Becoming an Economist is the introductory course on economics for undergraduates at Kingston University. This is the first of 11 lectures in the subject; I’ll post the others as I write them over the next few months. This lecture discusses why economists disagree with each other, and draws analogies with astronomy at the time when Galileo discovered craters on the Moon, and moons orbiting Jupiter and Saturn.
This is the Powerpoint file for the lecture, which includes links to the Youtube videos used in this lecture:
One of the people I miss talking with in Australia is radio journalist and tech and internet expert Phil Dobbie. Fortunately there’s Skype, and we regularly now chat matters economic on his internet radio show Balls Radio. Here’s the latest complete program, including our discussion of why interest rates are so low and are not going to move up until the level of private debt falls dramatically–which is unlikely to happen.
One of the very enjoyable aspects of being in London is speaking regularly with Simon Rose on the business-oriented internet radio Share Radio. I know I can talk under wet cement; I think Simon could manage to talk after it had set solid. We have a great time bantering about topics economics, and I hope it’s of interest to the audience as well. Here’s the latest installment, with some earlier ones available here.
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For seven years now, the rate The Fed sets to determine the price banks pay to borrow from it and from each other has been zero, or so close to zero that the difference is immaterial. This is, historically speaking, not normal, and The Fed has a desperate desire to return to what is normal, which is rate a few per cent above the rate of inflation (see Figure 1).
This is the brief talk I gave at a conference celebrating 25 years of the Critical Realist seminar series at Cambridge University. Critical realists argue against the use of mathematics in economics; I argue here that it’s the abuse of mathematics by Neoclassical economists–who practice what I have dubbed “Mythematics” rather than Mathematics–and that some phenomena are uncovered by mathematical logic that can’t be discovered by verbal logic alone. I give the example of my own model of Minsky’s Financial Instability Hypothesis, which revealed the possibility of a “Great Moderation” preceding a “Great Recession” before either event had happened.
There was a time when most educated people knew that the Earth was the center of the universe. There was a sophisticated “Geocentric” model, known as the “Ptolemaic system”, that predicted to very high accuracy the observed movement of all the objects in the Heavens, as they purportedly orbited the Earth on perfect crystalline spheres. 500 years ago, anyone who proposed an alternative model—in which the Sun was the center and the Earth was just another planet orbiting it—was derided as a heretic and a madman.
This is a talk I gave to undergraduate students at Cartanega University in Colombia last week, comparing the insistence on equilibrium modelling by economists to the bad habit of smoking.
In this post I consider the economy in general: I’ll cover asset markets in particular in the next column, but you’ll need to understand today’s post to comprehend the stock and property market dynamics at play. Having said that, the Shanghai Index fell another 7.5% on Tuesday, after losing 8.5% on Monday, and is now down over 45% from its peak—so I’ll try to write the stock-market-specific post by tomorrow. In this post I’ll show, very simply, why a slowdown in the rate of growth of private debt will cause a crisis, if both the level and the rate of change of debt are high at the time of the slowdown.
I’ve just taken part in a live studio debate about China’s crash on France 24. Much to my amazement, the segment is already up on their website–I’ve barely had time to walk home from their London studio. Please click on the links to watch (it’s in Flash format so I can’t embed it here):
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