Yes, that was an excellent comment Paul. To be clear, I don't think that interest rates are a particularly helpful tool in producing growth or keeping unemployment/inflation/both down. At it's best, a zero interest rate policy can harm rentiers and possibly adjust the productive to unproductive consumer ratio a little bit. I don't see it being able to do much more then that. Have you read Willi Semmler's 1984 book on testing the three basic propositions about prices and profit rates (neoclassical, classical/marxian, post-keynesian/post-marxian)? I'm 85 pages or so in and Have enjoyed it.
"You can't lower nominal interest rates past zero". I think there's actually some technical disputes about that operationally. In any case, I don't think it would be desirable. Jim said..."To some extent the conflict between the anti-inflation "hawks" (Volcker) and the anti-inflation "doves" (e.g., William Miller, who preceded him as the Fed Head) that reflects the division between banking/financial capitalists and industrial capitalists. (Lefties usually ignore that intra-class conflict, focusing instead on the inter-class conflict.)" I'm not sure about the truth of this, at least for the 1980's. the volcker raising of interest rates is what turned the savings and loans industry insolvent and then led them to push for deregulation and ultimately go the massive financial fraud route. That's because they had fixed thirty year mortgages and floating short term deposits so that rising interest rates turned the spread negative. All the contradictory effects between new borrowing, rentier income and asset valuations is another reason I'm for the "parking it" policy. -- -Nathan Tankus ----------------------------------------------------------------------------------------------------------------------------------------------- _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
