Merry Christmas

24 December 2012

Merry Christmas to all! (card via bluemountain.com) I have been collecting some quotable quotes from various sources and my bookmarks. Here are some of them: The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists. – Joan Robinson, 1955, […]


Random Tidbits On National Accounts And Keynesian Models Of Income And Expenditure

13 December 2012

I came across this article (via a Tweet from Stephen Kinsella): Accounting As The Master Metaphor Of Economics by Arjo Klamer and Donald McCloskey which discusses how the framework of national accounts has been pushed to the background in economic analysis over the years. It is a nice read – although boring in a few places. I […]


We Are NOT All Keynesians Now!

13 December 2012

The Jan Hatzius interview on sectoral balances mentioned in the previous post – although has given it some popularity – has led to great confusions among economic commentators. Here is a confused Professor from the famous institute INSEAD – Antonio Fatás on his blog. Fatás implicitly denies that propensities to consume/save and government expenditure and taxing decisions have […]


Jan Hatzius On Sectoral Balances

10 December 2012

Business Insider’s Joe Weisenthal interviewed Goldman Sachs’ Jan Hatzius recently with questions aimed at his usage of the sectoral balances approach: … BI: Back to the balance sheet, multi-sectoral framework of looking at the economy. How did you come to this view? On Wall Street this is still very rare. I don’t see many economist […]


“Maastricht Is A Half-Baked Half-Way House”

8 December 2012

I frequently quote Wynne Godley’s Maastricht And All That written for the London Review Of Books in 1992. Here’s from another article (paywalled) for the same magazine from 1993: I am in favour of Britain having much closer ties with other European countries, provided that appropriate institutions are created and the whole thing is brought under […]


Origins Of The Sectoral Balances Identity

29 November 2012

I thought I should share what I found recently about who was to state the sectoral balances identity first – since it comes across as enlightening to say the least. I found the identity in Nicholas Kaldor’s 1944 article Quantitative Aspects Of The Full Employment Problem In Britain. It was published as Appendix C to Full Employment […]


Canada’s Mark Carney To Head The Bank Of England

26 November 2012

So the news is that Mark Carney – the Governor of the Bank of Canada will now be the next Governor of the Bank of England. Wynne Godley would have been happy – had he been alive and known that Carney is perhaps the only central banker to have recognized his foresight. (Carney probably is […]


Money Supposedly Became Fiat And Hence Balance Of Payments Does Not Matter Kind Of Argument

20 November 2012

So Karl Whelan wrote another article on TARGET2 claiming once more that a loss of TARGET2 claims of the Bundesbank does not matter at all to Germany. He has a new paper as well. Earlier he was arguing there was no loss at all. His argument roughly is that since there is no longer trade […]


Joe Stiglitz’s Presentation On Global Imbalances

19 November 2012

I came across this presentation of Joe Stiglitz (from INET earlier this year) today as someone referred to it on Facebook. I think I may have referred to it earlier. Stiglitz is certainly one of the better economists in mainstream. The presentation is at Business Insider with the title Joe Stiglitz’s Presentation On Why The Entire […]


Happy Diwali!

11 November 2012

Happy Diwali to my Indian (and also non-Indian) readers! Diwali is a celebration of the triumph of good over evil. Reminds of this: I think I had best begin by making my own position clear – I regard ‘monetarism’ as a terrible curse, a visitation of evil spirits, with particularly unfortunate, one could say devastating, […]