Category: Economic TheoryThe analysis published under this category are as follows.
Sunday, June 16, 2013
Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is past the ocean is flat again. - John Maynard Keynes, A Tract on Monetary Reform
There can be few fields of human endeavor in which history counts for so little as in the world of finance. Past experience, to the extent that it is part of memory at all, is dismissed as the primitive refuge of those who do not have insight to appreciate the incredible wonders of the present. - John Kenneth Galbraith
Hitler must have been rather loosely educated, not having learned the lesson of Napoleon's autumn advance on Moscow. - Sir Winston ChurchillRead full article... Read full article...
Wednesday, June 12, 2013
The Risk of Government Economic Policies and the Rationing of Retirement / Economics / Economic Theory
In addition to our own, there is another conference I normally go to every spring; but sadly, I missed it this year. Rob Arnott of Research Affiliates indulges me and lets me attend the annual Research Affiliates Advisory Panel he conducts at some exclusive location (usually but not always) in Southern California, in close proximity to one or more fabulous gourmet establishments. And he is an oenophile of the first rank, a pastime that at one time in my life was a huge attraction. I now just live vicariously when he orders wine.Read full article... Read full article...
Tuesday, June 11, 2013
Both Keynesians and monetarists believe that increased government spending, or more money injected into the economy, is sometimes necessary. The intervention is in the form of unfunded government spending, artificially low interest rates to boost demand for money and bank credit, or a drive to make the currency “competitive” by lowering it. These methods have been tried unsuccessfully time and again, and they must be denounced if we are to understand our true economic condition.Read full article... Read full article...
Friday, May 31, 2013
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Lest I be accused of picking on US-centered media outlets, we’re going to spend a bit of time this week dissecting a Eurozone Reuters article which puts on full display the completely absurd rationale of the Keynesian economic model. This folks is truly the stinker of the year (so far) right here. Unfortunately, it also lays bare the dogmatic nature of economic thinking. It should be no surprise really; the same dogmatism exists in the political and religious arenas as well. Dogmatism was once explained to me as ‘clinging to a particular belief or beliefs in spite of overwhelming evidence to the contrary’. While this is not the ‘official’ Webster’s definition, it makes the most sense to the average person and is very fitting for this discussion.
Friday, May 31, 2013
I just finished reading The Smith/Klein/Kalecki Theory of Austerity by Paul Krugman and I believe it is the most disingenuous piece he has ever written.
Krugman comes out blazing with the statement "Noah Smith recently offered an interesting take on the real reasons austerity garners so much support from elites, no matter how badly it fails in practice."
Tuesday, May 21, 2013
DENY THE NEGATION
Unknown to many, the dominant political economic doctrine of today, certainly in the OECD countries is the "liberal market doctrine" was built on denial. Since the 2008 crisis, this doctrine has become a mix-and-mingle of 1980s Neoliberalism plus a rejuvenated or reycled 1940s Keynesianism. In other words there is non-intervention in markets, certainly when it concerns fighting near-total monopolies like Microsoft or Google or finding the populace a job, plus massive state borrowing and bail outs of Bad Banks, called too big to fail. The principle is:
Monday, May 20, 2013
I am getting more and more upset about the future of the economy, especially the part where I will probably still be alive to suffer through it, instead of being safely dead and gone, laughing disdainfully from whatever circle of Dante’s hell that is reserved for us lousy fathers, worthless husbands, lackluster employees and all-around lazy bastards.
“Hahaha!” I will bellow. “Now suffer! Suffer, you morons who actually believed that the idiocy of Keynesian economics would NOT end in disaster! From the heart of hell I strike at thee!”Read full article... Read full article...
Tuesday, May 14, 2013
Anti-consumerism is steadily advancing and gaining political visibility in Europe, as a Lost Decade opens up for Europe's present 29 million unemployed persons. Europe's huge ranks of youth unemployed, sometimes over 50% of the 16-25 year age group in the worst affected countries, know they have No Future. In some countries like Greece, they have been simply and officially told by the government that their only chance is to get out of the country. In others like Spain, the depth of crisis has forced the state to seize some foreclosed properties, simply to prevent the country's ever growing number of homeless families becoming too socially explosive, but its youth has No Future.
Monday, May 06, 2013
Hunter Lewis writes: In the beginning of The General Theory, John Maynard Keynes says that his ideas will no doubt be rejected because they are so novel and revolutionary. Toward the end of the same book, he seems to have forgotten this because now he says he is reviving the same centuries-old ideas that he had once dismissed as the most absurd fallacies. At least he acknowledges that he is changing his position, although he does not explain how his ideas can be new, revolutionary, and also centuries old.Read full article... Read full article...
Tuesday, April 30, 2013
Keith Fitz-Gerald writes: When it comes to spending or saving, it's always a contentious debate.
But the risks are rarely as high as they are now for the U.S. and most major industrial nations. Such fundamental economic decisions will move a country forward (or backward) for decades, not months, and can't be undone quickly.
So let's choose the "winner" and "loser" of this debate carefully.Read full article... Read full article...
Thursday, April 25, 2013
American singer Loudon Wainwright III has a song with this line: "I read the New York Times, it's where I get the news. Paul Krugman's on the op-ed page, that's where I get the blues".
Every era needs its gurus and sages, we are told. Keynes was in fact only an elite-approved guru right at the end of his life, but managed to do a lot of damage before quitting this world, leaving us the IMF as well as the already long-dead Bretton Woods agreement.Read full article... Read full article...
Tuesday, April 23, 2013
"The world’s leading economies acknowledged on Friday that 'further actions are required' to put the global economy on track for strong, stable and balanced growth.", writes the FT. The torture never stops. Not that we had expected it to just today.
Well, alright then, you can make a point that the biggest news in economics last week was the revelation of the errors in Rogoff and Reinhart's "debt over 90% is deadly" paper. Personally, I think what is still much bigger is the - renewed - revelation that actual policies executed by actual politicians have been based on that paper. Talk about poverty of ideas and imagination. But maybe that shouldn't be surprising. If anything's the core of economics it's such poverty. And that politicians in turn base their policies on that poverty is only fitting. As an old Buddhist adage says: If and when everyone is mindlessly stupid, will anyone notice?Read full article... Read full article...
Saturday, April 13, 2013
Riots in the streets; protest against a hated government; cops arresting protesters. A familiar story these days. But suddenly we find that the protests are directed, not against a hated Communist tyranny in Eastern Europe, but against Mrs. Thatcher's regime in Britain, a supposed paragon of liberty and the free market. What's going on here? Are anti-government demonstrators heroic freedom-fighters in Eastern Europe, but only crazed anarchists and alienated punks in the West?Read full article... Read full article...
Friday, April 12, 2013
As the top Keynesian gadfly, Paul Krugman's recent attack on Margaret Thatcher wasn't very surprising.
In a blog post on the very day she passed, he questioned whether or not Margaret Thatcher had actually made any difference to the performance of the British economy.Read full article... Read full article...
Friday, April 12, 2013
Picture a mono-racial New York metropolitan area with a fraction of the murders, if you can. Add in unreadable signs and buildings and infrastructure completed in 1960 or later. Then you might have a picture of Seoul, the capital of the Republic of Korea and, quite possibly, the new center of global capitalism. At least, that is my conclusion after spending several days there on academic and professional pursuits.Read full article... Read full article...