Re: A Savings-Free Economy

["William B. Ryan" <william_b_ryan@xxxxxxxxxxx>]

With all respect, Mason, "hoarding" is neither a virtue nor a vice to
the macroeconomy, but is merely an aspect of human behaviour that should
be easily accommodated.

As a matter of statistics, all money is money in motion through
accumulating account balances that behave quasi-mechanically, much as
the flow through a pipeline.

Your 1931 quotation from Keynes summarizes in one sentence what is wrong
with Keynesian economics.

There can never be "leakage" from the circular flow, because the economy
does not function in circular flow.  There is a second circuit in
symbiosis to the first that is continuously injecting credit in
compensation.  In the absence of actual credit contraction, there is
never a break in the flow of funds.

It problem is a matter of accounting, not psychology.

http://www.geocities.com/CapitolHill/Senate/7018/

----Original Message Follows----

From: "Mason A. Clark" <masonc@xxxxxxxxxxxxx>
To: POST-KEYNESIAN THOUGHT <pkt@xxxxxxxxxxxxxxxx>
Subject: A Savings-Free Economy

For the enlightenment of the Blumenstock potato-eaters,
I have placed a proposed Act of Congress for a new economy at:

   http://www.netcom.com/~masonc/savings.html

Being rather long, I chose not to post it here.
For your convenience, here is the essence:

Purpose. To end the practice of personal, business, and financial-
institution hoarding, commonly called "saving" and thereby to prevent
economic cycles and especially recessions and depressions, which
are caused by loss of consumer confidence and resultant increases in
savings.

"The best guess I can make is that whenever you save five shillings,
you put a man out of work for a day." JMK 1931

The New Economy will be characterized by there being
zero savings (in money or equivalent) whatsoever.  The
resultant increase in investment will cause a spectacularly
large growth rate.





______________________________________________________
Get Your Private, Free Email at http://www.hotmail.com