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This is just a heads up to the 12,675 reg­is­tered users on this site that you are about to receive an email from me ask­ing for your res­i­den­tal address.

This is intended just for the frac­tion of indi­vid­u­als who have reg­is­tered at or upgraded to a mem­ber­ship level that enti­tles them to an eBook or hard­copy ver­sion of the sec­ond edi­tion of Debunk­ing Eco­nom­ics, which will be launched and avail­able on Octo­ber 4th (in the UK–its avail­abil­ity in other coun­tries depends on ship­ping times). How­ever there is no way for me to select just that sub­set for emails from within Word­Press (if any Word­Press guru knows oth­er­wise, please tell me how!), so all of you will receive the request (assum­ing that the plu­gin works as adver­tised).

A note for those who are expect­ing an eBook: it is pos­si­ble to do this in the USA via a “gift” from Ama­zon, but it appears that in other coun­tries even Ama­zon hasn’t set this facil­ity up. In that case, you will be sent a paper­back copy–which is why your addresses are needed.

Finally, to put some sub­stance into this post, watch this excerpt from a BBC inter­view with a trader (Alessio Ras­tani) which out­lines a com­mon view in the hedge fund com­mu­nity. It’s some­thing I hear all the time–and which makes me seem rel­a­tively cheer­ful about our cur­rent eco­nomic predica­ment (and cer­tainly more con­cerned about its social impact!)

About Steve Keen

I am Professor of Economics and Head of Economics, History and Politics at Kingston University London, and a long time critic of conventional economic thought. As well as attacking mainstream thought in Debunking Economics, I am also developing an alternative dynamic approach to economic modelling. The key issue I am tackling here is the prospect for a debt-deflation on the back of the enormous private debts accumulated globally, and our very low rate of inflation.
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  • Philip

    Amaz­ingly hon­est. Too bad we rarely have the equiv­a­lent in the eco­nom­ics pro­fes­sion apart from the slim minor­ity with an eth­i­cal back­bone e.g. Steve, Fred Har­ri­son, etc.

  • alain­ton

    Might be ‘too good to be true’ and @dsquareddigest has been inves­ti­gat­ing and it looks like it might be clas­sic ‘yes men’ hoax — bril­liant hoax though if it is. Robert Peston has got him on the record on the BBC in last few mins to state he is not a mem­ber of the Yes men — beyond satire. 

    If you really want to be scared see this video of the slow unrolling of chi­nas bank cri­sis — http://www.creditwritedowns.com/2011/09/private-lending-china.html

    Level of bank debt caus­ing a run to cash and rich indi­vid­u­als act­ing as finan­cial inter­me­di­aries instead — lend­ing sub-prime at high inter­est rates.

    This kind of struc­ture really needs mod­el­ling as it is insta­bil­ity with­out exoge­nous mon­e­tary cre­ation. All trans­ac­tions are hard cash not book trans­ac­tions — like full reserve bank­ing.

  • aver­age­joe

    I enjoyed watch­ing that inter­view. Watch­ing the faces of the stu­dio pre­sen­ters and their reac­tion. It just shows how much the media presents a one dimen­sion, rose tinted gog­gles, ver­sion of real­ity. At least when the crash comes they cant say it was a ‘sur­prise’!

  • alain­ton

    Huff­post uk has on its front page the story that it could be a hoax http://www.huffingtonpost.co.uk/2011/09/27/alessio-rastani-hoax-on-bbc_n_983156.html

    Although he looks noth­ing like the guy from the 2004 Yes Men bhopal inter­view.
    Alessio Ras­tani though only seems to have an iden­tity on the inter­net and nonone has said — hey i work for a Hedge fund — I know him per­son­ally and pro­fes­sion­ally.

    His blog has a tiny num­ber of posts pre this week, and back to 2010. They can eas­ily be faked in Word­Press server side. The num­ber of face­books friends on his blog and face­book are iden­ti­cal, a lit­tle too con­ve­nient,

    His blog post is almost word for word what he said on the BCC ‘Why I pray for a Reces­sion’ http://www.leadingtrader.com/09/global-recession-why-i-pray-for-another-recession/

    Scripted to be picked up by media has to be the best guess.

    If he really was self employed by sell­ing train­ing advice on stocks he would be blog­ging and opin­ion­at­ing every day. 

    The inter­view that forbes did to test if he was ‘for real’ smells to high heaven
    Reads like some­one who read an air­port book on day trad­ing, and might do a bit of that a hobby.

    The BBC has issued a press release say­ing hes for real an ‘inde­pen­dent mar­ket trader’

    Cer­tainly not the wall street hedge fun guy he was pitched as

  • Philip


    Aus­tralian econ­o­mist called the bub­ble in 2002 using the debt to GDP ratio analy­sis.

  • alain­ton

    Ha ha every media organ­i­sa­tion has been hunt­ing down this guy and its the num­ber 1 trend­ing topic

    It turns out hes almost a neigh­bour of mine, isnt a reg­is­tered dealer and as I sus­pected day trad­ing is a hobby of his

    They approached me,” he told The Tele­graph. “I’m an atten­tion seeker. That is the main rea­son I speak. That is the rea­son I agreed to go on the BBC. Trad­ing is a like a hobby. It is not a busi­ness. I am a talker. I talk a lot. I love the whole idea of pub­lic speak­ing.”


    But dont laugh the crash of 29 was down in large part to hob­by­ists, the paper gold crash is down to hob­by­ists, we now have 1000s of hobby chi­nese banks that are stor­ing up prob­lems. Greed is a big hobby. The guy told it like it is and im sure he has a great media future on the com­edy panel shows.

  • The stock mar­ket is a Casino, some­body wins and some­body looses; it is only good for gam­bling not for peo­ple who are seri­ous about mak­ing money. The best thing to do is, to term deposit your cash in Aus­tralia and earn 6% + the 5% on the depre­ci­a­tion of prices on all goods (minus 5% infla­tion). It is gov­ern­ment guar­an­teed and gives you peace of mind. At this point you have time to work and earn money and save more. From noth­ing there is noth­ing, so long term this is the only way to get rich.

  • mfo
  • Yes, Peter Brain been a voice of san­ity in this insane pro­fes­sion for ages. We first worked together in 1979, when I ran a con­fer­ence on trade, and he had a stand-up fight with the IAC mob–great fun to watch.

    Peter also warned of the Asian cri­sis too before it hap­pened. Peter estab­lished the National Insti­tute for Eco­nomic and Indus­trial Research:


    It’s based on his non-neo­clas­si­cal, some­what dis­e­qui­lib­rium multi-sec­toral model. He’s a very impor­tant and under-rated con­trib­u­tor to eco­nomic real­ism here in Aus­tralia.

  • koonyeow

    Title: The Stock Mar­ket Is Not Nec­es­sar­ily A Casino

    1. The stock mar­ket is not a casino for value investors;
    2. I use the stock mar­ket to test my behav­iour as endowed by evo­lu­tion and con­firmed that there is a mon­key in me.

    Steve’s sug­ges­tion to make sec­ondary mar­ket stocks expire in 50 years would have made the stock mar­ket less casino like. Will Steve’s sug­ges­tion be adopted? Maybe around the year 2212 it will be (but in the long run we are all…).

  • Philip


    ANU eco­nom­ics pro­fes­sor calls the bub­ble in 2009.

  • Good on him–I’d missed that one. Good to see.

  • Philip

    Do you know the West­ern Syd­ney Uni­ver­sity econ­o­mists Wayne Dwyer and and Hay­dir Alhashimi? Found an arti­cle of theirs from 2004 that denies the hous­ing bub­ble.

    The res­i­den­tial prop­erty cycle and the Aus­tralian econ­omy: no bub­ble, no trou­ble”

    I’ve been read­ing through many papers and reports that pur­port to ana­lyze the US hous­ing mar­ket, com­ing from the Fed, NBER, con­ven­tional eco­nomic jour­nals, etc. It is amaz­ing that these cre­den­tialed and expe­ri­enced econ­o­mists could not see a $US8 tril­lion US hous­ing bub­ble.

    Many of the econ­o­mists were floun­der­ing as their sta­tic mod­els could not com­pre­hend how dis­pos­able incomes could drive up hous­ing prices. The worst was when they said that EMH and CAPM the­ory states that assets are priced effi­ciently by def­i­n­i­tion, so if hous­ing prices have risen to the moon, it must be an effi­cient out­come — so absurd.

  • Yes, Wayne is a good mate and Hay­dir is a very nice bloke too, but they are pri­mar­ily teach­ers rather than researchers. They stuck well within the bounds of con­ven­tional think­ing in that paper.

  • cen­ter­line


    Good stuff. So com­i­cal actu­ally that “head out the win­dow” analy­sis might have yield bet­ter prog­nos­ti­ca­tion as opposed to acad­e­mia. Hits right at the core of mod­ern eco­nomic edu­ca­tion being some­what absurd. 

    Regard­ing the BBC inter­view — there are so many rumors and so much “the­ater” going on in the main­stream media it has become noth­ing but a cir­cus. I sin­cerely believe that this “cir­cus” is, in itself, the sig­nal that all is not well and some­thing wicked this way comes!

  • @ Philip Sep­tem­ber 29, 2011 at 2:08 am | #

    ” It is amaz­ing that these cre­den­tialed and expe­ri­enced econ­o­mists could not see a $US8 tril­lion US hous­ing bub­ble.

    Many of the econ­o­mists were floun­der­ing as their sta­tic mod­els could not com­pre­hend how dis­pos­able incomes could drive up hous­ing prices. The worst was when they said that EMH and CAPM the­ory states that assets are priced effi­ciently by def­i­n­i­tion, so if hous­ing prices have risen to the moon, it must be an effi­cient out­come – so absurd.”

    I too was amazed at the so-called pro­fes­sion of Eco­nom­ics and now, I too, find the whole scam of eco­nom­ics “so absurd“‘; crim­i­nally and irre­spon­si­bly so but the pre­tence must be main­tained, and excused — by the Econ­o­mists, of course.

    Rec­om­men­da­tion: I would replace “Many” above, with ‘most.

    Note how the coerced Cen­tral Banks’ mar­ket manip­u­la­tions sur­rep­ti­tiously led by the soon to be grande loser Mr. Bernanke are beat­ing down Gold and Sil­ver down in the crim­i­nal attempt to force money into the US Dol­lar and US T Bonds. 

    This tac­tic, involved caus­ing a full unjus­ti­fied and unnec­es­sary bull store-high-in-tran­sit (SHIT) panic in the EU by hav­ing their trained and loyal true-believer Econ­o­mists and talk­ing heads plus the media talk and print mali­cious lies. Actu­ally, it is lies as these Econ­o­mists actu­ally believe the crap that they spruik is some sort of estab­lished sci­ence. Odes of Sum­mers, Rubin, Roubini and Krug­man, et al.

    How deluded is that. Noth­ing worse than a happy con­vict and there are plenty around here.

    But this is the only “Eco­nomic The­ory” you need to know and it is called the sup­port­ing pro­pa­ganda for gov­ern­men­tal, and bureau­cratic “theft” from the “gov­erned” for the Bank­ing Sys­tem.

  • Lyon­wiss

    @ Peter­jbolton Sep­tem­ber 29, 2011 at 1:01 pm

    Most (if not all) econ­o­mists do not under­stand the mon­sters they have cre­ated through their stu­pid the­o­ries. What Alessio Ras­tani does is no dif­fer­ent from what other traders do, in Gold­man Sachs and other invest­ment banks, “doing God’s work”. If any­one is shocked by the can­did com­ments, then the per­son has no idea of the true ori­gin of the finan­cial cri­sis.

  • @ Lyon­wiss Sep­tem­ber 29, 2011 at 1:58 pm | #

    Eco­nomic the­ory devel­op­ment has been dri­ven unfor­tu­nately, largely by rhetoric and by polit­i­cal and finan­cial sup­port of the rhetoric. This then dis­torts the edu­ca­tion sys­tem, which is mostly a meal-ticket pur­chase sys­tem, where regur­gi­ta­tion of mate­r­ial is a low-risk approach to meet­ing the job objec­tive.” Lyon­wiss August 13, 2011 at 2:52 pm |

    Just for the record Lyon­wiss and for prox­im­ity, I take great plea­sure in post­ing an ear­lier “utter­ance” of your orig­i­na­tion — see above — that brings great clar­ity and under­stand­ing in the most qual­i­ta­tive and suc­cinct man­ner.

    Thanks for being a human being.

    In a few hours we shall know the result of the Ger­many EFSF attempted rat­i­fi­ca­tion. If it fails, which it should, then it will be back to real­ity and the puss of the boils will spew forth unre­lent­ing. If is passes, it will be merely a post­pone­ment of what is to come.

  • Ger­many Backs EFSF Expan­sion With 523 Votes In Favor, 85 Against; EUR Sells On The News

    From: Zero Hedge

    Mad­ness and Insan­ity

    Polit­i­cal Cow­ardice and I thought that the Ger­mans had some back­bone; sigh.

  • cen­ter­line

    The news that Ger­many backed the EFSF is to me another sign that a Greek default sim­ply is very dan­ger­ous. That the EU can­not seem to find a good way to let this hap­pen. Oth­er­wise, I believe it would have already occurred. There­fore, I will­ing to take the next leap of faith to say that the EU is now “all in” on the process of avoid­ing any sort of crit­i­cal sov­er­eign default. The can has been kicked again.

    How­ever, noth­ing has fun­da­men­tally changed. In fact, the eco­nomic envi­ron­ment con­tin­ues to dete­ri­o­rate. There will come a point that the can will not be able to be kicked any fur­ther. And all the inter­ven­tion will have effec­tively only increased the poten­tial “eco­nomic” energy of the sys­tem to a point that the release of said energy will be akin to an eco­nomic nuclear det­o­na­tion.

    I sup­pose the pur­pose is a game of try­ing to out­run the inevitable bet­ter than another (say cred­i­tor). A hot potato game betweent the EU and US, wait­ing for China to implode first. Just spec­u­la­tion on my part of course.

  • Philip

    I found a good report on inter­na­tional com­par­isons of mort­gages.


    I find it odd that the main­stream says that Aus­tralia is in no dan­ger because we have a low rate of non-per­form­ing loans. Yet these loans only rise sig­nif­i­cantly after the bub­ble peaks and unem­ploy­ment rises. Non-per­form­ing loans in Spain and the US remained steady and only increased after the bub­ble burst, not before.

    The attached image shows this fal­lacy. Funny that Chris Joye should inter­pret it in the oppo­site man­ner.


    Inter­est­ingly, Aus­tralia has the same non-per­form­ing hous­ing loan rate of Spain in 2007 and we know that Spain is in a debt-defla­tion.

  • @Lyonwiss Sep­tem­ber 29, 2011 at 1:58 pm

    What Alessio Ras­tani does is no dif­fer­ent from what other traders do, in Gold­man Sachs and other invest­ment banks, “doing God’s work”.”

    The com­mon believe in a “God” (Chris­tain, Jud­ism or Islam) or any book that pro­mote such con­cepts can only arise due to delu­sional think­ing.


    Psy­chosis is given to the more severe forms of psy­chi­atric dis­or­der, dur­ing which hal­lu­ci­na­tions and delu­sions and impaired insight may occur.

    Also, those who burn a sys­tem that is part of their own means of sur­vival is akin to not using right speech (less alone right action). They will destroy the very thing that can help with there exis­tence (to a point of destroy­ing the earth or bio sys­tems on the earth).

  • Lyon­wiss

    Alan Gres­ley Sep­tem­ber 30, 2011 at 2:35 am

    The inter­view cited in one of the above com­ments:


    is frank, truth­ful and accu­rate from my own expe­ri­ence in trad­ing, both per­sonal and insti­tu­tional. Most traders can­not speak openly because they are gagged by their bosses or by their asso­ci­a­tions. Alessio Ras­tani (AR) said: “I trade my own money, my own account. That’s what I always wanted to do. I like the idea of not hav­ing a boss. I did work for one insti­tu­tion, but I real­ized I want to do it for myself.” (Totally log­i­cal: if you really can make money, you don’t need a boss.)

    The world is run by eco­nomic think­ing which is delu­sional. “This is not a time right now for wish­ful think­ing that gov­ern­ments are going to sort things out,” Ras­tani told the BBC. “The gov­ern­ments don’t rule the world, Gold­man Sachs rules the world.” Gov­ern­ments don’t make money; Gold­man Sachs does. Mak­ing money is “doing God’s work”.

    As a per­sonal account trader, it is entirely log­i­cal for Alessio Ras­tani to wish for a reces­sion, when you can make money most quickly, as the mar­ket goes up by the esca­la­tor and goes down by the lift-well. Alessio Ras­tani does not feel respon­si­ble for what he says, because eco­nomic the­ory accepts that any opin­ion alone is unim­por­tant and diverse opin­ions are needed to cre­ate a mar­ket and pro­vide liq­uid­ity.

    An impor­tant aspect of the social psy­chosis is people’s delu­sional under­stand­ing of how the econ­omy really works ver­sus how the econ­omy actu­ally works, being dri­ven by false eco­nomic the­o­ries which may be log­i­cally con­sis­tent, but dan­ger­ous and delu­sional.