Sublime

Keynes was a failed investor and statistician who never studied economics but was so well‐connected with the ruling class in Britain that the embarrassing drivel he wrote in his most famous book, The General Theory of Employment, Money, and Interest, was immediately elevated into the status of founding truths of macroeconomics. His theory begins wi

Keynes.

“The market can stay irrational longer than you can stay solvent,” Keynes famously declared. Being early and right is the same as being wrong, as investors have repeatedly discovered.

Monetarists generally oppose Keynesian efforts to spend money to eliminate unemployment, arguing that in the long run, the effect on unemployment will be eliminated while causing inflation. Instead, Monetarists prefer tax cuts to stimulate the economy, because they argue that the free market will better allocate resources than government spending.

Keynes, in other words, applied psychological principles rather than financial evaluation to the study of the stock market.

All spending is spending, in the naive economics of Keynesians, and so it matters not if that spending comes from individuals feeding their families or governments murdering foreigners: it all counts in aggregate demand and it all reduces unemployment! As an increasing number of people went hungry during the depression, all major governments spent