Wednesday's Top 10 with NZ Mint: A bank-free economy?; Spousonomics; How to tax the rich; The bankless economy; Corrupt kleptocracy; Dilbert

Here are my Top 10 links from around the Internet at 10 to 2 pm, brought to you in association with New Zealand Mint for your reading pleasure.

Another what a day. Richie McCaw and Dan Carter now have no choice. They must remain injury free and win the World Cup...

I welcome your additions and comments below, or please send suggestions for tomorrow's Top 10 at 10 via email to bernard.hickey@interest.co.nz.

I'll pop any surplus suggestions I get into the comment stream  

1. Could an economy exist without banks? - It seems heretical to ask, but could a modern economy survive and thrive without a sophisticated banking system?

An obviously curious Irish Times report asks that question on a trip to Argentina, where most people have lost faith in their banks and don't use them.

Yet the economy grew more than 8% last year.

The black or 'en negro' economy is a huge driver in Argentina.

This is one of the side effects too of having the government's tax raising activities embedded within the banking and payments system, as we have now with a higher GST.

How much of the NZ economy is being conducted 'en negro' now? .HT Brendan via email

Argentinians, by and large, conduct their lives without the assistance of daily banking, mortgages, car loans, overdrafts or credit cards. Judging by Argentina’s stellar economic performance in 2010 (reported growth of more than 8 per cent of gross domestic product), such a system has done the country little harm.

Argentinians have had a long and unhappy relationship with banks. Most recently they were badly burned during the economic crisis of the early years of this century, when banks shut their doors on customers to avoid a run on their reserves and the government converted dollar deposits at a rate of 1.4 peso to the dollar, a fraction of their actual worth.

“You’d probably find that a wide swathe of the population still has a healthy mistrust of banks,” says Peter Johnson, managing editor of the English-language Buenos Aires Herald . “They plough savings into property . . . into wheels or bricks, or whatever.”  

2. Using economics to save your marriage - Jenny Anderson has written a book called 'Spousonomics: Using Economics to Master Love, Marriage and Dirty Dishes'.

Here Paula Szuchman at Newsweek wrote how she used Spousonomics to encourage her husband to shut the cupboard doors and do more housework. I make no comment, although my wife regularly does...fair enough.

This research, combined with experimenting on my own husband, has led me to recommend a few core principles for anyone looking to fix their marriage. One key area is incentives, the things that motivate people. Mortgage deductions spur home purchases; salaries entice people to work. My husband’s incentive to close cabinets—avoid nagging—wasn’t exactly “perverse,” but it was backfiring.

Turns out, there are better incentives. One is trust, which economists have found can be surprisingly motivating. In one example, people were more likely to donate blood if they weren’t paid than if they were. Who knew? So I tried having a little faith in my guy. I stopped nagging. And one day I came home to find CLOSE ME signs taped inside our cabinets as reminders to himself.

Another lesson: 50/50 isn’t the best way to divide housework. We want an egalitarian marriage (and anything else would betray the feminist principles my mother taught me). But Adam Smith famously noted that efficiency is maximized when workers specialize. Today, I gladly pay all the bills, and my husband—mostly gladly—does all the sweeping and mopping.

3. Obama's shift to the right - Barack Obama is signalling with his push for new trade deals (including our Trans Pacific Partnership) that he's keen to cosy up to Wall St and the big lobbyists that shove Congress around on a regular basis.

Here Kevin Gallagher at The Guardian's Commentisfree website points to the letter from 257 economists calling on the American government to allow others to use capital controls.

The coalition behind the economists' statement attests to the fact that there is broad support for reforming US trade treaties' terms on capital controls. The list includes prominent academic economists who have been supportive of free trade deals, former IMF officials, and some economists affiliated with the pro-trade Peterson Institute for International Economics.

The economists should be listened to: US trade treaties should not be tools for US financial policies that are not only outdated, but actually helped cause the financial crisis in the first place. Allowing flexibility for the use of capital controls to prevent and mitigate crises now has broad support. Our trading partners have been requesting such flexibility for years; granting it would represent one small step toward a more stable financial system. US banks and investment houses played a role in nearly destroying the global economy.

Why should the Obama administration ban the measures that prevent contagion, while giving those same firms the right to sue foreign governments for damages?

4. Fantastic inflation heat map - Here's a fantastic heat map graphic  from WSJ.com that shows the inflation hot spots across the global economy and how that's changed over recent years. It's glowing dark red in a bunch of places. Yet the 30 year Treasury bond yield is still just 4.6%. It does not compute.

5. Who are the global elite? - Robert Guest, Business Editor of The Economist, discusses the rise of the global elite in this video below. It's all become more topical after this widely read piece on the global elite at The Atlantic.

6.  How to tax the rich - Give them something in return. Scott Adams, the guy behind Dilbert, has written this fantastic piece at the Wall St Journal musing on the problem of how to convince rich people to let the masses increase taxes on the rich.

He hits on some pretty deep themes in a cool way.

In reality, fairness is not so much about the actual distribution of loot as it is about the psychology of how you feel about it. That's important to understand because the rich won't give up their cash unless they feel they are getting something in return.

And so far, saving the country doesn't seem to be enough of a payoff.

I can think of five benefits that the country could offer to the rich in return for higher taxes: time, gratitude, incentives, shared pain and power.  

7. American might - An extra 400,000 Americans became so poor in November that they had to accept food stamps, this USDA document shows.

There are now 43.6 million Americans or just over 14.2% of the population on food stamps. This explains why there aren't mass protests in America. Bring me your huddled masses... HT Zerohedge.

8. This looks ugly - This photo below shows the current cyclone Yasi headed for Queensland on the left and Cyclone Tracy that devastated Darwin 1974 on the right.

9. Why are our troops still in Afghanistan? - This New Yorker story shows what really goes on behind the scenes in Kabul. It's a corrupt kleptocracy that our soldiers are defending.

Why?

Read this and be very angry.

The war in Afghanistan no longer appears to be a simple conflict with the U.S. and the Afghan government on one side and the Taliban insurgents on the other. When it comes to money—and particularly American money—allies and enemies often seem interchangeable. When American diplomats set up the Threat Finance Cell, in 2008, they charged it with severing the links between insurgents and their financing, much of which is believed to have come from drugs. Instead, they found that the lines that connected the Taliban and the drug smugglers often ran through the Afghan government.

When American investigators started examining a particular Islamic charity across the border in Pakistan for giving money to insurgents, they discovered that its director also maintained close ties to Afghan leaders. At Kabul Bank, according to a Western official familiar with the investigation, records show that Ruhullah, the head of a private security company and an ally of Ahmed Wali Karzai, the President’s half brother, transferred money into accounts believed to be controlled by the Taliban. (Ruhullah did not respond to repeated requests for an interview.)

Ahmed Wali Karzai himself, the head of the provincial council in Kandahar, has long been suspected of siphoning profits from the drug trade. Ahmed Wali Karzai has steadfastly denied such links. “People think it’s the Taliban versus the Afghan government, but, I’m telling you, the Afghans just don’t see it that way,” an American investigator told me last year.

“The Afghans look at this war very differently than we do.” Despite the deep skepticism that the Karzai government has prompted in Washington, the corruption appears to have got worse. One of the reasons is the war itself. President Obama’s deadline for beginning his withdrawal of American forces later this year confirmed for many Afghans that time is running out. “Right now, this country is all about raping and pillaging as much as you can, because there is no faith in the future,” an Afghan businessman told me.

10. Totally irrelevant video - This Brazilian Taxi Driver is much more talented than many of the Taxi Drivers who have driven me around...