⁦‪@ProfSteveKeen‬⁩ explains why the transformation and how the Debt Deflation theory works.

  

	Phil Dobbie ⁦‪@phildobbie‬⁩ Irving Fisher was a traditional economist who underwent quite a transition in his thinking, before arriving at Debt Deflation as a major cause of downturns. This week ⁦‪@ProfSteveKeen‬⁩ explains why the transformation and how the Debt Deflation theory works. debunkingeconomics.com/episode/irving…pic.twitter.com/JJyx6igtD2   2022/12/07 17:35

https://twitter.com/phildobbie/status/1600408729156984835?s=61&t=oURg8OmhWmnWN1-BlvrX7g

So you have it so good and then of course you get this period

 of contraction because you people have borrowed then they start and

 think this is his argument wasn't he gets a dead deflation. You've you've

 borrowed to such a point either. You can't pay by those debts or

 you panic and you pay back those debts. And then when you

 pay back those debts, you're an in effect shrinking the money supplies. So

 we see yeah. Yeah, and he was aware of the fact that the money supply

 was determined by just yeah.

 This is where he starts breaking away

 from the Milton Friedman because the the monitorous attitude

 fundamentally is that the government controls the

 money supply and therefore all the problems the system are caused

 by the government creating too much or sometimes too little money, which

 is the that was Milton Friedman's position decades later,

 but what Fisher realized and he actually says

 this in booms and depressions some first principles, which is

 a book that precedes writing the dead deflation theory

 of Great Depression, which is the very concise article, but

 in in that he

 says that a man to man dead is

A different to a bank debt and with a man-to-man

 debt and pardon them. Yes, okay with

 a man to man dead when one person who's in

 debt pays it down the person who blend the

 money gets spending power returned. Yeah and until this

 what we talked about last week. Okay? Yeah, but he then said when you have a bank

 dead the money is simply disappears. Mmm. Okay. And so

 that was an essential Insight. That was and this actually you're not

 all the people were talking about except Goodwin funnily enough good one

 doesn't actually understand money, which I find ridiculous because his

 father was a his grandfather was a banker and

 he went his father the bank failed

 during the Great Depression which through the family and apologize because you're working

 in a bank doesn't mean you understand the way the bang but I know that I know plenty

 people from the final secret that on a daily basis.

その結果、このような収縮期を迎えることになるのです。そのようなところまで借金をしたのです。その借金を返せなくなるか、パニックになって借金を返してしまう。借金を返すと、実質的にマネーサプライが縮小することになります。そうなんです。そう、そして彼は、マネーサプライがまさにそうして決定されるという事実を知っていました。 ここで彼はミルトン・フリードマンと決別します。なぜなら、監視主義者の態度は、基本的に政府が通貨供給をコントロールしており、したがってシステムの全ての問題は、政府が通貨を増やしすぎたり、時には減らしすぎたりすることによって引き起こされるというもので、これは数十年後のミルトン・フリードマンの立場と同じでした。 しかし、フィッシャーが気づいたこと、そして彼は実際に、世界恐慌のデフレ理論を書く前の本である booms and depressions some first principles でこのことを言っています、これは非常に簡潔な記事ですが、その中で彼は、一対一の死は銀行の負債と一対一の負債とでは違うと言っています、失礼しました。借金をした人がそれを返済すれば、お金を融通した人は支出力を取り戻せます。そう、そして先週話したように、このようになるのです。いいかい？ええ、でも彼は、銀行が倒産したら、お金は単に消えてしまうと言っていました。うーん。なるほどね。それが本質的な洞察だったんですね。彼の父親は祖父が銀行員で、大恐慌の時に銀行が倒産したのを父親が見ているから、私はおかしいと思うのです。