Transcript: Demand Side 324 Steve Keen on Minsky

Listen to this episode
plus Idiot of the Week with William Dunkleberg

First a note, we are rehabilitating the old Demand Side format.  The consensus of listeners is that the podcast is too long.  Too much Demand, as it were.  We're going back to the twice weekly 10-12 minute format, but keeping the Saturday relays.  Friday will be forecast day.

That means there will be a lot left on the cutting room floor.  If you are really hungry, you can keep up to speed with the Demand Side Group of blogs and sites.  Access that at Demand Side Blog dot blogspot dot com.

Now today, Steve Keen on Minsky and seeing it coming, plus idiot of the week with William Dunkleberg.

What a find is Steve Keen.  An Australian economist who as you will hear is in the direct lineage of Keynes through Minsky. 

KEEN

Steve Keen.  We'll have him back on Saturday with a full description of the Minsky view and debt deflation.  Don't miss that.  It is essential to understanding where we are and where we're going.  His blog is at debtdeflation.com.  


Next.  Idiot of the Week, with William Dunkleberg

Dunkleberg is chief economist of the NFIB, National Federation of Independent Businesses.  Here he is reporting to Tom Keen and a doorpost on the outcome of the NFIB's most recent survey.

DUNKLEBERG part 1

It is no surprise to Demand Side that demand is the problem.  "How's business?" usually means how is demand, do you have any customers, and so on.  You would think this is exactly where Dunkleberg is going.  Stimulating incomes and demand and getting customers back in the store might be important. 

DUNKLEBERG part 2

Yes.  The gutting of federal revenues by the Bush tax cuts had little to do with federal deficits, the housing bubble and debt deflation don't warrant a mention as causes of the current collapse, it is uncertainty about what congress is going to do.  Mr. Dunkleberg reliably informs us also that sun spots cause global warming and Elvis has returned to Memphis.

But there is a good reason beneath the vigorous pointing to Washington.  Mr. Dunkleberg is himself a banker, head of Liberty Bell Bank, a small bank in southern New Jersey.  But a bank which pumped home equity loans to people who are now under water, who wrote $300,000 mortgages on $200,000 houses, who resists every possible reduction of principle on these loans, and who is now sad for small business having no demand because Washington is worried about health care.

William Dunkleberg.  Idiot of the Week.

I suppose we could be more polite.

It is only when we get incomes going, debt burdens down and demand up that we will get any real forward movement in this economy.