I wrote a post on my blog, defending the Austrian Business Cycle Theory. The first comment brings up valuable points and arguments, and asks for statistics that I don't have. I was wondering if anybody had information concerning the following:
1. Which industry, would you say, was hit hardest in this recent slump?
2. Which industries, as far as your data tells you, are currently shedding most of the jobs?
Also, is my analysis in the second comment accurate? Or am I off the mark? Your comments there to help me defend the ABCT (or, otherwise) would be great (I am specifically looking for those who can answer the questions posed in that first comment, which I cannot).
I replied directly to Nima in your blog.
To paraphrase Marc Faber: We're all doomed, but that doesn't mean that we can't make money in the process. Rabbi Lapin: "Let's make bricks!" Stephan Kinsella: "Say you and I both want to make a German chocolate cake."
It look like a typical trap to me. There's no reason to ask that question and no reason to answer it. The only point to ABCT is to realize that central banks = bad. Anyone who pines over petty details of something with a perfect predictive record for any reason other than refinement reeks of shill. The only thing that I would say to him is to ask him to list theories that have worked better rather than wasting readers' time criticizing what we already know has.
I was a bit puzzled by your attitude until I read the questions... it now makes sense.
Freedom of markets is positively correlated with the degree of evolution in any society...
On second thought, his website is pro-praxeology. So, maybe he's not a shill. Although I still don't see the point.
I guess that his overall argument is that the boom was in the consumer-goods industry, not the capital-goods industry. At least, that's what I think. Otherwise, I'm not sure what he is saying (denying that the Austrians accept an increase in consumer-goods, although this is a keystone to the Austrian theory, given that savings have not increased).
I really, really wish people would understand the difference between thymology and praxeology. It would save so much confusion on both sides of the argument.
"You don't need a weatherman to know which way the wind blows"
Bob Dylan
“There is an increase in frictional unemployment, as workers which once labored in the capital-goods industry must find employment elsewhere”
It's not that they were employed in capital goods jobs, but rather, that they were employed in the wrong capital goods jobs.
savings implies that there are real consumption goods available to fund production processes that will not be completed until some time in the future, as well as an increased ability for savers to purchase the final products in the future. This may mean saved funds go towards capital goods industries, whose contribution to the production process in terms of final consumer goods will not bear fruit for quite some time. But it can also mean consumer goods that take long durations of time to produce.
Condos and houses are consumer goods, but it still requires a long period of time to create and sell them. Thus, they are equally subject to the ABCT.
Looking only at unemployment is misleading. In % terms more agricultural jobs might be lost, but agricultural job losses are actually much smaller than construction losses, in absolute terms. Construction, finance, and capital goods industries are hurting the most.
A better guide is to compare relative prices. Stock prices and housing prices fell much more than staple consumer prices.
Check my blog, if you're a loser