9 reasons Keynesians (and Hamish) aren't winning the argument

CLAPTON

Generali wrote: »

Yes I am.

The rate at which a Government can borrow in local currency is known as 'the Risk Free Rate'. You can be pretty sure you'll get your money back because if it comes to it the Government can simply print money to repay you.

A measure of the price of risk is the difference between the Risk Free Rate and the cost of borrowing where risk is attached to the loan.

From the point of view of a company wanting to borrow money to invest, one would suppose they they would only focus on the cost of borrowing in relaion to the likely return).
The spread between government costs and theirs would not be a factor.
So is the cost of borrowing actually preventing firms borrowing to invest?

StevieJ

Graham_Devon wrote: »

Does it matter?

You'll be offended by both

It's more about thsoe who follow the Keynesian theory in the bad times, but follow another theory in the good times. I.e. switch the throey they like dependant on the economy.

A true Keynesian would pay down in the good times, not spend excessivley to provide unfettered growth based on ever more debt.

Would the person named follow Keynes in the good times? Call to pay debt down at the expense of possible growth? You could bet every last dime you had they wouldn't. It would be straight back to pyramid schemes.

So why are you classing these people as Keynsians? Also why do people trash his ideas (you know like in thread titles) and them admit they have some utility if they are followed diligently?

antrobus

Generali wrote: »

....The rate at which a Government can borrow in local currency is known as 'the Risk Free Rate'. You can be pretty sure you'll get your money back because if it comes to it the Government can simply print money to repay you. .....

Unless the government in question doesn't actually control the local currency concerned. As in Greece.

Plus (of course) getting your money back in the local currency might still be something of a disappointment if the government has indeed printed piles of the stuff thereby causing its value to plummet.

TruckerT

Graham_Devon wrote: »

It's about thsoe who follow the Keynesian theory in the bad times, but follow another theory in the good times. I.e. switch the throey they like dependant on the economy

Generali wrote: »

The thing is, Keynes wasn't even a Keynesian necessarily. If you actually read what he wrote rather than others' interpretations you can find huge amounts of stuff that is self contradictory

Economics is a bit like religion - whether you read the Koran or the Holy Bible, there's always a bit which provides the answer you are looking for.

TruckerT

pqrdef

Generali wrote: »

There is, however, a problem with this. There is a finite amount of money available to be borrowed.

This is almost like saying there's only a finite amount of money to be spent. But when you spend money, you give it to somebody else, who spends it again, and so on. It doesn't get consumed. The basic problem with the great right-wing fraud called monetarist "economics" is that money is not actually a commodity.

antrobus

TruckerT wrote: »

Economics is a bit like religion - whether you read the Koran or the Holy Bible, there's always a bit which provides the answer you are looking for.

TruckerT

Not really. People who argue or disagree about religion frequently have read at least part of either the Koran or the Bible. People who argue or disagree about economics tend not to have read anything at all. I mean, have you ever actually even opened a copy of The General Theory of Employment, Interest and Money or A Monetary History of the United States, 1867-1960?

TruckerT

antrobus wrote: »

Not really. People who argue or disagree about religion frequently have read at least part of either the Koran or the Bible. People who argue or disagree about economics tend not to have read anything at all. I mean, have you ever actually even opened a copy of The General Theory of Employment, Interest and Money or A Monetary History of the United States, 1867-1960?

Mmmm - in a democracy, we expect our leaders to have the required technical knowledge, and we pay for a huge number of highly-trained people to advise them.

But no government in the western world seems to have the faintest idea about how to break away from the stranglehold of the banks.

Religions are like political parties - "all you have to do is believe, and you will be on the pathway to heaven"

TruckerT

antrobus

TruckerT wrote: »

Mmmm - in a democracy, we expect our leaders to have the required technical knowledge, and we pay for a huge number of highly-trained people to advise them.

But no government in the western world seems to have the faintest idea about how to break away from the stranglehold of the banks.

Religions are like political parties - "all you have to do is believe, and you will be on the pathway to heaven"

TruckerT

My comments were directed at the kind of people who engage in economic debates on the likes of MSE rather than politicians. Which bits of The General Theory of Employment, Interest and Money or A Monetary History of the United States, 1867-1960 have you found provide the answer you were looking for?

TruckerT

antrobus wrote: »

My comments were directed at the kind of people who engage in economic debates on the likes of MSE rather than politicians. Which bits of The General Theory of Employment, Interest and Money or A Monetary History of the United States, 1867-1960 have you found provide the answer you were looking for?

Well, at least I now know the titles!

Do they contain the answers to our problems? If so, then I suggest you tell the people in power...

Are you and Clapton one and the same?

TruckerT

CLAPTON

TruckerT wrote: »

Well, at least I now know the titles!

Do they contain the answers to our problems? If so, then I suggest you tell the people in power...

Are you and Clapton one and the same?

TruckerT

I consider your post rather offensive.