new maroon coloured school blazers, a white shirt, a ghastly maroon and yellow tie, grey shorts and long grey socks with black shoes. The school motto was Alta Petens (could be a good name for a search engine) and the future was a bright shiney apple which we were told was to be ours if we worked hard.
I remember the flash of excitement when our teacher, wearing his chalk smeared black gown over a rather shabby brown suit, told us that “neither energy not matter can be created or destroyed”.
Up until then I had been told to eat up all my food, not to waste electricity and that we had to be careful to save everything. Today tufty “greenies” preach the same thing, but I was brought up in north London just after the second world war in a country run by socialist nincompoops so everything was in very short supply.
Our teacher went on to explain in more detail what this basic fact of physics meant – he even gave a very accurate explantion of how a nuclear bomb worked, right down to to the critical mass of Uraniam needed and how explosive lenses worked – this was pretty radical stuff for 1956. I found out much later that this information was highly classified and there is no way he should have know this let alone be telling a class of eleven year olds. He later told us he had worked on some “interesting research” during the war, I now assume it was the Manhatten Project.
For me this flash of enlightenment meant I no longer needed to feel guilty if I did not eat my vegetables and had a profund argument to use as to why. I also stopped worrying about my Uncle’s car running out of petrol as this was a big problem in 1956 when the same incompetant looneys running countries decided to invade Suez.
So what has this go to do with anything?
I am thinking about this as I am getting some mail about the current global meltdown of credit and borrowing, with readers asking me if it is it going to affect property prices in the south of France. On average, the price of a house here has doubled over the last six years, so is now a good time to buy/sell/wait – will prices drop/fall/crash ?
Nothing can be created or destroyed, but everything can change its state – I was taught that energy degrades to longer and longer wavelengths eventually ending up as a sort of background noise of heat. So what will the result of a bunch of greedy rascals messing up the money supply for a while?
My theory is that overall nothing will (or has) been lost or created, but there will be local changes of state. Moneylenders cannot stop lending money or they will cease to exist, so the money will be lent, but in a different way. People will not stop living in houses, builders will not stop building (well they all seem to go bust anyway so no change there I suppose) and the world will go on in much the same way, but differently.
From my physics lessons I learnt that for something to change from one state to another, energy has to be used – if money is the fuel and house prices are in a state of flux, then the trick must be to look for the new product or market which is emerging.
A house is not going to change into a car, it will still be a house. But if the supply of cheap money (is that a paradox?) is removed, and if there are the same number of people needing shelter or a retreat, then what will change?
Answers on a postcard please, make a comment or Contact me and we can all be millionaires and benefit mankind.
P.S. I did register AltaPetens.com