萧条经济学的回归

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  2012-07-29
  Back to bank runs: In 1931, about half the banks in the United States failed. These banks were not all alike. Some were very badly run; some took excessive risks, even given what they knew before 1929; others were reasonably well, even coservatively managed. But when panic spread across the land, and depositors everywhere wanted their money immediately, none of this mattered: only banks that had been extremely conservative, that had kept what in normal times would be an excessively large share of their deposits in cash, survived.Were the Asian economies more vulnerable to financial panic in 1997 than they had been, say, five or ten years before? Yes, surely -- but not because of crony capitalism, or indeed what would usually be considered bad government policies. Rather, they had become m...
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  2012-07-29
  Even more important than this mechanical linkage, however, was the way that Asian economies were associated in the minds of investors......And it turned out that whatever differences among all those economies, one thing they did have in common was susceptibility to self-validating panic. The wise men in Woodstock were wrong about Indonesia, and the panicky investors right......It did not matter that these economies were only modestly linked in terms of physical flows of goods. They were linked in the minds of investors, who regarded the troubles of one Asian economy as bad news about the others; and when an economy is vulnerable to self-validating panic, believing makes it so.
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  2012-07-29
  Sometimes a panic is just a panic: an irrational reaction on the part of investors that is not justified by the actual news......Much more important in economics, however, are panics that, whatver sets them off, validate themselves -- because the panic itself makes panic justified.
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  2012-07-29
  The loss of confidence was to a certain extent a self-reinforcing process.......With fewer yen and dollares coming in, the demand for baht on the foreign exchange market declined; meanwhile, the need to change baht into foreign currencies to pay for imports continues unabated. In order to keep the value of baht from declinng, the Bank of Thailand had to do the opposite of what it had done when capital starting coming in: it went to the market to exchange dollars and yen for baht, supporting its own currency. But there is an important difference between trying to keep your currency down and trying to keep it up: the Bank of Thailand can increase the supply of baht as much as it likes, because it can simply print them; but it cannot print dollars.......The only way to sustain the value of ...
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  2012-07-29
  ......to be more precise,one thing that can get an economy out of a liquidity trap is expected inflation, which discourages people from hoarding money......Indeed, there has long been a strand of thought that says that moderate inflation may be necessary if monetary policy is to be able to fight recessions. Still, advocates of inflation have had to contend with a deep-seated sense that stable prices are always desirable, that to promote inflation is to create perverse and dangerous incentives.
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  2012-07-29
  Dornbusch and others argued that the problem lay in the value of the peso: an excessively strong currency was pricing Mexican goods out of world markets, preventing economy from taking advantage of its growing capacity What Mexico needed, then, was a devaluation -- a onetime reduction in the dollar value of the peso, which would get its economy moving again. After all, in 1992 Britain aid had been forced by financial markets to the let value of the pound decline, and the result of was to turn a recession into a boom. Mexico, said some, needed a dose of the same medicine.
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  2012-07-29
  The benefits of export-led economic growth to the mass of people in the newly industrializing economies were not a matter of conjecture......These improvements did not take place because well-meaning people in the West did anything to help -- foreign aid, never large, shrank in the 1990s to virtually nothing. Now was it the result of the benign policies of national governments, which, ...... were as callous and corrupt as ever. It was he indirect and unintended result of the actions of soulless multinational corporations and rapacious local entrepreneurs, whose only concern was to take advantage of the profit opportunities offered by cheap labor. It was not an edifying spactacle; but no matter how base the motives of those involved, the result was to move hundreds of millions of people fro...
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  2012-07-29
  For the first time since 1917, then, we live in a world in which property rights and free markets are viewed as fundamental principles, not grudging expedients; where the unpleasant aspects of market system -- inequality, unemployment, injustice -- are accepted as facts of life. As in the Victorian era, capitalism is secure not only because of its successes ...... but because nobody has a plausible alternative.
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  2012-07-28
  Anyway, the equations and diagrams of formal economics are, more often than not, no more than a scaffolding used to help construct an intellectual edifice. Once that edifice has been built to a certain point, the scaffolding can be stripped away, leaving only plain English behind.