Failing to channel saving to investment will lead to the paradox of thrift, slowing growth in productivity, while simultaneously causing asset price bubbles.
Tag: inflation
Last week I introduced the idea of a hierarchy of money. Each level is a claim on the level above: Securities are a promise to…
This week I wanted to show you visually some of the effects we’ve been talking about over the last few weeks. One of the points…
So why does all this matter? First of all, you need to think back to the conclusion drawn in this post: “Decisions about who to…
In the last 2 weeks we’ve seen that to have an economy with increasing productivity we need investment (which we’ve defined in economic terms) and…