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Niall Ferguson on lessons for the Great Repression
Posted on 28 January 2011 with 2 comments from readers
We are in denial and papering over the problem. This is the Great Repression, says Professor Niall Ferguson, the greatest historian of modern times.
His historical perspective is invaluable as nothing is ever different this time. Excess of leverage is the main issue with the German banks more leveraged than those in the US. History can only be understood in terms of finance and perhaps finance only in terms of history…
Posted on 28 January 2011
Categories: Banking & Finance, Global Economics, Investment Gurus, Video Channel
2 Comments posted by readers:
Very interesting video, Peter. The learned professor touched upon what few people seem to grasp about the rising oil price after peak oil arrives. Initially, having a little less oil won’t be the main problem. Having a LOT fewer jobs from the destruction of aggregate demand in the USA, and elsewhere, as more and more income is transferred to paying for fuel, will become a BIG problem. It will be like an ever increasing tax on everyone needing to commute to work. Luckily, some company just extracted the first natural gas from shale outside of North America, in India. A lot of shale probably contains natural gas. Even if it is far more expensive than conventional gas from your region, it sure beats running out. This planet could support a lot fewer people without oil OR gas.
And New Orleans is STILL surrounded by swamps. But the yellow fever epidemics that killed thousands back then are over. And, except for a couple of car plants, Mississippi is still mostly pine trees. Thankfully, paper, plywood, and lumber are quite useful. And all the animals around here have to live somewhere, so the government won’t let the developers drain, levee, and build in them anymore.
Perhaps the “first lessons: were a necessity, though some Austrian economists might disagree. But without a doubt, the current global financial crisis has proven that Keynesian economics has been disgraced, and rightly so. Go here
http://www.zerohedge.com/article/eric-sprott-we-are-now-paying-funeral-keynesian-theory
and here for more info.
http://www.zerohedge.com/article/gues-post-depression-within-depression
Unfortunately, in this 30 minute video, Ferguson adeptly side-steps the terrible fallacies of Keynesian economics and Keynesian thinking in general (sidenote: Keynes himself recognized these fallacies when he spoke to his arch-rival Friedrich Hayek in the 1930s, but his followers, aided by the FED economists of the day, insisted on advancing the Keynesian religion!).
Is “throwing money to the banks” the answer here? Is rewarding failure and excessive risk-taking the proper set of actions by the FED. Sadly, the world still has much to learn, regarding how to deal with financial turmoil.