On debt’s centrality to modelling complex economic systems
The following video is about modelling economic data. The takeaway for me here is that modelling complex systems is hard to do. The standard approach in mainstream economics is to strip the system down...
View ArticleLudwig von Mises on Austrian Business Cycle Theory
Yesterday, John Carney at CNBC had a nice little post comparing Hyman Minsky’s Financial Instability Hypothesis with some of the thinking by Friedrich von Hayek behind Austrian Business Cycle Theory....
View ArticlePtolemaic Economics in the Age of Einstein
By Steve Keen This post was first published on Steve Keen’s DebtWatch blog. Jetlag has me up and at the keyboard at 5.54am here in London, 43 minutes before sunrise, which today is at 6.37am. Only it’s...
View ArticleKrugman’s Flashing Neon Sign
By Scott Fullwiler Summary: Paul Krugman wants to argue that banks aren’t important since they can’t “do” anything more than occurs in a model without banks. This simply isn’t true. This post will...
View ArticleEndogenous or exogenous money?
While the debate on central bank monetary policy, banks and private debt (see here, here, here, here, and here) seems to have devolved into something unproductive, I have hopes that something more...
View ArticleProgress on the monetary policy and banking debate
We seem to be moving forward with this discussion on monetary policy, banking, and reserves. John Carney does a good job of summarising some of the initial forays in this back and forth. I am going to...
View ArticleAlan Blinder gets it
I caught this statement from Alan Blinder in a debate on the New York Times about teaching economics: Remember “conventional” monetary policy? The Federal Reserve shortens recessions by creating more...
View ArticleVideo: Steve Keen on modelling and the Krugman debate
I think this video is worth watching because Keen gets to the heart of the issues with the standard approach to economics. He says that banks, money and debt are front and center in reality as we now...
View ArticleKeen: Instability in Financial Markets
Steve Keen’s talk at INET is now up on the web (hat tip BT). His talk is billed as involving a discussion of “Instability in Financial Markets”. It also comes over as a primer on the economic approach...
View ArticleMinskian Perspective on Instability in Financial Markets
Editor’s note: Yesterday, we highlighted the talk that Steve Keen gave at the INET conference as our only post. Today, we present the full and in-depth version including his written analysis via Steve...
View ArticleWhat is this “Financial Instability Hypothesis” by Hyman Minsky really about?
By L. Randall Wray A version of this post first appeared at "Great Leap Forward”, my EconoMonitor blog. Since Paul Krugman kicked-off a heated discussion about Minsky’s views on banks, and because the...
View ArticleWhy can’t people understand national accounting?
I was on RT’s Capital Account last night talking to Lauren Lyster about the euro zone debt crisis. At the end of the show, we came up against the deficit problem and the question about how it should be...
View ArticleThe euro disaster is about more than just current account imbalances
By L. Randall Wray This post first appeared at "Great Leap Forward”, my EconoMonitor blog. Two weeks ago I cited Paul McCulley’s claim that MMT got it right. I followed that up last week with Brad...
View ArticleA Copernican Turn in Macro
Guest Author: Derryl Hermanutz The commenter quoted below is laboring under a very common (actually it’s pretty much universal) misconception about how our economies work. This is why the...
View ArticleThe Perversity of Economics’“Culture of Fraud”
By William K. Black Paul Krugman has written an article entitled “Culture of Fraud” about the Romney economics team. Still on vacation, but I have internet access for a bit, and have checked in on a...
View ArticleChart of the Day: Public deficits and private savings in the euro zone
In May I wrote a post asking "Why can’t people understand national accounting?" and I was heartened that the post seemed to get a lot of traction. Most people don’t get it. In fact, I didn’t get it...
View ArticleAre the Federal Reserve and other central banks printing money to solve this...
The global economy has been slowing for nearly a year now, both in developed economies and in emerging markets. Things were already weak before this global growth slowdown began. It almost seems like...
View ArticleWhy QE will fail, dissonant voices edition
Note: this post has been changed to state that my analysis assumes that negative real rates are indicative of a loose monetary policy. When it comes to the efficacy of Fed policy, there are a number of...
View ArticleWhat have the economists ever done for us?
By Andrew G Haldane, Executive Director, Financial Stability, Bank of England There is a long list of culprits when it comes to assigning blame for the financial crisis. This column argues economists...
View ArticleMy Comments on Spiegel’s Post on How Monetary Policy Threatens Savings
Editor’s Note: This is a weekly post that we have decided to release outside of the paywall to give readers a better feel for the kinds of macro analyses the Gold membership contains. The membership...
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