The Return of Depression Economics and the Crisis of 2008 (2008)

This book is brilliantly accessible. He first chastises economists for not expaining things clearly. Then, he uses the simple example of a babysitting coop to explain the business cycle. Without using the term Demurage, he cites the Keynesian and Gesellian idea of forced spending into the economy which increases circulation and ends the deflation cycle. But he expains it without using any of these terms. Brilliant. Too bad phd students are not allowed to do this in a thesis (Yes I saw one such thesis, but I think it was sociology, not economics, nor economic social policy, which was my area.)

I recall reading this in 2006 for my thesis, and wondering how my office-mate, an economics phd student, could know almost nothing about the history of economics. Now I know, sadly, that most economists seem to ignore history. Or brush it aside. Other authors mention a roughly 19 year boom-bust world economic cycle, but the cycle is there, and is not stable.

Yet the warnings of Keynes and even Greenspan were ignored. The Asian crises had all the hallmarks of the Great Depression, and international reaction follows, it seems, the errors of the Depression. He warns

"As in the Victorian era, capitalism is secure not only
because of its successes-which, as we will see in a moment, have
been very real-but because nobody has a plausible alternative.
This situation will not last forever. Surely there will be other
ideologies, other dreams; and they will emerge sooner rather than
later if the current economic crisis persists and deepens."

Some of those dreams will be utopian, and viable if we will it, but other ideologies may not be so utopian. Let's not "learn all the wrong lessons" again.
Shira of The MEOW CC Blog,
MEOW Date: 9 September, 12014 H.E. (Holocene/Human Era)
( )

This book is brilliantly accessible. He first chastises economists for not expaining things clearly. Then, he uses the simple example of a babysitting coop to explain the business cycle. Without using the term Demurage, he cites the Keynesian and Gesellian idea of forced spending into the economy which increases circulation and ends the deflation cycle. But he expains it without using any of these terms. Brilliant. Too bad phd students are not allowed to do this in a thesis (Yes I saw one such thesis, but I think it was sociology, not economics, nor economic social policy, which was my area.)

I recall reading this in 2006 for my thesis, and wondering how my office-mate, an economics phd student, could know almost nothing about the history of economics. Now I know, sadly, that most economists seem to ignore history. Or brush it aside. Other authors mention a roughly 19 year boom-bust world economic cycle, but the cycle is there, and is not stable.

Yet the warnings of Keynes and even Greenspan were ignored. The Asian crises had all the hallmarks of the Great Depression, and international reaction follows, it seems, the errors of the Depression. He warns

"As in the Victorian era, capitalism is secure not only
because of its successes-which, as we will see in a moment, have
been very real-but because nobody has a plausible alternative.
This situation will not last forever. Surely there will be other
ideologies, other dreams; and they will emerge sooner rather than
later if the current economic crisis persists and deepens."

Some of those dreams will be utopian, and viable if we will it, but other ideologies may not be so utopian. Let's not "learn all the wrong lessons" again.
Shira of The MEOW CC Blog,
MEOW Date: 9 September, 12014 H.E. (Holocene/Human Era)
( )

31/2 *
A useful survey but too enamoured with free markets. ( )

Depressing, unfortunately. Professor Krugman clearly outlines what led up to the crisis, what perpetuated the crisis, and how the crisis was not properly or fully handled. ( )

This is a solid 3 stars. I guess I was expecting more, which is a mistake on my part given it's a relatively brief book on economics at 200 pages. Krugman does a good job of making some potentially complex ideas easier to understand, but he doesn't really bring much new to the table. I'm your average guy and I know that hedge funds are operating well outside reasonable bounds and have the power to destroy economies. He mentions LTCM as a good example of the destructive power of hedge funds, for example, and that's hardly news. You do get a good, succinct, history of depressions in countries round the world. This books is a companion to Lords of Finance because each deals with how countries devalue or inflate their currencies to maintain stability. ( )