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> I can think of several theories that explain prices, business cycles, or
> organizational forms of production, but ltov is not one of them.
I wish you would share your thinking with us.
As far as I can see the efficient markets hypothesis is discredited with nothing to replace it except a list of factors that act in different combinations to affect asset price levels. The real business cycle theory can't explain this downturn as it even its own exponents admit. The Hayekian monetary theory fails because loose monetary policy can't have caused that magnitude of asset bubbles. Theories have been discredited, and all we are left with are better or worse institutional descriptions and narrative accounts (John Cassidy, Karen Ho, Gillian Tett). None of them count as theoretical economics. Even Cassidy argues that general equilibrium theory is interesting insofar as it shows that the market won't likely tend to equilibrium, or be free of positive feedbacks that keep the economy in free fall for prolonged periods. Again you should share with us these several theories that do good explanatory work. LR