During the labour government use of monetary targeting, the 'corset' was in operation which enabled the government to announce lower growth in the money (currency) supply while it was really growing at a higher rate. The explosion in inflation in the first couple of years of the Thatcher administration would not have been a surprise is the bank of England had been reporting monetary growth honestly.
Can just imagine Tim Congdon sitting there with steam coming out his ears. What a load of Keynesian rubbish. Still interesting to hear even if I disagree
Keynes was never wrong, just incomplete. He didn't acknowledge Kalecki's critique, and he didn't predict supply shocks or how to deal with them. Whereas the new consensus has never produced results even halfway as good as the Keynesian period. Not for the people, not for GDP, not even for dealing with supply shocks like in 2022. We have instead created a bailout driven economy with runaway inequality and a rapidly approaching return to serfdom.
@@TurielDAs an economist I would agree overall with your comment, but would add that, though Keynes‘ approach to macroec. was and is superior to neoclassicism, he overemphasized the importance of the rate of interest for both, investment and money demand. I think that the interest elasticities of both are extremely low if not exactly zero. Add a a horizontal LM curve ( set by the central bank) to a ( almost) vertical IS curve and you softly land in the world of „the classics“ again, with causalities reversed though. Investment ( and consumption) determine nominal output ( and not the effective money supply) while the central bank sets the lower bound of at least the short term interest rates.
@@lowersaxon Richard Werner observed, that interest rates follow growth and therefore can't be determined by them. He observed also that credit creation and strict guidance of credit creation into the productive economy leads to sustainable growth without of boom, bust, depression, inflation, "creative" destruction, opressing the middle class..... Sadly the central banks most times doesnt imply beneficial policies for the people. Better said, most times they only imply elite friendly policies for their cronies that crush the middle class and gives its wealth upwards. Is that only a conspiracy theorie or is it the one thing, all mainstream propagated economic theories lack one way or the other, and therefore do their duty to the interests of the super rich.
Insanity is doing the same thing over and over and expecting different results. The UK is in economic and societal decline. We need new ideas to revitalise. On current trends we'll be poorer than Poland in less than 10 years.
Listening to this, it seems to me economists are rather keen on creating pseudo-scientific theories that are supposedly supported by data but are actually supported by something akin to religious belief. I think it's understandable they'd want to establish a mathematical formulaic basis for economics as physicists used a similar approach to advance the utility of their field, especially in the first half of the 20th century. Psychologists have also tried to be more mathematically rigourous for the sake of prestige in the past few decades as well, with some prominent missteps resulting from that desire. I think more philosophical self reflection would benefit economists to recognise the origins and shortcomings of the decisions and diagnoses they make.
Thats absolutely true. The fundamental belief of neoclassical economics is that the market is best for all, and every problem comes from the government. All of the economics profession is geared towards making models that validate this belief. Every time these models fail to reflect reality, it's easy: the government messed up! The mathematics is deceptively basic, all meant to obfuscate the poor underlying assumptions and simplification needed to make the models work.
It's not "akin" to religion, it is religion. A belief system that ignores empirical evidence ans instead tries to bend the real world to make it fit with their fantastical models is pretty much the definition of a religion.
What money supply leading to inflation is he referring to? is it M0, M1, M2 or M3? Commercial banks control a large amount of the money supply by creating credit when they issue loans to individuals and companies. How could the government control this part of the money supply?
Tom's post sneeze hands must have been, most surely, as much as a threat to the pristine cleanliness of every object within reach as the nazis were to Europe in WWII! Nonetheless, stunningly moderated, Tom. Wonderful and insightful discussion.
Margarita thatcher sold the family jewels - sold to the few what was already owned by the many. 6-8 years of false dawn and then subsequent failures for the people and their standards of living. Norway has a massive sovereign wealth fund- wealth for the people. We have a massive gap between haves and have nots. Politicians are now career seat sitters not union leaders or entrepreneurs but goffers for the elites. The uk will be the new Poland of north Europe.
Was she ever a real monetarist? Interest rates were cut in 1981 as the money supply was going through the roof. Thatcher publically disavowed key aspects of the ideology - e.g. the natural rate of unemployment (NAIRU) on national TV. Milton Friedman (the father of monetarism) was critical and disowened her in the end - claiming that she'd not fully implemented the ideology.
Why is it that the political class and their acolytes can be open about their failure to manage anything but still pass on the entitlement to rule to the next generation without any contradiction? Inflation is caused by ruling class interference; starting with mandatory state fiat currencies.
It seems to me that elitism is a folk means to prevent those that are irrational, corrupt or incompetent from causing damage to institutions. But as such as means I would hope for it to become more accurate than it is at present. Are we selecting by the best criteria available or merely the same folk criteria we have throughout history until now?
@@AbAb-th5qe - Competent authority is clearly desirable. But most of pre-democratic governance is just special interest dominating by coercision - they exclude the folk as far as possible. The premise that there are people with the capability or desire to make best interest decisions for millions of other people looks increasingly dubious. Crowd wisdom looks far more stable than the political factionalism of elites.
@andyinsuffolk But why would those special interest groups be seeking to dominate in the first place? I think a notion like 'If you want something done right you've got to do it yourself' comes into it. Members of the crowd aren't always interested in the particulars of issues, and can be wanting to act against each other. So it still comes back to what criteria should be used to select for the smooth running of systems? There's always the problems of becoming over or improperly selective.
@@AbAb-th5qe - William the Conqueror wanted to dominate those around entirely for his own puposes and destroyed a unique developing political culture in the process. In this vid the ruling faction wishes to dominate so they can try out their ideas (and rule). In both cases the elite could have just withdrawn and allowed the society to find its own path(s) but their primary interests are themselves. The crowd can be left free to make decisions for themselves - the idea that all policy has to be homogenised is just more elite preference. We can agree both that we authorise state control of crime without agreeing that we all use the same currency. The elites want to reserve those choices to themselves - and history seems to indicate they have no idea what they are doing - as this vid also demonstrates.
@andyinsuffolk Everyone's primary interest is themselves. I think some people are more short sighted in their self interest - they are incompetent. The idea that there should be universality in approach is a religious one. But I think even now it's not clear what the nature of that universality should be, up to the extent that all talk of universality becomes just meaningless speech. 'something' covers all situations, but what is that? The 'us vs them' notion you seem to exhibit is rather dangerous in my opinion. We're all just people acting in our own self interest to live in harmony together. Best to just get stuck into the conversation rather than making excuses. However, I otherwise broadly agree with your viewpoint, especially that those in charge have no idea what they're doing. No one truely does in my opinion. We all just try to bumble through life to the best of our knowledge.
There is an alternative. I am amazed how early and quickly the blame 4inflation is placed on wages and labor unions. FDR they have succeeded in getting rid of your new deal worldwide.
@@teresabarrett8676 Western government's are bought and paid for by billionaires. They work for them to enrich them. Is it coincidence that the triumph of neoliberalism has led to the lowest rates of economic growth since the early 1900s
an hour on monetarism vs Keynesianism, no mention of Austrian theory? sheesh!
Margret Thatcher is the greatest example of leadership I can possibly find.
During the labour government use of monetary targeting, the 'corset' was in operation which enabled the government to announce lower growth in the money (currency) supply while it was really growing at a higher rate. The explosion in inflation in the first couple of years of the Thatcher administration would not have been a surprise is the bank of England had been reporting monetary growth honestly.
Can just imagine Tim Congdon sitting there with steam coming out his ears. What a load of Keynesian rubbish. Still interesting to hear even if I disagree
Keynes was never wrong, just incomplete. He didn't acknowledge Kalecki's critique, and he didn't predict supply shocks or how to deal with them.
Whereas the new consensus has never produced results even halfway as good as the Keynesian period. Not for the people, not for GDP, not even for dealing with supply shocks like in 2022. We have instead created a bailout driven economy with runaway inequality and a rapidly approaching return to serfdom.
@@TurielDAs an economist I would agree overall with your comment, but would add that, though Keynes‘ approach to macroec. was and is superior to neoclassicism, he overemphasized the importance of the rate of interest for both, investment and money demand. I think that the interest elasticities of both are extremely low if not exactly zero. Add a a horizontal LM curve ( set by the central bank) to a ( almost) vertical IS curve and you softly land in the world of „the classics“ again, with causalities reversed though. Investment ( and consumption) determine nominal output ( and not the effective money supply) while the central bank sets the lower bound of at least the short term interest rates.
@@lowersaxon Richard Werner observed, that interest rates follow growth and therefore can't be determined by them.
He observed also that credit creation and strict guidance of credit creation into the productive economy leads to sustainable growth
without of boom, bust, depression, inflation, "creative" destruction, opressing the middle class.....
Sadly the central banks most times doesnt imply beneficial policies for the people.
Better said, most times they only imply elite friendly policies for their cronies that crush the middle class and gives its wealth upwards.
Is that only a conspiracy theorie
or is it the one thing, all mainstream propagated economic theories lack one way or the other,
and therefore do their duty to the interests of the super rich.
Insanity is doing the same thing over and over and expecting different results. The UK is in economic and societal decline. We need new ideas to revitalise. On current trends we'll be poorer than Poland in less than 10 years.
Listening to this, it seems to me economists are rather keen on creating pseudo-scientific theories that are supposedly supported by data but are actually supported by something akin to religious belief.
I think it's understandable they'd want to establish a mathematical formulaic basis for economics as physicists used a similar approach to advance the utility of their field, especially in the first half of the 20th century. Psychologists have also tried to be more mathematically rigourous for the sake of prestige in the past few decades as well, with some prominent missteps resulting from that desire.
I think more philosophical self reflection would benefit economists to recognise the origins and shortcomings of the decisions and diagnoses they make.
Thats absolutely true. The fundamental belief of neoclassical economics is that the market is best for all, and every problem comes from the government. All of the economics profession is geared towards making models that validate this belief. Every time these models fail to reflect reality, it's easy: the government messed up!
The mathematics is deceptively basic, all meant to obfuscate the poor underlying assumptions and simplification needed to make the models work.
It's not "akin" to religion, it is religion. A belief system that ignores empirical evidence ans instead tries to bend the real world to make it fit with their fantastical models is pretty much the definition of a religion.
Detective of Money Politics is following this very informative content cheers from VK3GFS and 73s from Frank from Melbourne Australia
What money supply leading to inflation is he referring to? is it M0, M1, M2 or M3? Commercial banks control a large amount of the money supply by creating credit when they issue loans to individuals and companies. How could the government control this part of the money supply?
Tom's post sneeze hands must have been, most surely, as much as a threat to the pristine cleanliness of every object within reach as the nazis were to Europe in WWII! Nonetheless, stunningly moderated, Tom. Wonderful and insightful discussion.
Margarita thatcher sold the family jewels - sold to the few what was already owned by the many.
6-8 years of false dawn and then subsequent failures for the people and their standards of living.
Norway has a massive sovereign wealth fund- wealth for the people.
We have a massive gap between haves and have nots.
Politicians are now career seat sitters not union leaders or entrepreneurs but goffers for the elites.
The uk will be the new Poland of north Europe.
Inflation is always local and not global
Clever government?
Great productivity, but people not earning to enjoy it. Great job.
Was she ever a real monetarist? Interest rates were cut in 1981 as the money supply was going through the roof. Thatcher publically disavowed key aspects of the ideology - e.g. the natural rate of unemployment (NAIRU) on national TV. Milton Friedman (the father of monetarism) was critical and disowened her in the end - claiming that she'd not fully implemented the ideology.
UA-cam #adtech and #ux is categorical garbage, always. YT is just...so..stupid.
Why is it that the political class and their acolytes can be open about their failure to manage anything but still pass on the entitlement to rule to the next generation without any contradiction? Inflation is caused by ruling class interference; starting with mandatory state fiat currencies.
It seems to me that elitism is a folk means to prevent those that are irrational, corrupt or incompetent from causing damage to institutions. But as such as means I would hope for it to become more accurate than it is at present. Are we selecting by the best criteria available or merely the same folk criteria we have throughout history until now?
@@AbAb-th5qe - Competent authority is clearly desirable. But most of pre-democratic governance is just special interest dominating by coercision - they exclude the folk as far as possible. The premise that there are people with the capability or desire to make best interest decisions for millions of other people looks increasingly dubious. Crowd wisdom looks far more stable than the political factionalism of elites.
@andyinsuffolk But why would those special interest groups be seeking to dominate in the first place? I think a notion like 'If you want something done right you've got to do it yourself' comes into it.
Members of the crowd aren't always interested in the particulars of issues, and can be wanting to act against each other. So it still comes back to what criteria should be used to select for the smooth running of systems? There's always the problems of becoming over or improperly selective.
@@AbAb-th5qe - William the Conqueror wanted to dominate those around entirely for his own puposes and destroyed a unique developing political culture in the process. In this vid the ruling faction wishes to dominate so they can try out their ideas (and rule). In both cases the elite could have just withdrawn and allowed the society to find its own path(s) but their primary interests are themselves. The crowd can be left free to make decisions for themselves - the idea that all policy has to be homogenised is just more elite preference. We can agree both that we authorise state control of crime without agreeing that we all use the same currency. The elites want to reserve those choices to themselves - and history seems to indicate they have no idea what they are doing - as this vid also demonstrates.
@andyinsuffolk Everyone's primary interest is themselves. I think some people are more short sighted in their self interest - they are incompetent.
The idea that there should be universality in approach is a religious one. But I think even now it's not clear what the nature of that universality should be, up to the extent that all talk of universality becomes just meaningless speech. 'something' covers all situations, but what is that?
The 'us vs them' notion you seem to exhibit is rather dangerous in my opinion. We're all just people acting in our own self interest to live in harmony together. Best to just get stuck into the conversation rather than making excuses.
However, I otherwise broadly agree with your viewpoint, especially that those in charge have no idea what they're doing. No one truely does in my opinion. We all just try to bumble through life to the best of our knowledge.
Austrian school all the way
There is an alternative. I am amazed how early and quickly the blame 4inflation is placed on wages and labor unions. FDR they have succeeded in getting rid of your new deal worldwide.
@@teresabarrett8676 Western government's are bought and paid for by billionaires. They work for them to enrich them. Is it coincidence that the triumph of neoliberalism has led to the lowest rates of economic growth since the early 1900s