Deflations in History

Burdekin, Richard C. K.

doi:10.1007/978-981-10-0622-7_49-1

Handbook of the History of Money and Currency 2018

DOI: 10.1007/978-981-10-0622-7_49-1

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Deflations in History

Richard C. K. Burdekin¹

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2020

2021

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Cited by 2 publications

References 34 publications

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Searching for laws of economics: causality, conservation, and ideology

Dawson

2021

American Journal of Physiology-Cell Physiology

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This review is intended for scientists who may be curious about "laws" of economics. Herein, I search for laws governing value, including the value of money (inflation). I begin by searching out early scientists, e.g. Aristotle, Copernicus and Galileo, who contributed to theories of value; or who, like Isaac Newton and J. Willard Gibbs, inspired students of political economy and thereby profoundly influenced the evolution of economic thinking. From a period ranging from Aristotle to John Stuart Mill in the mid 19th century, I extract two candidates for "laws" of economics, one the well-known "Law of Supply and Demand (LSD)," and the other less well-known, "Fisher's Equation of Exchange" (FEE). LSD, in one form or another, has been central to the development of economic thought, but it has proven impossible to express LSD in any compact, deterministic form with causal implications. I propose, however, that, as suggested by Irving Fisher early in the 20th century and 100 years later by Nobelist, Thomas Schelling, that FEE is analogous to the First Law of Thermodynamics (FLT). I argue that both FEE and FLT can be viewed as "accounting identities," pertaining to energies in the case of FLT and money in the case of FEE. Both, however, suffer from a similar limitation; neither provides any information concerning causal relations among the relevant variables. I reflect upon impact of the absence of firm, fact-based, economic laws with causal implications on modern economic policy, allowing it to be dominated by ideologies damaging to American society.

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Searching for laws of economics: causality, conservation, and ideology

Dawson

2021

American Journal of Physiology-Cell Physiology

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The US Money Explosion of 2020, Monetarism and Inflation: Plagued by History?

Burdekin¹

2020

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Although the Federal Reserve's quantitative easing of early 2020 was comparable in scale to 2008-2009, the implications for the growth of money in circulation and future inflationary pressures appear quite different. Absent the unprecedented surge in bank excess reserve ratios seen in 2008 and after, massive monetary base increases imply the possibility of a much larger, and potentially worrisome, increase in the money in circulation. Rising inflation expectations are implied by such phenomena as the surging demand for Treasury Inflation Protected Securities and record highs for gold prices during the summer of 2020. These trends lend some support to market participants evincing concern that the surging money growth is, in fact, a precursor to future inflation. Historical perspective on the 2020 situation is provided by data from the time of the 1918-1919 Spanish flu and available documentation of inflation following medieval and Roman-era pandemics. Indications of extra upward pressure on prices arising from pent-up spending after the epidemic has passed include the surge in bank loans in the aftermath of the 1918-1919 Spanish Flu pandemic.

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Deflations in History

Cited by 2 publications

References 34 publications

Searching for laws of economics: causality, conservation, and ideology

Searching for laws of economics: causality, conservation, and ideology

The US Money Explosion of 2020, Monetarism and Inflation: Plagued by History?

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