David F. Ruccio — Ongoing crises of capitalism

What mainstream economics obscures from view is that the pattern of capitalist development leading up to 2007 created the conditions for a much more severe downturn than mainstream economists had been willing to admit, and that the severity of that cyclical downturn undermined the long-term rate of capitalist recovery going forward.

Clearly, the predictions by mainstream economists were wrong. But they continue to ignored the real effects of their mistakes, in both the short and long runs, which are being visited upon the working-classes in the United States and Europe.

Occasional Links & Commentary
Ongoing crises of capitalism
David F. Ruccio | Professor of Economics, University of Notre Dame

Bill Mitchell — External economy considerations – Part 9

I am now using Friday’s blog space to provide draft versions of the Modern Monetary Theory textbook that I am writing with my colleague and friend Randy Wray. We expect to publish the text sometime in 2013. Our (very incomplete) textbook home page – Modern Monetary Theory and Practice – has draft chapters and contents etc in varying states of completion. Comments are always welcome. Note also that the text I post here is not intended to be a blog-style narrative but constitutes the drafting work I am doing – that is, the material posted will not represent the complete text. Further it will change as the drafting process evolves.

Chapter 21 Policy in an Open Economy: Exchange Rates, Balance of Payments, and Competitiveness

This material updates the work already done on Chapter 21 that appeared in the following blogs:

• External economy considerations – Part 1
• External economy considerations – Part 2
• External economy considerations – Part 3
• External economy considerations – Part 4
• External economy considerations – Part 5
• External economy considerations – Part 6
• External economy considerations – Part 7
• External economy considerations – Part 8

Today, I am just continuing filling in the gaps in the Chapter.

21.7 Currency crises

[CONTINUING THIS SECTION FROM LAST WEEK - PREVIOUS MATERIAL IN LAST POSTS LINKED ABOVE]

The South East Asian Debt Crisis 1997

Bill Mitchell – billy blog
External economy considerations – Part 9
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at the Charles Darwin University, Northern Territory, Australia

James Narron and David Skeie — Crisis Chronicles: 300 Years of Financial Crises (1620–1920)

As momentous as financial crises have been in the past century, we sometimes forget that major financial crises have occurred for centuries—and often. This new series chronicles mostly forgotten financial crises over the 300 years—from 1620 to 1920—just prior to the Great Depression. Today, we journey back to the 1620s and take a fresh look at an economic crisis caused by the rapid debasement of coin in the states that made up the Holy Roman Empire.

FRBNY — Liberty Street
Crisis Chronicles: 300 Years of Financial Crises (1620–1920)
James Narron and David Skeie
(h/t Art Shipman at The New Arthurian Economics)

Claudio Borio — Macroeconomics and the financial cycle: Hamlet without the Prince?

Since the early 1980s, the financial cycle has re-emerged as a major force driving the macroeconomy, but economic analysis has not caught up. This column argues that macroeconomics without the financial cycle is like Hamlet without the Prince. Economic analysis and policies – monetary, fiscal, and prudential – should be adjusted to fully account for the financial cycles, but here more analytic work is needed. The question of how we address the bust and balance-sheet recession that follow the boom deserves special attention.

VOX

Macroeconomics and the financial cycle: Hamlet without the Prince?
Claudio Borio | Deputy Head of the Monetary and Economic Department and Director of Research and Statistics, Bank for International Settlements

BIS finally getting with it? While encouraging, Borio's post reveals that while he has recognized the problem and begun to come to grips with it, he has not realized yet that it has been addressed and largely resolved. Someone please direct him over to Levy Institute.