There’s an interesting post on the Atlantic by Jim Manzi, Stimulus predictions: put up or shut up, that calls on economists who are making predictions about what Obama’s stimulus package will or won’t do to present their models on which these predictions are based.
In part, he says:
It has been suggested to me that the number (and breadth) of discussions here has grown so much that this would be better served by establishing a discussion forum, as well as the blog.
Then discussions on given topics could be maintained on threads on the discussion site, while comments to the blog would be specifically on the topic of a given posting.
I am interested in how many others think this would be a good idea, and also of course in any drawbacks that people could anticipate.
Could we have a discussion here please, on this topic and none other?
Today Tonight’s James Thomas put together “Changing Times”, an excellent program on what a Depression is like, and the danger that we may be facing one today.
The centrepiece of the story was an interview with Eric Aarons, who at almost 90, lived through the Great Depression. His recollections frame an item that includes archival footage of the then Labor Party Prime Minister Scullin describing the turmoil of 1929 with the words “Australia is facing today the gravest financial crisis in its history”.
Plus ca change…
If you haven’t seen Changing Times yet, please do so.
So begins Anatole Kaletsky’s essay in The Times for February 5 2009. He is spot on. Economic theory played a direct role in this crisis, by legitimising the deregulation of finance and encouraging the profligate lending of financial institutions. There is much more that is wrong with the theory that dominates academic economics–known as “neoclassical economics”–enough to fill several books. My Debunking Economics : the naked emperor of the social sciences was one such book; in it I tried to explain all the technical flaws in economic theory to a non-mathematical audience.
The Today Tonight segment has been delayed till this evening (Wednesday February 4th)–which is a pity in a way because I will also be speaking at a public forum tonight at Circular Quay organised by the Property Knowledge Forum: An excerpt from the promotional flyer:
ARE WE HEADING FOR A DEPRESSION?
When will the bottom hit? Are we in store for 40% drops in property or has the recovery already begun?
Channel Seven’s Today Tonight is doing a piece on whether we might face a Depression, and if so what it might be like. It should go to air tomorrow–Tuesday February 3rd.
They have interviewed me for analysis, and Eric Aarons–who lived through the Great Depression and at 90 is still a dynamic sculptor and author.
They also want to speak to anyone who has lost their job recently–specifically if possible as a result of the global financial crisis.
So if anyone out there is willing to speak on camera about it, please contact the journalist James Thomas:
Click on Marx’s image to download this post in PDF format
“Talk about centralisation! The credit system, which has its focus in the so-called national banks and the big money-lenders and usurers surrounding them, constitutes enormous centralisation, and gives this class of parasites the fabulous power, not only to periodically despoil industrial capitalists, but also to interfere in actual production in a most dangerous manner— and this gang knows nothing about production and has nothing to do with it.” [1]
I’ve just been interviewed for an SBS News piece on China (for non-Australian readers, SBS is Australia’s multicultural television station, and its news has a strong international focus).
Ordinarily I don’t comment on China, because I don’t know enough about their economy right now–except to deride the belief that was popular in Australia last year that our exports to China would insulate us from the global downturn. “Decoupling” they called it–China was supposed to have its own internal growth dynamic that would mean it would continue growing and buying our raw materials even as the OECD tanked. This theory–ironically spouted by the same people who once touted that the world is now globalised and everything affects (and benefits) everything else–is now rather less popular as China’s growth has slowed.
What’s Really Going On? or…
Why Did I See it Coming and “They” Didn’t?
Part 2: The Models
“But this long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is long past the ocean is flat again.” (Keynes, A Tract on Monetary Reform, 1924)
In last month’s Debtwatch, I explained why the data side of why the “Financial Instability Hypothesis” enabled me to predict this crisis, long before conventional “neoclassical” economists had any idea it was approaching.
The Parliamentary Library arranged a debate between myself and Rory Robertson of the Macquarie Group on the financial crisis today. We had a good audience of about 70 Parliament House denizens. You can download the Powerpoint Slides slides for my presentation, and the Vissim model of Minsky’s Financial Instability Hypothesis which was part of the presentation ( Right click and choose “Save As” since this is a text file; then install the viewer, which can load the file and let you run it (I’ve also loaded the EXE file of the viewer onto my site as another way of getting the program). You can make changes too, but they can’t be saved).
