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  Tooze is an economic historian at Columbia University, co-hosts the podcast “Ones and Tooze,” writes the brilliant Chartbook blog and is the author of “Crashed,” the single best history of the 2008 financial crisis.  He’s now out with a new book, “Shutdown: How Covid Shook the World’s Economy,” which tells the story of the unprecedented global economic response to the pandemic. “The world discovered that John Maynard Keynes was right when he declared during World War II that ‘anything we can actually do, we can afford,’” writes Adam Tooze.  “Budget constraints don’t seem to exist; money is a mere technicality. The hard limits of financial sustainability, policed, we used to think, by ferocious bond markets, were blurred by the 2008 financial crisis. In 2020, they were erased.” Ezra Klein New York Times 17 September 2021 https://www.nytimes.com/2021/09/17/opinion/ezra-klein-podcast-adam-tooze.html Covid Showed Us What Keynes Always Knew - Adam Tooze https://englundmacro....

is the old adage attributed, probably incorrectly, to the famed economist John Maynard Keynes While he doesn’t say the market is in a bubble — a noun he seldom uses — Asness says pretty much any measure finds the valuation ratio of expensive stocks to cheap stocks is historically high. He gives three reasons why markets are less rational.  Two factors, he says, probably have a small influence — the rise of index investing and the long duration of low interest rates. But the biggest reason for a less efficient stock market, he says, is social media and related advances in technology.  “I’m far more certain that social media, the overconfidence that come when people think all the world’s data is at their fingertips, and gamified, fake-free, instant, 24/7 trading has done so in a significant way,” he says. MarketWatch 3 september 2024 https://www.marketwatch.com/story/the-market-is-getting-less-efficient-copy-this-strategy-from-the-apes-says-a-veteran-fund-manager-fdea97a7 Buy th...

 From Keynes's 1936 "General Theory of Employment, Interest, & Money, chapter 12... Brad DeLong Aug 20, 2024 https://braddelong.substack.com/p/reading-john-maynard-keynes-on-why?utm_source=substack&publication_id=47874&post_id=147929033&utm_medium=email&utm_content=share&utm_campaign=email-share&triggerShare=true&isFreemail=true&r=phhic&triedRedirect=true   ”Alla finansiella bubblor bygger i grund och botten på en bra idé. Folk tar den bara för långt”  Katrine Kielos-Marçal DN 17 augusti 2024 https://www.dn.se/ekonomi/katrine-kielos-marcal-kommer-ai-bubblan-tillatas-spricka/

Gone are the days when the political right and left could be distinguished by competing theories: free market, monetarist, or Keynesian.  Today, economic policy is mostly a grab bag from which policy interventions are found to address specific economic grievances. No overarching economic theory guides either party’s approach to policymaking. By the end of the 1990s all the talk was of the “Washington consensus,” an approach that argued prosperity and stability could be achieved via orthodox monetary and fiscal policies, alongside vigorous engagement in international trade. The Washington consensus, however, was never quite as widely fancied within the economics profession as it was amongst politicians.  It is not that economists disagreed with the merits of independent central banks tasked with keeping inflation low, deregulation, or increased globalization.  Rather, the economics profession noted that those pillars, while necessary for growth, shared prosperity, and stab...

A professor of philosophy—and occasional spy for Britain—sent back early warnings from his time in Germany after World  War I. After emerging from four years of largely genteel captivity in Germany, the young scholar was recruited in London by Britain’s nascent Secret Intelligence Service, or SIS (the department later known as MI6). As his biographer puts it: “In 1918, no Briton knew more about Germany than Bell.” SIS quickly dispatched Winthrop, under cover as a Reuters correspondent, back to Germany, which was attempting to reinvent itself as a liberal democracy.  Most of “Cracking the Nazi Code” focuses on the immediate aftermath of World War I, when Winthrop lobbied for the Allies to ease up on their rush to punish Germany.  He did so openly as a journalist filing impassioned stories about the threat of mass starvation and covertly in his SIS role.  Mr. Bell credits his subject with playing a major role in persuading the Allies to lift their food blockade of Germ...

 Adam Smith vars Wealth of Nations kom 1776 Adam Smiths gode vän David Hume i Of Money år 1752. Ett första steg i analysen var att formulera kvantitetsteorin  I flera av de industrialiserade länderna hade det förekommit återkommande kriser men det var den stora depressionen i början av 1930-talet som på allvar kom att påverka den ekonomiska teorin. Under 1930-talet kom Gunnar Myrdal och Bertil Ohlin att spela viktiga roller vid utvecklandet av makro- och konjunkturteorin inom den grupp som fått namnet “Stockholmsskolan”.  Det största genomslaget fick dock John Maynard Keynes arbete The General Theory of Employment Interest and Money från 1936.  Denna något korta beskrivning av nationalekonomiämnets utveckling fram till för 50 år sedan innehåller stora luckor. Claes-Henric Siven är professor emeritus vid Stockholms universitet.  Claes-Henric Siven Liberal Debatt 26 mars 2024 https://www.liberaldebatt.se/2024/03/en-snabbresa-genom-nationalekonomins-historia/ Svant...

She did mention there’s an alternative notion afoot: using those frozen Russian assets as collateral for borrowing.  It’s an idea pushed by Belgium.  According to RSM chief economist Joe Brusuelas, it would be the alternative that renowned economist John Maynard Keynes would’ve taken. Keynes, who in 1946 met his long-term forecast of dying, is obviously no longer around for consultation.  But Brusuelas noted that Keynes was tasked with helping to resolve the global financial crisis when the Bank of England lost two-thirds of its gold reserves in a week due to the outbreak of World War I. Keynes, noted Brusuelas, correctly predicted that the harsh conditions imposed on Germany after World War I would reverberate. Keynes would almost certainly be against the outright confiscation of Russian reserves or significant wartime reparations designed to cripple the Russian postwar economy,” he said.  “One of the major lessons learned during the 20th century was that the unrest...

As a society, we overinvest in real estate. We build (and buy) too many extra-big homes and strive to make almost everyone into a buyer. Robert J. Samuelson, July 26 2008 https://www.internetional.se/villains.htm#obs I’m almost 75. If I haven’t yet said what’s on my mind, I never will. So far as I can tell, nothing that I have written has ever had the slightest effect on what actually happened. But I’m resigned to this. No one elected me to anything. In our system, the people rule, not the pundits; and that’s how it should be. The truly big economic story of the past half-century has been the rise and fall of “macroeconomics.” This is economists’ fancy term for using interest rates, taxes and government spending to regulate the economy’s growth and stability. This once seemed doable. Now, less so. What happened?  Robert J. Samuelson Washington Post https://www.spokesman.com/stories/2020/sep/15/robert-j-samuelson-goodbye-readers-and-good-luck/ Robert J. Samuelson - Wikipedia

 The discipline, willingly or not, has inhaled his influence When he presented an early version, a young economist despaired: “You just explained why everything I’ve done in the last few years is worthless.”  Economists, he believed, “are basically storytellers, creators of make-believe economic systems”. So he and his colleagues built a fantastical new world for wonks to explore. Lucas adopted the “rational expectations hypothesis”. He assumed the actors in his models would expect what the model itself predicted. If an economist can foresee that extra tokens will raise ride prices, then operators should expect the same. With the assumption of rational expectations, Lucas felt he had “eliminated the main intellectual basis” for fiscal and monetary fine-tuning of demand. After all, cashiers could not systematically fool ride operators. “Keynesian economics is dead,” he reported in 1979.  That report proved exaggerated.  The Economist 18 May 2023 https://www.economist....

Robert skidelsky’s three-volume biography of John Maynard Keynes achieved something few histories of economic thought can do: it was well written, packed with interesting detail and offered enough—but not too much—theory.  Now Keynes’s great rival, Friedrich Hayek, is the subject of a biography comparable to Lord Skidelsky’s. It is certainly on a similar scale. The first volume is more than 800 pages, and a second is on the way. Bruce Caldwell’s and Hansjoerg Klausinger’s work also has the makings of something just as good. Both were born into respectable families. Both were too clever for school and so got bored. Both liked holidaying in Cornwall. Both, in their economic theorising, used little mathematics. And, in their personal interactions, there was tremendous mutual respect, even if not always warmth. Keynes arranged for Hayek to spend time with him at King’s College, Cambridge, during the second world war. The Economist 17 November 2022 https://www.economist.com/culture/2022...

John Maynard Keynes was one of the most influential and also divisive economists who ever lived, but almost everyone cites one of his quotations with approval. “When the facts change, I change my mind. What do you do sir?”  As Jason Zweig of the Wall Street Journal has revealed, it’s not at all clear that the great man ever said this, but we can all agree with the sentiment. That brings us to the events of last Friday.  Everything seemed to point to a decline in job creation. Instead, payrolls added more than 500,000 new workers. That’s very, very unusual. Does all of this make Jerome Powell look silly or smart? It’s important not to be too binary about this. For Blitz, the greatest danger remains that the Fed cuts too much as the economy slows later this year and inflation doesn’t go away. Others take a diametrically opposed view.  Friday’s action in the Nasdaq-100 index, and in the ARK Innovation ETF, which manager Cathie Wood modestly describes as “the new Nasdaq,” was...

 Elisabeth Svantesson är utbildad, inte bara på Timbro. 2006 Ekonomie licentiat, Örebro universitet  2001 Masterexamen i ekonomi, Uppsala universitet Licentiat https://sv.wikipedia.org/wiki/Licentiatexamen - Med hänsyn till det ekonomiska läget och den höga inflationen föreslår regeringen en svagt åtstramande inriktning på budgeten.    Genom att följa det finanspolitiska ramverket säkerställs att det finns handlingsutrymme vid ett försämrat ekonomiskt läge. Regeringen prövar samtliga reformförslag mot det ekonomiska utrymmet och det finanspolitiska ramverket. Ordning och reda i de offentliga finanserna är en prioriterad uppgift.  Samtidigt behöver den finansiella stabiliteten värnas.  (Finansplanen, s 9)   Hon avslutade sina studier något år innan Finanskrisen bröt ut. Det var en härlig tid. Robert Lucas fick nobelpriset i ekonomi. Five years before the financial meltdown of 2008, Robert Lucas famously declared that “the central problem of depression-p...

 ... when the inflation-adjusted numbers tell a more dire story  Wall Street doesn’t care about real results so why should they?  Corrected for inflation, real wages have declined  Since March 2021, nominal retail sales have risen 6.9% but are down 4.1% in real terms. Dow Jones, in nominal terms, oscillated around the 1,000 level from the late 1960s to the late 1970s, in real terms it plunged 73.1% from January 1966 to July 1982. The 5% increase in S&P 500 earnings that Wall Street analysts forecast for 2022, as reported by S&P Global, will amount to a real decline.  My earlier forecast of a 40% total drop in the S&P 500 from the early January peak is still relevant.   Gary Shilling Bloomberg 2 september 2022  https://www.bloomberg.com/opinion/articles/2022-09-02/wall-street-is-in-denial-over-the-real-economy Gary Shilling is author, most recently, of “The Age of Deleveraging: Investment Strategies for a Decade of Slow Growth and Defla...

Don’t believe everything you read on the Internet For example, more than a million Google search results, thousands of articles and dozens of books and investment letters will tell you, without evidence, that the great economist John Maynard Keynes said “the market can remain irrational longer than you can remain solvent.” The man who actually said it 36 years ago, Wall Street veteran Gary Shilling, is no slouch at the dismal science himself and, unlike Lord Keynes, is still with us at age 85. He has some opinions about how rational the recent stock market rebound is:  After the mildest of bear markets, the hardest-hit companies, many still unprofitable, have been leading a recovery the past eight weeks. Dr. Shilling is skeptical, saying stocks never reached their “puke point”—a stage of despair that serves as the basis for a sustainable rebound. Spencer Jakab WSJ 12 August 2022  https://www.wsj.com/articles/peloton-rivian-amc-gamestop-stock-market-psychology-11660250193 Gary ...

When the guns finally fell silent in 1918 and peace was forced on Germany at Versailles (in the Carthaginian terms that Keynes decried so eloquently), the Bidens, Johnsons and Macrons of the time tried to restore the old world order of free trade and liberal harmony — and comprehensively failed.  The situation for liberal economics was so dismal that, by the mid-1930s, Keynes himself had abandoned free-market liberalism as a lost cause and was campaigning for national self-sufficiency.   Ukrainian immigrants are being welcomed by nations that only a few months ago were shunning foreigners, and, after a decade of slumber in Brussels, the momentum for integration is increasing.  And look at the West’s leaders! Joe Biden hardly conveys an image of world-changing dynamism; after his initial heroics, Olaf Scholz greeted Volodymyr Zelenskiy’s speech to the German parliament with pudding-like inertia; Emmanuel Macron is bent on winning an election while trying to look like ...

The first type includes pioneers of the field such as David Ricardo, William Stanley Jevons, and, in our own time, Robert Lucas. They all aimed to economize knowledge in order to explain the largest possible amount of behavior with the smallest possible number of variables. The second category, which includes Thorstein Veblen, John Maynard Keynes, and Albert O. Hirschman, sought to broaden economic knowledge in order to understand motives and norms of behavior excluded by mainstream analysis but important in real life. Robert Skidelsky Project Syndicate 12 November 2021 https://www.project-syndicate.org/onpoint/veblen-keynes-hirschman-biographies-economics-outsiders-by-robert-skidelsky-2021-11 Why do economists continue to get it so wrong? Lucas https://englundmacro.blogspot.com/2019/10/why-do-economists-continue-to-get-it-so.html

But governments’ and central banks’ success in holding the world’s financial system together is contributing in the long run to inequality and social polarization.  It was tempting to imagine that some common threat — perhaps an alien invasion — might make a reality of the United Nations. The coronavirus, one might think, was precisely such an invasion. And yet faced with this common threat, cooperation failed. The development of Covid vaccines was a collective triumph of researchers, governments and businesses around the world. Mr. Trump’s Operation Warp Speed was the most successful of all.  Budget constraints don’t seem to exist; money is a mere technicality. The hard limits of financial sustainability, policed, we used to think, by ferocious bond markets, were blurred by the 2008 financial crisis. In 2020, they were erased. The world discovered that John Maynard Keynes was right when he declared during World War II that “anything we can actually do, we can afford.” The cen...

Robert Skidelsky is a historian, an epic biographer of John Maynard Keynes, and a prolific debater in the United Kingdom’s House of Lords. He calls What’s Wrong with Economics? a “primer,” Although the neoclassical hegemony was disrupted by the Great Depression and the rise of Keynesian models, that period proved to be merely a 40-year digression. The economics profession today is as Skidelsky describes it: an army of neoclassical technicians ... academics compete for attention, citations, rankings, promotions, and – above all – the approval of those who taught them those tools in the first place. As such, Skidelsky’s appeal for a return to an economics that is rooted in history, sensitive to ethics, and alert to the limits of the “self-regulating” market is doomed to fall on deaf ears.  In The Age of Fragmentation, Italian economist Alessandro Roncaglia, formerly of Sapienza University of Rome, provides a wide-ranging critical history of contemporary mainstream economic thought. H...

because the phenomena Keynes described couldn’t happen in an economy of perfectly rational individuals and perfectly functioning markets. Then came the 2008 crisis and its aftermath, which demonstrated that Keynes had been right all along.  The slump reflected a collapse in demand; governments that responded with deficit spending were able to mitigate the downturn, while those that practiced fiscal austerity made it worse. And the anti-Keynesian theories that had dominated the journals for several decades proved perfectly useless. Many economists entered the crisis ignorant of basic concepts that had been worked out many decades earlier, because you couldn’t publish those concepts in the journals or teach them in many (not all) graduate programs. Paul Krugman NYT 1 June 2021 https://messaging-custom-newsletters.nytimes.com/template/oakv2?uri=nyt://newsletter/41b9ba2a-b998-5d36-9aa2-a79dbdcec326&productCode=PK&te=1&nl=paul-krugman&emc=edit_pk_20210601 Keynes lived an...

He attended the Paris Peace Conference after World War I as an economic adviser with the British delegation. He was appalled by the terms imposed on the defeated countries of Europe Not even as brilliant an intellect as his could resist the fevered markets of the Roaring Twenties. He bought as the market ran up, and in the final two years of the 1920s lost 80% of his net worth. He initially described the Wall Street crash of late 1929 as a correction but soon changed his view.   https://www.wsj.com/articles/investing-with-keynes-review-cambridge-values-11617057461   Grundbultsfrågan: Hur blir S = I ??? Savings and investment, being different activities carried on by different people https://englundmacro.blogspot.com/2014/07/grundbultsfragan-hur-blir-s-i-savings.html