Keynsian economics is dead

Discussion in 'Economics' started by Humpy, Dec 1, 2008.

  1. Humpy


    Sadly it looks like the magic words - Lord Keynes - and his theories are not going to fix the present crisis imho. This must be on a par with telling a priest that God doesn't exist because Keynesian theory is such a basic part of economic theory and has been since the 30s.
    Yes it helped countries out of the depression years ago but things are now different and it will be disastrous to implement his theories. The spiralling debt has been allowed to get completely out of control by such noteworthy figures as Alan Greenspan etc. To massively spend into even more debt is ridiculous. Its like giving a terminally ill person steroids or a spendaholic more money to waste. The West's manufacturing companies are largely on the ropes and most will fail to the new emerging markets. Gordon Brown, Bush and others keep repeating the same old mantra of open and free trade. That's just fine if it's not your economy that's going down.
  2. Humpy


    In the 30s only the few rich had money to spend. Public works gave the masses money and there was a huge appetite for household goods, cars etc.
    Not so today in the West. Most households have a TV etc if they want one. There is all of a sudden a huge over-capacity to produce cars, TVs , washing machines etc. around the world. Those in the developed countries that do want new goods will usually pay even if it's on credit and buy a machine but which is now made in an emerging economy, so what sales there are, are largely benefitting the new economies.

    It wouldn't surprise me if B Ob tries a form of protectionism for the auto and other industries. Without it they are unable at present to compete. Hundreds of thousands of jobs are at stake here and therefore votes !! It may be for a limited period until they can get their act togethor ?
  3. It's the stupidest, shittiest theory of economics I've ever heard of, I never agreed with it, and it's designed to cultivate the lowest and most base nature of human beings, and apply to their innate greed, laziness and stupdity.

    It's a theory of economics desgined to milk the population as consumer driven, debt ridden, chattle, and maybe that is what they are.
  4. Unfortunately its not dead in the minds of the central bankers and politicians. - - It likely won't be dead until the economy is driven to its knees and even then they'll probably think its only because they didn't do enough of it. (If it hasn't worked for decades - - - then do it some more !) - - - The outlook for stocks in the wheel barrel manufacturing biz is quite bullish, however.
  5. empee


    Tell us what you <i>really</i> think.
  6. Well, I don't know. - - It could be some Grand Plan by "Them" or the accumulation of decades of just plain short sighted stupidity and stubborn adherence to bone headed dogma. (The later seems more likely to me, however.) - - - - I have no way of knowing which it is, and it makes no difference to my personal course of action. - -
  7. Totally agree. What is a recovery supposed to look like from Bernankes and co's perspective? Everyone go back to burying themselves in unsustainable debt?
  8. I'm not that big on economic theory. But I don't believe that true Keynsian fiscal policy had ever really been implemented in any meaningful way. As I understand it, the idea is to spend during recessionary periods while taxing more, spending less and paying down debt during expansionary periods. How much debt has actually been paid down during expansionary periods? Further, the idea is to reduce interest rates to stimulate the economy rather than in reaction to stock market dips. The interest rate manipulation perpetrated by Bernanke, and Greenspan before him, had nothing to do with Keynsian theory to the very limited extent that I understand it. You can't dismiss a concept while only adhering to one half of the equation and perverting the other half. Even so, let me repeat that I'm not that big on economic theory.
  9. theory is overrated anyway. Someone should tell moron bernanke that. I personally think the government is going to make the situation worse.
  10. Well, some theories make better sense than others. Further, you can't grossly disregard the actual recipe and then blame the cookbook on the outcome.
    #10     Dec 1, 2008