Re: US Trade Deficit As 'World Engine Of Growth'?

[paul davidson <pdavidson@xxxxxxx>]

At 12:10 PM 9/28/03 , you wrote:

> Paul Davidson wrote: [obvious misspellings corrected]
>
> >In my view, you are just confused-- It has nothing to do with final
> >demand inflation -- only that the present value of a future stream of
> >quasi-rents associated with a new piece of real investment exceeds the
> >present cost of producing that piece of investment.
>
> >If only you would read my book perhaps you might understand.
>
> Perhaps if your book answered the question *why* its pv exceeds its
> production cost, in a logical way from stated premises, would it be
> understandable.


What in the world do you think "animal spirits" means when translated into
a mathematical formula?????
-- it must mean thatan  entrerpreneur EXPECTS the present value to exceed
the present costs



>  As it stands you seem to contend a "real" or "certain"
> present value based on an uncertain future stream of quasi-rents.

NOT at all --

 Since I  introduced the notion of non-ergodic  uncertainty into the
economic literature and EMPHASIZED in my book FUINANCIAL MARKET S ,MONEY
AND THE REAL WORLD-- I think you will find it hard to stick me with
assuming a "'real' or 'certain' present value notion on me.  So lets not
caste such careless accusations.



> Only if the present is deemed uncertain, or better said indeterminate,
> can progress in these discussions be made.



What in the world do you think  a nonergodic environment means???



> It can then be shown that
> capital can only "have been" and not "is" profitable; based not on any
> level of wages, but on the degree of direct spending of profit income
> within the time limit set by creditors with the power to pull the plug.


Do not try to put this lame explanation on me.

> "New and improved" productive capital can be adequately provided through
> depreciation schedules in the private sector;



depreciation is merely an accounting charge and does not represent a fund
per se.


>  and if need be supplemented
> through government assistance, both for the true mega projects and the
> aspiring new entrepreneur.  But damning casino capitalism, while at the
> same time extolling the virtues of the "real" investor while he's been
> robbing Peter to pay Paul, is no more than exculpating the race to the
> bottom.
> We have to move beyond confusion and contradiction to prevent the latter.


Well if you stop confusing my writings with that of orthodox classical
economists, that would be a start!!

Paul Davidson
Louise Davidson
Editorial Office Manager
JOURNAL OF POST KEYNESIAN ECONOMICS
SMC 501
Department of Economics
University of Tennessee
Knoxville, Tennessee 37996-0550
phone: (865) 974-4221
fax: (865) 974-1686