Wednesday, August 31, 2011

Steve' barking at flat earth economics

I guess who ever reads this never heard the expression of flat earth economics.
I remember learning about Micro and Macro economics, I even took courses in them.
I just learned about an academic expressions call fresh water and salt water economics. Now I think I understand what they are, but I like to think in in the terms of logic. It can be called logic economics vs flat earth economics.
Lets try an example of flat earth economics. Inflation in the Weimar Republic was caused by the printing of money.
An example of logic economics is inflation in the Weimar Republic was caused by the Allies cutting off resources and demanding reparations from a people that had nothing to give there by forcing the excess printing of money.
Who are flat earth economist? Economist who can't see above the horizon.

* We seem to forget the old saying. What is a recession? When your neighbor is out of work and can't find a job. What is a depression? When you are out of work and can't find a job.

Economist tend to say that 3 quarters of negative growth is a recesion. And positive growth show that your out of a recesion.
Logic say that if negative growth is x and the positive growth  y is not equal to or greater then x your still in a recesion. 

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