Keynes vs. Hayek (2 rap videos)

Posted by  $  MikeMarotta 7 months, 3 weeks ago to Entertainment
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Classics in case you have not enjoyed them.

Round 1
https://www.youtube.com/watch?v=d0nER...

Round 2:
https://www.youtube.com/watch?v=GTQna...

Written and produced by John Papola and Russ Roberts.


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  • Posted by CircuitGuy 7 months, 3 weeks ago
    I loved this. It's biased against Keynes. I learned the Keynesian model of central banks tinkering with the money supply to influence aggregate demand to prevent unused productive capacity. There are so many problems with central banks, and even without them people find a way to put the means of production to use. These are great videos to explain it to someone who didn't take Macro.
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    • Posted by  $  7 months, 3 weeks ago
      It was not so much "biased" againt Keynes as an explanation of his theories. Hayek was portrayed as the underdog, cheated of his victory. I think, also, that someone would have to know the economic theories to appreciate the raps. Otherwise, none of it makes any sense. The second video was clearly the stronger of the two for exposition.

      I am not sure that a central bank has any more problems than a central anything-else. It depends on whether the decisions are informed by power or by market. That applies to any business or even a (so-called) "non-profit" organization. Just for example:

      The Suffolk System was a central clearing house for banknotes around Boston in the 1830s. The Suffolk Bank in Boston collected notes issued by rural banks but spent in the city. Their riders took the notes back to the issuing bank to be redeemed for specie.

      In a sense, any bank is a "central" bank if you accept that anyone and everyone is their own bank in their own home or business, but looks to the banking retailer for specific services. The same applies to the pharmacy or apothecary. Colgate-Palmolive and Lever Brothers were "central soap makers" if you want to think of it that way.
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        Posted by CircuitGuy 7 months, 2 weeks ago
        "I am not sure that a central bank has any more problems than a central anything-else."
        That's a good point, sort of how I'm beginning to see it.

        Ever since StraigthtLineLogic said don't think about money as you know it but what money could be, it's been kicking around in the back of my mind. Fractional reserve banking with a central bank acting as a backstop and expanding/contracting money supply to reduce surplus supply/demand is the devil I know. Its most vocal critics don't have an alternative that makes sense to me. But I'm beginning to think there must be an alternative, maybe cryptycurrencies. I don't see how we use something, though, whose value relative to basket of common goods/services doesn't stay constant and/or decay in a slow predictable way. I do not get the critics. They're mad that state-backed currencies decay in a slow predictable way, yet somehow are okay with using precious metals, which experience wild fluctuations and increase in value as the number of goods/services in the economy increases. They see even predictable inflation as "theft" from savers, and I see the deflation of prices relative to gold as not only impractical but as "theft" from producers.

        I only learned about bits and pieces of the Austrian School in college. Maybe behind the vocal tight-monetary-policy nutjobs, there is actually a reasonable alternative to central banks, a secret they hide in books.
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  • Posted by  $  Solver 7 months, 3 weeks ago
    A classic alright, but this is modern times.
    Next time the economy needs another punch of stimulus we can just give all the gangs of postmodern social justice warriors sledgehammers and they can go to it, thus stimulating the economy by creating new jobs and compelling people to spend, or surrender, their hard earned savings.
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