How about both of these are garbage under current conditions. If someone were to buy a tree I produce from me for 300 bucks and I took that 300 and bought a trailer ramp another guy welded for me, and he took the 300 and paid for a birthday dinner another guy cooked and that guy took the 300 and bought a puppy, that’s an economy, and that’s velocity of money. If the same original guy went to Walmart and sent that money to china, it’s not bouncing around here anymore.
dc.sunsets
September 22, 2014 9:17 pm
” If the same original guy went to Walmart and sent that money to china, it’s not bouncing around here anymore. ”
No, but the stuff that was purchased is. US dollars shipped to China, Useful Stuff shipped here. Looks like a heck of a deal to me, for the moment. 1 = 1. I’ll grant you that if the Useful Stuff is just consumption that turns to junk later, well, it’s lose-lose in the long run. My point? I might as well buy a tool at Harbor Freight (explicitly made in China) than Sears (the Craftsman tool is still made in China, probably at the same factory, because the US manufacturer couldn’t afford the EEOC, OSHA, sex harassment, and LGBT lawsuits.
Austrian economics treats the study of economics as an observed science. Economic activity just “is” and we can learn by watching and inferring how things work.
All other approaches are positivist, in the sense of chemistry or physics. If we want “X” outcome we put in “Y” ingredients.
The postivists are fools. Human social behavior (of which economic activity is a subset) is neither chemistry nor physics. It is a complex system, and thus an economy is a complex system.
Under the dimly understood rules of complexity, the same input produces different outputs at different times. This means the entire notion that an economy can be “steered” is a false belief.
Complex systems cannot be steered. Attempting to do so simply causes their oscillations to grow in amplitude, which is why the Fed hasn’t eliminated the business cycle (which is natural), it has AMPLIFIED IT MASSIVELY.
Wait until the next iteration of bust. It must be commensurate with the immediately prior boom, and this one goes back to the 1970’s.
It’s going to be HELL to pay.
No one can steer an economy. All they can do is make the booms last longer and go higher, leading to a mammoth bust that begins from a higher point and dives just as deep.
bb
September 23, 2014 12:25 am
Now you know why they don’t teach Austrian economics in high school or colleges. Austrian economics holds people and governments accountable
Econman
September 23, 2014 1:08 am
I taught my students Austrian Economics. It easily predicts exactly what’s going on.
Medvyed
September 23, 2014 3:30 am
Strictly speaking, the Austrian school is not emprical. Its epistemology is rational thought, not scientific observation and testing. That is not to say that Austrian observations can’t be held to an empirical standard, just that the merits of the discipline can’t be discounted in the same manner that a scientific discipline can be.
The Keynesian school, or more properly, the orthodox school of economics, of which a majority hold to the work of Keynes, claims to be empirical, but it does away with all of that nasty, useless stuff like testing and peer review. As a real scientist, I fucking love calling out Keynesian fanboys on their pseudoscience. I’m trying to cut down on being a narcissistic ass, but they can make it so easy…
As for which school is superior…I don’t know. I try and keep up with some of the emerging heterodox schools of thought, most of which seem to be based on the work of Keynes, but I read a bit about monetary theory as well, most of which seems to come from people with an Austrian background. I can’t say that I am commited to any school of thought, though enviromental economics is something I find quite interesting.
bb
September 23, 2014 9:45 am
Hey so called scientist , if you don’t know which school is superior then I question your claim to be a scientist. Unless you claim to be a psychologist , psychiatrist or a witch doctor then I can understand your lack of critical thinking skills.
bb
September 23, 2014 9:49 am
ECONMAN , why do I not believe you ? Even at Dumbfuck university they still don’t allow Austrian economics to be taught.
How about both of these are garbage under current conditions. If someone were to buy a tree I produce from me for 300 bucks and I took that 300 and bought a trailer ramp another guy welded for me, and he took the 300 and paid for a birthday dinner another guy cooked and that guy took the 300 and bought a puppy, that’s an economy, and that’s velocity of money. If the same original guy went to Walmart and sent that money to china, it’s not bouncing around here anymore.
” If the same original guy went to Walmart and sent that money to china, it’s not bouncing around here anymore. ”
No, but the stuff that was purchased is. US dollars shipped to China, Useful Stuff shipped here. Looks like a heck of a deal to me, for the moment. 1 = 1. I’ll grant you that if the Useful Stuff is just consumption that turns to junk later, well, it’s lose-lose in the long run. My point? I might as well buy a tool at Harbor Freight (explicitly made in China) than Sears (the Craftsman tool is still made in China, probably at the same factory, because the US manufacturer couldn’t afford the EEOC, OSHA, sex harassment, and LGBT lawsuits.
Austrian economics treats the study of economics as an observed science. Economic activity just “is” and we can learn by watching and inferring how things work.
All other approaches are positivist, in the sense of chemistry or physics. If we want “X” outcome we put in “Y” ingredients.
The postivists are fools. Human social behavior (of which economic activity is a subset) is neither chemistry nor physics. It is a complex system, and thus an economy is a complex system.
Under the dimly understood rules of complexity, the same input produces different outputs at different times. This means the entire notion that an economy can be “steered” is a false belief.
Complex systems cannot be steered. Attempting to do so simply causes their oscillations to grow in amplitude, which is why the Fed hasn’t eliminated the business cycle (which is natural), it has AMPLIFIED IT MASSIVELY.
Wait until the next iteration of bust. It must be commensurate with the immediately prior boom, and this one goes back to the 1970’s.
It’s going to be HELL to pay.
No one can steer an economy. All they can do is make the booms last longer and go higher, leading to a mammoth bust that begins from a higher point and dives just as deep.
Now you know why they don’t teach Austrian economics in high school or colleges. Austrian economics holds people and governments accountable
I taught my students Austrian Economics. It easily predicts exactly what’s going on.
Strictly speaking, the Austrian school is not emprical. Its epistemology is rational thought, not scientific observation and testing. That is not to say that Austrian observations can’t be held to an empirical standard, just that the merits of the discipline can’t be discounted in the same manner that a scientific discipline can be.
The Keynesian school, or more properly, the orthodox school of economics, of which a majority hold to the work of Keynes, claims to be empirical, but it does away with all of that nasty, useless stuff like testing and peer review. As a real scientist, I fucking love calling out Keynesian fanboys on their pseudoscience. I’m trying to cut down on being a narcissistic ass, but they can make it so easy…
As for which school is superior…I don’t know. I try and keep up with some of the emerging heterodox schools of thought, most of which seem to be based on the work of Keynes, but I read a bit about monetary theory as well, most of which seems to come from people with an Austrian background. I can’t say that I am commited to any school of thought, though enviromental economics is something I find quite interesting.
Hey so called scientist , if you don’t know which school is superior then I question your claim to be a scientist. Unless you claim to be a psychologist , psychiatrist or a witch doctor then I can understand your lack of critical thinking skills.
ECONMAN , why do I not believe you ? Even at Dumbfuck university they still don’t allow Austrian economics to be taught.