Macroeconomics Has Lost Its Way

By Alasdair Macleod – Re-Blogged From Silver Phoenix

The father of modern macroeconomics was Keynes. Before Keynes there were macro considerations, which were firmly grounded in human action, the personal preferences and choices exercised by individuals in the context of their own earnings and profits. In order to give a role to the state, Keynes had to get away from human action and devise a positive management role for central planners. This was the unstated purpose behind his General Theory of Employment, Interest and Money.

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State or Individual?

By Alasdair Macleod – Re-Blogged From Gold Money

The most important question faced by the human race is almost never addressed in modern times: which should be the master, the state over the individual or the individual over the state? It is particularly relevant today, bearing in mind President Trump is demolishing the established order both domestically and within America’s wider sphere of influence. The blowback he is getting from all the vested interests that have wormed their way into the processes and assumptions that drive government policy is considerable. It is very much relevant to the UK’s Brexit process, where the establishment is trying to scupper the freely expressed will of the people in a referendum.

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Marx: The Worst Man In Modern History

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenix500.com

It seems extraordinary that in defiance of all factual history and philosophical knowledge anyone should celebrate the bicentenary of the birth of Karl Marx. More than anyone, through wrong-headed ideas, he bears responsibility, indirectly admittedly, for the deaths of an estimated one hundred million people in the last century, and the severe suppression though economic and social servitude of fully one third of the world’s population. And if you also include those who have suffered under the yoke of Marxist-inspired modern socialism, the philosophy that says the state is more important than the individual, you could argue nearly the whole world is influenced by Marxian philosophy today.

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Economics 101: Who Sets Prices?

By Alasdair Macleod – Re-Blogged From http://www.Gold-Eagle.com

Since the advent of nineteenth century socialism, politicians and economists in the centre ground have argued for a balanced approach, where vital services are provided by the state, and capitalism is left to provide the rest. Vital services in a modern economy are taken to include pensions, unemployment and disability benefits, healthcare and education. Most states also provide communications, such as rail and road infrastructure, electrical grids and perhaps telecommunications. They often own and operate on behalf of the people utilities, such as the railways, ports, electricity and water.

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Brexit – The Battle For Ideas

By Alasdair Macleod – Re-Blogged From GoldMoney

The battle for ideas in the Brexit debate comes down to two basic economic approaches. The neo-Keynesian macroeconomists in the permanent establishment, who manage the state as economic planners and regulators are on one side. They are naturally sympathetic with the policies and ideals of their EU counterparts. Against them are those who argue that in economics free markets must have primacy over the state.

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Will Macro-Economists Ever Learn?

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenix500.com

As we lurch through successive credit crises, central bankers and economists believe they learn valuable lessons every time, and that the ultimate prize, the suppression of business cycles through monetary policy, will be achieved. Enormous effort is put into computer models to enable economists to predict the future, and no doubt, the modellers are now working with artificial intelligence to improve their accuracy.

We saw, over Brexit, how wrong the Bank of England’s and the UK Treasury’s models were, and these errors were also evident in the OECD’s model. Brexiteers smelled conspiracy, but in the absence of evidence, perhaps we should give them the benefit of the doubt and assume the errors were genuine. If so, all computer economic modelling has been a waste of time.

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