Re: Re: Re: Re: Re: Re: Re: Re: Re: Implications ofSurplus Tax Cut?

[Doug Henwood]

Ellen Frank wrote:

>I think we're using terms differently here.  The term
>hoarding (in Keynes usage) means a preference for
>liquidity.  This is usually broadly interpreted today to
>mean keeping wealth in near-cash assets like short-term
>bank deposits or commercial paper.

Exactly - the individual is hoarding, or trying to. But a bank 
deposit or CP is likely to find its way into the real economy. Keynes 
also wrote as if the choice for investors was between securities and 
real investments, but in fact the purchase of securities and the 
purchase of stocks and bonds are activities undertaken by different 
groups of people. So while I get the theory, the practice is a little 
harder to figure out.

Doug