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Steve Keen . . .
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Re: Keen-sianism
take aways on this excellently illuminating piece:
1 - max thinks keen was/is "most accurate forecaster" of the fin crisis (what, max dont know EJ ?)
2 - the 2 main theory of ops in dealing with it: fed deficit spending in US, austerity in EU havent been working
(in the case of the US, had the deficit gone to investment in the future/infrastucture rather than bailouts of past dem-gov farces: auto/municipal unions, giveaways to the ny banks etc, WE MIGHT'VE GOT SOMEWHERE???)
3 - its the private sector debt deleveraging (xfr'd to .gov) thats screwing the economies of both
4 - he blames the central banks and their attempts to 'manage the cycles' for all of it, starting with greenspan
5 - a large fin sector, as we have in US/EU, is a sign of a "sick economy" and that banks should function like a "regulated utility" rather than the freewheeling/laissez-faire nightmare they've gotten away with (and the political class has enabled)
and that the aussies RE crash is now underway and can be expected to be even worse than whats occurred in The US, with the same expected 'remedies' (bailout of the banksters, while the working class gets f__ked)
with the british being the most corrupted fin sector of them all.....
brilliant - and this is what we get from the ivory tower crowd?
and people made fun of how dumb ole gee dubya was because re rejected them beginning in his days at yale?
ole geedub wernt all that dumb, now was he....
too bad the GS crew that pulls all the levers/strings made him look even dumber when he signed off on the TARP plan that the GD dems running congress put on his desk....
never mind whats happened since nov08.
and ya cant just make this stuff up, they say..... -
Re: Keen-sianism
The dems put the Tarp plan on his desk? I thought Paulson and Bernanke came up with that.Comment
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Re: Keen-sianism
Most of seven decades of Republican (RePUKE) rule in America: a needless Korean War, a needless and RIDICULOUS VIET-NAM WAR; a stupid space-race with the USSR; atomic-bomb testing which was hardly "Atoms for Peace"; a for-profit free-enterprise health care system in the US, where only the very rich can afford to get sick; no plan and no planning by government for anything except for new wars; the Cold War; king-dollar backed by faith and hot air in order to fund more wars; inflation and the Federal Reserve Bank (Arthur Burns, Alan Greenspan, and now Ben Bernanke ); no more silver coins and no more silver dollars; the archaic US public school curriculum and its brain-washing; deficit- spending and Keynesian economics; outrageous home prices and the housing bubble; the bubble economy; the Great Recession; needless consumption in order to "prime-the-pump" for economic recovery; permanent recession for working people; permanent unemployment; trickle-down economics; corporatism; bail-outs and welfare for the rich; nationalism and flag-waving; gun-toting; English-only; religion, faith, and the South; prisons and executions; the Drug War; J.Edgar Hoover; Ronald Reagan, Richard Nixon, the George Bushes (I & II); the oil addiction and OPEC as a result; dollar shrinkage and the nick-knack bottles/cans now at the grocery stores; big government which does nothing but suck money; big bureaucracy; permanent gridlock and zero change; putting all solutions for anything off into the distant future; and saddling a future generation with failed policies and deficits from the past; the credit bubble and now zero-interest rates to pay for it; fleecing the savers, fleecing the prudent, and fleecing the elderly..........MOST of SEVEN DECADES oF REPUBLICAN RULE IN AMERICA, either in the House or the Senate, or the White House, or all three together. ADD IN THE FOSSILS ON THE SUPREME COURT and WE HAVE AN AMERICA RAMMED INTO THE ROCKS.Last edited by Starving Steve; March 12, 2012, 11:46 PM.Comment
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Re: Keen-sianism
uh... mr steve?Originally posted by Starving Steve View Post
even tho i wasnt really paying much attention to this stuff during the time - cept for the apollo moonshots, which eye happened to catch as live as it got on TV - nears i can recall the vietnam thing wasnt a repuke item - the dems/kennedy (and LBJ in particular) owns that one
but i'll be back for more on this, as you know how much i like joustin with ya....
and dcarigg on my 'history lesson' on a subsequent item - hey! - its the only way i get to re-live the parts of the 60's,70's,80's i missed while i was having fun as a kid (bein the '58 model that i am) - and wernt you a geography teacher? (was always one o my faves)
atomic-bomb testing which was hardly "Atoms for Peace"; a for-profit free-enterprise health care system in the US, where only the very rich can afford to get sick; no plan and no planning by government for anything except for new wars; the Cold War; king-dollar backed by faith and hot air in order to fund more wars; inflation and the Federal Reserve Bank (Arthur Burns, Alan Greenspan, and now Ben Bernanke ); no more silver coins and no more silver dollars; the archaic US public school curriculum and its brain-washing; deficit- spending and Keynesian economics; outrageous home prices and the housing bubble; the bubble economy; the Great Recession; needless consumption in order to "prime-the-pump" for economic recovery; permanent recession for working people; permanent unemployment; trickle-down economics; corporatism; bail-outs and welfare for the rich; nationalism and flag-waving; gun-toting; English-only; religion, faith, and the South; prisons and executions; the Drug War; J.Edgar Hoover; Ronald Reagan, Richard Nixon, the George Bushes (I & II); the oil addiction and OPEC as a result; dollar shrinkage and the nick-knack bottles/cans now at the grocery stores; big government which does nothing but suck money; big bureaucracy; permanent gridlock and zero change; putting all solutions for anything off into the distant future; and saddling a future generation with failed policies and deficits from the past; the credit bubble and now zero-interest rates to pay for it; fleecing the savers, fleecing the prudent, and fleecing the elderly..........MOST of SEVEN DECADES oF REPUBLICAN RULE IN AMERICA, either in the House or the Senate, or the White House, or all three together. ADD IN THE FOSSILS ON THE SUPREME COURT and WE HAVE AN AMERICA RAMMED INTO THE ROCKS.[/QUOTE]
uh - didnt the dems run congress or at least the house for most of that???Comment
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Re: Keen-sianism
I blame the Dems for becoming the party of lunatic special interests. I blame the Repubs for forgetting their 1964 platform. I blame both for selling out to powerful, wealthy special interests. They have both become whores. What really pi__es me off is what cheap whores they are. Where else can a corporation or special interest invest a few hundred thousand dollars and see a return of hundreds of millions or even billions of dollars?(I remember reading something like this sentence somewhere recently.) I am reminded of the old joke, slightly rewritten for the fools on the hill. I called my congressperson a nickel and dime whore, and he/she hit me over the head with a bag of quarters!
Still, I see some small hope that the grassroots can recover control of the Republican party. As for the Democrats, I don't believe all their lunatic special interests put together could figure out how to pour pi__ out of a boot if the directions were written on the heel, and most of them wouldn't see a need to do it!"I love a dog, he does nothing for political reasons." --Will RogersComment
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Re: Keen-sianism
LBJ ( a Demo ) is one of the most interesting of all political characters. From Texas, he was in-bed with the extreme conservatives and Republicans. So, it is no surprise that most of the blame for escalating the war in Vietnam should fall upon the shoulders of LBJ. Sad to say, LBJ ran as a peace candidate in 1964. ( Remember the commercial on TV of that little girl picking flower pedals off of a sunflower and she counted upward: 1, 2, 3, 4, 5,.... and the military voice cuts-in: 5, 4, 3, 2, 1, and the atomic bomb explodes? Then came LBJ's sobering voice, "These are the stakes: Will there be war, or will there be peace? Will our children have a future, or will there be none at all for them?" Those may not have been the exact words of Johnson, but those are close to what they were. Johnson's remarks were electrifying. As I said, LBJ ran as the peace candidate in 1964........ And then as soon as he was elected ( and he won by a huge majority ) he escalated the war far beyond anything Goldwater was even thinking about doing.
I think your point is well-taken: Both the Demos and the Repukes have been identical politically on some important issues such as the Vietnam War. The Demos had a hidden agenda of winning the Vietnam War, just as the Republicans openly campaigned that they would do.... This doesn't speak-well of the American system of govn't, does it, but this is the way it works ( i.e, fails to work for the people ) sometimes.
Anyway, in Johnson's favour, he had Medicare for the senior citizens passed in Congress with his majority there. That was a milestone of progress in America. But sadly, LBJ fell in love with his ridiculous Vietnam War; fifty-thousand boys were killed, not to mention tens-of-thousands of Vietnamese were killed; and to-day, fifty years later, no-one knows why America got itself involved in that ridiculous war. Nothing whatsoever has come out of that war, even after half-a-century of historical perspective.
No sooner did LBJ get his stupid war escalating, there was a run on the dollar, led by President De Gualle in Paris. You might remember that the old silver dollars disappeared within weeks from the gaming tables in Nevada. That happened in 1963. Then over the next several months, as the insanity of escalating the War unfolded, silver certificate one-dollar bills, $5 bills and $10 bills disappeared. Federal Reserve notes were quickly printed to replace the certificates of deposit for silver.... Then, all silver coin disappeared from circulation: the dimes, quarters, and half-dollars.... There was a massive coin shortage, and the economy began to stop. All coin transactions for a few days (of calamity) had to be done with nickels and pennies. Then, the greasy clad quarters (dated 1965) were flooded into circulation, literally over-night. They were called, the "Johnson quarters" and for obvious reason.
If Barry Goldwater would have won in 1964, the stupid war would still have been escalated. Nothing would have changed. But sad to say, if Goldwater would have won, America would not have had Medicare for the senior citizens passed. So, things would have been even worse.
But anyway, both Goldwater and Johnson came from the most conservative states in America ( Texas and Arizona ). So, really, both were conservatives. The conservatives have run America onto the rocks, and they have so for my entire life.
Thanks for your comments, Lektrode. Yes, I was a geography major at UC Berkeley. I did an M.A. in geography at the Univ of Minnesota. Dr. Mario Giovinetto at UC was my advisor. Dr. Skaggs at the U.of Minn. was my advisor. I did a thesis in climatology on the urban heat-island of the Twin Cities. The heat-island is not due to CO2. It is due to the blockage of heat from radiating outward (upward) to space at night. Carbon dioxide is of no importance at all in making cities warm. Furthermore, when temperature stations are located within cities, especially underneath the shadow of large buildings, the temperature readings taken give the impression of "global warming". But that warming is purely a local effect, associated with the urban heat-island and NOT WITH CARBON-DIOXIDE.... There is little or no evidence for global warming anywhere on this planet.
Lektrode: If you are Dr. Bill Wattenburg of the Univ of California, I love your show on KGO 810 AM Radio in San Francisco on Sunday nights. You have common-sense.Last edited by Starving Steve; March 13, 2012, 11:16 PM.Comment
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Re: Keen-sianism
From Keen's 1995 paper Finance and economic breakdown: modeling Minsky's "financial instability hypothesis"
Really prescient.The introduction of a finance sector means that capitalists can borrow to finance their investment plans, and hence accumulate long-term debt. This possibility fundamentally alters the nature of the model: a stable limit cycle is replaced by either of two possibilities, given the values of key parameters: a system that tends to stability, or a system that "breaks down," by achieving an unsustainable debt to output ratio.
[...]
[...] rather than the cycle being damped away, the higher rate of interest leads to the formation of a wage-employment vortex, where bankers' share continues to grow rather than reaching a plateau. From this point on, the rise in bankers' share causes a fall in investment, leading to a drop in employment and hence a (slightly sharper) fall in workers' share. This causes an increase in profits and hence investment, leading to further debt and a rise in bankers' share again. Rather than attenuating, the cycles now become more intense, with the strong fall in workers' share causing a big growth in profits, a commensurately larger surge in investment (given the nonlinear investment function), a further increase in debt, then the increase in workers' share due to increased employment (and the nonlinear wage change function), and a renewal of the cycle at a higher pitch. Eventually the boom is so extreme that the extra debt incurred results in profits falling and remaining below zero, given the level of debt that has been accumulated. The system then collapses toward zero employment, wages, and profits, with bankers' share spiraling ever upward. It is now in a debt-induced breakdown, from which--without a change in the rules, such as a debt moratorium--it cannot escape
[...] a long period of apparent stability is in fact illusory, and the crisis, when it hits, is sudden occurring too quickly to be reversible by changes to discretionary policy at the time. [...] the conventional policy response of governments to an overheated economy--increasing the interest rate with the intention of dampening investment and thus tempering the boom--acts not only upon the incentive to invest, but also upon the level of outstanding debt. If this level is already high, then increasing the interest rate may turn boom into crisis. The subsequent attempt to revive the economy by reducing interest rates--and thus stimulating investment, according to IS-LM analysis--amounts to trying to force the economy back down into the stable section of the vortex, when it has already passed into its catastrophic region. However, the centripetal forces that exist in that region the weight of accumulated debt upon a depressed economy--are so great that any government action at that time may be too little, too late. This emphasizes the essential policy message of the financial instability hypothesis, that we should avoid crises in the first place, by developing and maintaining institutions and policies that enforce "a 'good financial society' in which the tendency by businesses and bankers to engage in speculative finance is constrained" (Minsky, 1982, p. 69). These institutional arrangements include close and discretionary supervision of financial institutions and financial arrangements, and a bias toward income equity rather than inequality.
Interesting read even if you only skim through the math. http://www.jstor.org/sici?sici=0160-...:%3E2.0.CO;2-B. The model is relatively simple, yet it seems to capture what has been happening with FIRE over the past few decades.Comment
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Re: Keen-sianism
Lektrode: I know who you are. You were my advisor at the U of MB 40 yrs ago. What a coincidence running into you here! So you weren't Dr. Bill Wattenburg on KGO AM Radio in San Francisco as I had always thought. Dr. Bill also lives in Honolulu, I think.
Great to see that apparently you have retired in Hawaii, just as Dr. Bill has. What a difference from Wpg! Congratulations and good luck to you.
Sincerely, Starving Steve, 14 Mar, 2012Comment
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Re: Keen-sianism
uh... mr steve?
while i guess i'm flattered, alas no, i'm just a simple tradesman, formerly from NH (via FL and CA) who ended up goin where the weather suits my clothes....
Originally posted by Starving Steve View PostComment
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