I came across another article which brought up the old Keynesian "Paradox of Thrift" argument and was wondering if there were good resources I could link to &/or read up on for myself.
I searched this site & came up with one that looked like it was on topic, but after reading it, I felt it was off base as he actually agreed with what I thought was a facetious headline:
Cause of Today's Economic Crises: Too Much Thrift
This Lilburne article wasn't on that specific topic, though in critiqueing Krugman it was obviously discussed:
The Second Coming of Keynes
That article also linked to:
Feasts to cure famine
Which did a pretty good job on it as well. But I'm curious if there are other good resources on the topic.
Thanks for any help anyone might be able to provide.
BTW, I think it makes a good quiz to read the Aquinim's Razor article you linked to, the one called "Cause of Today's Economic Crisis: Too Much Thrift", and point out where the flaws are.
My humble blog
It's easy to refute an argument if you first misrepresent it. William Keizer
Smiling Dave:The Feds didn't want the banks to lend out that money to the real world, because they know full well it will cause high inflation.
My point is that what the Fed is doing doesn't mesh with what they've been saying, if that makes any sense. Ben Bernanke has been saying that the United States economy is in danger of entering a "deflationary recession", so then the obvious course of action would be for the Federal Reserve to increase the money supply in the hopes of triggering inflation (the Philips curve and the multiplier effect). Or is it your contention that Bernanke knows that inflation will just exarcebate the problem so he's being more cautious about quantitative easing?
They say you can tell when Bernanke is lying because his lips move.
He's creating plenty of inflation [see the Economic Policy Journal's many blog posts about inflation] buying Treasuries [=printing money and lending it to the US govt to spend]. Lending money to the banks and borrowing it right back is a side job, to keep them afloat.
What does Bernanke know or not know about inflation? Hard to say, but he knows how to cause it and has said over and over that he's determined to do it.
Rcder: Smiling Dave:The Feds didn't want the banks to lend out that money to the real world, because they know full well it will cause high inflation. My point is that what the Fed is doing doesn't mesh with what they've been saying, if that makes any sense. Ben Bernanke has been saying that the United States economy is in danger of entering a "deflationary recession", so then the obvious course of action would be for the Federal Reserve to increase the money supply in the hopes of triggering inflation (the Philips curve and the multiplier effect). Or is it your contention that Bernanke knows that inflation will just exarcebate the problem so he's being more cautious about quantitative easing?
Well, I think they are inflating the money supply and artificially holding down the interest rates, BUT because they are monetizing the Treasury's monster deficits they would be increasing the money supply far too fast and could send us into a hyperinflationary event. According to Bill Gross, head of PIMCO, the largest bond company in the world, the Fed was in effect purchasing 70% of the treasuries that were being issued in this latest iteration of "Quantitative Easing". Supposedly other governments were buying roughly the other 30%.
Here's a chart showing the increase in MZM:
Here's a chart showing the increase in the bank reserves held at the Federal Reserve:
If those reserve balances were loaned back out into the economy we would probably have roaring inflation by now. We already have what appears to be the beginnings of it.
The Fed sounded quite pleased with themselves when they got the authority to pay interest on those reserves at the Fed as it would give them another tool to pull money out of the economy. That money is not counted in the money supply, of course. It seems to me that it is a way for them to "print money" to pay the government's bills without it flooding the economy with hot money. At least for now. I'm not sure how this will all play out, but it looks to me like it will give them some additional time.
John James: JeffB:Thanks for that tip as well. It'll probably come in handy in the future. No problem. Got one more for you...it'll help you with quoting.
JeffB:Thanks for that tip as well. It'll probably come in handy in the future.
No problem. Got one more for you...it'll help you with quoting.
Thanks!
My problems with the quoting seem to be intermittent. I've had it work before, but last night I couldn't get it to despite bypassing my proxy & reloading the pages multiple times. It worked OK for me a couple of times today, but hasn't worked for several other times, including this reply. That's rather curious.
But your workaround seems to work flawlessly. It makes me wonder, though, whether it isn't some sort of government plot, trying to force me to change what the Mises Institute calls "False" to "True".
Go figure.