I watched the new ABC drama Rake starring Richard Roxburgh. The first episode has Roxburgh’s character defending a ‘famous economist’ who turns out to be a cannibal.
Are you surprised that the economist – a Professor Murray – turns out to be a ‘Friedmanite’? He couldn’t be a Keynesian or Marxist could he?
The ABC can’t help itself. It produces a drama series about a down-on-his-luck barrister but still manages to have a swipe at free market economics.
I’m sure it’s a coincidence.
Ev630
6 Nov 10 at 9:52 am
They could have done worse and made him an Austrian.
After all, there are more Austrian economists in Australia than in Austria these days.
http://mises.org/daily/4753
Rafe
6 Nov 10 at 10:26 am
What a laughably pathetic whinge.
FDB
6 Nov 10 at 10:34 am
This could be the Krispy Kreme of TV drama (except that we only pay through our taxes). The hero looks like a knockoff from Susan Geason’s low rent, beaten up private eye Sydney Fish and her comment was that she has never seen so much media coverage for a new series.
How unlikely can you get, the loser has a son in private school, gets beaten up by thugs for overdue gambling debts, defends an economist who is a cannibal (OK he is a free marketeer, so I suppose that bit is credible) and his girlfriend is an up market call girl (OK she needs a night off occasionally).
But do you want to see the second episode?
Rafe
6 Nov 10 at 10:36 am
You missed out the best part. The guy the free market economist dismembered and ate was a maritime lawyer, this is obviously meant to be some hugely clever political metaphor.
The ABC doesn’t produce art, it produces propaganda.
Blake Van Buren
6 Nov 10 at 10:49 am
“He told me they were chicken fillets … with garlic”, whimpers his distraught wife.
This really is some kind of terrible.
Blake Van Buren
6 Nov 10 at 10:53 am
Did you see the feature they ran about cannibalism amongst Australian Aborigines prior to the arrival of whites?
Yep I’m still waiting for that one too.
Chris M
6 Nov 10 at 10:53 am
SUBURBAN HOUSEWIFE: “So you’re going convince a jury that this cannibal isn’t a monster?”.
RAKE: “It’s easier than convincing them that an economist is a human being”.
Blake Van Buren
6 Nov 10 at 11:05 am
CLEAVER: sorry.
Andrew Knight writes women like a man.
SOME STUPID TART: “I’m a woman, I internalise everything until I explode”.
Blake Van Buren
6 Nov 10 at 11:10 am
Samuel
Oh FFS, delete this thread as quickly as you can. What a complete goose!
Peter Patton
6 Nov 10 at 11:14 am
Charlie Waterstreet co-wrote Cleaver Greens’s role. Should be a hoot!
Peter Patton
6 Nov 10 at 11:16 am
Blake
Or it could be that to 99% of humanity, both economists and maritime lawyers are as interesting as a cup of cold accountants, and so its quite a hoot to see them as such large characters such as cannibals.
Peter Patton
6 Nov 10 at 11:24 am
The economist’s world collapses after his best mate sleeps with his wife just minutes before Lehman Brothers collapses.
PROFESSOR’S MATE: “Nothing’s been normal since the crisis began”.
CLEAVER: “You don’t mean the global financial crisis?”.
…
PROFESSOR’S MATE: “The very same day Mr Green, almost down to the second I slept with my best friend’s wife and betrayed my own and almost instantly the world as I knew it ceased to exist”.
Blake Van Buren
6 Nov 10 at 11:25 am
Blake
If you live in Victoria, you can use their anti-vilification legislation! Your statement of claim can demand standing on the basis you are an Indigenous economist.
Peter Patton
6 Nov 10 at 11:28 am
Not when the acting is this bad and the writing so appalling. Writers often sit around jacking themselves off about how clever they are with the hidden meanings and metaphors they weave into their plots. It’s kind of sad when it’s this unsubtle.
I’m loving every second of this show though, really bad writing is highly instructive.
Blake Van Buren
6 Nov 10 at 11:30 am
This show seems to be like a luvvie anti-Les Norton.
.
6 Nov 10 at 11:44 am
CLEAVER: “You failed to predict it [the GFC] didn’t you, Mr Murray”.
PROFESSOR: “Yes, everyone did.”
CLEAVER: “Oh, well not everyone, there were a handful in the United States who predicted it, a couple in Europe”.
PROFESSOR: “Keynsians, their modelling was deeply flawed”.
…
PROFESSOR: “How could you possible be a genius when you failed to predict the single biggest economic event of our times. You missed it by a mile, didn’t you! You and your free market pals. You thought you’d factored in everything, it was a perfect market. Except there was one thing you failed to take into account, the bottomless pit of human greed, and that’s something that’s impossible to quantify isn’t it Mr Murray”.
PROFESSOR: “Well … uh, it … it, it, it … finds a level”.
CLEAVER: “But it didn’t, did it?”
…
Suitable traumatised, he eventually breaks down in the dock.
PROFESSOR: “I’M NOT A KILLER, I’M AN ECONOMIST.” (crying)
He even gives the Richard Nixon victory salute and laughs as he is led out of the court after being found not guilty while the court orders a psychiatric evaluation.
Blake Van Buren
6 Nov 10 at 12:20 pm
I saw the first few minutes of that new series and walked away in disgust knowing that our taxes were sunk into that.
We don’t produce good shows for the most part because the people producing them are from the same inner city circles.
Can anyone ever imagine a Green’s party supporter with a sense of humor or something interesting to say? Yea? That’s where they recruit from to make shows and movies etc. so no wonder they turn out failures.
JC
6 Nov 10 at 12:20 pm
Blake
I didn’t see it. I haven’t watched free to air TV for years.
Peter Patton
6 Nov 10 at 12:21 pm
Definitely one for the ALP true-believers, it’s so bad it’s almost a parody of itself.
I love shows like this. They completely discredit the capacity of public broadcasters to produce quality television.
Blake Van Buren
6 Nov 10 at 12:28 pm
Free market economists are there to play the role of Pangloss in contemporary satire. In the past, this role might have been reserved for Keynesians or Soviet types, but it’d make little sense to satirise these guys now, since they’re not in charge of the economy. Instead, you have the GFC, in which ‘objectivist’ clowns like Greenspan were found to be incompetent ideologues, combined with the very Friedmanite debacle in Iraq. The millions of unemployed in the US are suffering because Wall St metaphorically cannibalised itself. (Most people don’t believe the free market account of the GFC, in which it was caused because Stalinists forced banks to lend to the poor, causing the market to asplode.)
In short, these guys are ripe for satire, the more so since these economists aren’t merely academics, but are very much the lickspittle of governments and bankers.
THR
6 Nov 10 at 12:35 pm
I must admit looking at the writing, acting, production, and ‘consultant’ credits it must rank of the most luvvie things ever produced in Australia.
Peter Patton
6 Nov 10 at 12:36 pm
Kinda like getting a joint Happy Sorry Day card from Lefty Kim and Markie B.
Peter Patton
6 Nov 10 at 12:37 pm
combined with the very Friedmanite debacle in Iraq.
Friedman was against the Iraq war. His wife and him used to argue about it all the time.
Infidel Tiger
6 Nov 10 at 12:40 pm
Actually THR you are projecting your own statist authoritarianism. The point about liberal democracy is that NO-ONE is “in charge” of the economy. This most displeases those who think THEY should be in charge such as the Krugmanistas and their waterboys like our P.Kwig’n.
Peter Patton
6 Nov 10 at 12:44 pm
Friedman was against the Iraq war. His wife and him used to argue about it all the time.
Be that as it may, there could have been no war without Friedman. The corporate welfarism that developed in the US post-9/11 (‘privatisation’, at taxpayer’s expense) and the free marketing of the Iraq economy were all directly from the Friedman playbook. The guy was a hero to Rumsfeld, one of the war’s architects. Friedman’s ideas supplied the economic basis to the war, and without the economic basis, there would have been no war.
The point about liberal democracy is that NO-ONE is “in charge” of the economy.
Try to follow the basics of this discussion. Nobody said anything about being ‘in charge’ of anything. The point is that free marketists are, for reasons of Zeitgeist, objects of ridicule and scorn. It may seem otherwise on a right-liberal blog (the free market equivalent of Hitler’s bunker in Berlin), but it’s simply not the case in the wider world.
THR
6 Nov 10 at 12:50 pm
Be that as it may, there could have been no war without Friedman.
THR,
Dude, have you been up all night watching over the kid?
Seriously.
JC
6 Nov 10 at 12:53 pm
Actually, there has been a degree of sleeplessness.
But all the same, who believes fairytales about WMD, or spreading democracy through ‘shock and awe’? Surely the war was waged principally for economic reasons. And the reasoning behind the economic motivation was given its imprimatur by Friedman and friends.
THR
6 Nov 10 at 12:57 pm
Quite true. I vaguely remember Saddam Hussein and the Persian Ayatollahs brandishing Free To Choose as they killed 1 million of each other.
Peter Patton
6 Nov 10 at 12:59 pm
What a laughably pathetic whinge.
Yes it was. But that’s the ABC.
The other boilerplate lefty cliche was a man who has destroyed his family and who treats women like blow-up dolls being a Loveable Larrikin. There was even a prostitute with a Heart of Gold who’s going to uni and a mystical little brown man with body language-reading skills.
C.L.
6 Nov 10 at 1:03 pm
Best Australian drama produced lately is Rush on Channel 10. Far above anything else I’ve seen.
daddy dave
6 Nov 10 at 1:03 pm
That’s true. The WSJ ran an interview with Milt and his wife and they were bickering over it.
He thought it was a huge mistake and his wife began to attack him over it and began to quarrel in the middle of the interview.
JC
6 Nov 10 at 1:04 pm
THR
You really are going to have to start learning to post in a more systematic way than just picking all these words which you think mean “poo poo head” and just throwing them in the air, and typing them here.
Hullo?
Peter Patton
6 Nov 10 at 1:05 pm
The ABC’s other other old-fashioned bit of tripe for the week was its laughable attempt to make up for the embarrassment of Menzies and Santamaria being right about Petrov and the communists by making Ian Spry a Monster of Himmler proportions who was mean to homos and longhairs.
C.L.
6 Nov 10 at 1:07 pm
Really? They had that in the show? Lol.
JC
6 Nov 10 at 1:10 pm
You really are going to have to start learning to post in a more systematic way than just picking all these words which you think mean “poo poo head” and just throwing them in the air, and typing them here.</I.
Fact: in the two great 'crises' of the noughties, 9/11 and the GFC, free marketeers were implicated. In the former crisis, free marketeers used the ideas of Friedman and others to redistribute wealth in the US to corporations, and to seize control of Iraq's state assets. Rumsfeld and Bremer are avowed free marketeers, and the system they tried to impose in Iraq has Friedman's ideas written all over it.
The GFC was preceded by years of free market policy by government and the Federal Reserve, exemplified by the 'objectivist' Greenspan.
Diverting discussion into JQ cannot refute these fundamental points.
THR
6 Nov 10 at 1:11 pm
THR
So liberal economists are relevant, but Keynesians are not? Friedman is relevant, but Krugman is not? In discussion of an Australian TV show based in Australia, Greenspan is relevant, but JKw is not?
But your dumping unattributed Naomi Klein is soooo relevant, eh?
Peter Patton
6 Nov 10 at 2:03 pm
‘Freidmanites’ are in an unusual position, Patton. Highly influential in government and certain parts of the corporate world, but on the fringe everywhere else, and largely reviled. Free market ideas are thoroughly implicated in the great debacles of the past decade. So it’s not really evidence of ‘bias’ that they are satirised, on the ABC and elsewhere.
THR
6 Nov 10 at 2:08 pm
Wow, Crinmes Against “Implication”! What a complete and utter hack you are.
Peter Patton
6 Nov 10 at 2:20 pm
I’m all for satire but Rake was absolute garbage. Idealogues can’t produce satire – only propaganda – they take themselves too f’ing seriously.
I thought that “mystical little brown man” was some brand of retard?
Blake Van Buren
6 Nov 10 at 2:26 pm
No doubt, Patton, if you had your way, the ABC would do nothing but comment/satirise on your beloved white whale, Mark B, and his evil sidekick, Prof JQ. Since this’d be as boring as fuck, like most of your ‘luvvie’-obsessed comments here, perhaps you could be a good chap and return when you’ve grasped what free market ideas (i.e. unregulated finance markets, ‘austerity’, siphoning of public funds to private pockets) mean to the majority of the developed world.
THR
6 Nov 10 at 2:58 pm
FDB said “What a laughably pathetic whinge.”
It would be except that the ABC has so much form in this going back over several decade. For example, I recall the early 1990s depication of an economics teacher in Brides of Christ declaring economics to be “The Science Of Money” – ie, what the then luvvie de jour, Michael Pusey, would (mis)characterise it as. Coincidence? Maybe, but I see so many such “coincidences” on the ABC since then to believe that. Its mostly subtle stuff, but it also seems to go just one way.
Let’s face it, most ABC luvvies can’t tell a supply curve from an interest rate, but they do know that they’re tools of evil. Yes, on this matter at least, the ABC is biased.
TN
6 Nov 10 at 3:00 pm
Cetainly the ABC is behaving like the ABC.
There was good news this week.
Clover Moore fell off her bike, and in a fine display of Multiculturism a young Moslem woman stabbed a British labour MP right in the Constituancy.
rodney
6 Nov 10 at 3:08 pm
THR
You could start by keeping some semblance of consistency between your posts, rather than constantly moving the goal posts and baiting and switching.
Peter Patton
6 Nov 10 at 3:32 pm
You could start by keeping some semblance of consistency between your posts, rather than constantly moving the goal posts and baiting and switching.
Go back to the original comment I made. Free marketeers are the Panglosses of today, and it’s only right that they be satirised. There’s no baiting, no switching, and no need to invoke the spectre of Mark B.
THR
6 Nov 10 at 3:50 pm
I enjoyed Rake. I didn’t really care that they attempted to satirise economists, Friedmanite or not. Free markets, etc are here for good; if we have to bear the occasional barb of their satire while feasting on the fat of the land then so much the better, it will be an interesting diversion and a reminder of life’s bitter-sweetness.
dover_beach
6 Nov 10 at 4:25 pm
I will not watch RAKE because I’m tired of lawyer type themes. I would much rather see the ABC do a satirical series on Greenies. Imagine the fun they could have with that. They could start right here on the Gold Coast where the Greenies forestalled the completion of the Tugan bypass for many years, thereby greatly increasing traffic congestion and travel times.
John H.
6 Nov 10 at 4:29 pm
Not a bad idea, JohnH. We should also include scientists in a round of satire; just to remind them of their humanity.
dover_beach
6 Nov 10 at 4:33 pm
We should also include scientists in a round of satire; just to remind them of their humanity.
Now you’re asking for the impossible!
Wait, we could start with Mr. Dawkins. Qtn 1. Dear Mr. Dawkins, in recent years you have gone on a crusade against religion. Does that mean you will abandon your neodarwinian faith?
John H.
6 Nov 10 at 4:36 pm
Or rather, applying empirical analysis of Waterstreet’s written output to date: a steaming pile of odious excrescence.
Ev630
6 Nov 10 at 5:20 pm
John, I thought you were a scientist? How can you apply the scientific reasoning equals a new religion trope? Unless of course you are satirising the feeble-minded morons who think that straw man is a stunning maneuver! Cunning…
I like it!
Ev630
6 Nov 10 at 5:25 pm
“CLEAVER: “Oh, well not everyone, there were a handful in the United States who predicted it, a couple in Europe”.
PROFESSOR: “Keynsians, their modelling was deeply flawed”.”
Peter Schiff is a Keynesian? Part of the crisis was eminently Keynesian – a refusal to allow bear markets.
I thought it was just shit TV but this is just rank propaganda. Rank propaganda based on lies.
“Free marketeers are the Panglosses of today, and it’s only right that they be satirised. There’s no baiting, no switching, ”
Blah blah blah…your denialism of the existence of Schiff is hilarous.
.
6 Nov 10 at 5:26 pm
Ev630
Dover Beach was taking a cheap shot aimed at me. DB should know by now that I am more than happy to laugh at my own tribe. Generally I find libertarians to take their own ideas far too seriously. They too often display the same attitude that so many scientists display: Trust us! We are the truth seekers! Perhaps I am mistaken but I consider it a good sign when I find people who can laugh at themselves.
Neodarwinism is an interpetation of natural selection. It is not the final explanation and it is in its death throes. Dawkins gene centric focus reflects his ignorance about biological processes. In my view his underlying assumptions are the types of assumptions one typically absorbs in high school science.
People seem to think that science is some special realm of human cognition. Then there is all this rot about the “scientific method”. I’m not confident that we can ever hope to rid ourselves of certain underlying unproven assumptions that permeate all cognition. Perhaps Dover Beach and Steve Edney can expand on that idea, they are better informed about such matters. Sadly, it does seem to me that too many scientists who seem to think they are operating in some platonic realm of pure cognition.
It is precisely because scientists are typically perceived as our new truth seekers that they should be mocked.
John H.
6 Nov 10 at 5:40 pm
“free market ideas (i.e. unregulated finance markets, ‘austerity’, siphoning of public funds to private pockets) ”
THR you’re just an unrepentant liar. There were NO unregulated finance markets in the US, no austerity, but plenty of bailouts opposed by those who support free enterrpise, with Barney Frank et. al., on the “rake”.
Just be honest with yourself for once and you’ll come up with a logical and useful composition one day. Your characterisation of Bush as “austerity” is Homeric in stupidity.
.
6 Nov 10 at 5:41 pm
What about a parody of the DCC ala Mark L’s description of a DCC manager saying it’s all a front for higher taxes. A Government lying about surpluses. Fake revenue projections. Treasury models with missing parameters in the open source code and data. A Treasurer blurting out that a new tax is to boost an unfinded promise on superannuation. A Treasurer who doesn’t know the difference between the CAD and his own Govenrment debt. Fake finance committee meetings to fool the hard headed finance Minister. An infrastrucutre project with hidden business plans, cost beenfit analyses and delayed performance reviews. Fake consultation that is meant to smooth over a decision already made. A resource policy that sees a 37% reduction in inputs resulting in a 1% drop in output.
Let’s see that on the ABC.
.
6 Nov 10 at 5:50 pm
Y’know, reading the comments to this thread on a rainy Saturday afternoon is a weird experience. Bit like listening to a tape of midnight-to-dawn radio when they used to do that live.
ken n
6 Nov 10 at 5:51 pm
DCC done as ‘The Hollow Men’.
That’d be good!
As for bias, they have internalised it so much that they’d probably be astonished that their bias could even be thought of as bias.
MarkL
Canberra
MarkL of Canberra
6 Nov 10 at 6:04 pm
John H., good suggestion, although I seem to remember the ABC did have a bit of a go at Greenies in Grass Roots and Sea Change.
Dot, I think the Potemkin Villages in government theme is also promising.
Heck, we should write the script now.
Mother Hubbard's Dog
6 Nov 10 at 6:07 pm
Dover Beach was taking a cheap shot aimed at me. DB should know by now that I am more than happy to laugh at my own tribe.
Certainly at some within your tribe but more generally at those those that almost slavishly believe anything they might say.
dover_beach
6 Nov 10 at 6:08 pm
Grass Roots
Oh thank you for reminding me of one of the best programs ever created by Australians. Yes, there was a little greenie send up there but it was principally a send up of local govt. Great series, so much so you have now prompted me to look for a torrents …
John H.
6 Nov 10 at 6:09 pm
Neodarwinism is an interpetation of natural selection. It is not the final explanation and it is in its death throes.
Could you explain that John? What neo-darwinist ideas are being rejected by the scientific community? What viewpoint is taking its place?
daddy dave
6 Nov 10 at 6:11 pm
Hey Daddy Dave,
Cliff notes:
Group vs. individual selection
I’ve always regarded this as a false dichotomy. Trying to explain altruism without reference to group selection leads to silly proclamations. It reflects our intrinsic bias to try and reduce everything down to single causative issues. There is absolutely no way we can explain “immunological fitness” without reference to group selection because no single individual can have immune processes that will confer greater fitness. Species survival from pathogens arises because of a distinct spread in HLA haplotypes and heaven knows how many other variables. 90% will die, the remaining 10% carry the alleles that confer an advantage for that specific pathogen.
Genotype – phenotype
A study only a few months ago found that natural selection can act on “networks of genes”. Well der, like of course but if you are “natural selection acts on the single gene” type of thinker you have a problem.
Epigenetics = Lamarkian inheritance. The Aus immunologist Ted Steele way back in the 70′s, was arguing for a lamarkian style of inheritance in immunological function. His views were rejected. He should now be seen as anticipating one of the most exciting developments in genetics.
The same gene in different chromosomal locations can code for a different protein.
This UP – DOWN dichotomy for genetic effects is specious and reflects a too mechanical understanding of genetics.
This is nascent and only a few months ago a friend of mine in NY sent some material touching on this. The theme was reflected only last week in a Nature paper which found that genetic transcription is dependent on the TOTAL shape of the chromosome. Suggestive of non-communicative geometry, a paradigm that has been explored for decades by the likes of Stewart and Kaufmann. My friend referenced a scientist he met a conference who is with a group of scientists very busy exploring this realm. I can’t elaborate on this theme DD, I’m too ignorant for that, but I am very fascinated by it. Here’s one reason why: a few months ago some clever bods did an experiment where they created antibodies out of plastic. The anti bodies work but could not be re-produced by the body. Point is and has long been known – it is the shape that matters. Now we can say it is not just the amino acid sequence that determines antibody function, the critical variable is the shape. Future studies may reflect that same is true of ligand – receptor interactions.
John H.
6 Nov 10 at 6:33 pm
The Aus immunologist Ted Steele way back in the 70?s, was arguing for a lamarkian style of inheritance in immunological function. His views were rejected.
Can you elaborate on this point? Aren’t Lamarckian ideas related to acquired inheritance?
THR
6 Nov 10 at 6:48 pm
There were NO unregulated finance markets in the US, no austerity, but plenty of bailouts opposed by those who support free enterrpise, with Barney Frank et. al., on the “rake”.
There were and there are. Securities were a highly profitable free-for-all which didn’t ‘self-correct’. The economic architects of the Iraq War were resolutely free market, and imposed their ideology both on the US and Iraq. Greenspan conceded that his views were wrong, and best confined to bloated works of fiction. Ireland (among others) went down the free market path, and now finds itself in a disastrous state. Mass protests around the world have accompanied ‘austerity’ and bailouts, from both the left and the right.
This is what ‘free enterprise’ looks like in practice, and it’s not only a failed doctrine, it’s one that’s been thoroughly rejected by all who’ve encountered it. Satirise this on a fictional show, however, and people are on the phone to the bias police.
THR
6 Nov 10 at 6:56 pm
I thought the ABC may have gone into remission since there has been a sharp drop in the use of the “….worst……since the Howard government” phrase in their news items. Alas, the affliction has multiplied in other areas.
GP
6 Nov 10 at 6:56 pm
YES THR, exactly. There is now good evidence that what your parents, and even your grandparents, did and experienced in life can impact on the descendant phenotype. For example, one study asserted that if your grandparents went through a prolonged period of famine you will have a higher risk of type 2 diabetes. Given that in countries like India, where long term dietary restriction, esp. fat, has been in short supply, and India has v. high rates of type 2, we need to consider that the move to a Western style diet is going to increase type 2 incidence. However, over x generations, hopefully only one or two, I would expect this to decline.
Just last week a study asserted that the lifestyle of men can impact on the descendents. The Weismann Barrier, a concept to indicate that germ line cells are immune from environmental effects, has been demolished.
There is a responsiveness in the genome that is truly dazzling. This was first pointed out long ago. Lewontin did experiments where the gene coding for serotonin(essential for some bacteria) could be excised and yet the bacteria found another way to create serotonin.
John H.
6 Nov 10 at 7:00 pm
There were and there are. Securities were a highly profitable free-for-all which didn’t ‘self-correct’.
THR,
You might want to read, “The Sellout” by Paul Gasparino(spelling!)
This book goes into great detail about the various trading houses on Wall street, from the early 80′s to the present. Some of the behavior mentioned in that book was clearly unethical and illegal. Two weeks ago a Lehmann CEO got slugged with massive fines. If you read that text you will be led to believe that many other Wall St people could soon be doing time. They should be, some of those practices were shocking and revealed sociopathic predispositions.
People here always complain about governments, why is it that they so casually ignore corporate behavior which clearly played a major role in the GFC?
John H.
6 Nov 10 at 7:05 pm
Group vs. individual selection
Holding an outdated version of evolution isn’t the same thing as “clinging” to a “neodarwinian faith.”
For my money, the best comment you ever made about Dawkins was when you said, (I’ll have to paraphrase) his big mistake is thinking that erroneous beliefs, and not realising how easy it is to believe nonsense. That he does not understand that sloppy thinking, myth, superstition, statements that crumble under scrutiny, counter-factual beliefs, prejudices, and mumbo jumbo are all around us. Or something to that effect.
Personally I’ve read a lot of what Dawkins has to say on matters outside of his core expertise and he seems to be a living proof of the theorem (for example, his anti-Americanism; faith in Al Gore; and anti-capitalism are all evidence of unscientific prejudice).
That’s not to take away from the fact that he has made a huge impact on modern thought, and his early work was simply groundbreaking.
daddy dave
6 Nov 10 at 7:49 pm
correction:
“thinking that erroneous beliefs are rare and easily avoided”
daddy dave
6 Nov 10 at 7:50 pm
Mark
Anyone with an interest in Keynes of the GT should should have been concerned with financial conditions as loose as they were.
The fault lies with believers in the great bull market like Greenspan who reckoned you could just mop up the mess if things got out of hand.
Any serious Austian should also have been concerned.
sdfc
6 Nov 10 at 8:58 pm
sdfc
An, the GT was written for a period of history long, long, loooooong gone.
Peter Patton
6 Nov 10 at 9:00 pm
Peter
History has a habit of repeating itself.
sdfc
6 Nov 10 at 9:03 pm
Look, face facts. The apogee of macroeconomics was Malthus. Since then it’s all been downhill, and more often a train wreck.
Peter Patton
6 Nov 10 at 9:03 pm
sdfc
What incoherent rubbish. The past can never be “repeated”. Where do these boneheaded illogical cliches come from, and what circles allow them to fester. The problem is macroeconomists completely ignorant of history.
Peter Patton
6 Nov 10 at 9:05 pm
Well that’s your opinion. Maybe you should elaborate.
sdfc
6 Nov 10 at 9:06 pm
What an absurd comment Peter. We’ve just had the worst financial crisis since the 1930s. Of course history repeats. Ignoring the mistakes of the past isn’t too clever.
sdfc
6 Nov 10 at 9:10 pm
THR
Er, first of all – by definition – goal post shifting, baiting, and switching can only occue after an original comment. But what the hay, let’s take up your offer.
Free market economists are there to play the role of Pangloss in contemporary satire. In the past, this role might have been reserved for:
- Keynesians or Soviet types,
-‘objectivist’ clowns like Greenspan
- the very Friedmanite debacle in Iraq.
And why are you so dumb at history and philosophy?
Peter Patton
6 Nov 10 at 9:10 pm
And what the hell does fricking Stalin have to do with anything?
Peter Patton
6 Nov 10 at 9:16 pm
Oh FMD! NURSE!!!
Peter Patton
6 Nov 10 at 9:21 pm
If what you guys have just posted is truly the dialog, I am soooo glad I do not watch free-to-air TV.
Peter Patton
6 Nov 10 at 9:31 pm
What an absurd comment Peter. We’ve just had the worst financial crisis since the 1930s. Of course history repeats. Ignoring the mistakes of the past isn’t too clever.
Completely agree with PP. sdfc, if you think the conditions that preceded the Great Depression are the same or similar to those that preceded the GFC you’re sillier than I thought.
dover_beach
6 Nov 10 at 10:13 pm
sdfc
As somebody who has a degree in History, this sentence has packed in so much that is so wrong and so WTF, I am stunned. It is nothing but tabloid cliches thrown in the air, accepting the order in which they land.
Peter Patton
6 Nov 10 at 10:25 pm
By the way. In NO way am I suggesting that having a History degree makes one the first or last word on anything past, present, or future. I WILL say it has made me realize how fricking clueless macroeconomists are when they wade into real living societies, and especially history.
Peter Patton
6 Nov 10 at 10:28 pm
Obviously the history of finance and economics is not your strong point.
It’s not that having a finance and economics degree and working in the financial markets makes me the last word on financial crisis. But it makes be realise how clueless those that fail to learn fom history are.
sdfc
6 Nov 10 at 11:02 pm
Actually your degrees PREVENT you from understanding crisis, and COMPLETELY disable you from historical insight. This is my entire point.
I have masters level Economics, Finance, and Econometrics. I was dumbfounded several times a week at the almost autistic way macroeconomists plied their trade. While Microeconomics is the real deal, Macro is just Romper Room. Oh, and having worked for, inter alia JP Morgan and CSFP…psssssssssstttttt…I should inform you that “working in the financial markets” teaches you 3/5ths of fuck all about history.
Peter Patton
6 Nov 10 at 11:11 pm
I have masters level Economics, Finance, and Econometrics
Jesus fucking christ. You know a thread is derailed when Patton has two fluffy ducks and a pink lady, then gets on the internets and starts spruiking his (supposed) cv.
THR
6 Nov 10 at 11:28 pm
THR
Education has never been more accessible than it is in 2010. Having a masters degree nowadays is no big deal. So do some research, enrol, and learn. Knowing stuff and being able to think makes life so much cooler; not to mention making you a more substantial blogger.
Peter Patton
6 Nov 10 at 11:31 pm
In fact, were your comprehension skills developed beyond ESL, you would have realized I was actually minimizing the significance of degrees.
Peter Patton
6 Nov 10 at 11:33 pm
Peter
I would expect someone with a masters in finance and economics would have a better understanding of the financial markets.
Given your qualifications you should be embarrassed of your ignorance of the most significant fincial and economic even in 75 years.
sdfc
6 Nov 10 at 11:39 pm
sdfc
My masters was not in History.
Peter Patton
6 Nov 10 at 11:40 pm
Anyway back to The ABC….
tal
6 Nov 10 at 11:41 pm
Oh, but from my time in derivatives sales, I long ago saw what was happening on Wall Street; regulatory arbitrage. This explains why there was no ‘G’. It was purely a North Atlantic phenomenon.
Don’t both looking in the GT to understand.
Peter Patton
6 Nov 10 at 11:44 pm
It was purely a North Atlantic phenomenon.
If by ‘North Atlantic’ you include the Baltic states, Greece and Spain…
THR
6 Nov 10 at 11:46 pm
When did you work at CSFP Peter?
JC
6 Nov 10 at 11:49 pm
You obviously didn’t pick up much from your time in the market then. If you had been paying attention you would realise it was a case of loose money.
Australia got through the financial crisis in relatively good shape due to RBA and government action preventing the unemployment rate from rising sharply and by the guarantee of ADI wholesale debt allowing our ADI’s to compete in the global financial market.
The Australian money market came under extreme stress. So much so that the RBA was required to provide huge amounts of liquidity to the market to facilitate the flow of credit. I would have thought this was well known by a master of finance and economics and former derivative trader.
The GFC was a every bit a financial crisis as outlined in the GT.
sdfc
6 Nov 10 at 11:57 pm
Peter
Working in the financial does teach you about history if you bother to research.
We have seen financial crisis numerous times before. There all reasonably similar.
Loose money helps foster a period of confidence. This gets out of hand, debt rises, risk premiums decline to inappropriately low levels. Bust.
Debtors can’t validate their debts. I’ll let you try to figure out how this impacts on the banking system and what this does to risk premiums, the low of credit and financial sector balance sheets.
sdfc
7 Nov 10 at 12:05 am
flow of credit
sdfc
7 Nov 10 at 12:06 am
What derivatives were you trading by the way and when did you leave the market?
sdfc
7 Nov 10 at 12:10 am
SDFC:
I think it’s easy looking back now and saying easy money policies in the early part of the decade caused these problems.
However the Fed at the time was gripped with a serious fear of deflation and the economy falling off the cliff.
There was the tech crash. Admittedly that was a collapse in equity values which thankfully didn’t have a lot of debt attached to it although there was indirect debt as people were borrowed against their homes. However home prices didn’t fall.
You then had 911 which sent a really serious chill through the economy.
It’s not hard to understand the position the Fed took then, which incidentally is no different to now but only in degree.
JC
7 Nov 10 at 12:13 am
sdfc
It was my first job out of uni, and in London, a long time ago; last century!
I have no idea what bucket shop you work for, but I am seriously concerned they employ people who believe trading rooms provide a history education!
Peter Patton
7 Nov 10 at 12:21 am
JC I think the fear of deflation was misplaced with the downward pressure on prices driven at least partly by goods price deflation out of China. My major criticism is them taking for ever and a day to normalise rates given the build up in financial liabilities.
The Japanese and Chinese didn’t help by pushing so much money back to the US and pushing down the cost of capital to such low levels.
I’m always pretty critical of central banks keeping policy too loose. If you don’t want the bust keep a lid on the boom I reckon.
sdfc
7 Nov 10 at 12:22 am
I’m not a trader Peter but one of my hats is as a market economist. basically an interest rate strategist. I reckon part of my job is to research market history.
sdfc
7 Nov 10 at 12:25 am
Well, it isn’t, and you don’t.
Peter Patton
7 Nov 10 at 12:27 am
A market economist is not an historian. This is what I am trying to knock into you.
Peter Patton
7 Nov 10 at 12:27 am
Sorry guys I’ve gotta go. I have to watch a film or I’ll be in trouble.
sdfc
7 Nov 10 at 12:32 am
SDFC:
Their formula of a behaved CPI had worked for a long time going back to the 80′s.
Greenspan has said a number of times that perhaps they made an error in being far too focused on core CPI.
I think it tells us something though. I think it tells you that targeting CPI based inflation is to all intents and purposes a crock of shit, which I have been saying for a very long time.
Do I Know what would be better?
I thought we never gave Friedman’s approach enough time to work and to finesse. I know he said himself that focusing on the aggregates M’s were problematic especially with M3. The Fed has even disconinuted even reporting that now. The problem is what to include.
Perhaps targeting aggregate bank balance sheets may be the long term way to go.
Interesting that the Fed and the other larger central banks have gone back to a form of targeting quantity of money.
I always thought that interest targeting was a huge mistake. Yes I know that price (interest rates) is a determining factor. However if you control price you really have no control over quantity. And incremental 25 basis point moves are nonsense.
Best to allow the market to determine price and the CB to decide quantity. This of course would mean far more volatile short term interest rates, but so be it and I would think that over time, say a decade or so, we would begin to see a normalization there too.
JC
7 Nov 10 at 12:34 am
Peter
That is a strange position to take. Obviously you think nothing can be learned from the history of financial crisis.
That’s the sort of attitude that got us into trouble in the first place. This time is different.
sdfc
7 Nov 10 at 12:35 am
Sorry JC I’m getting dirty looks. I really do have to go.
sdfc
7 Nov 10 at 12:36 am
sdfc go now. I’m really good at those looks and it doesn’t bode well for you
tal
7 Nov 10 at 12:40 am
This explains why there was no ‘G’. It was purely a North Atlantic phenomenon.
You heard it here first, people. Growth stopped in Australia simply by accident. And the RBA cut the cash rate merely because they were feeling frisky that day. Nothing global about it.
Incidentally, Patton, in which of Pyongyang’s tertiary institutions did you receive your Master’s degrees?
THR
7 Nov 10 at 12:43 am
THR you’re up late….is the Princess giving you grief?
tal
7 Nov 10 at 12:47 am
Not just this minute, but she has been, shall we say, Princessy of late. She has nothing of my mild-mannered diplomacy.
THR
7 Nov 10 at 12:55 am
Pop over to the open forum THR and tell me about it(out of respect for Sam J)
tal
7 Nov 10 at 1:00 am
sdfc, your lessons of history lectures are amusing.
dover_beach
7 Nov 10 at 7:56 am
THR
Aaaaarrrrghhhhhh…You just Don’t. Get. It. It doesn’t matter where I got it, as tertiary Economics teaching is pretty well commodified across the globe.
As I have been trying to teach you, the reason I even raise it is to point out in no way do I consider that degree as qualifying me to presume seer status on the ‘GFC’. And similarly to thump my forehead whenever I hear somebody who thinks that very degree gives them seer status. Macroeconomics is bunk. It is less than astrology. At least the medieval astrologer was first trained in astronomy, geometry, and physics!
Peter Patton
7 Nov 10 at 8:31 am
sdfc
I think learning about ALL history is worthwhile. Again, what forces are at work that hoodwink a gullible young graduate to think his working in the financial markets is simultaneously a History traineeship?
Peter Patton
7 Nov 10 at 8:34 am
sdfc
Working in the financial markets should develop social psychology intuition and ability to identify and exploit arbitrage opportunities. I get the impression you think ‘history’ was last quarter’s growth data, which is good from your employer’s perspective, because the financial markets do not operate according to Chairman Keynes’ dictates.
Peter Patton
7 Nov 10 at 8:41 am
JC
Personally I think price stability has to play some sort of role in your monetary framework but I agree central banks became far too focussed on CPI inflation at the exclusion of almost everything else.
For instance the huge growth in M3 and credit was just ignored it seems.
Here’s where history comes in Peter. The higher private sector credit outstanding the greater is financial system fragility. It was the ignorance or dismissal of history that saw so many to miss the imbalances that were building.
JC, I’ve always thought some sort of credit growth targeting might should be incorporated into a future framework. Targeting bank balance sheets is an interesting concept.
I like interest rate targeting because I kind of like having some certainty in near term funding and investing costs. Some of the older more experienced guys I have worked with have in the past regaled me with stories of how volatile money market rates were prior to cash rate targeting. I reckon there’s good evidence cash rate targeting has been a big contributor to the flattening of the yield curve over the past 20 years.
I also agree that 25 point rate hikes are bullshit for the most part. The RBA strategy of sparse 25 point rate hikes between March 2005 and August 2007 has left the Australian economy and financial sector extremely vulnerable to shocks.
I’ve already said I believe the Fed’s series of 25 point hikes from its 1% base earlier this decade was a disaster .
Dover
I don’t know why researching the history of financial crisis by a financial market participant is laughable. You’ll have to explain why ignorance is your preferred state of being.
Tal
The wife’s got a point we don’t spend enough time together.
sdfc
7 Nov 10 at 1:59 pm
Peter
What are you talking about? To ignore the past is to consign yourself to a state of ignorance.
You obviously haven’t worked in the market for quite a while. That “social psychology intuition” is what got us into trouble in the first place. The failure to realise that the huge surge in profits was the result of loose monetary conditions and not merely the genius of financial market innovation nearly brought on a 1930s style financial collapse in the US.
Anyone who had even a passing interest in the history of financial crisis would have been aware of the rising instability of the financial system.
sdfc
7 Nov 10 at 2:00 pm
I don’t know why researching the history of financial crisis by a financial market participant is laughable. You’ll have to explain why ignorance is your preferred state of being.
That isn’t laughable; what is laughable is the claim that we can draw lessons from them. That you think the above claim meant that I was promoting ‘ignorance’ is simply evidence of your own ignorance regarding the character and limits of historical knowledge. The following might go some way in alleviating it.
dover_beach
7 Nov 10 at 4:33 pm
Personally I think price stability has to play some sort of role in your monetary framework but I agree central banks became far too focussed on CPI inflation at the exclusion of almost everything else.
For instance the huge growth in M3 and credit was just ignored it seems.
I think price stability (CPI) is nonsense and is more politically motivated than anything else. Prices are the signal and this part of market calculation shouldn’t be muffled. Monetary stability and price stability are two different things.
JC, I’ve always thought some sort of credit growth targeting might should be incorporated into a future framework. Targeting bank balance sheets is an interesting concept.
I think it would be an appropriate method but I’m not an expert in this field obviously.
I like interest rate targeting because I kind of like having some certainty in near term funding and investing costs. Some of the older more experienced guys I have worked with have in the past regaled me with stories of how volatile money market rates were prior to cash rate targeting. I reckon there’s good evidence cash rate targeting has been a big contributor to the flattening of the yield curve over the past 20 years.
If you control the price you can’t control quantity. It would take about a decade of hard work but eventually short-term prices would settle down. I think it could also act as a break on banks from positioning their books with wide gaps.
JC
7 Nov 10 at 4:42 pm
“I’m not a trader Peter but one of my hats is as a market economist.”
You’re not an economist, no matter how many times you repeat it.
You don’t understand how demand curves aggregate. You think this is untrue because representative agent models have egregious assumptions.
How did you ever pass university?
“Anyone with an interest in Keynes of the GT should should have been concerned with financial conditions as loose as they were.
The fault lies with believers in the great bull market like Greenspan who reckoned you could just mop up the mess if things got out of hand.”
Yes – like Brad de Long for example. _ Keynesian.
“Anyone who had even a passing interest in the history of financial crisis would have been aware of the rising instability of the financial system.”
Yet again.
“The GFC was a every bit a financial crisis as outlined in the GT.”
Page and edition please.
.
7 Nov 10 at 5:05 pm
sdfc
Why do you keep posting that somehow I am the one here ignorant of – or disinterested in – history? I would have thought it was pretty obvious that the opposite is the case.
Peter Patton
7 Nov 10 at 5:18 pm
sdfc
Even from your own faith perspective, you’ve got this tits up. Surely, the primary interest is/was “loose monetary conditions” about which you should consult Keynes?
But even this is rubbish. From a market – and even policy – perspective you should be “concerned with”- or more accurately interested in – “loose monetary conditions” and a hundred other aspects of market behavior, and in this case regulatory behavior.
And I think you will find that on the topic of “loose money” there are 100,000 scholars/academics you could consult. I would suggest the Avian Oracle might have a thing or two to add on the subject, rather than some book written nearly a century ago for a world that had neither TV, spin dryers, pocket calculators, nor global regulations setting up incentives to get rich from regulatory arbitrage.
Please, please post here whenever you intend to dip in and out of the market. I am guaranteed a fortune, if I sell every time you buy, and vice versa.
Peter Patton
7 Nov 10 at 5:28 pm
Dover
Of course we can learn lessons from history. Lesson number one from the Great Depression was prvide liquidity to a stressed banking sector adn do what you can to prevent the money supply from going backwards. You oviously pay little attention to monetary ecommics so why bother commenting?
JC
Rising CPI inflation is a signal that monetary conditions are too loose. There is a reason price stability is the key plank of central bank policy.
Interest rate targetting has in the main been a success. The problem has been that its implementation has been asymetric because no one wants to preside over recession. SO instead of allowing minor businesss cycle fluctuations they chose instead to to allow huge financial liabilities to gather in the system.
Monetary targeting was tried and proved too difficult leading one central banker I forget which one to say they didn’t abandon monetary targets but rather that the monetary aggregates abandoned the target. Or something like that.
sdfc
7 Nov 10 at 6:32 pm
Of course we can learn lessons from history. Lesson number one from the Great Depression was prvide liquidity to a stressed banking sector adn do what you can to prevent the money supply from going backwards. You oviously pay little attention to monetary ecommics so why bother commenting?
Another amusing ‘lesson’ from sdfc.
dover_beach
7 Nov 10 at 6:46 pm
Rising CPI inflation is a signal that monetary conditions are too loose. There is a reason price stability is the key plank of central bank policy.
I don’t buy that, SDFC. The oil price can move around a great deal even with the threat of war etc. and has no direct relationship to inflationary threats. Rising oil prices seep into almost every nook and cranny of the economy and I would argue rising oil prices have dis-inflationary tendencies. You raise rates in that environment and you’re asking for trouble.
Interest rate targetting has in the main been a success.
How does the CB ensure quantitative stability with this method? It can of course guess but not every guess is right. Don’t forget that the one major reason the Fed was slow to raise in the early part of the decade was exactly because CPI was well behaved.
The problem has been that its implementation has been asymetric because no one wants to preside over recession. SO instead of allowing minor businesss cycle fluctuations they chose instead to to allow huge financial liabilities to gather in the system.
Exactly. They let the money supply rip.
Monetary targeting was tried and proved too difficult leading one central banker I forget which one to say they didn’t abandon monetary targets but rather that the monetary aggregates abandoned the target. Or something like that.
I think it should have been pursued for longer and finessed.
JC
7 Nov 10 at 7:00 pm
“The problem has been that its implementation has been asymetric because no one wants to preside over recession. SO instead of allowing minor businesss cycle fluctuations they chose instead to to allow huge financial liabilities to gather in the system.”
Keynesians.
.
7 Nov 10 at 7:03 pm
sdfc
Control fallacy indicative of the Stalinist mindset common among macroeconomists that it is command and control technocrats who do, can, and should operate the economy like a puppet.
Oh yeah, and there are dozens of reasons why the price of a bundle of consumer goods increases.
Quite. We learnt our lesson after the Keynesian debacle. Don’t taken over by drunken sailor politicians.
The Reserve Bank presides?
Peter Patton
7 Nov 10 at 7:38 pm
Mark
Don’t tell my employers I’m not an economist they might get rid of me.
It’s funny how you say demand curves can be aggregated but deny the whole shebang is reliant on consumers being considered homogeneous. In short aggregation is a huge problem for neoclassical theory.
I passed uni by regurgitating what they wanted me to regurgitate. The difference between me and you is that I realised it was only a conceptual framework loaded with assumptions rather than an accurate description of real world processes. Just look at your belief that there can be no deficiency in demand. Anyone who’d worked in business would know that is bollocks.
The GT is largely a book about financial processes and financial instability. What evidence do you want? When Keynes spoke of the dangers of speculation taking over from the facilitation of credit to enterprise as the primary function of finance. When he spoke of imprudently low risk premiums in the Marginal Efficiency of Capital. Just what is it that you don’t get?
As for Brad DeLong. He’s an academic. I’m not sure academics have ever really got a handle on the financial markets.
Peter
Given our recent conversation your first comment makes no sense.
I no slavish follower of Keynes (though I admit it does appear that way). I’m more interested in his desciption of financial market processes during a depression and his reasons as to why you should not let a slump get out of control.
My opinion on the evils of loose money hasn’t been gleaned from the GT but from following the economy and the market as part of my job.
No economist is going to be able to tell you when to “dip in and out of the market”. I think you know that.
I started my finance career as a quant, we started looking closely at credit derivatives etc when some of our clients began telling us they could buy AAA paper at BBSW +150. I decided pretty much decided then that the shit was going to hit the fan.
Trouble is that was sometime in 2005 so I was wrong for around two years during which time you would have lost a lot of money.
sdfc
7 Nov 10 at 8:41 pm
I also forgot to mention Keynes description of the inducement to invest for which he hit the nail right on the head and which is a variable neoclassical economics seems to ignore.
sdfc
7 Nov 10 at 8:48 pm
So Peter you believe central banks should let inflation run out of control. You’re entering crackpot territory now.
Why don’t you name a dozen reasons CPI inflation runs out of control then and why nothing should be done about it.
Monetary policy is the main stabilisation tool. So they would be seen to preside over a recession. Again not sure what you don’t understand. Or is your comment a trivial remark over my choice of words?
Stalinist? When you resort to rubbish like that you signal you’re beginning to struggle.
sdfc
7 Nov 10 at 9:06 pm
No economist is going to be able to tell you when to “dip in and out of the market”. I think you know that.
What ever happened to the “lessons” of history?
dover_beach
7 Nov 10 at 9:10 pm
“It’s funny how you say demand curves can be aggregated but deny the whole shebang is reliant on consumers being considered homogeneous. In short aggregation is a huge problem for neoclassical theory.”
No it fucking doesn’t! Who taught you this? What are their names? How do we get their pensions terminated?
“I passed uni by regurgitating what they wanted me to regurgitate.”
No shit! Likely you never did microeconomics 1.
“As for Brad DeLong. He’s an academic. I’m not sure academics have ever really got a handle on the financial markets.”
Er um Keynes. What his trading record like at the end of his career?
“When he spoke of imprudently low risk premiums in the Marginal Efficiency of Capital. Just what is it that you don’t get?”
That makes sense, except an average figure is dubious. Like, you know, it relies on all capital being homogenous, which you previously would have been uterly opposed to?
.
7 Nov 10 at 9:19 pm
JC
The oil price is part of the tradeables basket in the Australian CPI it was low tradeables inflation that kept the CPI within the target band for so long. Our inflation problem was mainly driven by non-tradeables that is domestically driven inflation.
While I think inflation targetting has been largely successful in increasing transperancy in the monetary framework I agree the approach has been too focussed on CPI inflation at the exclusion of other variables such as the build up in private sector debt.
Mark
I agree the inflationary bias to policy setting has seen us reach a point where the system is all but broken. Maybe you should advise what your preferred solution to the problem is.
sdfc
7 Nov 10 at 9:19 pm
sfdc1:
“I no slavish follower of Keynes (though I admit it does appear that way). I’m more interested in his desciption of financial market processes during a depression and his reasons as to why you should not let a slump get out of control. ”
Um…
sfdc2:
“The problem has been that its implementation has been asymetric because no one wants to preside over recession. SO instead of allowing minor businesss cycle fluctuations they chose instead to to allow huge financial liabilities to gather in the system.”
Again with the confused narrative.
“The difference between me and you is that I realised it was only a conceptual framework loaded with assumptions rather than an accurate description of real world processes.”
No you imbecile, you aren’t even aware of the assumptions are. Your teachers ought to have their pensions terminated. The fact that you peddle this epistomological furphy and continue to call yourself an “economist” is a smear on the entire profession.
“Just look at your belief that there can be no deficiency in demand. Anyone who’d worked in business would know that is bollocks. ”
Belief? What belief? Why must you verbal people when you run out of empty rhetoric?
Okay pal, there is an objective level of demand is there? Are REALLY you serious you think demand management is better than AVOIDING the causes of game theoretic individual level rational/aggregate “bad” behaviour from occuring?
How the fuck do we avoid falling demand in Japan for example with basically a dying population where the elderly have no interest in entrepreneurial activity?
If you repent your “demand curve” nonsense, most is forgiven.
.
7 Nov 10 at 9:30 pm
Mark
What confused narrative. The only confusion is that you believe the economy is always in equilibrium or on its way to equilibrium.
That’s a function of sitting in a classroom and assuming away all those inconvenient little aspects of the real economy such as finance and uncertainty. The really funny thing is that you don’t even know what the assumptions are.
It is that sort of muddle-headed thinking that leads you to believe that consumers can be aggregated so to produce a nice downward sloping demand curve yet you fail to understand that to do this you have to assume consumers are homogeneous. That might be fine for a single industry but to try and extend it to the economy as a whole under all conditions is delusional.
So now you acknowledge there can be a deficiency in demand. It seems you have chucked away a key plank of your previous arguments against government spending. You know, when you failed to understand a little thing such as an output gap.
By demand management I assume you mean avoiding deflation in a debt laden economy in financial crisis.
I notice I ask you to put forward your solution to the above but instead you want me solve Japan’s demographic problem.
It seems your good at spitting your dummy when people disagree with you but not much else.
sdfc
7 Nov 10 at 10:46 pm
Demand curves aren’t downward sloping SFC? Where does this come from?
JC
7 Nov 10 at 10:51 pm
By the way while demand management has been less than perfect being asymmetrical as I have said it is by far more efficient than the boom and bust system that prevailed in the 19th century.
sdfc
7 Nov 10 at 10:54 pm
No JC what I said is you can’t aggregate all consumers into a nice constant slope demand curve without assuming they have all the same tastes. In other words consumption patterns change over time and with income.
sdfc
7 Nov 10 at 11:00 pm
SDFC;
There could be a hurricane of nuclear war, but the shape of demand cannot change. They can only slope downward. That applies in aggregate and micro level.
JC
7 Nov 10 at 11:05 pm
You’re confusing things here. Consumers may not be monolithic but that has little to do with which way demand curves slope.
JC
7 Nov 10 at 11:08 pm
JC
It is not about the arguing that individual demand functions slope downward but that you can’t aggregate individual consumer demand functions and get a nice neat consumer demand function.
It is a problem which is has been acknowledged by a number of neoclassical economists that the micro built consumer demand function tells us little about the economy because it is reliant on a bunch of restrictive assumptions. Such as consumers being homogenous, who make their decisions independent of each other and that their preferences don’t change with income.
The upshot being that you can’t construct a market equilibrium from the consumer demand curve. It’s a nice abstract for analysing individual markets or teaching economic concepts at uni or high school but at an economy wide level is of little use.
sdfc
8 Nov 10 at 12:32 am
sfdc,
You’re really out of your depth and don’t even know you’re often arguing against straw men.
“The only confusion is that you believe the economy is always in equilibrium or on its way to equilibrium. ”
Not me you idiot. You just assumed this ebcause of your own lack of depth of knowledge.
“So now you acknowledge there can be a deficiency in demand. It seems you have chucked away a key plank of your previous arguments against government spending.”
No you dummy, you have binary thinking like a very primitive computer. The argument against demand management (as opposed to “Government spending” which you confuse because you don’t really know the difference between Keynes and Obama anyway) is that it has shit outcomes, which has been drilled into your brain over and over again. “Key plank” my arse.
“By demand management I assume you mean avoiding deflation in a debt laden economy in financial crisis.”
DO YOU SPEAK ENGLISH???
Demand management means Keynesian management of the economy to avoid any fluctuation in GDP.
Seeing that the US only saw deflation recently during and towards the end of the fiscal stimulus, your ideas are busted, busted fella.
“It is that sort of muddle-headed thinking that leads you to believe that consumers can be aggregated so to produce a nice downward sloping demand curve yet you fail to understand that to do this you have to assume consumers are homogeneous. That might be fine for a single industry but to try and extend it to the economy as a whole under all conditions is delusional.”
Everyone here (except you) thinks AD is a nebulous and somewhat dodgy concept. You then prattle on about MEC and implicitly assume homogeneity of capital It is also an inherent Keynesian idea. Hoist by own pretard.
“By the way while demand management has been less than perfect being asymmetrical as I have said it is by far more efficient than the boom and bust system that prevailed in the 19th century.”
You’re just asserting complete and utter bullshit. The only reason why modern recessions aren’t worse is because we aren’t reliant on agriculture for the business cycle. Technology is what ahs given us prodidgous growth since 1900. We STILL have a boom and bust cycle, now predicated on Government largesse.
“No JC what I said is you can’t aggregate all consumers into a nice constant slope demand curve without assuming they have all the same tastes. In other words consumption patterns change over time and with income.”
Yes you fucking can. How can you work as a quant and not understand this?
You may as well ditch all microeconomics, put a poster of Obama on the wall, read Alinsky and sign the internationale.
Who taught you this? What are their names? How do we get their pensions terminated?
“It is a problem which is has been acknowledged by a number of neoclassical economists that the micro built consumer demand function tells us little about the economy because it is reliant on a bunch of restrictive assumptions”
WHAT restrictive assumptions do supply/demand curves rely on?
“The upshot being that you can’t construct a market equilibrium from the consumer demand curve. It’s a nice abstract for analysing individual markets or teaching economic concepts at uni or high school but at an economy wide level is of little use.”
No shit, like I’ve said before, we think AD/AS is somewhat nebulous and dodgy, but it is a thoroughly Keynesian tool used in keynesian policy making. The most respectable part of it all is the labour market.
If you knew something about those you picked a fight with (free marketers) you’d know this already, you ignant clod.
“It seems your good at spitting your dummy when people disagree with you but not much else.”
You’re rewriting economics in toto because of something you failed to understand when you were at university, or because you fail to understand your detractors don’t actually believe in something.
You are out of your depth.
.
8 Nov 10 at 7:03 am
I couldn’t help myself, here’s my take chaps:
http://willtypeforfood.blogspot.com/2010/11/workers-seizing-means-and-arms-and-legs.html
TimT
9 Nov 10 at 9:25 am
http://www.theaustralian.com.au/news/can-somebody-tell-those-dreadful-heathen-economists-that-eating-people-is-wrong/story-e6frg6n6-1225949627527
Samuel J
9 Nov 10 at 11:32 pm