Lex Fridman Podcast full episode: ruclips.net/video/Rz-4ulRKnz4/видео.html Thank you for listening ❤ Check out our sponsors: lexfridman.com/sponsors/cv8400-sa See below for guest bio, links, and to give feedback, submit questions, contact Lex, etc. *GUEST BIO:* Jennifer Burns is a historian of ideas, focusing on the evolution of economic, political, and social ideas in the United States in the 20th century. She wrote two biographies, one on Milton Friedman, and the other on Ayn Rand. *CONTACT LEX:* *Feedback* - give feedback to Lex: lexfridman.com/survey *AMA* - submit questions, videos or call-in: lexfridman.com/ama *Hiring* - join our team: lexfridman.com/hiring *Other* - other ways to get in touch: lexfridman.com/contact *EPISODE LINKS:* Jennifer's X: x.com/profburns Jennifer's Website: www.jenniferburns.org Jennifer's Books: Milton Friedman biography: amzn.to/4hfy1HO Ayn Rand biography: amzn.to/4afr3A0 *SPONSORS:* To support this podcast, check out our sponsors & get discounts: *Brain.fm:* Music for focus. Go to lexfridman.com/s/brainfm-cv8400-sa *GitHub:* Developer platform and AI code editor. Go to lexfridman.com/s/github-cv8400-sa *LMNT:* Zero-sugar electrolyte drink mix. Go to lexfridman.com/s/lmnt-cv8400-sa *Shopify:* Sell stuff online. Go to lexfridman.com/s/shopify-cv8400-sa *AG1:* All-in-one daily nutrition drinks. Go to lexfridman.com/s/ag1-cv8400-sa *PODCAST LINKS:* - Podcast Website: lexfridman.com/podcast - Apple Podcasts: apple.co/2lwqZIr - Spotify: spoti.fi/2nEwCF8 - RSS: lexfridman.com/feed/podcast/ - Podcast Playlist: ruclips.net/p/PLrAXtmErZgOdP_8GztsuKi9nrraNbKKp4 - Clips Channel: ruclips.net/user/lexclips *SOCIAL LINKS:* - X: x.com/lexfridman - Instagram: instagram.com/lexfridman - TikTok: tiktok.com/@lexfridman - LinkedIn: linkedin.com/in/lexfridman - Facebook: facebook.com/lexfridman - Patreon: patreon.com/lexfridman - Telegram: t.me/lexfridman - Reddit: reddit.com/r/lexfridman
The little meeting on Jekyll Island and government involvement in the economy. People need to be ok with some people being obese and some starving, based on their ability to function in an unregulated, competitive market.
Austrian Business Cycle Theory is the only theory that explains the unsustainable boom in the 1920s and the initial bust in 1929. Friedman and Keynes are both wrong.
Sowell would say it was the Smoot-Hawley tariffs that killed the recovery. Coolidge has a market crash in '23 but the economy chugged along fine. The next crash was followed by unemployment dropping but then the bill is passed and a snowball effect takes place.
There was also a short, severe depression after USA de-mobilized millions rapidly after WW1 ended and industries had to re-tool back to consumer goods. But thankfully as Murray Rothbard wrote in his book (one of the only in the whole world) on the Depression of 1920... the USA experienced a "stroke of good luck" in that the ultimate meddler and tyrant prez, Woodrow Wilson, who wanted to micro-manage the economy just like he did in WW1 was unable to because he had a stroke and the WH was mostly incapacitated with his wife, Edith, doing most of the day-to-day managing of affairs but the WH energy and vigor was greatly sapped. And then Warren Harding gets in running on the slogan "A Return to Normalcy" and the roaring 20's was on. The Middle Class truly came into being during the 1920's.
Yes- things were turning around like in 1920-21 but stupid Hoover interfered/invervened... in the same way as FDR. FDR lambasted him for it and then doubled down on intervention
Arthur Burns was Murray Rothbard's Doctoral Thesis Advisor at Columbia. He hated him for personal reasons and thwarted his earning his doctorate until he left CU to become Fed Chair...
Thomas Sowell points out some excellent facts concerning the great depression. Recessions happen on a regular basis. What happened to turn a recession into the great depression? Sowell says Govt intervention Look at the timing. The stock market fell, no government intervention happened and the un employment rate rose, but not in to double digits. Then the government intervened and unemployment went into double digits and was in double digits for most of the next decade, which represented incredible human suffering. According to Sowell, the proof that government intervention caused the great depression is that the extreme negative markers came after government intervention, not before as you would expect.
Amity Schlaes The Forgotten Man, provides an explanation covering the economics, the politics, and people. Your guest does not cover how the government’s whipsaw fiscal policy, antagonism towards capital (they prosecuted former Treasury Secretary) nor the hard left influence of personnel compromised by the Soviet’s and Italian fascists on FDR prolonged the depression. Without that, your guest desribes at best a surface level understanding of the Depression.
But why were there bank runs? That's a kind of important detail. I haven't read the book. But it sounds like she's saying Friedman and Schwartz are blaming monetary contraction for the banks failing. But it seems obvious the casual effect is the other way around, that the bank failures caused monetary contraction. There's no mention of robber barons and unstable hyper-valued stocks. Wealth was concentrated but there was still money in circulation. Stock investments were excessive. When Wall Street crashed, people paniced. Savings withdrawals snowballed. The vast majority of banks participated in the stock investment craze. So when their stocks crashed so did their assets. Many people couldn't get their money out because it didn't exist anymore. Businesses that didn't fold focused on stability and efficiency. Banks that didn't fold were extremely cautious in lending exacerbated by public distrust of banks they were very low deposits. People without money can't buy things. There were so many people out of work, no jobs available and Banks incapable or unwilling to lend we had a Depression. And with all that money having evaporated we also had a monetary contraction in the process. As things got worse available money contracted which cyclically exacerbated thr problems. It was more effect than cause but it did contribute. But only secondarily because everything else was failing.
It is simple, agricultural collapse started in 25/26- exports dried up, and overproduction continued into the face of a crash.. Midwest banks were already the living dead by 1928- but money kept flowing into the market and speculation until splat. The market was the last domino to fall, and the banks were subsequently destroyed by their liquidity crisis. Capitalism has routinely kept failing through the same mechanisms, so the New Deal did make a huge push to prosperity. Smoot Hawley was an issue with long term consequences. Friedman totally ignored the crisis of agriculture- which was a tremendous part of the economic sector.
YES! I was 11 when the gold window was shut- at summer camp with Steven Mnuchin... As Milton said in Daniel Yergin's "Commanding Heights" documentary, Nixon "compromised his principals for political expediency" (best as I can remember)
@ bro, that was the free market you were striving for. You literally had your paradise. Vs ours, 50’s/60’s and the highest middle class ever in the history of the world.
greed, speculation, lack of regulation? u know, the normal stuff. there is no perfect "ism". like most things in life, you need balance. get too far one way or the other, hurts society.
It's why there is so much dog whistling about communism and socialism whenever anything that would benefit the nation is proposed. Particularly regarding regulations of any given industry
Regulation causes most of the problems. I can’t believe anyone still argues for regulation. Our government specializes in regulation. For a hundred years they pile regulation on top of regulation and still the system fails then they say “we just didn’t regulate enough, these new regulations will stop it”. Then ultimately another financial failure.
How did the depression end? Keynes with the war. Dont confuse QE with what Friedman thinks. Its a long podcast you have the opportujity to explain be concise.
Fascinating explanation but this is an analysis of the tertiary impacts of the causes of the Great Depression. Primary- triple hit of agricultural mechanization, over-production of those products, and lower than typical demand in Europe due to WWI. Secondary- farmers were wiped out and defaulted on their loans. Massive contraction of available credit due to bank failures and worthless loan portfolios Tertiary - mismatch in the monetary supply due to contraction of the credit markets. How about we talk about the primary causes instead of esoteric monetary policies
The great depression was intentionally caused with margin loans. I thought everyone knew this by now. Margin loans allowed you to invest in a stock for only 10% of the stock, the catch was the financer could call in what they were owed at any time. All margin loans were called in overnight and because a massive majority of people couldn't cover the debt the institutions crashed instantly. This caused a cascade across markets and banks.
Let's not forget that 12.5 million people starved to death and another 13.5 million died of malnutrition related diseases- mostly children. Funny that no one mentions that.
Whoever this guy was in the 1930’s, … he should have discarded all of the airy-notions of the day, and just focused on being a useful accountant! … Someone that provides a useful service to a community or a business.
Friedman was wrong. It was bigger than the supply money, it was the disappearance of capital. However, that still is merely a symptom. The market, particularly with respect to large corporate institutions are inherently extractive. It tends towards a widening wealth gap. This makes people desperate to get on the positive side of that divide. To do this they begin to borrow more and more money. In the case of the depression, this lead banks to be over leveraged to people who could not pay their loans back. They are often using this money to artificially inflate stock prices. A a point people realize they are in a bubble and begin pulling out of their investments, this pops the bubble. People lose all of their capital, to the point that they can no longer even afford to spend any money. The loss of consumers mean businesses begin to fail. This shrinks money supply, capital, and the economy does. The wealthy hold onto their dollars waiting for the crash to pass and it never does. This is how capitalism broke the economy. Keynesianism didn’t quite exist yet. Hoover tried market oriented solutions, it failed and when Roosevelt was elected he threw the kitchen sink at it. The policies that improved the situation happened to align with somewhat with Keynesianism.
It looks like a money problem, but then you notice the homelessness problem piling up. I think you're describing is a gradual erosion of the ability of the monetary system to solve these problems. Money is an accounting measure that solves coordination problems. If you look at more practical fundamentals, it's obvious why and when money is failing to solve social issues. Non scientific economists should be thrown away at this point. Clearly they have a blind spot. (The real world.)
@johanlantz1474 I'm quite sure physicists don't think about cause and effect like economists do! In the social sciences, I think you're better off attributing fault to the instrument you're fixing the issue with. You seem to have 2 courses of action: more or less money. My suggestion is to look a little deeper at the nature of the bubble, and the fallout it creates. Property, agriculture, and transportation bubbles have a different downside than tulip bubbles, and prompt a different response. Doesn't it look like this society has been shaped in the aftermath of bubbles bursting? I have a theory that protecting against the downside allows more leveraging.
This is wrong. You say that the bubble popping “shrank the money supply”. This is factually incorrect. The money supply does not change except for two things - when the Fed does QE/QT, and when banks expand or contract credit. That is it. It is a common misperception that asset prices falling means that money goes poof. It doesn’t. Asset prices are not money. Only cash and credit are considered money. You also have to realize that when someone bought a stock at a high price, someone else must have sold the stock at a high price. That cash does not go “into” the asset, it goes into the sellers bank account.
Former American and World History teacher here (so I'm in the know and need to announce so my comment has cred). The Great Depression was caused by a number of factors, but it was an overinvestment in the stock market and a shortage of the money supply that really caused the pot to boil over.
Why was there over investment in the stock market? Why did the money supply contract? If those are the main causes why didn’t we have the Great Depression much sooner in American history? This wasn’t the first time we had a stock market bubble, and a contraction of the money supply.
Lex, Can you please get a hold of your friend and tell him I would like my $106,000. ? Thanks, I'd really appreciate it, especially when that's all I need to get him out of my life!
So, the data is there and tools to work out solution, the AI is being perfected. But the Chinese have got the edge unexpectedly; yesterday, a cheap AI system toppled the NY exchange to the tune of half a trillion, it seems. The future of humanity is in the hands of two men, both Christians who have been taught to extend empathy to others. Hope those two hold back the reins for the next few years so that at least three or four generations can live in this world.
Sorry Lex but you are hanging with the wrong crowd. Joe has proven himself to be dishonest or uninformed. You are too close to that group (you interview the same people) for me to trust you. Good luck I hope you find your way out.
Stating the obvious here but the FED not stepping in and "preventing" the depression, would not be the cause. It would be reflective of the private sectors failure (mismanagement) along with greed and corruption. You know the things that libertarians refuse to see. The problem is the people that make up the government are the same people that run the private sector, they all come from the same place.
It's impossible for the private sector to manage the money supply through market forces once you introduce the FED. In freebaking systems there was never a depression like that one AFAIK (although you still had some fluctuations). That was the mistake, having the FED in the first place. Many banks were also expecting the FED to intervene. If the FED were not there in the first place they would have just halted withdrawals until the panic resolved and before going bankrupt. That's why it was the FED that caused it. Because the FED altered the game.
@@RobertSmith-lg7jp It was created for various reasons, but mostly because of some economic theories that claimed you could improve market stability and economic growth by centralising control of the money supply/interest rates. I believe those theories are wrong. When you look at the market as a system of individuals, you can derive the conditions that cause it to create less-than-desirable results. These conditions happen sometimes, and in these cases, the interventionists claim the government has to fix or prevent these conditions. What they don't realise is that states and governments are themselves systems of individuals. If you apply the same reasoning used to derive problems within the market to those institutions, you quickly realise that things are much worse with centralised states and governments.
@@M4nu3l90F It was created by BANKING MISMANAGEMENT. If the market acted responsibly its customers would not have demanded that the government step in do something about it. Im not debating what system works better just pointing out who is truly to blame. You dont find it odd that Friedman and others whisper about bank mismanagement and shout about gov intervention when the former clearly creates the latter.
@ What do you mean by mismanagement? Surely it can't be that all banks happen to behave irresponsibly at the same time by chance. There must be some systemic issue. As I said, there were problems. Note that in the US there was never free banking. Free banking was the norm in Canada, Australia, Scotland and other places and historically it created a more stable system. Of course because no system is perfectly stable then people ask the goverment to fix it even when it will just lead to a worse system. Not all problems can be fixed or mitigated.
Models is models..... Simple models, work off imperial data. Should tell that to climate scientists!!!! Oh yeah, and the models should actually be able to predict something, Lex says. Haha
![Felix "Unfair" | [Stray Kids : SKZ-PLAYER]](http://i.ytimg.com/vi/Oswujxm2Ag0/mqdefault.jpg)
Lex Fridman Podcast full episode: ruclips.net/video/Rz-4ulRKnz4/видео.html
Thank you for listening ❤ Check out our sponsors: lexfridman.com/sponsors/cv8400-sa
See below for guest bio, links, and to give feedback, submit questions, contact Lex, etc.
*GUEST BIO:*
Jennifer Burns is a historian of ideas, focusing on the evolution of economic, political, and social ideas in the United States in the 20th century. She wrote two biographies, one on Milton Friedman, and the other on Ayn Rand.
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When economists get physics envy, it's always bad.
As Walter Block tries to warn us... :)
0:38 Ludwig von mises expected and predicted the Great depression
He expected and predicted a lot more of them that never occurred, he was the Peter Schiff of his time. Pretty much wrong about everything.
Mises predicted much of this.
ruclips.net/video/V1rVXbAxLsE/видео.html
When Great Britain went off the gold standard Mises predicted hyperinflation and GDP collapse,
Instead they had an industrial revolution.
The little meeting on Jekyll Island and government involvement in the economy. People need to be ok with some people being obese and some starving, based on their ability to function in an unregulated, competitive market.
Austrian Business Cycle Theory is the only theory that explains the unsustainable boom in the 1920s and the initial bust in 1929. Friedman and Keynes are both wrong.
Rothbard's work on the Great Depression is a must-read to understand this topic.
Austrian Economics is economics. Keynesianism is merely apologism for inflation IMHO...
@@EletricDrums Murray Baby.
Savings were obliterated, debts were not. Recipe for disaster.
Bingo plus the money supply was frozen. The bank had a lot to do with this
Small hat economics
Fine presentation, wonderfullly well read guest! Thank you
Sowell would say it was the Smoot-Hawley tariffs that killed the recovery. Coolidge has a market crash in '23 but the economy chugged along fine. The next crash was followed by unemployment dropping but then the bill is passed and a snowball effect takes place.
Did he say that Republicans had majority (even supermajority) control of the government throughout the 20s?
There was also a short, severe depression after USA de-mobilized millions rapidly after WW1 ended and industries had to re-tool back to consumer goods. But thankfully as Murray Rothbard wrote in his book (one of the only in the whole world) on the Depression of 1920... the USA experienced a "stroke of good luck" in that the ultimate meddler and tyrant prez, Woodrow Wilson, who wanted to micro-manage the economy just like he did in WW1 was unable to because he had a stroke and the WH was mostly incapacitated with his wife, Edith, doing most of the day-to-day managing of affairs but the WH energy and vigor was greatly sapped.
And then Warren Harding gets in running on the slogan "A Return to Normalcy" and the roaring 20's was on. The Middle Class truly came into being during the 1920's.
Yes- things were turning around like in 1920-21 but stupid Hoover interfered/invervened... in the same way as FDR. FDR lambasted him for it and then doubled down on intervention
@@jonathanf3434 Exactly. Jim Grant wrote a book about it too.
Income tax really caused the great depression according to Art Laffer. I think he was right but tariffs and liquidity played a role too.
Arthur Burns was Murray Rothbard's Doctoral Thesis Advisor at Columbia. He hated him for personal reasons and thwarted his earning his doctorate until he left CU to become Fed Chair...
Thomas Sowell points out some excellent facts concerning the great depression.
Recessions happen on a regular basis. What happened to turn a recession into the great depression?
Sowell says Govt intervention
Look at the timing.
The stock market fell, no government intervention happened and the un employment rate rose, but not in to double digits.
Then the government intervened and unemployment went into double digits and was in double digits for most of the next decade, which represented incredible human suffering.
According to Sowell, the proof that government intervention caused the great depression is that the extreme negative markers came after government intervention, not before as you would expect.
More likely incorrect policy by governments, in not sure how to measure the effects or no effects!😮
He's wrong! The Great Depression was caused by the same financial backers of the Federal Reserve.
A mathematician properly motivated can tell you more about the world and how it works than a million social workers
Amity Schlaes The Forgotten Man, provides an explanation covering the economics, the politics, and people. Your guest does not cover how the government’s whipsaw fiscal policy, antagonism towards capital (they prosecuted former Treasury Secretary) nor the hard left influence of personnel compromised by the Soviet’s and Italian fascists on FDR prolonged the depression. Without that, your guest desribes at best a surface level understanding of the Depression.
The FED restricted money supply by 25%. Full Stop. That's all it was, everything else mentioned here was an effect. END THE FED!
But why were there bank runs?
That's a kind of important detail.
I haven't read the book. But it sounds like she's saying Friedman and Schwartz are blaming monetary contraction for the banks failing. But it seems obvious the casual effect is the other way around, that the bank failures caused monetary contraction.
There's no mention of robber barons and unstable hyper-valued stocks. Wealth was concentrated but there was still money in circulation. Stock investments were excessive. When Wall Street crashed, people paniced. Savings withdrawals snowballed. The vast majority of banks participated in the stock investment craze. So when their stocks crashed so did their assets. Many people couldn't get their money out because it didn't exist anymore. Businesses that didn't fold focused on stability and efficiency. Banks that didn't fold were extremely cautious in lending exacerbated by public distrust of banks they were very low deposits. People without money can't buy things. There were so many people out of work, no jobs available and Banks incapable or unwilling to lend we had a Depression. And with all that money having evaporated we also had a monetary contraction in the process. As things got worse available money contracted which cyclically exacerbated thr problems. It was more effect than cause but it did contribute. But only secondarily because everything else was failing.
It is simple, agricultural collapse started in 25/26- exports dried up, and overproduction continued into the face of a crash.. Midwest banks were already the living dead by 1928- but money kept flowing into the market and speculation until splat. The market was the last domino to fall, and the banks were subsequently destroyed by their liquidity crisis. Capitalism has routinely kept failing through the same mechanisms, so the New Deal did make a huge push to prosperity. Smoot Hawley was an issue with long term consequences. Friedman totally ignored the crisis of agriculture- which was a tremendous part of the economic sector.
A lack of alcohol was depressing
19th amendment didn't help either
We either have inflation or contraction. Things never stay the same. It's whether it happens short term or long term that causes strife.
Historical narratives are poisonous without perspective.
Perspective is everything!
Answer: poor risk management and a lack of liquidity/ money supply after a private money over supply into poor investments at a global scale.
Great stuff ❤
"We are all Keynesians now." Nixon
And Milton said he never forgave him for doing price and wage controls because of course they didn't work as they never do!!
YES! I was 11 when the gold window was shut- at summer camp with Steven Mnuchin... As Milton said in Daniel Yergin's "Commanding Heights" documentary, Nixon "compromised his principals for political expediency" (best as I can remember)
@@jonathanf3434yeah because the gilded age worked well
@ Imagine thinking we are defending everything about the Gilded Age just because we shit on the obvious failures of Keynsianism
@ bro, that was the free market you were striving for. You literally had your paradise. Vs ours, 50’s/60’s and the highest middle class ever in the history of the world.
U need to have Peter Schift on...
Well, they were already going through a recession. But to top it all off, the music they made at the time, made it the great depression.
😂
Your mother gave me a great depression
You mean jazz? Really? Or maybe the Blues... Count Basie is God. :)
greed, speculation, lack of regulation? u know, the normal stuff. there is no perfect "ism". like most things in life, you need balance. get too far one way or the other, hurts society.
It's why there is so much dog whistling about communism and socialism whenever anything that would benefit the nation is proposed. Particularly regarding regulations of any given industry
Wrong wrong wrong
Regulation causes most of the problems.
I can’t believe anyone still argues for regulation. Our government specializes in regulation. For a hundred years they pile regulation on top of regulation and still the system fails then they say “we just didn’t regulate enough, these new regulations will stop it”. Then ultimately another financial failure.
@@rogerwelsh2335 who regulates the bad actors then? themselves? take a minute and actually think about what you're arguing for.
@ my argument is that regulation has not stopped problems and in fact has caused them.
How did the depression end? Keynes with the war. Dont confuse QE with what Friedman thinks. Its a long podcast you have the opportujity to explain be concise.
Interesting we live in a system with an abundance of theories and very little, if any, common knowledge
Fascinating explanation but this is an analysis of the tertiary impacts of the causes of the Great Depression.
Primary- triple hit of agricultural mechanization, over-production of those products, and lower than typical demand in Europe due to WWI.
Secondary- farmers were wiped out and defaulted on their loans. Massive contraction of available credit due to bank failures and worthless loan portfolios
Tertiary - mismatch in the monetary supply due to contraction of the credit markets.
How about we talk about the primary causes instead of esoteric monetary policies
The great depression was intentionally caused with margin loans. I thought everyone knew this by now. Margin loans allowed you to invest in a stock for only 10% of the stock, the catch was the financer could call in what they were owed at any time. All margin loans were called in overnight and because a massive majority of people couldn't cover the debt the institutions crashed instantly. This caused a cascade across markets and banks.
David kennedy summarized it pretty well in “freedom from fear”
It's not "what caused the great depression?", the correct question is "who caused the great depression?" 😅
so your'e saying his mentors were Homer and Mr Burns?
I hope everyone is preparing for the next downturn. We will have a new depression soon due to our debt!
A lack of anti-depressants.
If you think you’re smarter than Milton, here in the comments, you’re missing some marbles
If you idolize him and think he’s a genius, you’re an idiot. His job was to keep blame off the banks and wealthy.
Let's not forget that 12.5 million people starved to death and another 13.5 million died of malnutrition related diseases- mostly children.
Funny that no one mentions that.
Banks create money out of thin air by accounting when loans are made!
2:25 Keynes - giant PDFile btw
people were all boozed up and greed is good.
Read Jim Powell.. FDR Follies. Explains it all
Jonah Carden the Great Depression 🔥🔥
The ‘puzzle’ 🧩 of Usury 🤑.
Whoever this guy was in the 1930’s, … he should have discarded all of the airy-notions of the day, and just focused on being a useful accountant! … Someone that provides a useful service to a community or a business.
So basically Word for Word step-by-step she is saying Trump is Hoover. 100% on the money. It’s like we’re watching it in slow motion.
What caused the liquidity crisis?? You guys completely glossed over that. I'm freaking out!!!!
Bank failures and the Fed allowing that money to just exit the system.
Friedman was wrong. It was bigger than the supply money, it was the disappearance of capital. However, that still is merely a symptom. The market, particularly with respect to large corporate institutions are inherently extractive. It tends towards a widening wealth gap. This makes people desperate to get on the positive side of that divide. To do this they begin to borrow more and more money. In the case of the depression, this lead banks to be over leveraged to people who could not pay their loans back. They are often using this money to artificially inflate stock prices. A a point people realize they are in a bubble and begin pulling out of their investments, this pops the bubble. People lose all of their capital, to the point that they can no longer even afford to spend any money. The loss of consumers mean businesses begin to fail. This shrinks money supply, capital, and the economy does. The wealthy hold onto their dollars waiting for the crash to pass and it never does. This is how capitalism broke the economy. Keynesianism didn’t quite exist yet. Hoover tried market oriented solutions, it failed and when Roosevelt was elected he threw the kitchen sink at it. The policies that improved the situation happened to align with somewhat with Keynesianism.
You deserve a Nobel prize.
It looks like a money problem, but then you notice the homelessness problem piling up.
I think you're describing is a gradual erosion of the ability of the monetary system to solve these problems.
Money is an accounting measure that solves coordination problems.
If you look at more practical fundamentals, it's obvious why and when money is failing to solve social issues.
Non scientific economists should be thrown away at this point.
Clearly they have a blind spot. (The real world.)
Cheap money (low interest rates) are the cause of bubbles
@johanlantz1474 I'm quite sure physicists don't think about cause and effect like economists do!
In the social sciences, I think you're better off attributing fault to the instrument you're fixing the issue with.
You seem to have 2 courses of action: more or less money.
My suggestion is to look a little deeper at the nature of the bubble, and the fallout it creates.
Property, agriculture, and transportation bubbles have a different downside than tulip bubbles, and prompt a different response.
Doesn't it look like this society has been shaped in the aftermath of bubbles bursting?
I have a theory that protecting against the downside allows more leveraging.
This is wrong. You say that the bubble popping “shrank the money supply”. This is factually incorrect. The money supply does not change except for two things - when the Fed does QE/QT, and when banks expand or contract credit. That is it. It is a common misperception that asset prices falling means that money goes poof. It doesn’t. Asset prices are not money. Only cash and credit are considered money. You also have to realize that when someone bought a stock at a high price, someone else must have sold the stock at a high price. That cash does not go “into” the asset, it goes into the sellers bank account.
Tariffs.
False
@umoramayori wrong
Maybe we can look at the Great Depression as one big pump and dump stock. Somebody won while everyone else lost.
The moment has arrived now. Major economic and geopolitical crash is ongoing
Every mkt crashes is done by bankers and traders
Seed Oils!
Former American and World History teacher here (so I'm in the know and need to announce so my comment has cred). The Great Depression was caused by a number of factors, but it was an overinvestment in the stock market and a shortage of the money supply that really caused the pot to boil over.
Why was there over investment in the stock market? Why did the money supply contract?
If those are the main causes why didn’t we have the Great Depression much sooner in American history? This wasn’t the first time we had a stock market bubble, and a contraction of the money supply.
They saw economics as a real science back then! 😂
its the juice ... its always the juice
"What caused the Great Depression" as according to one person... lol
ruclips.net/video/V1rVXbAxLsE/видео.html
I distrust Ayn Rand devotees. Not sure if it's fair or correct but there I am.
The truth, or lack of the truth.
Power grab.
Was it because the Fed only 😂bailed out the fereral reserve banks ? - eg the Fed knew exactly what they were doing … 😂
Lex, Can you please get a hold of your friend and tell him I would like my $106,000. ? Thanks, I'd really appreciate it, especially when that's all I need to get him out of my life!
Can I borrow 5,421???
@briancallahan5673 Yes, you may.
So, the data is there and tools to work out solution, the AI is being perfected. But the Chinese have got the edge unexpectedly; yesterday, a cheap AI system toppled the NY exchange to the tune of half a trillion, it seems.
The future of humanity is in the hands of two men, both Christians who have been taught to extend empathy to others. Hope those two hold back the reins for the next few years so that at least three or four generations can live in this world.
Mr never a banks fault
Should be pretty obvious why
Is rhis the daughter or grand daughter of Arther Burns?? Burns caused the great depression of the 1980s with his 20% interest rates.
Word salad, not mentioning the gilded age,
Short answer: Greed
Greed with a healthy dash of incompetence and some short sighted arrogance for good measure.
So tired 🙄
Commie answer
Sorry Lex but you are hanging with the wrong crowd.
Joe has proven himself to be dishonest or uninformed.
You are too close to that group (you interview the same people) for me to trust you.
Good luck
I hope you find your way out.
Why dont they just say its the bad J's? 😂 really if you k ow your hostory...
FJB!!!!!!!
Stating the obvious here but the FED not stepping in and "preventing" the depression, would not be the cause. It would be reflective of the private sectors failure (mismanagement) along with greed and corruption. You know the things that libertarians refuse to see. The problem is the people that make up the government are the same people that run the private sector, they all come from the same place.
It's impossible for the private sector to manage the money supply through market forces once you introduce the FED. In freebaking systems there was never a depression like that one AFAIK (although you still had some fluctuations). That was the mistake, having the FED in the first place. Many banks were also expecting the FED to intervene. If the FED were not there in the first place they would have just halted withdrawals until the panic resolved and before going bankrupt. That's why it was the FED that caused it. Because the FED altered the game.
@ "That was the mistake, having the FED in the first place." Was it created on a whim?
@@RobertSmith-lg7jp It was created for various reasons, but mostly because of some economic theories that claimed you could improve market stability and economic growth by centralising control of the money supply/interest rates. I believe those theories are wrong.
When you look at the market as a system of individuals, you can derive the conditions that cause it to create less-than-desirable results. These conditions happen sometimes, and in these cases, the interventionists claim the government has to fix or prevent these conditions. What they don't realise is that states and governments are themselves systems of individuals. If you apply the same reasoning used to derive problems within the market to those institutions, you quickly realise that things are much worse with centralised states and governments.
@@M4nu3l90F It was created by BANKING MISMANAGEMENT. If the market acted responsibly its customers would not have demanded that the government step in do something about it. Im not debating what system works better just pointing out who is truly to blame. You dont find it odd that Friedman and others whisper about bank mismanagement and shout about gov intervention when the former clearly creates the latter.
@ What do you mean by mismanagement? Surely it can't be that all banks happen to behave irresponsibly at the same time by chance. There must be some systemic issue. As I said, there were problems. Note that in the US there was never free banking. Free banking was the norm in Canada, Australia, Scotland and other places and historically it created a more stable system. Of course because no system is perfectly stable then people ask the goverment to fix it even when it will just lead to a worse system. Not all problems can be fixed or mitigated.
Dr. Robert Murphy explains best (Mises Institute 10 years ago) ruclips.net/video/V1rVXbAxLsE/видео.html
Intellectually Arrogant ‘conversation’ on Colonial[Ism] + Usury - Lovely 🙄.
Models is models.....
Simple models, work off imperial data. Should tell that to climate scientists!!!! Oh yeah, and the models should actually be able to predict something, Lex says. Haha
empirical...
Lol, capitalism
This was pure nonsense.
Oh baby! I'm gonna love This!!!! & milton.. heatshoeld flap $15. 13 really, < LiFE!
Intellectually Arrogant ‘conversation’ on Colonial[Ism] + Usury - Lovely 🙄.