"one would have to be naive to believe that stock markets are anything other than approximate manifestations [of the principal of least effort]."
Oh, Dr. Pangloss! Surely that must be a quote from Voltaire's Candide. May I paraphrase? "One would have to be naive to believe that stock markets are anything other than all for the best in the best of all possible worlds." - Show quoted text - -- Sandwichman On 7/11/10, Sandwichman <[email protected]> wrote: > "one would have to be naive to believe that stock markets are anything > other than approximate manifestations [of the principal of least > effort]." > > Oh, Dr. Pangloss! Surely that must be a quote from Voltaire's Candide. > May I paraphrase? > > "One would have to be naive to believe that stock markets are anything > other than all for the best in the best of all possible worlds." > > > > > On 7/11/10, Keith Hudson <[email protected]> wrote: >> We'll obviously have to agree to differ over the interpretation of what >> Keynes said about Hayek's ideas and what Hayek thought about Keynes's. >> >> As to the "Efficient Market Hypothesis", it's a straw man as far as I'm >> concerned. All the necessary information that would be necessary to test >> it -- in economics -- can never be fully known. The principle of least >> effort (maximum efficiency) is something that runs through all physics >> from >> fundamental particles through to cosmological events but one would have >> to >> be naive to believe that stock markets are anything other than >> approximate >> manifestations of it. >> >> Keith >> >> >> At 11:34 11/07/2010 -0700, you wrote: >>>It's news to me that Schumpeter's creative destruction has been >>>"largely ignored". Paragraph five contains a remarkable instance of >>>argument by elision and insinuation. The only reference to Keynes in >>>"The Road to Serfdom" is a warmly approving citation of his 1915 >>>critique of the militarization of industrial life in Germany. To say >>>that Hayek argued that Keynes's ideas would lead to Soviet-style >>>totalitarianism is a slander against Hayek. To then say that Keynes >>>acknowledged an argument that Hayek didn't make is then fatuous. But >>>let's get down to brass tacks. The idea that Hayek is criticizing, and >>>praising Keynes for criticizing, is summed up in the following: >>> >>>"Individualism must come to an end absolutely. A system of regulation >>>must be set up, the object of which is not the greater happiness of >>>the individual... but the strengthening of the organized unity of the >>>state for the object of attaining the maximum degree of efficiency, >>>the influence of which on individual advantage is only indirect. -- >>>This hideous doctrine is enshrined in a sort of idealism." >>> >>>May I remind Keith that "the object of attaining the maximum degree of >>>efficiency" is the single overarching rationale for the market >>>fundamentalism of the last 30 years that has adopted Hayek as its >>>patron saint? Anyone heard of the Efficient Market Hypothesis? The >>>stuff is steeped in two things: the worship of "efficiency" and the >>>dogmatic certainty that the market and only the market is the >>>guarantor of "the maximum degree of efficiency." >>> >>> >>> >>> >>>On 7/11/10, Keith Hudson <[email protected]> wrote: >>> > John Maynard Keynes was one of the most humane and brilliant minds of >>> > the >>> > last century. At the Versailles Conference after the First World War >>> > and >>> > Germany's defeat, President Clemenceau of France was adamant that >>> > millions >>> > of German civilians should be allowed to starve to death. It was >>> > Keynes >>> > (then a Treasury official) who persuaded Prime Minister Lloyd George >>> > to >>> > oppose Clemenceau's plans and make sure that emergency food was sent. >>> > >>> > Unfortunately Keynes was less successful when trying to persuade Lloyd >>> > George and Clemcnceau not to punish Germany's economy too fiercely. It >>> > was >>> > then that he wrote one of his most famous books, "The Economic >>> > Consequences >>> > of the Peace" (1919) when he forecast the German instability that >>> > would >>> > follow France's vengeance. Thus the subsequent Weimar hyperinflation >>> > of >>> > the >>> > 1920s, the Great Depression which followed and the subsequent outbreak >>> > of >>> > the Second World War did not surprise him. >>> > >>> > Brilliant though Keynes was, he was also someone who could never quite >>> > make >>> > up his mind on other issues for most of his life. For some years he >>> > had >>> > a >>> > homosexual relationship with a young man, Sebastian Sprott at the same >>> > time >>> > as one with Lydia Lopokova, a leading ballerina of the 1920s. It >>> > became >>> > an >>> > effort of will to finally plump for Lydia, whom he married in 1925 >>> > (and >>> > a >>> > happy marriage ensued). >>> > >>> > He was equally vacillating about his economic ideas and the book for >>> > which >>> > he is best known, his "General Theory", is self-contradictory in >>> > places >>> > -- >>> > which he acknowledged himself later. His main fault is that he said >>> > (most >>> > of the time anyway) that money was the prime motivator of consumer >>> > goods >>> > consumption and that if governments showered money on people in bad >>> > times >>> > then they would start buying goods and the economy would recover. But >>> > money >>> > is only a transient intermediary. It's the attractiveness of the goods >>> > themselves which causes people to work hard, save money and buy them. >>> > >>> > In fact, when Friedrich Hayek opposed Keynes' ideas in his book, "The >>> > Road >>> > to Serfdom" (1944) -- as leading to Soviet-style totalitarianism -- >>> > Keynes >>> > finally acknowledge that his own main idea had been wrong. He wrote to >>> > Hayek: "In my opinion it is a grand book ... Morally and >>> > philosophically >>> > I >>> > find myself in agreement with virtually the whole of it: and not only >>> > in >>> > agreement with it, but in deeply moved agreement." >>> > >>> > Furthermore, only ten days before he died of a heart attack in 1946 he >>> > told >>> > Henry Clay at a Bank of England lunch that he was finally a convert to >>> > Adam >>> > Smith's primary idea of the invisible hand. He said: "I find myself >>> > more >>> > and more relying for a solution of our problems on the invisible hand >>> > which >>> > I tried to eject from economic thinking twenty years ago." >>> > >>> > Keynes was brilliant enough to be able to change his mind -- and not >>> > to >>> > be >>> > ashamed when he did so. Unfortunately, that cannot be said of some >>> > public >>> > economists who are certainly clever but nowhere near as brilliant as >>> > Keynes >>> > or -- dare I say it? -- Hayek. >>> > >>> > Incidentally, the other great economist of the last century who also >>> > argued >>> > forcefully against Keynes' earlier ideas was Joseph Schumpeter, >>> > someone >>> > whose ideas of "creative destruction" are largely ignored because >>> > they're >>> > uncomfortable. But as we're living in uncomfortable times perhaps some >>> > of >>> > our public economists ought to do some reading of him also. >>> > >>> > Keith >>> > >>> > Keith Hudson, Saltford, England >>> >>> >>>-- >>>Sandwichman >> >> Keith Hudson, Saltford, England > > > -- > Sandwichman > -- Sandwichman _______________________________________________ Futurework mailing list [email protected] https://lists.uwaterloo.ca/mailman/listinfo/futurework
