The IS-LM model basically, is made up of two components: IS & LM curves. The IS curve represents a “[negative] relationship between the interest rate and the level of income that arises in the market for goods and services.” (Mankiw, 2010) IS stands for investment and saving. IS curve represents the market for goods and … Continue reading IS-LM Model – Theories of Short-Run Fluctuations
One Rule For One, One Rule For Another…Some Australian politicians are double-dipping and just receive a slap-on-the-wrist. Whereas, this exclusive policy helps one to correct for tax errors and I am against taxes as they misdirect resources and favour one group of society over another. However, I disagree with the line of law surrounding it … Continue reading ‘Double-Dipping’
The Keynesian Cross is “[a] simple model of income determination, based on the ideas in Keynes’s General Theory, which shows how changes in spending can have a multiplied effect on aggregate income.” (Mankiw, 2010) Well, it might be a nice simple model with neatly placed lines, however, this only measures a closed economy and wrongly … Continue reading Keynesian Cross – Theories of Short-Run Fluctuations
This article is a summary of the views expressed by Robert Higgs in his article Recession and Recovery: Six Fundamental Errors of the Current Orthodoxy. And how the article compares to the approach taken by Gregory Mankiw in his well known textbooks along with Keynes theories as their arguments can contradict themselves for the following … Continue reading Recession & Recovery – Robert Higgs
Manipulating interest rates in any degree, one is considered to be committing legal plunder. Though, the law is no less immune to manipulation than are interest rates. The law could not organise interest rates without disorganising justice, the resulting transmission of wealth through intended inflation is a violation of property. Legal plunder: “[The word plunder … Continue reading Blunder or Plunder?
Australia’s net foreign debt exceeds $1 trillion for December. Net foreign debt (national debt) is the sum of money Australia owes and all the money they owe Australia. See the ABC figure chart, using the Australian Bureau of Statistic’s since the December quarter, 1998-2015. Net foreign debts are loans of one country owing to another … Continue reading Australian Net Foreign Debt Exceeds $1 Trillion