Coming Soon:

The following books by Robert Paul Wolff are available on Amazon.com as e-books: KANT'S THEORY OF MENTAL ACTIVITY, THE AUTONOMY OF REASON, UNDERSTANDING MARX, UNDERSTANDING RAWLS, THE POVERTY OF LIBERALISM, A LIFE IN THE ACADEMY, MONEYBAGS MUST BE SO LUCKY, AN INTRODUCTION TO THE USE OF FORMAL METHODS IN POLITICAL PHILOSOPHY.
Now Available: Volumes I, II, III, and IV of the Collected Published and Unpublished Papers.

NOW AVAILABLE ON YOUTUBE: LECTURES ON KANT'S CRITIQUE OF PURE REASON
LECTURE ONE: https://www.youtube.com/watch?v=d__In2PQS60
LECTURE TWO: https://www.youtube.com/watch?v=Al7O2puvdDA

ALSO AVAILABLE ON YOUTUBE: LECTURES ONE THROUGH TEN ON IDEOLOGICAL CRITIQUE



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Sunday, January 25, 2015

THE WEALTH EFFECT

I have on many occasions made reference to my Paris apartment, the most economically daring purchase I have ever made and far and away the most rewarding.  Now that North Carlina has turned back from its purplish trend to become one of the most appallingly red states in the Union, I think I could not bear life if I did not have the chance to escape to Paris periodically.

Our apartment in Paris is tiny.  It is a tad more than 31 square meters, which is to say roughly 330 square feet, a bit more than one-fifth the size of our condo here.  [It is a tribute to our marriage that Susie and I can spend five weeks there at a time without filing for divorce.] 

Because the apartment is in a prime location, it is, per square meter, fabulously expensive.  From time to time I check the postings in the windows of real estate offices and calculate in my head the amount in dollars that our apartment would be worth, and I then experience what is called by economists "the wealth effect," which is to say the illusion one has of being in funds when an illiquid asset one has no intention of selling goes up in price.

Those of you with a special interest in the Eurozone may be aware that in the last several months the value of the Euro has plummeted against the dollar.  Last July, one Euro was going for about $1.35.  This morning, it was going for $1.12. 

How should I react to this news?  On the one hand, I have "lost" a bundle because, although the Euro value of the apartment has not declined, the dollar equivalent has taken a beating.  On the other hand, when we go to Paris in March for a brief visit during UNC Chapel Hill's Spring Break, everything we buy will be a good deal cheaper, and that is real money, not notional money.

So, should I be feeling richer and splurge on an extra glass of wine at dinner out, or should I be feeling poorer and eat in more often, substituting a cheap fish like Dorade for a pricier fish like Dorade Royale?

Inquiring minds want to know. 

5 comments:

David Auerbach said...

Neither. You should go to Legrand Filles et Fils and buy a nice bottle of Armagnac to bring back.

Robert Paul Wolff said...

My tastes run to Gigondas, but I take your meaning.

Matt said...

You should feel a bit richer, and go to Le petit pontoise, on 9 Rue de Pontoise, not far from your place. It was the most enjoyable place I ate while there, and a find, I thought. I believe a reservation is likely needed most evenings, but for lunch we walked in and were very happy. They have an excellent wine list, and are quite nice. Or, if you want to not spend much, the somewhat shabby looking bar right on the street of your apartment is run by a guy who is actually quite charming, and we enjoyed chatting with him and getting his opinion on places to go, even if, on average, French beer is nothing to get excited about.

Robert Paul Wolff said...

Le Petit Pontoise has long been one of our favorite restaurants, and now that they have put the joue de porc back on the menu we go every time we are there. That bar [le onze] fascinates me. There is never anyone in there. How does it survive? Is it a front for drugs, a money laundering operation? Do you have any idea? I am fascinated.

Matt said...

The Bar is a funny place. We stopped briefly for a beer three nights just before turning in. The man who runs it (maybe owns it?) was very nice - we half spoke English, half French (to my wife, as I don't really speak any.) I gather that he also works in the hotel business, but how exactly I didn't catch. One night (maybe on the 1st of Jan.? I can't remember for sure) there were maybe 5-6 people there, including the chef (maybe - a top kitchen person of some sort at least) from the near-by restaurant Le Reminet. (Also very good, if a bit fancy for my tastes as far a decor goes - candle light and all.) Both other times we stopped by, we were the only ones there, and I don't think I saw any others when we were walking by. It's very shabby. But, the man running it was nice, and the last night when we went there, he gave us our beer for free. My wife liked talking with him very much. The bathroom, however, was like something I saw in Russia 15 years ago, and should be avoided. The bar is certainly not making much money. The owner(?) said he watches movies (He was watching the old Kirk Douglas western "Man Without a Star" one night) and drinks whiskey most of the time. It was a funny place, but a bit charming to stop in for a beer and a chat, if you like that sort of thing.