Robert Lucas on debt — unbelievable stupidity even to come from Chicago
30 Sep, 2013 at 18:33 | Posted in Economics | 5 Comments
Interviewed in this television documentary on the the economic crisis, Nobel laureate Robert Lucas answered a question (wind to 19:40 in the programme) if the level of debt was a problem, by telling us that the high level of debt is not an interesting problem, since, for a country as a whole, debt and credit always “cancel out.” Unbelievable stupidity even to come from a Chicago economist. Fortunately Dirk Bezemer and Steve Keen were also interviewed and could sort things out and give a more sensible view on the increasing indebtedness of modern economies.
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LARS P. SYLL 
Strangely, those guys that are always so keen to consider single individuals, rather than society as a whole, don’t worry about debt, because it “cancels out” at the national level.
Comment by Alex Hanin— 1 Oct, 2013 #
Debt and asset, rather than debt and credit, surely?
Agree that this is a very stupid argument. And you’d see the likes of Lucas make exactly the opposite case in the case of government debt! Ridiculous.
Comment by pilkingtonphil— 1 Oct, 2013 #
It is nothing short of religion if you think about It(mainstream economics).
Comment by Kristjan— 30 Sep, 2013 #
Guess you’re right — and with uberpriests from the jesuit college of Chicago 🙂
Comment by Lars P Syll— 30 Sep, 2013 #
Interesting Lars!Here is another article ( in Swedish and English) by Lars E.O Svensson, a real good one. In plain language and ,straight-to the point-without- average- level- debt -asset -mumbojumbo,He could have put it that way from beginning. Maybee Lars E.O actually read the little short story by Tage Danielsson after all 🙂 ??
Riksbanken orsakar ”debt deflation”-The Riksbank causes “debt deflation” LARS EO SVENSSON
http://ekonomistas.se/2013/09/30/riksbanken-orsakar-debt-deflation/
http://larseosvensson.se/2013/09/30/ekonomistas-the-riksbank-causes-debt-deflation/
Comment by Jan Milch— 1 Oct, 2013 #