Re: Keynes Harris Lecture

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

In reply to http://csf.colorado.edu/forums/pkt/2000/msg00023.html
Continuing http://csf.colorado.edu/forums/pkt/2000/msg00021.html

>From either an accrual or cash-flow perspective, it certainly is
possible for a single firm to finance growth from its profits.

For the economy as a whole, however, it is not financially possible
for there to be growth in the aggregate in the absence of credit
expansion, into either the B or A circuits, or both.

Credit expansion can derive endogenously or exogenously.  If
endogenous, it expands dollar for dollar with increasing debt; debt of
firms, consumers, or both.

If there is continuous labor displacement in such a purely endogenous
regime, debt must compound exponentially in proportion to consumable
production.

In any case, "profit" is merely an arbitrary though useful fiction
deriving from the rules of accounting.

Bill Ryan
william_b_ryan@xxxxxxxxxxx
http://www.geocities.com/CapitolHill/Senate/7018



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