Keynesianism (reply to Brad)
Brad DeLong
delong at econ.Berkeley.EDU
Fri Apr 13 14:02:02 PDT 2001
>JMK>>
>> I do not take this view. I find the explanation of the current
>> business losses, of the reduction in output, and of the unemployment
>> which necessarily ensues on this not in the high level of investment
>> which was proceeding up to the spring of 1929, but in the subsequent
>> cessation of this investment. I see no hope of a recovery except in a
>> revival of the high level of investment. And I do not understand how
>> universal bankruptcy can do any good or bring us nearer to
>> prosperity...
>
>************
>And "who" caused the said cessation in investment; what caused the
>saturation of
>investment demand [as if it were as simple as that :-)], if more is
>always better?
>
>Ian
"Animal spirits" coupled with too high an ex ante expected
risk-adjusted real interest rate.
Brad DeLong
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