Re: Liquidity Preference and State Theory of Money

["Gunnar Tomasson" <gunnar.tomasson@xxxxxxxxxxx>]

Re. the following:

> When you say this, do you have in  mind Keynes' type of saving
> (where saving = income - consumption spending)...

Yes - (where saving = income - consumption spending = Net Factor Investment
in the Economy's Work in Progress).

> Also, if THAT TYPE of saving and investment are one and the same thing,
then
> a boost in consumption spending does not boost that type of investment.

Agree.

Hence John Stuart Mill's anti-General Theory dictum:

"Demand for commodities is not demand for labour."

Gunnar

----- Original Message -----
From: "Harry Veeder" <eo200@xxxxxxxxxxxxxxxxxxx>
To: "post keynesian thought" <pkt@xxxxxxxxxxxxxxxx>
Sent: Saturday, May 03, 2003 8:31 PM
Subject: Re: Liquidity Preference and State Theory of Money


> Gunnar wrote:
>
> <SNIP)
> >
> > For, by joining Ohlin et al. in debate on a NON-issue insofar as "the
> > process of capital formation" is concerned, Keynes overlooked the BIG
> > issue - namely, that the "equality between saving and investment:" is
NOT a
> > function of "the level of income".
> >
> > That "saving" - 'finance' provided by suppliers of factor services - and
> > "investment" - net factor content of the economy's work in progress -
are
> > one and the same thing at ALL levels of income.
>
> When you say this, do you have in  mind Keynes' type of saving
> (where saving = income - consumption spending) or the alternate type known
> as the flow funds account as described in my recent post 'NIPA and
saving'.
> If you have in mind the former, then I agree.
>
> Also, if THAT TYPE of saving and investment are one and the same thing,
then
> a boost in consumption spending does not boost that type of investment.
>
>
> Harry Veeder
>
>
>